12-000692MPI Agency For Health Care Administration vs. A+ Therapy, Inc. Status: Closed Recommended Order on Wednesday, July 18, 2012.

Summary: Peititioner proved that Respondent received some Medicaid overpayments that must be repaid, and that interest, fines, and costs should be imposed.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

AGENCY FOR HEALTH CARE )

ADMINISTRATION , )

)

Petitioner , )

)

vs. ) Case No. 12 - 0692MPI

)

A THERAPY, INC. , )

)

Respondent . )

)

RECOMMENDED ORDER

A fi nal hearing was conducted in this case on May 10, 2012,

pursuant to sections 120.569 and 120.57(1), Florida Statutes

(20 11), before Jessica E. Varn, an Administrative Law Judge of

the Division of Administrative Hearing s (DOAH). The hearing was

held by vid eo teleconference at sites in Lauderdale Lakes and

Tallahassee, Florida.

APPEARANCES

For Petitioner: Rachic Avanni Wilson, Esquire

Agency for Health Care Administration

Fort Knox Building 3, Mail Station 3

Suite 3431

2727 Mahan Drive

Tallahassee, Florida 32308

For Respondent: Erin M. Bengele, Esquire

Nicholson and Eastin, LLP

Suite 301

707 Northeast Third Avenue

Fort Lauderdale, Florida 33301

STATEMENT OF THE ISSUE

W hether Respondent received Medicaid overpayments that

Petitioner is entitled to recoup, and whether fines should be

imposed against Respondent.

PRELIMINARY STATEMENT

Fol lowing an audit of Respondent ' s Medicaid billing for the

period of January 1, 2009 through December 31, 2009, the Agency

for Health Care Administration (AHCA) issued a Final Audit Report

(FAR) on January 2, 2012. In the FAR, AHCA concluded that

Respondent , A Therapy, Inc. (A Therapy), received $152,529.46

in Medicaid overpayments. The FAR informed A Therapy that AHCA

intended to recoup the overpayment, impose a fine of $24,976.91,

and seek recovery of its costs as authorized by statute.

A Therapy time ly requested an administrative hearing to

contest the FAR, and on February 17, 2012, this case was

forwarded to DOAH for the assignment of an Administrative Law

Judge to conduct the requested hearing. The hearing was

scheduled for May 10, 2012.

Before the final hearing, the 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 outset of the final hearing, AHCA ann ounced that the

alleged overpayment had been reduced to $119,023.94, and the fine

had been recalculated to be $23,804.79. AHCA presented the

testimony of Robi Olmstead, an AHCA administrator in the Bureau

of Medicaid Program Integrity (MPI); and Tracy Mac Donnell, an

AHCA Medical Health Care Program Analyst in the Bureau of

Medicaid Program Integrity. AHCA ' s Exhibits 1 - 16 were admitted

by stipulation. The stipulated exhibits included pertinent

sections of Florida Statutes, Florida Administrative Code rule s,

and Medicaid provider handbooks incorporated by reference in

rules, for the year in which the alleged overpayments were made.

Official recognition was taken of these submissions, without

objection. The parties also agreed to allow AHCA 7 days after

th e hearing to file its final calculation of costs.

A Therapy presented the testimony of Susan Marquez , the

owner of A Therapy; and Michael Sloan and Jaime Correa , two

therapists with A Therapy . Respondent ' s Exhibits 1 - 7 were

admitted by stipulation. Th e parties agreed to allow 20 days

after the filing of the Transcript to file Proposed Recommended

Orders (PRO). The two - volume Transcript was filed on May 31,

2012, and b oth parties timel y filed PROs on June 20, 2012. The

PRO s have been considered in the preparation of this Recommended

Order.

Unless otherwise indicated, all statutory references are to

the 2009 codification , which was in effect at the time of the

alleged overpayment.

FINDING S OF FACT

1. AHCA is the state agency responsible for administeri ng

the Medicaid program in Florida. The Medicaid program is a

federal and state partnership that provides health care services

to certain qualified individuals.

2. At all times materi al to this case, A Therapy has been

a Medicaid provider rendering ther apy services , pursuant to a

Medicaid Provider Agreement with AHCA . A Therapy ' s Medicaid

provider number is 886486100. A Therapy provides physical,

occupational, and speech therapy to pediatric patients.

3. A Therapy is required to retain Medicaid rec ords that

support services provided to Medicaid recipients, and to timely

provide those records to AHCA upon request.

4. Medicaid policy requires that all services reimbursed by

Medicaid must be prescribed by the recipient ' s primary care

provider, an adva nced registered nurse practitioner (ARNP) or a

designated physician assistant (PA), or a designated physician

specialist. Services rendered prior to a prescription being

received are not reimbursable.

