06-003494MPI Agency For Health Care Administration vs. Harold L. Murray, M.D. Status: Closed Recommended Order on Tuesday, July 10, 2007.

Summary: Respondent referred his patients` radiologic exams to a radiologist for interpretation and is liable to Petitioner for the principal sum of $94,675.83, which the Florida Medicaid Program paid him for interpretations from July 1, 2001 to December 31, 2005.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

AGENCY FOR HEALTH CARE )

ADMINISTRATION, )

)

Petitioner, )

)

vs. ) Case No. 06 - 349 4 MPI

)

HAROLD L. MURRAY, M.D. , )

)

Respondent. )

)

RECOMMEND ED ORDER

This case came before Administrative Law Judge John G.

Van Laningham for final hearing by video teleconference on

February 14, 2007, at sites in Tallahassee and Miami, Florida.

APPEARANCES

For Petitioner: L. William Porter, II, Esqui re

Agency for Health Care Administration

Fort Knox Executive Center III

2727 Mahan Drive, Building 3, Mail Stop 3

Tallahassee, Florida 32308 - 5403

For Respondent: Jose M. Herrera, Esquire

Jose M. Herrera, P.A.

1401 Ponce de Leon Boulevard, Suite 200

Coral Gables, Florida 33134

STATEMENT OF THE ISSUE

The issue for determination is whether Respondent is liable

to Petitioner for the principal sum of $ 94,675.83 , which equals

the amount that the Florida Medicaid Program pa id Respondent for

the "professional component" of claims for radiologic services

rendered to Respondent's patients between July 1, 2001 and

December 31, 2005 .

PRELIMINARY STATEMENT

Petitioner Agency for Health Care Administration is the

agency responsible for administering the Florida Medicaid

Program. Respondent Harold L. Murray, M.D., is a doctor who has

furnished goods or services to Medicaid beneficiaries.

After investigating Dr. Murray's medical practice ,

Petitioner issued a Final Agency Audit Repor t on July 19 , 2006 ,

wherein it alleged that this physician had been overpaid

$ 94,675.83 for Medicaid claims arising from Respondent 's

provision of radiologic services to eligible beneficiaries . The

gravamen of the Agency's complaint was that Dr. Murray ha d

billed Medicaid (and been paid) for interpreting radiologic

studies (such as X - rays and sonograms) when in fact the

interpretations (called "professional component" services in

Medicaid terminology) h ad been done by a radiologist. On

September 5 , 2006, Dr. Murray served a n Amended Request for

Formal Administrative Hearing disputing the overpayment

assessment. The matter was referred to the Division of

Administrative Hearings on September 15, 2006.

At t he final hearing, which took place as scheduled (a fter

one continuance) on February 14 , 200 7 , the Agency called Vicki

Anne Remick, a Medical Healthcare Program Analyst, as its sole

witness. In addition , Petitioner's Exhibits 1 and 2, and 9

through 14 were admitted into evidence.

Respondent testified on his own behalf and presented one

other witness: Griselle Aguilera, Esquire. Dr. Murray did not

offer any exhibits.

The two - volume final hearing transcript was filed on

March 5 , 200 7 . The parties timely filed proposed recommended

orders on t he establis hed deadline (after several extensions) of

May 16 , 200 7 . These papers were carefully considered in the

preparation of this Recommended Order.

Unless otherwise indicated, citations to the Florida

Statutes refer to the 2006 Florida Statutes.

FINDINGS OF FAC T

1. Petitioner Agency for Health Care Administration

("AHCA" or the "Agency") is the state agency responsible for

administering the Florida Medicaid Program ("Medicaid").

2. Respondent Harold L. Murray, M.D. ("Murray") was, at

all relevant ti mes, a Medicaid provider authorized to receive

reimbursement for covered services rendered to Medicaid

beneficiaries.

3. Exercising its statutory authority to oversee the

integrity of Medicaid, the Agency sent investigators to Murray's

office on November 22, 2005. The purpose of this visit was to

verify that claims paid by Medicaid had not exceeded authorized

amounts. To this end, the investigators inspected Murray's

facilities an d reviewed his medical records . What the

investigators saw gave them reas ons to believe that Medicaid had

been overpaying Murray for radiologic services. They focused on

the period from July 1, 2001 to December 31, 2005 (the "Audit

Period").

