04-003025MPI Henry Lepely, M.D. vs. Agency For Health Care Administration Status: Closed Recommended Order on Friday, March 25, 2005.

Summary: Petitioner received an overpayment for Medicaid services; Petitioner`s patient records failed to justify the claims he filed and for which he was paid.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

HENRY LEPELY, M.D., ) )

)

Petitioner, )

) Case No. 04-3025MPI

vs. )

)

AGENCY FOR HEALTH CARE )

ADMINISTRATION, )

)

Respondent. )

RECOMMENDED ORDER

A formal hearing was conducted in this case on October 25,

2004, and November 4, 2004, in Tallahassee, Florida, before

Suzanne F. Hood, Administrative Law Judge with the Division of

Administrative Hearings.

APPEARANCES

For Petitioner: John D. Buchanan, Jr., Esquire

Henry, Buchanan, Hudson,

Suber & Carter, P.A.

117 South Gadsden Street

Tallahassee, Florida 32302

For Respondent: Debora E. Fridie, Esquire

Agency for Health Care Administration

Fort Knox Building III, Mail Station 3

2727 Mahan Drive, Suite 3431

Tallahassee, Florida 32308

STATEMENT OF THE ISSUES

The issues are whether Petitioner received a Medicaid

overpayment for claims paid during the audit period, August 1,

1997, through August 25, 1999, and if so, what is the amount

that Petitioner is obligated to reimburse to Respondent.

PRELIMINARY STATEMENT

In a Final Agency Audit Report (FAAR) dated October 1,

2003, Respondent Agency for Health Care Administration

(Respondent) advised Petitioner Henry Lepely, M.D. (Petitioner)

that he had received overpayment for Medicaid claims in the

amount of $39,055.34 during the audit period, August 1, 1997,

through August 25, 1999. On November 25, 2003, Petitioner

requested an administrative hearing to challenge Respondent's

findings in the FAAR. On January 5, 2004, Respondent referred

Petitioner's request to the Division of Administrative Hearings.

A Notice of Hearing scheduled the case for hearing on

April 27-28, 2004. However, on March 30, 2004, the parties

filed a Joint Motion to Relinquish Jurisdiction and Remand Back

to the Agency. In an Order Closing File dated April 2, 2004,

the undersigned granted the motion with leave for either party

to request that the file be reopened if further administrative

proceeding became necessary.

On August 24, 2004, Respondent filed a Motion to Reopen

Proceeding.

On August 27, 2004, the Division of Administrative Hearings

issued the Initial Order in this case. On September 3, 2004,

the parties filed a Joint Response to the Initial Order.

In a Notice of Hearing dated September 8, 2004, the

undersigned rescheduled the hearing for October 25-26, 2004.

On September 30, 2003, Respondent filed a Motion to Allow

Expert Testimony by Deposition in lieu of trial testimony. The

undersigned granted the motion in an Order dated October 8,

2004.

On September 30, 2004, Respondent filed a Motion for

Official Recognition of the following: (a) Chapters 409 and

414, Florida Statutes (1999)(1998) and (1997); (b) Rules 59G-1,

59G-4, and 59G-5, Florida Administrative Code; and (c) excerpts

from the Florida Medicaid Physician Coverage and Limitations

Handbook , January 1999, January 1998, November 1997, and January

1996 (Limitations Handbook), and the Medicaid Provider

Reimbursement Handbook, HCFA-1500 and Child Health Check-Up 221 ,

November 1996 (Reimbursement Handbook). The motion was granted

on the record during the hearing.

On October 1, 2004, Respondent filed a Motion for Costs.

Respondent cites Section 409.913(23), Florida Statutes, as

grounds for the motion. The motion is hereby granted as set

forth below in the Conclusions of Law.

On October 1, 2004, Petitioner filed a Motion for Costs and

Attorney's Fees without citing specific authority as grounds for

the motion. Petitioner's motion is hereby denied.

On October 20, 2004, Respondent filed a Motion to Restrict

Use and Disclosure of Information concerning Medicaid applicants

and beneficiaries. The motion was granted on the record during

the hearing.

