11-004242MPI Agency For Health Care Administration vs. Juana Rodriguez, D/B/A Access Road, Inc. Status: Closed Recommended Order on Monday, March 26, 2012.

Summary: Petitioner proved that Respondent received Medicaid overpayments that must be repaid and that fines should be imposed.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

AGENCY FOR HEALTH CARE )

ADMINISTRATION , )

)

Petitioner , )

)

vs. ) Case No. 11 - 4242MPI

)

JUANA RODRIGUEZ, )

d/b/a ACCESS ROAD, INC. , )

)

Respondent . )

)

RECOMMENDED ORDER

A final administrative hearing was held in this case on

January 3, 2012, in Tallahassee, Florida, before Administrative

Law Judge Elizabeth W. McArthur of the Division of Administrative

Hearings.

APPEARANCES

For Petitioner: L. Willi am Porter, II, Esquire

Beverly H. Smith, Esquire 1/

Agency for Health Care Administration

Fort Knox Building, Building 3

2727 Mahan Drive

Tallahassee, Florida 32308 - 5403

For Responde nt: Nancy P. Campiglia, Esquire

Keating and Schlitt, P.A.

250 East Colonial Drive, Suite 300

Orlando, Florida 32801 - 1231

STATEMENT OF THE ISSUE S

The issues in this case are whether Respondent received

Medicaid overpayments that Petitioner is entitled to recoup, and

whether fines should be imposed against Respondent.

PRELIMINARY STATEMENT

Following an audit of 2007 and 2008 Medicaid claims, the

Agency for Health Care Administration (AHCA or Petitioner) issued

a Final Audit Report (FAR) on August 10, 2010, concluding that

Respondent, Juana Rodriguez, d/b/a Access Road Inc. (Access Road

or Respondent), received $159,741.86 in Medicaid overpayments.

The FAR informed Respondent that AHCA intended to recoup the

overpayments, impose a fine of $3,500.00, and seek recovery of

its costs as authorized by statute.

Respondent timely requested an administrative hearing to

contest the FAR, and on August 19, 2011, this case was forwarded

to the Division of Administrat ive Hearings (DOAH) for the

assignment of an Administrative Law Judge to conduct the

requested hearing. 2/ The initially - scheduled hearing was

continued once on the parties' joint motion and was rescheduled

for January 3, 2012.

Before the final hearing, th e parties submitted a joint

Pre - Hearing Stipulation, in which they stipulated to a number of

facts. These agreed facts are incorporated into the Findings of

Fact below, to the extent relevant.

At the final hearing, Petitioner presented the testimony of

Ro bi Olmstead, an AHCA administrator in the Bureau of Medicaid

Program Integrity (MPI); Kristin Koelle, an MPI investigator; and

Fred Huffer, Ph.D., a professor at Florida State University in

the statistics department, tendered and accepted as an expert in

M edicaid statistical formula evaluation of claims. Petitioner's

Exhibits A through Q were admitted in evidence by stipulation.

Included in the stipulated exhibits were pertinent sections of

Florida Statutes, Florida Administrative Code rules, and Medicaid

provider handbooks incorporated by reference in rules, all for

the years in which the alleged overpayments were made. Official

recognition was taken of these submissions, without objection.

In addition, Petitioner's Exhibit R, a demonstrative exhibit

cr eated by Dr. Huffer at the hearing to illustrate his testimony

was admitted in evidence without objection.

Respondent presented no witnesses and no evidence. Instead,

Respondent relied on cross - examination of Petitioner's witnesses

and argument in its Pro posed Recommended Order (PRO).

The record was left open at AHCA's request to receive an

update of the exhibit of AHCA's costs admitted in evidence to

reflect additional costs incurred through the final hearing.

AHCA timely filed its updated cost exhibit o n January 7, 2012.

Respondent was initially allowed seven days to submit a response

or objection to AHCA's updated cost exhibit. Respondent moved

for a brief extension, which was granted, and Respondent timely

filed a response by the extended deadline. Although timely

filed, as will be discussed below, Respondent's submission did

not dispute the accuracy or reasonableness of AHCA's updated

costs. Instead, Respondent took the opportunity to belatedly

request a discovery sanction as an offset to any statu tory award

of costs to AHCA.

At Respondent's request, the parties were allowed 30 days

after the filing of the Transcript to submit their PROs. The

two - volume Transcript of the final hearing was filed on

January 17, 2012. AHCA filed its PRO on January 26, 2012. On

February 15, 2012, Respondent requested a short extension of the

PRO deadline due to unforeseen circumstances, which was granted

without objection. Respondent timely filed its PRO by the

extended deadline of February 24, 2012. Both PROs hav e been duly

considered in the preparation of this Recommended Order.

FINDING S OF FACT

1. AHCA is the single state agency responsible for

administering the Medicaid program in Florida. The Medicaid

program is a federal and state partnership to cover the c osts of

providing health care and related services to persons meeting

certain criteria, such as persons with very low income or persons

with certain developmental disabilities.

2. For persons with developmental disabilities, Florida

developed a program designed to identify those who could receive

needed services in their homes and communities, instead of in

institutional settings. To use the state - federal Medicaid funds

for home and community - based services, instead of institutional

care, Florid a was required to obtain a waiver from the federal

government by demonstrating that its program presented a less -

costly and more - effective alternative to institutionalization.

This program, approved for certain developmentally disabled

Medicaid recipients , is known as the Home and Community - Based

Waiver (HCB waiver) .