4. During the Audit Period, Murray had submitted

approximately 2,000 claims seeking the "maximum fee" for

radiologic services, which Medicaid had paid . The maximum fee

includes compensation for "professional component " services.

(Medicaid uses the term "professional component" to describe the

physician's s ervices of interpreting a radio logic study and

reporting his or her findings. These services are distinguished

from those comprising the "technical component," which are

routinely performed by technicians. Thes e latter serv i ces

include operating the radiologic equipment ( e.g. an X - ray or

sonographic machine ) and performing the exam. ) It appeared to

the investigators that Murray had not, in fact, been performing

the professional component.

5. Using information in its database, the Agency

determined that , during the Audit Period, Mu rray had received

Medicaid payments totaling $ 94,675.83 for professional component

services. The Agency repeatedly requested that Murray supply

additional information that might substantiate his prior claims

for fees relating to the professional component . Murray failed,

refused, or was unable to comply with the Agency's requests .

6. Murray did testify at hearing, however, providing a

reasonably clear picture of what had occurred. On direct

examination, Murray explained that he had perform ed the "first

preliminary" review of each radiologic examination in question

before sending the study to a radiologist, whom he pa id "out of

[his own] pocket" to interpret the exam and make a report.

According to Murray, Medicaid paid only for his (Murray's)

professio nal component se rvices —— not the radiologist's. Murray

argues that he is entitled to compensation for the professional

component services that he personally performed, notwithstanding

that another doctor performed the same services.

Analysis of the Facts

7. Although Murray's position might have some superficial

appeal, it does not withstand scrutiny as a matter of fact , the

undersigned has determined . To explain why this is so requires

an analy sis of Murray's testimony that entails neither legal

conclus ions nor findings of historical fact. The undersigned's

rationale, being essentially fact - based, is explicated here in

the interests of organizational coherence and readability.

8. Assume first, for the sake of argument, that Murray's

"first preliminary " review constituted an authoritative

interpretation of the radiologic study. Because it is

reasonable to infer (and the undersigned finds) that the

radiologist's subsequent interpretation of the study was

a uthoritative —— Murray's routine practice of order ing and

personally paying for the "second opinion" would have be en

inexplicable , and indeed irrational , if the radiologist's

interpretation were of dubious value —— the inevitable conclusion ,

assuming Murray's findings were authoritative, is that the

"second opinion" was nearly always duplicative, excessive , and

unnecessary. i

9. Murray's responses to that conclusion doubtless would

be : (1) Medicaid did not pay for the second opinion, so whether

it was excessive and unnecessary is irrelevant ; and (2) the re is

no statute, rule, or Medicaid policy that forbids a provider

from procuring, at his own expense, a second opinion —— even an

unnecessary one.

10. It is not accurate to say, however, that Medicaid did

not pay for the second opinion ; this , ultimately, is the fatal

f law in Murray's reasoning . To the contrary, Murray's testimony

shows clearly that Medicaid did pay for some or all of the

expense of the second opinion , albeit indirectly, when it paid

Murray for the same work. As his own account reveals , M urray

was , in effect, merely a conduit for the Medicaid money, which

passed through his hands on its way to the radiologist.

11. Murray contends, of course, that the Medicaid payments

for the professional component were "his," that he had earned

them b y performing the "first preliminary" read , and that he was

free to spend his income however he chose . If our initial

assumption were true, namely that Murray's preliminary

interpretation were authoritative, then his claim to the

Medicaid payments at issue might have merit. But, on

reflection, th is assumption is difficult , if not impossible, to

square with the fact that Murray found it necessary always to

pay another doctor to perform the very same professional

component services . Indeed , having a second opinion was so

important to Murray that he was willing to perform his purported

preliminary read at a substantially discounted rate, at least,

if not for free —— or even, maybe, at a financial loss : in every

instance, one of these was necessarily the net ec onomic result

of his actions. ii

12. If, as we have assumed, Murray were performing a

valuable professional service each time he interpreted a

radiologic exam, then —— the question naturally arises —— why would

he effectively have give n away his expert opinio ns? Murray

testified that he did so for "the safety of [his] patient" and

because the radiologist is "educated for that." But these

"answers," far from being persuasive, actually undermine the

assumption that spawns the question of motive . Indeed, Murra y's

testimony confirm s a reasonable inference contrary to our

initial assumption , which inference is that Murray lacked

sufficient confidence in his so - called "preliminary"

interpretations ever to rely on them alone. This inference,

which the undersigned accepts as a finding, arises from the

basic undisputed fact that Murray routinely sought "second

opinions" for every patient. It is ultimately determined,

therefore, that whatever Murray's "first preliminary" review s

comprised, they did not constitute aut horitative interpretation s

of the radiologic studies at hand .