When the hearing commenced, Respondent presented the

testimony of two witnesses. Respondent offered Respondent's

Exhibit Nos. R1-R11, R26-R27, and RR1, which were accepted as

evidence.

Petitioner testified on his own behalf and presented the

testimony of one additional witness. Petitioner offered

Petitioner's Exhibit Nos. P1-P4, which were accepted into

evidence.

The Transcript of the hearing was filed on November 30,

2004.

On December 10, 2004, the parties filed a Joint Motion for

Enlargement of Time to File Proposed Recommended Orders. The

motion was granted in an Order dated December 14, 2004.

On January 21, 2005, Petitioner filed the deposition

testimony of Ephraim Asher, Ph.D. Pursuant to the agreement of

the parties, Dr. Asher's deposition testimony is hereby accepted

as evidence in lieu of testimony at hearing.

On January 21, 2005, both parties filed Proposed

Recommended Orders.

There has been no substantive change to the relevant

provisions of Chapter 409, Florida Statutes, since 1997.

Therefore, all references hereinafter shall be to Florida

Statutes (2004) unless otherwise specified.

FINDINGS OF FACT

1. Respondent is the agency responsible for administering

the Florida Medicaid Program. One of its duties is to recover

Medicaid overpayments from physicians providing care to Medicaid

recipients.

2. Petitioner is a licensed psychiatrist and an authorized

Medicaid provider. His Medicaid provider number is No.

048191200.

3. Chapter Three of the Limitations Handbook describes the

procedure codes for reimbursable Medicaid services that

physicians may use in billing for services to eligible

recipients. The procedure codes are Health Care Financing

Administration Common Procedure Coding System (HCPCS),

Levels 1-3. The procedure codes are based on the Physician's

Current Procedural Terminology (CPT) book, published by the

American Medical Association. The CPT book, includes HCPCS

descriptive terms, numeric identifying codes, and modifiers for

reporting services and procedures.

4. The Limitations Handbook further provides that Medicaid

reimburses physicians using specific CPT codes. The CPT codes

are listed on Medicaid's physician fee schedule.

5. The CPT book includes a section entitled Evaluation and

Management (E/M) Services Guidelines. The E/M section

classifies medical services into broad categories such as office

visits, hospital visits, and consultations. The categories may

have subcategories such as two types of office visits (new

patient and established patient) and two types of hospital

visits (initial and subsequent). The subcategories of E/M

services are further classified into levels of E/M services that

are identified by specific CPT codes. The classification is

important because the nature of a physician's work varies by

type of service, place of service, and the patient's status.

6. According to the CPT book, the descriptors for the

levels of E/M services recognize seven components, six of which

are used in defining the levels of E/M services. They are

history, examination, medical decision making, counseling,

coordination of care, nature of presenting problem, and time.

The most important components in selecting the appropriate level

of E/M services are history, examination, and medical decision

making. However, since 1992, the CPT book has included time as

an explicit factor in selecting the most appropriate level of

E/M services.

7. At all times relevant here, Petitioner provided

services to Medicaid patients pursuant to a valid Medicaid

provider agreement. Therefore, Petitioner was subject to all

statutes, rules and policy guidelines that govern Medicaid

providers. The Medicaid provider agreement clearly gives a

Medicaid provider the responsibility to maintain medical records

sufficient to justify and disclose the extent of the goods and

services rendered and billings made pursuant to Medicaid policy.

8. This case involves Respondent's Medicaid audit of

claims paid to Petitioner for Medicaid psychiatric services

during the audit period August 1, 1997, through August 25, 1999

(the audit period). Petitioner provided these services to his

Medicaid patients, which constituted approximately 85 to 90

percent of his practice, at his office and at hospitals in the

Jacksonville, Florida, area.