3. Under the HCB waiver, services are planned for each

developmentally disabled recipient according to the recipient's

particular needs and described in a detailed support plan. The

suppor t plan articulates the goals for each type of needed

service and is updated annually. A service authorization is

developed from each support plan to specify the amount, by time

and dollars, approved for each type of service. The support plan

and service authorization documents also identify which Medicaid -

contracted providers will be providing each of the approved

services.

4. At all times material to this case, Access Road has been

a provider of HCB waiver services to Medicaid recipients,

pursuant to a Medicaid provider contract with AHCA. Access

Road's Medicaid provider n umber is 681213996.

5. Between January 1, 2007, and December 31, 2008, Access

Road provided HCB waiver services to a total of 16 Medicaid

recipients. Fourteen recipients received ser vices throughout the

two - year period. Two recipients received services for only a

short period of time near the end of the two - year period.

6. During th is two - year time period, Access Road provided

four types of HCB waiver services: personal care as sistance;

companion care; respite care; and non - residential support. Each

of these services is billed in quarter - hour units of service

provided on a single day so that a claim for 16 units of service

would represent that the service was provided for four hours that

day.

7. For the two - year period at issue, Access Road submitted

a total of 12,927 claims for reimbursement for services provided

to the 16 Medicaid recipients. For those claims, Access Road

billed Medicaid and was reimbursed a total of $809, 374.42.

8. By entering into Medicaid provider agreements with AHCA,

providers such as Respondent agree to "maintain and make

available in a systematic and orderly manner," as AHCA requires,

all Medicaid - related records for a period of at least five years.

In addition, providers agree to send "at the provider's expense,

legible copies of all Medicaid - related information" to authorized

state and federal employees. These contractual agreements are

also requirements of Florida's Medicaid laws and rules, incl uding

the Medicaid provider handbooks that are promulgated as rules.

9. AHCA is responsible for conducting investigations and

audits to determine possible fraud, abuse, overpayment, or

neglect, and must report any findings of overpayment in audit

reports. AHCA need not have any particular reason or cause for

initiating investigations and audits of Medicaid providers. AHCA

is not only authorized to conduct random audits; AHCA is required

to conduct at least five percent of its audits on a random basis.

1 0. In this instance, in early 2010, some question about

Respondent's billings arose from a cursory review by the AHCA

field office in Respondent's area. The nature of the field

office's review or question about Respondent's billings was not

established, b ut is not material, as it is only germane as

background explanation of how this matter arose. The result of

the area office's question about Access Road's billings was that

the MPI Bureau decided to conduct an audit investigation of

Respondent, as it is a uthorized to do, and a referral was made to

MPI investigator Kristin Koelle.

11. The purpose of the Medicaid audit was to verify that

claims for which Respondent has already been paid by the Medicaid

program were for services that were provided, billed, an d

documented in accordance with Medicaid statutes, rules, and

provider handbooks. While Respondent certifies with each claim

submission that the claim is proper and that all records required

to be maintained in support of each claim are in fact being

main tained, the audit goes behind that certification by actually

reviewing those records.

12. In setting the audit period, AHCA has up to a four - year

range. The end point is set by going back at least one year,

since providers have one year to submit and adju st claims. The

beginning point is set no more than five years back, which is the

record retention period. In this case, within the allowable

four - year range, AHCA chose two years, January 1, 2007, through

December 31, 2008.

13. The next step in the audit process is to determine the

population of recipients and claims for which records will be

requested for review. When AHCA audits a Medicaid provider for

possible overpayments, it "must use accepted and valid auditing,

accounting, analytical, statistical, or peer - review methods, or

combinations thereof. Appropriate statistical methods may

include, but are not limited to, sampling and extension to the

population, . . . and other generally accepted statistical

methods." § 409.913(20), Fla. Stat. (2007). 3/

14. The audit methods used depend on the characteristics of

the provider and of the claims. For example, where a provider

serves thousands of Medicaid recipients during the audit period,

but for each recipient , there are not many claims, such as might

be the case for a hospital provider, then AHCA may use a single -

stage cluster sampling methodology. Under this approach, a

random sample of recipients is selected, and then all claims are

examined for the recipient sample group.

15. Alternatively, where ther e are too many claims to

review all of the claims for each recipient or to review all

claims for a sample group of recipients, a two - stage cluster

sample methodology may be used, whereby a random sample of

recipients is first selected and then random sampl es of the

claims for the sample group of recipients are selected .

16. Because of the extremely high volume of claims

generated by Respondent during the audit period, Ms. Koelle

determined with her supervisor that a two - stage cluster sampling

methodology wo uld be u sed . AHCA utilizes a computer program to

carry out the random sampling selection once the method is

chosen, so Ms. Koelle was able to select the two - stage cluster

sampling method and , with the provider number and audit period,

the computer drew fr om the claims database to ma k e the random

selection of the samples to be reviewed.

17. As a general target, AHCA considers 30 recipients to be

a reasonable sample size for the first stage of two - stage cluster

sampling. This target sample size assumes that there are many

more than 30 recipients. Since Access Road only served 16

recipients over two years, the computer selected all 16

recipients for review.