5. Medicaid policy requires that all therapy services

reimbursed by Medicaid must have an individualized plan of care

developed by the therapist for a recipient. The plan of care

must include the elements as described in the Therapy Services

Coverages and Limitations Handbook . A plan of care should be

appr oved by the medical provider prior to services being

provided.

6. Medicaid policy requires that therapy services be

recorded on a per treatment basis and that therapist rendering

the services must record the time period and type of service

rendered, the p rogress achieved and the change in the recipient ' s

status due to treatment. Each entry must be signed and dated by

the Medicaid enrolled treating provider contemporaneous to the

date the service is rendered.

7. Medicaid policy specifies that to be reimbu rsable,

services must be medically necessary.

8. The audit i n the instant case was initiated bec ause in

running what is commonly called " time bandits " , AHCA discovered

that A Therapy was billing an unusually high number of services.

9. When AHCA audits a possible overpayment, 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 popu lations . . . and other generally

accepted statistical methods. " § 409.913(20), Fl a . Stat .

10. AHCA uses a sample cluster program in cases where it is

impractical to review all claims for each recipient or all claims

for a sample group of recipients. In this case, a two - stage

cluster sample first identifie d a statistically valid random

sample of recipients. Then, a statistically valid random sample

of claims billed by the provider during the corresponding aud it

period was selected .

11 . On May 11, 2011, Tracy MacDon ell, the AHCA Medical

Health Care Program Analyst assigned to investigate this case,

sent A Therapy a letter, notifying A Therapy that an audit was

being conducted, and requesting all records for the list of

recipients and dates of service t hat had been randomly selected

from the cluster sample program.

12 . A Therapy collected and sent records to AHCA on

May 26, 2011.

13 . After a review of all the records sent, Ms. MacDonell

prepared a Preliminary Audit Report (PAR) dated October 14, 20 11.

The PAR gave A Therapy the option of providing more records,

which A Therapy did on November 1, 2011.

14 . AHCA reviewed the additional records sent, and made

adjustments to the overpayment amount. AHCA issued a FAR on

January 4, 2012, after the cl uster sample program took the

randomly selected claims and extrapolated those claims to the

universe of all claims in the audit period and gener ated a total

overpayment amount of $152,529.46. A fine of $24,976.91 was also

being imposed, and costs were inc urred in the amount of

$2,668.00.

15 . The parties stipulated that A Therapy provided all

services billed through Medicaid .

16 . AHCA contends, however, that A Therapy has : (1)

provided therapeutic services without a prescription; (2)

provided services without an individualized plan of care; (3)

failed to properly record the therapeutic services on a per

treatment basis; and (4) as to one recipient, provided services

that were not medically necessary.

17 . As to the allegation that one recipient, T.F., r eceived

services that were not medically necessary, A Therapy concedes

that the servi c es were not medically necessary.

18 . As to the allegation that proper documentation was not

kept by A Therapy, the undersigned finds that A Therapy did

comply with Me dicaid policy by using two forms for each date of

service, and for each treatment provided. For each recipient, A

Therapy had narrative forms, where the therapist would list each

date of service, and provide a S.O.A.P. (S=Subjective,

O=Objective, A=Asses sment, P=Plan) note for the dates of service.

The treating therapist signed and dated each S.O.A.P. note. The

second form contained a chart, with each date of service listed,

each type of service documented in 15 - minute intervals, and the

treating therap ist ' s initials were plac ed on each date of

service.

19 . The records for all of the r ecipients that were

reviewed for the audit contain proper documentation, in full

compli ance with Medicaid requirements .

20 . As to the allegation that physical therapy s ervices

were provided before a prescription was received , A Therapy

concedes that prescriptions were never received for recipients

R.M ., A.M., S.G., Y.U., and A.G. , despite efforts to acquire the

prescriptions from the medical provider. Accordingly, A T herapy

improperly billed Medicaid for physical therapy for these four

recipients.

21 . As to the allegation that speech therapy services were

provided before a prescription was received, A Therapy concedes

that a prescription was never received for recipi ent A.M.,

despite efforts to acquire the prescription from the medical

provider. Accordingly, A Therapy improperly billed Medicaid for

speech therapy services provided to A.M.

22 . As to the allegation that occupational therapy services

were provided bef ore a prescription was received, A Therapy

concedes that a prescription was never received for recipient

J.S., despite efforts to acquire the prescription from the

medical provider. Accordingly, A Therapy improperly billed

Medicaid for occupational ther apy services provided to J.S.