9. During the audit period, Petitioner billed Medicaid for

services furnished under the following CPT codes and E/M levels

of service: (a) 99215, office or other outpatient visit for the

evaluation and management of an established patient; (b) 99223,

initial hospital care per day for the evaluation and management

of a patient; (c) 99232, subsequent hospital care per day for

the evaluation and management of a patient; (d) 99233,

subsequent hospital care per day for the evaluation and

management of a patient; (e) 99238, hospital discharge day

management; (f) 99254, initial inpatient consultation for a new

or established patient; and (g) 90862, other psychiatric service

or procedures, pharmacologic management.

10. Except for CPT code 90862, the E/M levels of services

billed by Petitioner require either two or all three of the key

components as to history, examination, and medical decision-

making. The CPT book assigns a typical amount of time that

physicians spend with patients for each level of E/M service.

11. The CPT book contains specific psychiatric CPT codes.

CPT codes 90804-90815 relate to services provided in the office

or other outpatient facility and involve one of two types of

psychotherapy. CPT codes 90816-90829 relate to inpatient

hospital, partial hospital, or residential care facility

involving different types of psychotherapy. CPT codes 90862-

90899 relate to other psychiatric services or procedures.

12. CPT code 90862 specifically includes pharmacologic or

medication management; including prescription, use, and review

of medication with no more than minimal medical psychotherapy.

CPT code 90862 is the only psychiatric procedure code that

Petitioner used in billing for the psychiatric services he

provided. CPT code 90862 does not have specific requirements as

to history, examination, and medical decision-making or a

specified amount of time.

13. Most of Petitioner's hospital patients were admitted

to the hospital for psychiatric services through the emergency

room. As part of the admission process, Petitioner performed

psychiatric and physical examinations. However, testimony at

hearing that Petitioner generally performed the psychiatric

evaluations and the physical examinations on separate days is

not persuasive. The greater weight of the evidence indicates

that the hospital physical examinations were conducted as part

of the routine admission process and appropriately included in

claims for the patients' initial hospital care.

14. Some of Petitioner's hospital patients had complicated

conditions. Some patients required crisis intervention and/or

lacked the ability to perform activities of daily living. The

initial hospital care of new hospital patients required

Petitioner to take an extensive medical and psychiatric history.

15. Petitioner attended his hospital patients on a daily

basis. However, there is no persuasive evidence that Petitioner

routinely spent 20-25 minutes with his hospital patients for

each subsequent daily visit until the day of discharge.

16. Petitioner used a team approach when attending his

hospital patients. On weekdays, the team consisted of

Petitioner, a social worker, a music therapist, and the floor

nurses. On weekends, Petitioner generally made his rounds with

the floor nurses. Petitioner's use of the team approach to

treat hospital patients did not change the level of service he

provided in managing their medication.

17. Petitioner did not document the time he spent with

patients during hospital visits. However, his notations as to

each of these visits indicate that, excluding admissions and

discharges, the hospital visits routinely involved medication

management. Petitioner's testimony that his treatment during

subsequent hospital visits involved more than mere medication

management is not persuasive.

18. Petitioner also failed to document the time he spent

with patients that he treated at his office. He did not present

his appointment books as evidence to show the beginning and

ending time of the appointments.

19. Petitioner's notes regarding each office visit reflect

a good bit of thought. However, without any notation as to

time, the office progress notes are insufficient to determine

whether Petitioner provided a level of service higher than

medication management for established patients.

20. Petitioner and his office manager agreed in advance

that, unless Petitioner specified otherwise, every office visit

for an established patient would be billed as if it required two

of the following: a comprehensive history; a comprehensive

examination; and a medical decision making of high complexity.

With no documented time for each appointment, Petitioner's

records do not reflect that he provided a level of service

higher than medication management for the office visits of

established patients. Petitioner's testimony to the contrary is

not persuasive.

21. Petitioner treated some patients at their place of

residence in an adult congregate living facility (ACLF).

Respondent does not pay for psychiatric services in such

facilities. Instead of entirely denying the claims for ACLF

patients, Respondent gave Petitioner credit for providing a

lower level of service in a custodial care facility.

22. Sometime in 1999, Respondent made a decision to audit

Petitioner's paid claims for the period of time at issue here.