18. AHCA's expert credibly explained that while a selection

of all recipients is an unusual applicatio n of the concept of

random sampling, it is an appropriate result that comports with

the technical meaning of random sample: a sample chosen whereby

all possible samples of the same size are equally likely to have

been chosen. Thus, AHCA's expert opined t hat this audit involved

an entirely correct and reasonable, albeit atypical, application

of two - stage cluster sampling. 4/ Given that AHCA's standard rule

of thumb is to include 30 recipients in the "sample" group, it is

apparent that what is atypical here is that the provider served

only 16 Medicaid recipients over the audit period. Given the

small number of recipients served, review of all 16 recipients

was feasible and could only increase the reliability of AHCA's

review , as AHCA's expert confirmed. 5/

19. It was not feasible, however, to review all 12,927

claims generated by those 16 recipients, nor, presumably, would

Access Road want to have been burdened with producing all records

to support its 12,927 claims. As a general target, AHCA

considers sam ples of between five and 15 claims , per recipient ,

to be reasonable sample sizes for the second stage of two - stage

cluster sampling. Accordingly, the computer selected 219 claims,

representing between five and 15 claims for each recipient in

accordance wi th AHCA's standard.

20. AHCA's expert opined that the sampling method used in

this case was reasonable and comported with generally accepted

statistical methods. His opinions and explanation were credible,

were unrebutted, and are accepted. Respondent's attempt to

undermine the expert's opinions, through cross - examination and

argument in Respondent's PRO, was ineffective and lacked the

support of contradictory expert testimony regarding generally

accepted statistical methods.

21. By letter to Access Road dated May 11, 2010, AHCA

requested copies of all documentation supporting the 219 claims

that were the sample group of claims for the 16 recipients.

Access Road also was asked to produce specified staff records, to

document that the individuals providing the services represented

by the 219 claims were qualified to do so and had met background

screening requirements. With its production, Access Road was

required to execute a certificate of completeness attesting that

all supporting documentation for the 2 19 claims had been

produced.

22. The May 11, 2010, letter stated that the documentation

was due within 21 days from the letter's receipt, but added that

Access Road should submit the documentation and certificate of

completeness "within the requested timef rame, or other mutually

agreed upon timeframe."

23. Respondent did not request a different deadline.

Instead, Respondent sought clarification of the documentation

that had to be produced and then sent a package with

documentation and a certificate of co mpleteness, by which

Respondent certified to AHCA that all documentation to support

the specified billings was included.

24. Ms. Koelle contacted Access Road after reviewing the

documentation, because she was unable to determine from what was

submitted th at all staff were qualified or had undergone

background screening. Ms. Koelle allowed Access Road additional

time to submit any further documentation to address the omissions

she had identified.

25. After the additional time for staff - related

documentatio n, Ms. Koelle conducted her audit of the 219 claims.

Ms. Koelle assessed the documentation for each claim by reference

to the requirements in Medicaid provider handbooks, as well as

the specific service authorizations and support plan goals for

each recip ient. Each of the 219 claims was either allowed,

denied, or adjusted to reduce the amount of the claim for reasons

set forth in detailed audit work papers.

2 6 . Ms. Koelle input the audit results on the 219 claims --

approved, denied, or adjusted - - into the computer that was

programmed to carry out the two - stage cluster sampling

methodology by extending the results of the claims sample

reviewed to the entire claims population. The result was a

preliminary audit determination that Respondent had been overpaid

$219,810.12.

2 7 . The results of Ms. Koelle's review were summarized in a

Preliminary Audit Report (PAR). The reasons for the denied and

adjusted claims were grouped in two broad categories:

(1) incorrect, illegible, or insufficient documentation; and

(2 ) overbilling leading to overpayment. The first category

included claims for services provided by ineligible or

unqualified staff, claims for services with no documentation, and

claims for services for which no activities were documented on a

service log. The second category included claims for which the

number of units of service billed was not supported by the

documented activities, claims that billed for more units of

service than were documented, and claims for services and

activities beyond the scope of services authorized in the

recipient's support plan or service authorization.

2 8 . The PAR and the audit work papers were sent to

Respondent on June 22, 2010. Respondent was advised that

additional documentation could be submitted by a specified

deadli ne in support of claims identified as overpayments.

However, in bold print , the PAR warned Respondent that while any

additional submittals would be reviewed and could change the

treatment of claims, "additional documentation may be deemed

evidence of non - compliance with the Agency's initial request for

documentation in which [ Respondent was] required to provide all

Medicaid - related records. Sanctions for this non - compliance will

be imposed."

29 . Respondent submitted additional documentation by the

speci fied deadline. Ms. Koelle repeated the process of reviewing

the new submittals, and in some instances, approving claims that

were preliminarily denied. Ms. Koelle repeated the process of

inputting the revised determinations into the computer, which

repea ted the extension of the overpayments within the sampled

claims to the entire claims population for the 16 recipients.

The result was a reduced overpayment determination, which was set

forth in the FAR , of $159,741.86.

3 0 . The reasons for the denied and adjusted claims were

grouped in the same two categories and included the same problem

areas that had been summarized in the PAR. The FAR determined

that a total of 55 claims, representing 25.11 percent of the

sample group of claims, were denied, in whole or in part , for

documentation deficiency reasons (the first category); and an

additional 16 claims, representing 7.31 percent of the sample

claims reviewed, were denied, in whole or in part, due to

overbilling (the second category). In total, nearly one - third --

71 of the 219 claims reviewed -- were found in the FAR to involve

overpayments.

3 1 . As Respondent was warned, the production of additional

documentation after the PAR resulted in the FAR's imposition of a

$1,000 fine for failing to provide all Medica id - related records

within the timeframe requested in the May 10, 2010, records

request. The FAR also imposed a fine of $2,500 for Respondent's

failure to follow Medicaid laws, rules, and provider handbooks.

3 2 . Petitioner submitted in evidence the FAR and the audit

work papers standing behind the FAR's determinations, including

Ms. Koelle's worksheets stating the reasons for denying or

adjusting specific claims and the provider documentation that was

submitted and available for review of the claims that we re

adjusted or denied.