Contested O verpayments

23 . Recipient A.C. : A prescription dated August 25, 2009

was followed by a plan of care that was created on September 1,

2009. It was not signed by the treating medical provider until

October 9, 2009 . Services were provided on September 8, 11, and

16, 2009. Since the services were provided before the plan of

care was signed and approved by the medical provider, these dates

of service were improperly billed to Medicaid .

24 . Recipient E.C. : The p lan of care for physical therapy

was signed but not dated; therefore, there is no evidence to

establish that the plan of care was approved prior to the dates

of service that were audited. Accordingly, A Therapy improperly

billed Medicaid for the physical th erapy services .

25 . Recipient Mat. C. : Mat. C. received speech therapy

services on June 10 and 15, 2009. The plan of care for speech

therapy was not signed by the medical provider until August 25,

20 09. Accordingly, A Therapy improperly billed Medicai d for the

speech therapy services .

26 . Recipient F.F. : A valid presc ription for physical

therapy was dated November 3, 2008, and although the plan of care

is signed by the medical provider, it is not dated. Therefore,

there is no evidence to establish t hat the plan of care was

approved prior to the physical therapy services being provided.

Accord ingly, A Therapy improperly billed Medicaid for physical

therapy . For occupational therapy services provided to F.F., the

prescription is dated November 21, 2 008, and the plan of care was

signed and dated by the medical provider on November 25, 2008.

All of the audited dates of service for occupational therapy are

subsequent to the plan of care having been approved; therefore,

the y do not constitute overpaymen ts.

27 . Recipient A.G. : As to occupational therapy, the plan

of care is signed by the medical provider, but not dated.

Therefore, there is no evidence to establish that the plan of

care was approved prior to the treatments. Accordingly, all

dates of oc cupational therapy ser vices were improperly billed to

Medicaid . As to the speech therapy provided to A.G., the

prescription is dated May 20, 2009, and the only plan of care

that is dated and signed by the medical provider is dated

November 20, 2009. Occu pational therapy services dated prior to

that date were improperly billed to Medicaid ; occupational

therapy services provided after November 20, 2009, do not

constitute overpayments.

28 . Recipient D.G. : A plan of care for physical therapy

was never signe d or approved by a medical provider; therefore,

the physical therapy ser vices were improperly billed to Medicaid .

As to occupational therapy, the plan of care was dated and signed

on May 26, 2009, but there is no legible evidence of a

prescription for occ upational therapy. Accordingly, A Therapy

improperly billed for occupational therapy treat ments . As to

speech therapy, there is no legible evidence of a prescription

for speech therapy ; therefore, A Therapy improperly billed for

speech therapy services .

29 . Recipient S.G. : As to occupational therapy, the

prescription is dated May 20, 2009, and the plan of care was

approved by the medical provider on June 17, 2009. All

occupational therapy treatments prior to June 17, 2009, were

improperly billed to M edicaid ; any occupational therapy

treatments after June 17, 2009, do not constitute overpayments.

30 . Recipient R.L . : As to speech therapy, the plan of care

was signed and dated by the medical provider on August 7, 2009.

All speech therapy provided on J uly 20 and 22, 2009, as well as

on August 3, 2009, was improperly billed to Medicaid . As to

occupational therapy, the plan of care was approved by the

medical provider on July 23, 2009. The occupational therapy

provided on July 22, 2009, was improperly b illed to Medicaid .

All occupational therapy provided after July 23, 2009, was

properly billed to Medicaid .

31 . Recipient J.M. : As to physical therapy, the plan of

care was never approved by the medical provider; therefore, all

physical therapy services au dited were improperly billed to

Medicaid . As to occupational therapy, the plan of care was

approved by the medical provider on August 25, 2009. All

occupational therapy provided before August 2 5, 2009, was

improperly billed to Medicaid . Occupational t herapy provi ded

after that date w as properly billed to Medicaid . As to speech

therapy, the plan of care is signed by a medical provider, but

not dated. Accordingly, there is no evidence to establish when

the plan of care was approved. All speech therapy services were

improperly billed to Medicaid .

32 . Recipient Jo.M. : As to physical and occupational

therapy, there is no dated prescription or dated plan of care

approved by the medical provider; therefore, all physical and

occupational therapy treatment s were improperly billed to

Medicaid .

33 . Recipient I.O. : As to occupational therapy, the plan

of care was approved by the medical provider on September 10,

2009. All occupational therapy treatments provided prior to t hat

date were improperly billed to Medicaid ; all occupational therapy

treatments provided afte r that date were properly billed to

Medicaid . As to speech therapy, the plan of care was approved by

the medical provider on August 13, 2009. Speech therapy provided

on July 20, 2009, and on Au gu st 5, 2009, was improperly billed to

Medicaid .