After making that decision, Respondent randomly selected the

names of 30 Medicaid patients that Petitioner had treated. The

30 patients had 282 paid claims that were included in the

"cluster sample."

23. Thereafter, Respondent's staff visited Petitioner's

office, leaving a Medicaid provider questionnaire and the list

of the 30 randomly selected patients. Respondent's staff

requested copies of all medical records for the 30 patients for

the audit period.

24. Petitioner completed the Medicaid questionnaire and

sent it to Respondent, together with all available medical

records for the 30 patients. The medical records included

Petitioner's progress notes for office visits. Petitioner did

not send Respondent all of the relevant hospital records for

inpatient visits.

25. The original hospital records belonged to the

hospitals where Petitioner provided inpatient services.

Petitioner had not maintained copies of all of the hospital

records even though Medicaid policy required him to keep records

of all services for which he made Medicaid claims.

26. When Respondent received Petitioner's records, one of

Respondent's registered nurses, Claire Balbo, reviewed the

records to determine whether Petitioner had provided

documentation to support each paid claim. Ms. Balbo made

handwritten notes on the records of claims that were not

supported by documentation. Ms. Balbo reviewed the

documentation in the records between February 10, 2000, and

March 7, 2000.

27. Next, one of Respondent's investigators, Art Williams,

reviewed the records. Mr. Williams made his review on or about

January 23, 2001.

28. In some instances, Mr. Williams changed some of

Petitioner's CPT codes from an inappropriate hospital inpatient

or office visit procedure code to a psychiatric procedure code

with a lower reimbursement rate. Additionally, Mr. Williams

noted Petitioner's visits in ACLF's that, according to Medicaid

policy, were not reimbursable. Finally, Mr. Williams noted that

Petitioner occasionally made several claims on one line of the

claim form contrary to Medicaid policy.

29. Mr. Williams made these changes to the CPT codes based

on applicable Medicaid policy. His review of the audit

documents and patient records did not involve a determination as

medical necessity or the appropriate level of service. A peer

reviewer makes determinations as to medical necessity and the

appropriate level of service for each paid claim in the random

sample of 30 patients.

30. Respondent then sent the records to Dr. Melody

Agbunag, a psychiatrist who conducted a peer review of

Petitioner's records. Dr. Agbunag's primary function was to

determine whether the services that Petitioner provided were

medically necessary and, if so, what the appropriate level of

service was for each paid claim.

31. Dr. Agbunag conducted the peer review between June 8,

2001, and August 29, 2001. She agreed with Respondent's staff

regarding the adjustments to the procedure codes that

corresponded with the level of service reflected in the medical

records.

32. When Dr. Agbunag returned the records to Respondent,

Ms. Balbo calculated the monetary difference between the amount

that Medicaid paid Petitioner for each claim and the amount that

Medicaid should have paid based on Dr. Agbunag's review. The

difference indicated that Respondent had overpaid Petitioner for

claims that in whole or in part were not covered by Medicaid.

33. Respondent sent Petitioner a Preliminary Agency Audit

Report (PAAR) dated December 27, 2001. The PAAR stated that

Petitioner had been overpaid $54,595.14. The PAAR stated that

Petitioner could furnish additional information or documentation

that might serve to reduce the overpayment.

34. Petitioner responded to the PAAR in a letter dated

February 28, 2001. According to the letter, Petitioner

challenged the preliminary determinations in the PAAR and

advised that he was waiting on additional patient records from a

certain hospital.

35. In a letter dated June 30, 2002, Petitioner advised

Respondent that he generally spends 15-20 minutes with his

hospital inpatients. The letter does not refer to any

additional hospital records.

36. Petitioner's office manager sent Respondent a letter

dated August 1, 2002. The letter discusses every service that

Petitioner provided to the 30 patients during the audit period.

Some of these services were not included in the random "cluster

sample" because Medicaid had not paid for them during the audit

period.