3 3 . At hearing, Respondent did not offer any evidence or

testimony to refute or impeach the audit findings or to

supplement the documentation relevant to the denied or adjusted

claims beyond what was provided in Petitioner's audit wo rk paper

exhibits.

3 4 . In its PRO, Respondent presented argument disputing the

findings on 15 claims for eight recipients. Thus, Respondent

presented no evidence and no argument to refute AHCA's

overpayment determinations for 56 of the 219 claims reviewed .

The disputed claims, audit findings, and Respondent's argument

are summarized below.

3 5 . Recipient No. 1, Claim 5 : This claim was for 20 units

of service (5 hours) for personal care assistance on December 10,

2007. The claim was denied based on insuff icient documentation,

"no activities documented on service log." Respondent's PRO

argues that the audit work papers only include a service log for

the week that includ ed December 10, 200 8 , whereas the

documentation for this claim would have been on a diff erent

service log for December 10, 2007. However, Respondent failed to

offer in evidence a service log covering December 10, 2007, which

Respondent claims would have documented that personal care

assistance was provided on December 10, 2007, as would be

n ecessary to rebut Petitioner's audit findings of insufficient

documentation. It is possible that the service log in the audit

work papers was dated incorrectly, or it may be that there was no

other service log with an entry for December 10, 2007.

Regardl ess, there is no evidence of sufficient documentation for

this claim.

3 6 . Recipient No. 1, Claim 6 : This claim was for four

units of respite care service on January 7, 2008. The claim was

denied because there was no service log. Ironically (juxtaposed

with the last challenge), Respondent asserts that a service log

in the audit work papers for the week ending January 13, 200 7 , is

the correct service log , but that it was dated incorrectly. Even

if Respondent's assertion (not supported by any testimony or

evidence) is correct, Respondent overlooks the fact that the

misdated service log would support Petitioner's denial of

Claim 6, because that service log has no respite care entry on

January 7, 2007. Therefore, either because there is no service

log at al l for January 7, 2008, or because the service log for

January 7, 2007, contains no respite care hours, Claim 6 was

properly denied.

3 7 . Recipient No. 1, Claim 7 : Claim 7 was for four units

of respite care service on January 25, 2008. The claim was

denied , again because there was no service log. A service log in

the work papers for the week including January 25, 2008, shows

zero hours of respite care on January 25, 2008, but four hours of

respite care each on January 26 and 27, 2008, which was all the

res pite care authorized for the week. Respondent claims in its

PRO, with no supporting documentation or testimony, that there

was a clerical error. According to Respondent's PRO assertion,

respite care was provided to Recipient No. 1 on Friday,

January 25, 2008, as billed, but was incorrectly recorded on

January 26, 2008. But Respondent's PRO assertion is not evidence

and cannot be the basis for a finding of fact. The fact remains

that Respondent billed Medicaid for respite care services

provided on Januar y 25, 2008, and was paid for those services,

but there is no documentation that the services were provided.

Moreover, no evidence was offered to show that Respondent was not

paid for all of the documented respite care hours on January 26,

2008, which Resp ondent now claims were not all provided that day.

3 8 . Re cipient No. 2, Claim 8 : Respondent billed Medicaid

for 28 units (seven hours) of companion care services on

February 10, 2008. The claim was adjusted by disallowing 14

units of service, based on the finding that the documentation

does not support the number of units of service billed. The only

documentation describing the companion care services provided was

the following statement signed by the provider: "Today we went

to the Library. She was ver y happy looking at different

magazines and to [sic] different books. She was seating [sic]

for a while watching the books." Respondent argues in its PRO

that Petitioner arbitrarily reduced the claimed units, because

the documentation is sufficient to est ablish the activity, even

if all things done at the library were not listed. However, AHCA

reasonably found excessive a claim for seven hours at a library

to look at magazines and books, absent more detail and more

information, which Respondent failed to provide by way of

testimony or documentary evidence. Respondent's arguments that

the documentation was "sufficient to establish the activity" and

the reduction was "arbitrary," are not evidence to refute the

contrary finding that the units billed were exc essive.

39 . Recipient No. 2, Claim 15 : This claim was for eight

units of personal care assistance on October 16, 2008. The claim

was denied due to lack of a service log. Respondent points out

that there is a service log, showing two hours (eight units) of

personal care assistance on October 16, 2008. However, there is

an unexplained anomaly on this service log. The service log is

filled out, in part, by typewriting and, in part, by handwriting.

Typewritten in the blank for the total number of personal care

assistance hours for the week was ten hours , but in handwriting,

the " 0 " was changed to a " 2, " changing the total to 12 hours.

The daily entries, all typewritten, add up to 12 hours.

Therefore, AHCA could reasonably question this claim, without

exp lanation of the service log anomaly. If the total hours of

personal care assistance that week was actually ten , it may be

that the entry of two hours for October 16, 2008, was not done

contemporaneously with the service, but , rather, at the end of

the wee k when the document was signed, and it became apparent

that there was a shortage of personal care assistance hours that

week. While bad motives are not attributed to Respondent or to

the individual caregiver who completed the form, the anomaly on

the form is sufficient to support Petitioner's audit finding, and

Respondent has failed to rebut that finding with evidence

explaining the anomaly in the documentation.