13. That being the case, it is determined that Murray's

preliminary opinions a dded little or no actual value to the

subject medical transaction s . Offering some sort of provisional

opinion that holds only until the "real" opinion can be obtained

from the radiologist is not tantamount to performing the

professional component. iii Based on the evidence presented, it

is determined that the radiologist performed the professional

component of the r adiologic studies at issue, not Murray.

14. As a result of improperly claiming that he had

performed professional component services when in fact he had

not, Murray received from Medicaid a total of $94,675.83 in

payments that were not authorized to be p aid. This grand total

of $94,675.83 constitutes an overpayment that Murray must return

to the Agency.

CONCLUSIONS OF LAW

15 . The Division of Administrative Hearings has personal

and subject matter jurisdiction in this proceeding pursuant to

Sections 12 0.569 and 120.57(1), Florida Statutes.

16 . The Agency is empowered to "recover overpayments . . .

as appropriate." § 409.913, Fla. Stat. An "overpayment"

includes "any amount that is not authorized to be paid by the

Medicaid program whether paid as a re sult of inaccurate or

improper cost reporting, improper claiming, unacceptable

practices, fraud, abuse, or mistake." § 409.913(1)(e), Fla.

Stat.

1 7 . One method of recovering overpayments is through

"recoupment," which is " the process by which the departm ent

[ i.e. AHCA] recovers an overpayment or inappropriate payment

from a Medicaid provider ." Fla. Admin. Code R. 59G - 1.010(245).

1 8 . The burden of establishing an alleged Medicaid

overpayment by a preponderance of the evidence falls on the

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

Admin. , 653 So. 2d 440, 441 (Fla. 3d DCA 1995); Southpointe

Pharmacy v. Department of Health and Rehabilitative Services ,

596 So. 2d 106, 109 (Fla. 1st DCA 1992). iv

19. To be authorized for payment by Medic aid, a claim for

services that a doctor has provided must comply with the terms

and conditions set forth in the Physician Services Coverage and

Limitations Handbook ("Handb ook"). Because the Handbook is

incorporated by reference in Florida Administrative Code Rule

59G - 4.230, its terms and conditions have the force and effect of

administrative rules.

20 . Although the pertinent provivisions of the Handbook

were revised from time to time, the substantial Medicaid policy

that governs this case remained the sa me throughout the Audit

Period —— and is not disputed. The principal rule behind the

present dispute, as stated in the January 2001 version of the

Handbook, is this:

To be reimbursed the maximum fee for a

radiology service, the physician must

provide both t he technical and professional

components.

The same Handbook (Jan. 2001) defines the term "professional

component service" as "the physician's interpretation and

reporting of the radiological exam . . . ."

21. The undersigned has found that , throughout t he Audit

Period, Murray claimed (and was paid) maximum fees for

radiologic services even though he had not performed the

professional components. As further found, t he amounts that

Murray received for professional component services were not

authorized to be paid by Medicaid; he received these sums as a

result of improper claiming.

22. The undersigned accordingly finds and concludes that

the total amount Murray received in payment of professional

component services —— $94,675.83 —— is an overpayment, which the

Agency is entitled to recover from the provider.

23. There is one final matter to discuss. The Agency

seeks to impose a fine of $ 1 ,000 against Murray . The authority

to impose such a fine is given in Section 409.913(16), Florida

Statutes, which prov ides in pertinent part as follows:

The agency shall impose any of the following

sanctions or disincentives on a provider or

a person for any of the acts described in

subsection (15):

* * *

(c) Imposition of a fine of up to $5,000

for each viola tion.

2 4 . Among the acts described in subsection (15) are the

following:

(e) The provider is not in compliance with

provisions of Medicaid provider publications

that have been adopted by reference as rules

in the Florida Administrative Code; with

provi sions of state or federal laws, rules,

or regulations; with provisions of the

provider agreement between the agency and

the provider; or with certifications found

on claim forms or on transmittal forms for

electronically submitted claims that are

submitted by the provider or authorized

representative, as such provisions apply to

the Medicaid program[.]