37. According to the August 1, 2002, letter, Petitioner's

office manager attached some of the patient records that

Petitioner had not previously provided to Respondent. The

additional documentation related to multiple claims involving

several of Petitioner's hospital and office patients.

38. Sometime after receiving the additional documentation,

Dr. Agbunag conducted another peer review. She did not change

her prior determination regarding the level of service as to any

paid claim.

39. In 2003, Vicki Remick, Respondent's investigator,

reviewed the audit, the patient records, and all correspondence.

Her review included, but was not limited to, the determination

of the appropriate CPT code and amount of reimbursement, taking

into consideration Medicaid policy and Dr. Agbunag's findings

regarding medical necessity and the level of care for each paid

claim.

40. On or about October 1, 2003, Respondent issued the

Final Agency Audit Report (FAAR). The FAAR informed Petitioner

that he had been overpaid $39,055.34 for Medicaid claims that,

in whole or in part, were not covered by Medicaid. The FAAR

included a request for Petitioner to pay that amount for the

overpayment.

41. The FAAR concluded, as to some patients, that

Petitioner's documentation did not support the CPT codes that

Petitioner used to bill and that Respondent used to pay for

services. Thus, Respondent "down graded" the billing code to a

lesser amount. As a result, the difference between the amount

paid and the amount that should have been paid was an

overpayment.

42. The FAAR also stated that Petitioner billed and

received payment for some undocumented services. In each such

instance, Respondent considered the entire amount paid as an

overpayment.

43. The FAAR indicated that Petitioner billed Medicaid for

some services at acute care hospital psychiatric units without

documenting the medical records as to the appropriate CPT codes

and medical illness diagnosis codes. Respondent adjusted the

payments for these services to the appropriate psychiatric CPT

codes.

44. According to the FAAR, Petitioner billed and received

payment for services which only allowed one unit of service per

claim line. For this audit, Respondent allowed charges for the

additional units of service where Petitioner's documentation for

the additional dates of service supported the services allowed

by the peer reviewer.

45. The FAAR stated that Petitioner billed for psychiatric

services at an ACLF or an assisted living facility. Medicaid

normally does not pay for such services. However, in this case,

Respondent adjusted the claims to a domiciliary or custodial

care visit.

46. Sometime after Petitioner received the FAAR,

Petitioner sent Respondent some additional patients' medical

records. Some of the records were duplicates of documents that

Petitioner previously had furnished to Respondent. Other

records were for services that may have been provided during the

audit period but which were not a part of the random sample

because Medicaid did not pay for them during relevant time

frame.

47. Respondent requested Dr. James R. Edgar to conduct a

second peer review of Petitioner's correspondence and patient

records to determine the appropriate level of service.

Respondent provided Dr. Edgar with a copy of the patients'

medical records, a copy of Respondent's worksheets, including

Dr. Agbunag's notes, and the appropriate policy handbooks.

Respondent requested Dr. Edgar to make changes in the level of

service as he deemed appropriate.

48. Dr. Edgar performed his review between July 25, 2004,

and July 29, 2004, making an independent determination regarding

issues of medical necessity and level of care. Initially, as to

every disputed paid claim, Dr. Edgar agreed with Dr. Agbunag

that Petitioner's patient records were insufficient to justify

the procedure code and higher level of service claimed by

Petitioner. Specifically, Dr. Edgar presented persuasive

evidence that a number of paid claims, which Petitioner billed

under CPT codes 99215, 99223, 99232, 99233, and 99238, were

properly adjusted to CPT code 90862. Petitioner was not

entitled to bill at a higher level of reimbursement because he

failed to adequately document as to history, examination,

medical decision-making, and time.

49. Dr. Edgar agreed that, upon reconsideration,

Petitioner's claim for Recipient 14, date of service

September 7, 1998, billed under CPT code 99238, was appropriate.

50. As to Recipient 1, date of service March 9, 1999,

Petitioner was not entitled to bill for services using CPT code

99255, initial inpatient consultation for a new or established

patient. CPT code 99222, initial hospital care, per day, for

the E/M of a new or established patient, was more appropriate

because Petitioner provided the consultation for one of his

established patients. His services included a comprehensive

history, a comprehensive examination, and medical decision

making of moderate complexity.