4 0 . Recipient No. 3, Claim 12 : This claim was for 20 units

(five hours) of respite care servic e on June 20, 2008. The claim

was denied based on a finding of no documentation to support the

billing. The service log for that week shows zero hours of

respite care on June 20, 2008, a Friday. Five hours of respite

care was provided on each weekend da y, for a total of ten hours,

which was all that was authorized. Respondent argued in its PRO

that this was another clerical error, and the amount billed is

documented under June 21 and June 22, 2008. Once again, however,

Respondent provided no testimony or evidence to support this

assertion. Once again, the fact remains that Respondent billed

Medicaid for respite care services provided on June 20, 2008, and

was paid for those services, but there is no documentation that

they were provided. And once agai n, Respondent failed to prove

that it was not reimbursed for the claimed respite care on the

days on which Respondent now claims the service was not actually

provided.

4 1 . Recipient No. 6, Claim 5 : Respondent billed Medicaid

for four units of companion c are service on May 15, 2008. This

claim was denied because the documented activities billed under

companion care -- meal preparation and washing dishes -- were

unauthorized by the support plan for companion care services.

Respondent argued in its PRO that te aching a recipient meal

preparation is a "meaningful activity." However, the issue is

not whether it is "meaningful," but whether it is an authorized

activity as part of the companion care service authorization.

According to the support plan, the recipi ent was also authorized

to receive personal care assistance. Personal care assistance

was authorized to maintain the recipient's hygiene and help with

his personal care needs. Companion care was authorized to give

the recipient meaningful days to visit p laces and make new

friends. Meal preparation and washing dishes fall within the

personal care assistance category and not within the authorized

companion care, as described in the support plan. This claim was

properly denied.

4 2 . Recipient No. 9, Claim 1 2 : This claim was for 24 units

of companion care service on May 14, 2008. The claim was

adjusted, allowing three hours instead of the six hours claimed,

based on a finding that the documentation did not support the

number of units billed. The only docum entation describing what

was done in this six - hour period was "parks," with no additional

detail or information to justify the amount of time claimed.

With the absence of detail, AHCA reasonably found that a six - hour

claim for "parks" was excessive. Resp ondent argued in its PRO

that the activity is appropriate, and the number of units billed

is in line with the service. Respondent presented no evidence to

establish the facts or opinions argued in its PRO. Respondent's

unsupported assertions are not evid ence to refute the contrary

finding that the claim was excessive.

4 3 . Recipient No. 14, Claim 1 : This claim was for 16 units

of non - residential support services on January 2, 2007. The

claim was denied on the basis of insufficient documentation, as

ther e was no daily progress note. Respondent argues that the

weekly service log is sufficient documentation. The service log

for the week including January 2, 2007, shows that non -

residential support services were provided from 8:00 a.m. to

12 noon on three consecutive days -- January 1, 2, and 3, 2007. No

information is provided regarding the activities done each day.

Instead, a single - block description is provided, presumably of

all activities done over the three - day, 12 - hour period. The

description was:

a. Get in order all of his money

b. Get in order gift certificates

c. [Illegible]ing money

The support plan goals for non - residential support services for

this recipient were to help the recipient learn the value of

money, learn to make purchases, a nd pay for them. Respondent

argues in its PRO that the activities summarized above for the

three - day period are "geared toward the recipient's stated

goals[.]" While that is apparently true, the summary is

inadequate to justify the claim for four hours e ach day for a

three - day period. As Petitioner notes in the audit, there should

be daily progress notes specifying what was done each day.

Indeed, daily progress notes are required by the Developmental

Disability Waiver Services Coverage and Limitations H andbook

(Waiver Handbook). See Waiver Handbook, Ch. 2 - 55, Non -

Residential Support Services, Documentation Requirements, No. 5

("Daily progress notes for each day services were provided . ").

4 4 . Recipient No. 15, Claim 9 : Respondent billed Medicaid

for 32 units (eight hours) of companion care services on May 10,

2008. AHCA adjusted the claim to allow 14 units of service.

AHCA denied 16 units of service because the documentation did not

support the amount billed. Two units of service were denied for

time spent doing laundry, an unauthorized activity for companion

care. The service log showed that on May 10, 2008, companion

care was recorded from 11 a.m. until 7 p.m. , a total of eight

hours. In addition, another four hours were logged for personal

care se rvices, described as shampoo, bathroom cleaning, bedroom

cleaning, and laundry. The description of the companion care

services for that day was "restaurant" and "laundry."

4 5 . Respondent argued in its PRO that the claim was

directly connected to the goal s for recipient no. 15, which

include activities to reduce depression and avoid suicidal

tendencies. However, Respondent failed to address the points

made in the audit -- that the documentation does not support the

number of units of service claimed and tha t laundry is an

authorized activity for personal care assistance , not companion

care . Petitioner's auditor reasonably found that eight hours for

"restaurant and laundry" w ere excessive, and, indeed, Petitioner

was generous in allowing three and one - half h ours for

"restaurant," while disallowing only one - half hour billed as

companion care for doing laundry. The claim was properly

adjusted; Respondent offered no evidence or argument to the

contrary.

4 6 . Recipient No. 16, Claims 3, 4, 5, 7, and 8 : These

cla ims were each for 12 units of companion care services on

different days. Each of these claims was adjusted by subtracting

one unit of service from the 12 units claimed, because the

documentation showed that an unauthorized activity -- feeding -- was

included. The applicable support plan authorized companion care

services for the following goals: "Wants to have meaningful days

and socialize as well as buy things of his interests; Wants to go

to the library to get videos." The recipient was also authorized

fo r personal care assistance provided by a different provider

(not Respondent) to meet the following goal: "Wants to be helped

with his personal care needs." Respondent argued in its PRO that

the recipient needs to be fed through a bag and learn how to

per form personal care, so these are activities for which he needs

assistance. Respondent's argument, unsupported by any testimony

or documentary evidence, misses the point. The recipient was

indeed authorized to receive "help with his personal care needs,"

but the authorized service for that activity was personal care

assistance, not companion care, to be provided by a different

provider, not Respondent. Respondent failed to refute the

finding that the claims included an unauthorized activity.