§ 409.913(15)(e ), Fla. Stat. ; see also Fla. Admin. Code R. 59G -

9.070(7)(e).

2 5 . Murray submitted approximately 2,000 claims for

radiologic services that w ere not in compliance with the

pertinent provisions of the Handbook. Therefore, Murray

committed multiple violations , for each of which AHCA may impose

a fine of up to $5,000. The fine of $ 1 ,000 that AHCA wants to

impose is well within its statutory auth ority.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that the Agency enter a final order

requiring Murray to repay the Agency the principal amount of

$94,675.83 , together with an administrative fine of $ 1 , 000.

DONE AND ENTERED this 10th day of Ju ly , 2007, in

Tallahassee, Leon County, Florida.

S

JOHN G. VAN LANINGHAM

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 10th day of Ju ly , 2007 .

ENDNOTES

i / The undersigned supposes (but has no evi dence upon which to

base a finding) that there might have been some unusual

situations where a true "second opinion" would have been

beneficial, even assuming Murray's interpretations were

authoritative. Murray, however, always obtained a "second

opinion, " regardless of the novelty or complexity of the case.

In the run of cases, this must have been overkill —— if Murray

were really performing professional component services.

ii / The evidence does not reveal whether Murray paid the

radiologist an amount tha t was greater than, less than, or equal

to the Medicaid reimbursement for the professional component.

The re is nothing in the record , however, suggesting that the

radiologist charged less than the Medicaid fee for the

professional component.

iii / The unde rsigned perceives no material difference between

Murray's practice of obtaining "second opinions," on the one

hand, and simply subcontracting the professional component to a

radiologist, on the other. (Of course, any doctor who would use

a subcontractor t o interpret radiologic exams could claim, as

Murray has done, that he himself performed "first preliminary"

reviews, if the latter need not be authoritative to be

compensable.) Plainly, however, if a doctor were permitted to

subcontract his professional o bligations in this way, then the

statute respecting Medicaid provider agreements (§ 409.907, Fla.

Stat.) would be seriously compromised, for doctors not under

contract with the Agency would be able to provide services to

Medicaid recipients as subcontracto rs to doctors who were under

contract with the Agency. In fact, because the instant record

contains no evidence concerning the identities of the

radiologist or radiologists on whom Murray relied for the safety

of his patients, it is possible that these ra diologists (or some

of them) were not Medicaid providers. In any event, acceptance

of Murray's position would open the door, even if only a crack,

to subcontracting.

iv / Although the Agency bears the ultimate burden of persuasion

and thus must present a prima facie case through the

introduction of competent substantial evidence before the

provider is required to respond, Section 409.913(22), Florida

Statutes, provides that "[t]he audit report, supported by agency

work papers, showing an overpayment to the provider constitutes

evidence of the overpayment." Thus, the Agency can make a prima

facie case merely by proffering a properly supported audit

report, which must be received in evidence. See Maz

Pharmaceuticals, Inc. v. Agency for Health Care Administr ation ,

DOAH Case No. 97 - 3791, 1998 Fla. Div. Adm. Hear. LEXIS 6245, *6 -

*7 (Mar. 20, 1998); see also Full Health Care, Inc. v. Agency

for Health Care Administration , DOAH Case No. 00 - 4441, 2001 WL

729127, *8 - 9 (Fla.Div.Admin.Hrgs. June 25, 2001)(adopted in

toto, Sept. 28, 2001, AHCA Rendition No. 01 - 262 - FOF - MDO).

COPIES FURNISHED :

L. William Porter, II, Esquire

Agency for Health Care A dministration

Fort Knox Executive Center III

2727 Mahan Drive, Building 3, Mail Stop 3

Tallahassee, Florida 32308 - 5403

Jose M. Herrera, Esquire

Jose M. Herrera, P.A.

1401 Ponce de Leon Boulevard, Suite 200

Coral Gables, Florida 33134

Richard J. Shoo p , Agency Clerk

Agency for Health Care Administration

2727 Mahan Drive, Mail Station 3

Tallahassee, Florida 32308

Craig H. Smith , General Counsel

Agency for Health Care Administration

Fort Knox Building, Suite 3431

2727 Mahan Drive

Tallahassee, Florida 323 08

Andrew C. Agwunobi, M.D., Secretary

Agency for Health Care Administration

Fort Knox Building, Suite 3116

2727 Mahan Drive

Tallahassee, Florida 32308

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions w ithin

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.