51. An independent analysis of the selection of the random

sample, the statistical formula used by Respondent, and the

statistical calculation used to determine the overpayment,

confirms the conclusions in the FAAR. The greater weight of the

evidence indicates that Respondent properly extrapolated the

results from the sample to the total population.

52. Out of a population of 222 recipients and a population

of 2,123 claims, 30 recipients selected at random with 282 paid

claims capture most of the characteristics of the total

population. In this case, the statistical evidence indicates

that 29 of the 30 recipients had overpayments. The odds that 29

out of 30 randomly selected recipients would have overpayments,

if no overpayments existed, are greater than the odds of winning

the Florida Lotto Quick Pick three weeks in a row. In fact,

within a statistical certainly, the amount claimed in this cause

based on the records of 30 recipients is lower than the

reimbursement amount that Petitioner would owe if all records

were reviewed.

53. Respondent incurred costs during the investigation of

this matter. The amount of those costs was not known at the

time of the formal hearing.

CONCLUSIONS OF LAW

54. The Division of Administrative Hearing has

jurisdiction over the parties and the subject matter of this

proceeding. See §§ 120.569 and 120.57(1), Fla. Stat.

55. Respondent has the burden of proving by a

preponderance of the evidence that Petitioner has been overpaid

for Medicaid services delivered to Medicaid recipients. South

Medical Services, Inc. v. Agency for Health Care Administration ,

653 So. 2d 440 (Fla. 3rd DCA 1995).

56. Section 409.907, Florida Statutes, governs Medicaid

provider agreements, which require the provider to comply with

all state and federal laws that relate to the Medicaid program.

See § 409.907(1), Fla. Stat.

57. Section 409.907(2), Florida Statutes, states as

follows in pertinent part:

(2) The provider agreements are

voluntary contracts between the agency and

the provider, in which the provider agrees

to comply with all laws and rules pertaining

to the Medicaid program . . . and the agency

agrees to pay a sum, as determined by fee

schedule, payment methodology, or other

manner, for the service or goods provided to

the Medicaid recipient.

58. The agreements require providers to "retain all

medical and Medicaid-related records for a period of 5 years to

satisfy all necessary inquiries by the agency." See

§ 409.907(3)(c), Fla. Stat. The agreements also require

providers to "[p]ermit the agency . . . access to all Medicaid-

related information . . . and other information pertaining to

services or goods billed to the Medicaid program. . . ." See

§ 409.907(3)(e), Fla. Stat.

59. Section 409.913, Florida Statutes, which relates to

Respondent's oversight of the integrity of the Medicaid program,

states that:

The agency shall operate a program to

oversee the activities of Florida Medicaid

recipients, and providers and their

representatives, to ensure that fraudulent

and abusive behavior and neglect of

recipients occur to the minimum extent

possible, and to recover overpayments and

impose sanctions as appropriate.

60. Section 409.913(1)(d), Florida Statutes, states as

follows in pertinent part:

. . . For purposes of determining Medicaid

reimbursement, the agency is the final

arbiter of medical necessity.

Determinations of medical necessity must be

made by a licensed physician employed by or

under contract with the agency and must be

based upon information available at the time

the goods or services are provided.

61. "Overpayment" is defined as "any amount that is not

authorized to be paid by the Medicaid program whether paid as a

result of inaccurate or improper cost reporting, improper

claiming, unacceptable practices, fraud, abuse, or mistake."

See § 409.913(1)(e), Fla. Stat.

62. Section 409.913(2), Florida Statutes, states as

follows:

(2) The agency shall conduct, or cause

to be conducted by contract or otherwise,

review, investigation, analyses, audits, or

any combination thereof, to determine

possible fraud, abuse, overpayment, or

recipient neglect in the Medicaid program

and shall report the findings of any

overpayments in audit reports as

appropriate.