Petitioner r easonably adjusted these claims by deducting one unit

of service from each claim.

Petitioner's Costs

4 7 . Petitioner presented an exhibit at hearing, updated

after the hearing, setting forth its investigative and expert

witness costs. Respondent did not object to or dispute the

reasonableness of Petitioner's documented costs. Through the

final hearing, Petitioner's total investigative and expert

witness costs were $4,087.19.

4 8 . Respondent took the opportunity offered to respond or

object to Petitioner's updated cost submittal, but Respondent's

response did not actually respond or object to Petitioner's

updated costs. Instead, Respondent asserted that an offset

should be applied to reduce any award of Petitioner's costs by

what would be, in effect, a dis covery sanction.

49 . Respondent's request for an offset is based on the

apparent fact that in pre - hearing discovery, counsel for

Petitioner agreed to make AHCA's expert witness available for

deposition in Tallahassee. Although the expert witness appeare d

for his deposition, he had not yet reviewed the case material

because the file had not yet made its way into his hands.

Counsel for Respondent traveled to Tallahassee for the deposition

and for business of other clients. After the deposition, counsel

f or AHCA expressed his apologies, and although he could not

commit, he stated he would attempt to get some cost reimbursement

for Respondent. Apparently, that never happened.

5 0 . Respondent now seeks recovery of costs for attending a

deposition that had to be rescheduled after AHCA's expert witness

was better prepared. Even if Respondent had timely filed a

motion shortly after this occurrence for costs imposed as a

discovery sanction, Respondent offers no authority for ordering

reimbursement of costs under these circumstances. Respondent

could have subpoenaed the expert and the necessary documents for

deposition; Respondent could have asked for entry of an order of

pre - hearing instructions to impose requirements on expert witness

discovery; Respondent took none of these steps. No subpoena was

violated; no pre - hearing order was violated; no rule of civil

procedure for discovery was violated.

CONCLUSIONS OF LAW

5 1 . The Division of Administrative Hearings has

jurisdiction over the parties and the subject ma tter of this

proceeding. §§ 120.569 and 120.57(1), Fla. Stat. (2011).

5 2 . The statutes and rules in effect during the period for

which services were provided govern this dispute. Toma v. Ag. for

Health Care Admin. , Case No. 95 - 2419, RO at ¶ 213 (Fla. DO AH

July 26, 1996; Fla. AHCA Sept. 24, 1996). This includes the

provider handbooks pertinent to this case: the Medicaid Provider

General Handbook , and the Developmental Disabilities Waiver

Services Coverage and Limitations Handbook , which are promulgated

as rules.

5 3 . AHCA is empowered to "recover overpayments . . . as

appropriate." § 409.913. An "overpayment" includes "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." § 409.913(1)(e).

5 4 . Payments are not "authorized to be paid by the Medicaid

program" when the provider has not complied with section

409.913(7), which at all times material to this case provided , in

pertinent part , as follows:

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

su pervise 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,

re gulations, 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. Medicai d 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.

The agency may deny payment or require

repayment for goods or s ervices that are not

presented as required in this subsection.

5 5 . Recoupment of overpayments is one remedy that AHCA is

authorized to seek to remediate proven charges under what, in

2007, was section 409.913(15). Colonnade Med. Ctr., Inc. v. Ag.

for He alth Care Admin. , 847 So. 2d 540 (Fla. 4th DCA

2003)(confirming AHCA's authority to recover overpayments to

remediate proven charges under what was then section

409.913(14)). Section 409.913(15) provided, in pertinent part,

as follows:

The agency may seek any remedy provided by

law, including, but not limited to, the

remedies provided in subsections (13)

and (16) and s. 812.035 , if:

* * *

(c) The provider has not furnished or has

failed to make available such Medicaid -

related records as the agency has found

necessary to determine whether Medicaid

payments are or were due and the amounts

thereof;

* * *

(e) The provider is not in compliance with

provisions of Medicaid provider publications

that have been adopted by reference as rules

in the Fl orida Administrative Code; with

provisions 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

electronicall y submitted claims that are

submitted by the provider or authorized

representative, as such provisions apply to

the Medicaid program.

5 6 . The burden of establishing an alleged Medicaid

overpayment by a preponderance of the evidence falls on

Petitioner. S. Med. Servs., Inc. v. Ag. for Health Care Admin. ,

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

Dep't of HRS , 596 So. 2d 106, 109 (Fla. 1st DCA 1992). The burden

of proof with respect to the imposition of fines is by clear and

convinc ing evidence. Dep't of Banking and Fin. v. Osborne Stern &

Co. , 670 So. 2d 932 , 935 (Fla. 1996).

5 7 . Although AHCA bears the ultimate burden of persuasion

and, thus, must present a prima facie case, section 409.913(20)

provides that "[i]n meeting its bur den of proof . . ., the agency

may introduce the results of [generally accepted] statistical

methods as evidence of overpayment." In addition, section

409.913(22) provides that "[t]he audit report, supported by

agency work papers, showing an overpayment t o the provider

constitutes evidence of the overpayment." Thus, AHCA can make a

prima facie case by proffering a properly - supported audit report,

which must be received in evidence. See Maz Pharm., Inc. v. Ag.

for Health Care Admin. , Case No. 97 - 3791 (Fla . DOAH Mar. 20,

1998; Fla. AHCA June 26, 1998); see also Full Health Care, Inc.

v. Ag. for Health Care Admin. , Case No. 00 - 4441 (Fla. DOAH

June 25, 2001; Fla. AHCA Sept. 28, 2001).

58. If AHCA makes a prima facie case as outlined by the

statute, then it i s "incumbent upon the provider to rebut,

impeach, or otherwise undermine AHCA's evidence." Ag. for Health

Care Admin. v. Bagloo , Case No. 08 - 4921, RO at p. 33 ( Fla. DOAH

Sept. 10, 2009; Fla. AHCA Nov. 8, 2010).

59. For the reasons set forth in the Findin gs of Fact

above, the undersigned concludes that AHCA made a prima facie

case by presenting its properly - supported audit report, including

work papers. AHCA's overpayment calculation was based on

generally accepted statistical methods, properly applied to this

provider.

60. The kind of cluster sampling method used in this case

was approved as a means to carry out the requirements of section

409.913(20) in Agency for Health Care Administration v. Custom

Mobility, Inc. , 995 So. 2d 984, 986 - 987 (Fla. 1st DCA 2008). The

court described the types of statistical sampling methodologies

contemplated by that statute as follows:

Statistical sampling methodologies are used

to permit the auditors to analyze a random

sample from the population of Medicaid

recipients an d/or claims, determine the

findings in the sample, and extend the sample

findings to the population of recipients

and/or claims. (emphasis added).

Id. at 985.

61. Respondent improperly attempted to undermine AHCA's

evidence with facts not supported by any testimony or documentary

evidence, but, rather, only with assertions in Respondent's PRO.

For the reasons set forth in the Findings of Fact, Respondent

failed to effectively rebut, impeach, or otherwise undermine

AHCA's evidence.

62. By presenting pr ima facie evidence of the overpayment,

which was not rebutted by Respondent, Petitioner met its ultimate

burden of proving that Respondent has received overpayments in

the total amount of $159,741.86, which is subject to recoupment.

Pursuant to section 40 9.913(25)(c), the overpayment bear s

interest at the rate of ten percent per annum from the date of

determination of the overpayment.

63. Section 409.913(16)(c) provided at all times material

to this case, that AHCA "shall impose any of the following

sancti ons . . . on a provider or a person for any of the acts

described in subsection (15): . . . Imposition of a fine of up

to $5,000 for each violation."

64. Rule 59G - 9.070 was promulgated in 2005 to provide

notice regarding how AHCA would normally exercise its sanction

authority and to set forth guidelines for imposition of sanction

types and amounts.

65. The FAR imposed a fine of $1,000 pursuant to rule

59G - 9.070(7)(c) based on the act described in section

409.913(15)(c) (failure to furnish all Medicaid - r elated records

within the timeframe requested by the Agency or other mutually

agreed - upon timeframe). Respondent was warned in the PAR that

such a fine would be imposed if additional documents were

submitted after Respondent had certified that all documen ts had

been provided.

66. The guidelines for sanctions in the version of rule

59G - 9.070(10) , in effect at the time Respondent committed the act

described in section 409.913(15)(c), provided for imposition of a

fine of $1,000 per record request for a prov ider's first

violation. There is no question that Respondent failed to

furnish all Medicaid - related records within the timeframe

requested by AHCA in its initial records request, because

Respondent provided additional records in response to the PAR.

67. The FAR also imposed a fine of $2,500 pursuant to r ule

59G - 9.070(7)(e) , for the acts described in section

409.913(15)(e)(failure to comply with Medicaid laws, rules, and

handbooks). The version of the guidelines rule in effect when

most of the claims were submitted 6/ provided, in the case of first

offenders, for imposition of a fine of $1,000 per violation , not

to exceed $3,000 per agency action for a "pattern" of acts.

68. A "pattern" is defined in the applicable rule a s when

the number of individual clai ms found to be in violation is

greater than 6.25 percent of the total claims that were reviewed

to support the agency action. Fla. Admin. Code R. 59G -

9.070(2)(s)2.a.

69. Petitioner clearly and convincingly established that

substantially more than 6.25 per cent of the 219 claims reviewed

did not comply with requirements of Medicaid laws, rules, and

provider handbooks. Numerous requirements were not followed, as

detailed in the FAR , ranging from documentation of services to

authorization for services, to qua lifications of staff providing

services, to eligibility of staff based on background screening.

Respondent did not attempt to dispute the findings on 56 of the

219 claims reviewed, which alone is over 25 percent.

Petitioner's proposed fine of $2,500 is w ithin the permissible

range for Respondent's patterned failure to comply with Medicaid

laws, rules, and provider handbooks.

70. The sanctions statute and rule both acknowledge that

the AHCA Secretary "may make a determination that imposition of a

sanction or disincentive is not in the best interest of the

Medicaid program, in which case a sanction or disincentive shall

not be imposed." The AHCA Secretary did not make such a

determination prior to issuance of the FAR.

71. Respondent complains that there is no procedure

established for the AHCA Secretary to review audit reports to

make such a determination. However, the statute does not require

a procedure for the agency head to review audit reports, nor

would such an undertaking be possible.

72. Respondent could have taken the opportunity presented

by this case to offer evidence demonstrating why and how

imposition of fines would not be in the best interest of the

Medicaid program, but Respondent offered no such evidence. The

record fails to establish that imposing fines within the

applicable guidelines in this case would not be in the best

interest of the Medicaid program. Hence, this record does not

support the AHCA Secretary's exercise of discretion to waive the

fines.