63. Section 409.913(7), Florida Statutes, states as

follows in relevant part:

(7) When presenting a claim for

payment under the Medicaid program, a

provider has an affirmative duty to

supervise the provision of, and be

responsible for, goods and services claimed

to have been provided, to supervise and be

responsible for preparation and submission

of the claim, and to present a claim that is

true and accurate and that is for goods and

services that:

* * *

(e) Are provided in accord with

applicable provisions of all Medicaid rules,

regulations, handbooks, and policies and in

accordance with federal, state, and local

law.

(f) Are documented by records made at

the time the goods or services were

provided, demonstrating the medical

necessity for the goods or services

rendered. Medicaid goods or services are

excessive or not medically necessary unless

both the medical basis and the specific need

for them are fully and properly documented

in the recipient's medical record.

64. Section 409.913(9), Florida Statutes, states as

follows in relevant part:

(9) A Medicaid provider shall retain

medical, professional, financial, and

business records pertaining to services and

goods furnished to a Medicaid recipient and

billed to Medicaid for a period of 5 years

after the date of furnishing such services

or goods. The agency may investigate,

review, or analyze such records, which must

be made available during normal business

hours. . . The provider is responsible for

furnishing to the agency, and keeping the

agency informed of the location of, the

provider's Medicaid-related records.

65. Respondent has authority to require a provider to

repay amounts received for goods and services that are

inappropriate, medically unnecessary, or excessive. See

§ 409.913(11), Fla. Stat.

66. Section 409.913(15), Florida Statutes, states as

follows in relevant part:

(15) The agency may seek any remedy

provided by law . . . if:

* * *

(d) The provider has failed to

maintain medical records made at the time of

service, or prior to service if prior

authorization is required, demonstrating the

necessity and appropriateness of the goods

or services rendered;

(e) The provider is not in compliance

with provision of Medicaid provider

publications that have been adopted by

reference as rules in the Florida

Administrative Code; . . . with provisions

of the provider agreement between the agency

and the provider . . . .;

* * *

(h) The provider or an authorized

representative of the provider, or a person

who ordered or prescribed the goods or

services, has submitted or caused to be

submitted false or a pattern of erroneous

Medicaid claims.

* * *

(n) The provider fails to demonstrate

that it had available during a specific

audit or review period sufficient quantities

of goods, or sufficient time in the case of

services, to support the provider's billings

to the Medicaid program.

67. In the instant case, Respondent made its determination

of overpayment to Petitioner using accepted and valid auditing,

accounting, and analytical review methods as required by Section

409.913(20), Florida Statutes. Regarding the audit report and

agency work papers, Section 409.913(22), Florida Statutes,

states as follows:

(22) The audit report, supported by

agency work papers, showing an overpayment

to a provider constitutes evidence of the

overpayment. A provider may not present or

elicit testimony, either on direct

examination or cross-examination in any

court or administrative proceeding,

regarding the purchase or acquisition by any

means of drugs, goods, or supplies; sales or

divestment by any means of drugs, goods, or

supplies; or inventory of drugs, goods, or

supplies, unless such acquisition, sales,

divestment, or inventory is documented by

written notices, written inventory records,

or other competent written documentary

evidence maintained in the normal course of

the provider's business.

68. "Recoupment" means "the process by which the

department recovers an overpayment or inappropriate overpayment

from a Medicaid provider." See Fla. Admin. Code Rule, 59G-

1.010.

69. As stated in Full Health Care, Inc. v. Agency for

Health Care Administration , DOAH Case No. 00-4441 (Recommended

Order, June 25, 2001):

once the Agency has put on a prima

facie case of overpayment--which may involve

no more than moving a properly supported

audit report into evidence--the provider is

obligated to come forward with written proof

to rebut, impeach, or otherwise undermine

the Agency's statutorily-authorized

evidence; it cannot simply present witnesses

to say that the Agency lacks evidence or is

mistaken. (Emphasis included)

70. In this case, Respondent met its prima facie burden of

proving that Petitioner received an overpayment in the amount of

$39,055.34 less an adjustment for the claim for Recipient 14,

date of service September 7, 1998. Petitioner, on the other

hand, presented no persuasive evidence to the contrary. In

fact, he presented no documentation to support his position

regarding the time he spent providing treatment to established

patients in his office or in a hospital.

71. Petitioner presented no persuasive evidence that

Respondent's statistical formula, data, or calculations are

invalid. To the contrary, Respondent made its determination of

overpayment to Petitioner using accepted and valid auditing,

accounting, and analytical review methods as required by Section

409.913(20), Florida Statutes.

72. The Limitations Handbook includes the following: (a)

a definition of "consultative services" and a description of the

minimum documentation required to be included in the recipient's

record; (b) a policy requiring psychiatric services provided to

hospital patients to be billed using psychiatric procedure and

diagnosis codes; (c) a policy requiring that only one unit of

service may be billed on one line of the claim form; and (d) a

policy prohibiting reimbursement for psychiatric services

rendered in a custodial care facility, including assisted living

facilities or ACLFs. There is no persuasive evidence that

Respondent improperly applied these or any other Medicaid policy

provisions to the disputed claims in the instant case.

73. Respondent cites Section 409.913(23), Florida

Statutes, in support of its Motion for Costs. That statutes

provides as follows:

(23)(a) In an audit or investigation

of a violation committed by a provider which

is conducted pursuant to the section, the

agency is entitled to recover all

investigative, legal, and expert witness

costs if the agency's findings were not

contested by the provider or, if contested,

the agency ultimately prevailed.

(b) The agency has the burden of

documenting the costs, which include

salaries and employee benefits and out-of-

pocket expenses. The amount of costs that

may be recovered must be reasonable in

relations to the seriousness of the

violation and must be set taking into

consideration the financial resources,

earning ability and needs of the provider,

who has the burden of demonstrating such

factors.

(c) The provider may pay the costs

over a period to be determined by the agency

if the agency determines that an extreme

hardship would result to the provider from

immediate full payment. Any default in the

payment of costs may be collected by any

means authorized by law.

See § 409.913(23), Fla. Stat.

74. Respondent did not renew its request for costs in its

Proposed Recommended Order. There is no authority in Section

409.913(23), Florida Statutes, for the an Administrative Law

Judge to retain jurisdiction on the issue of Respondent's costs.

See Meji, Inc., d.b.a. 7th Avenue Pharmacy , DOAH Case No. 03-

1195MPI (Recommended Order, July 15, 2003). Rather, Respondent,

once it has "ultimately prevailed" in this case, may then

determine the amount of its costs and assess them against

Petitioner. Should Petitioner dispute Respondent's

determination and raise disputed issues of material fact, the

matter may then be referred by Respondent to the Division of

Administrative Hearings.

RECOMMENDATION

Based on the forgoing Findings of Fact and Conclusions of

Law, it is

RECOMMENDED:

That Respondent enter a final order finding that Petitioner

owes Respondent for an overpayment in the amount of $39,055.34,

less an adjustment for the September 7, 1998 claim for Recipient

14, plus interest.

DONE AND ENTERED this 25th day of March, 2005, in

Tallahassee, Leon County, Florida.

S

SUZANNE F. HOOD

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone] SUNCOM 278-9675

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 25th day of March, 2005.

COPIES FURNISHED :

Alan Levine, Secretary

Agency for Health Care Administration

Fort Knox Building III

2727 Mahan Drive, Suite 3116

Tallahassee, Florida 32308

Valda Clark Christian, General Counsel

Agency for Health Care Administration

Fort Know Building III

2727 Mahan Drive, Suite 3431

Tallahassee, Florida 32308

Debora E. Fridie, Esquire

Agency for Health Care Administration

Fort Knox Building III, Mail Station 3

2727 Mahan Drive, Suite 3431

Tallahassee, Florida 32308

John D. Buchanan, Jr., Esquire

Henry, Buchanan, Hudson,

Suber & Carter, P.A.

117 South Gadsden Street

Post Office Box 1049

Tallahassee, Florida 32302

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the final order in this case.