73. Based on the recommendations he rein, AHCA would be

considered to have ultimately prevailed in this dispute, and, as

such, is entitled to recover its costs, which were found to be

$4,087.19. § 409.913(23)(a). Respondent is not entitled to any

offset, having failed to show any legal bas is to award what would

be, in effect, a discovery sanction as an offset to statutory

costs and having failed to establish any acts or omissions that

would warrant sanctions.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, i t is RECOMMENDED that Petitioner, Agency for Health Care

Administration, enter a final order requiring Juana Rodriguez,

d/b/a Access Road, Inc.:

(1) To repay the sum of $159,741.86, for overpayments on

claims that did not comply with the requirements of M edicaid

laws, rules, and provider handbooks;

(2) To pay interest on the sum of $159,741.86 at the rate

of ten percent per annum from the date of the overpayment

determination;

(3) To pay a fine of $1,000 for failure to furnish all

Medicaid - related record s within the requested timeframe;

(4) To pay a fine of $2,500 for the patterned violations of

the requirements of Medicaid laws, rules, and provider handbooks;

and

(5) To pay $4,087.19 to reimburse Petitioner for its costs.

DONE AND ENTERED this 26th da y of March , 2012 , in

Tallahassee, Leon County, Florida.

S

ELIZABETH W. MCARTHUR

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850 ) 488 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 26th day of March , 2012 .

ENDNOTE S

1/ Mr. Porter's retirement from AHCA coincided with his early

submission of AHCA's Propose d Recommended Order in this case on

January 26, 2012. Thereafter, Ms. Smith entered her appearance

in substitution for Mr. Porter.

2/ No record explanation was given for the delay in transmitting

this case to DOAH. However, according to Respondent's

pr eliminary statement in its Proposed Recommended Order, the

procedural background of this case included the following: this

matter previously had been transmitted to DOAH where a case was

initially opened; thereafter, jurisdiction was relinquished to

AHCA; and AHCA later determined to re - transmit the matter to DOAH

when this case was opened. Neither party presented any evidence

regarding, or requested official recognition of, that first DOAH

case, and, therefore, no findings of fact can be made regarding

t he first DOAH case.

3/ Unless otherwise stated, a ll statutory references herein are

to the Florida Statutes (2007), the law in effect at the time of

the services and claims at issue. It is noted that section

409.913 was not amended in 2007 and only para graph (36), which is

not material to this case, was amended in 2008. Therefore, the

2007 statute reflects in all material respects the law in effect

for all of 2007 and 2008.

4/ Dr. Huffer explained that the atypical application of the

two - stage cluster sample methodology in this audit -- where the

random sample of recipients in the first stage ended up being all

of the recipients -- made this methodology "exactly equivalent to"

a stratified random sampling method. In a stratified analysis,

sampl ing is sele cted from all of the strata, so if the 16

recipients are thought of as strata, then the technique used in

this case is "exactly the same as stratified random analysis."

Dr. Huffer's testimony, and demonstrative exhibit illustrating

his testimony, establis hed that the "atypical" application of

two - stage cluster sampling is actually the equivalent of

stratified random analysis and both are generally accepted

statistical methods. Respondent acknowledged in its PRO that

stratified random sampling would be a p roper methodology to use

in this case. Respondent argued that this technique was not used

and relied on one statement by Dr. Huffer, which in context was

plainly a misstatement on his part, that the technique applied in

this case is "atypical of stratifie d random sampling."

Considering Dr. Huffer's testimony as a whole, it is clear that

Dr. Huffer misspoke in this single instance, when he meant to say

"atypical of two - stage cluster sampling." Other than that one

statement, Dr. Huffer consistently testifi ed, and illustrated in

formulaic fashion, that while the application of two - stage

cluster sampling in this case was atypical (but reasonable), it

was "exactly equivalent to," "exactly the same as," "[i]t is

stratified random sample." (emphasis added) .

5/ Respondent argued in its PRO that the selection of all 16

recipients was improper , because the "rule for choosing sample

size is: not less than five and not more than fifteen."

However, Respondent was confused with the rule of thumb for

selecti ng the sample size of claims to review, which Dr. Huffer

testified was between five and 15. A different rule of thumb

applies to selecting the recipient sample size: 30 recipients.

Relying on the wrong rule of thumb, Respondent argued that by

using a la rger than typical sample size of recipients, the result

would be overstating the overpayment. Not only is the premise of

Respondent's argument wrong, but , also, no evidence was presented

to establish the claimed result even if the premise had been

correct . Neither part of this two - part argument was established.

6/ Rule 59G - 9.070 was amended effective October 29, 2008, to

increase the amounts of fines in the guidelines. Since most of

the claims in 2007 and 2008 were before the effective date, the

rule version preceding that amendment has been applied to the

claims - based violations. However, the 2008 rule amendment was

applied to the fine for Respondent's failure in 2010 to provide

all Medicaid - related records within the requested timeframe.

COPIES FU RNISHED:

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration

Fort Knox Building, Mail Stop 3

2727 Mahan Drive

Tallahassee, Florida 32308

William H. Roberts, Acting General Counsel

Agency for Health Care Administration

Fort Knox Building , Mail Stop 3

2727 Mahan Drive

Tallahassee, Florida 32308

Nancy Pico Campiglia, Esquire

Keating and Schlitt, P.A.

250 East Colonial Drive, Suite 300

Orlando, Florida 32801 - 1231

Beverly H. Smith, Esquire

Agency for Health Care Administration

Fort Knox Building, Mail Stop 3

2727 Mahan Drive

Tallahassee, Florida 32308 - 5403

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 Recommen ded Order should be filed with the agency that

will issue the Final Order in this case.