34 . Recipient K.P. : As to occupational therapy, the

prescription was dated March 5, 2008, and the plan of care

approved on January 12, 2009. All occupational therapy provided

prior to January 12, 2009 , was improperly billed to Medicaid .

Any occupational therapy pro vided after January 12, 2009, was

properly billed to Medicaid . As to physical therapy, the

prescription is dated February 21, 2008, the plan of care

approved on September 9, 2008. As all the aud ited dates of

service fall in 2009, t he physical therapy provided was properly

billed to Medicaid .

35 . Recipient J.S. : As to physical therapy, the

prescription was dated November 11, 2008, but the plan of care

was never approved by the medical provider. Therefore, all

physical therapy treatments were improperly billed to Medicaid .

36 . Recipient Y.U. : As to occupational therapy, the plan

of care was approved by the medical provider on January 20, 2009.

Any occupational therapy provided prior to that da te was

improperly billed to Medicaid ; any occupational therapy provided

after that date was properly billed to Medicaid .

CONCLUSIONS OF LAW

3 7 . The Division of Administrative Hearings has personal

and subject matter jurisdiction in this proceeding pur suan t to

s ections 120.569 and 120.57(1), Florida Statutes.

38 . AHCA 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 pa id as a result of inaccurate or improper cost

reporting, improper claiming, unacceptable practices, fraud,

abuse, or mista ke. " § 409.913(1)(e) .

39. Section 409.913(15) provides that AHCA may recoup

overpayments and seek any remedy provided by law where:

(c) The provider has not furnished or had

failed to make available such Medicaid Î

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 com pliance with

provisions of Medicaid provider publications

that have been adopted by reference as rules

in the Florida Administrative Code ; with

pro visions of state or fede ral laws, rules,

or regulations; with provisions of the

provider agreement betw een th e agency and the

provider; or with certifications found on

claim forms or on transmitta l forms for

electronically subm itted claims that are

submitted by the provider or authorized

representative, as such provisions apply to

the Medicaid program.

40. The Florida Medicaid Provider General Handbook , p. 2 -

44, states in relevant part:

Medicaid requires that the provider retain

all medical, fiscal, professional, and

business records on all services provided to

a Medicaid recipient. Records can be kept on

paper , magnetic material, film, or other

media including electronic storage, except as

otherwise required by law or Medicaid

requirements. In order to qualify as a basis

for reimbursement, the records must be signed

and dated at the time of service, or

otherwi se attested to as appropriate to the

media. Rubber signatures must be initialed.

The records must be accessible, legible and

comprehensible.

41. Regarding documentation for therapy services, the

Therapy Services Coverage and Limitations Handbook , p.2 - 4 ,

states:

Documentation for authorization must include:

* The evaluation and plan of care, reviewed,

signed and dated by the primary care

provider, ARNP or PA designee, or designated

physician specialist and the therapist, and

* A prescription for the t herapy service

that is in accordance with the prescription

requirements in this chapter.

42. Regarding prescription requirements, the Therapy

Services Coverage and Limitations Handbook , p 2 - 3, states:

To be reimbursed by Medicaid, all therapy

services, P T, OT, RT and ALP, must be

prescribed by the recipient ' s primary care

provider, an advanced registered nurse

practitioner(ARNP) or a designated physician

assistant (PA), or a designated physician

specialist.

* * *

If the prescription has not been rec eived

before the service is rendered, Medicaid will

not reimburse for the service.

43. Regarding plan of care requirements, the Therapy

Services Coverage and Limitations Handbook , p 2 - 7, states:

The plan of care must be reviewed, signed and

dated by the therapist and by the primary

care provider, ARNP or PA designee, or

designated physician specialist who

prescribed the therapy. The physician ' s

signature indicates approval of the care

plan. The physician must review, certify,

and re - sign the renewed pla n of care every

one to six calendar months depending on the

approved authorization period. This must be

done before the end of the authorization

period.

44. With regard to documentation of therapy services, the

Therapy Services Coverage and Limitations Handbook , p 2 - 11 ,

states:

The therapist must record, on a per treatment

basis the time period and type of services

rendered, the progress achieved, and the

change in the recipient ' s status due to

treatment. Each entry must be signed and

dated by the Medic aid enrolled treatment

provider on the date the service is provided.

45 . The burden of establishing an alleged Medicaid

overpayment by a preponderance of the evidence falls on

Petitioner. South Medical Serv. , 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).

46 . Although AHCA bears the ultimate burden of persuasion

and thus mu st present a prima facie case, s ecti on 409.913(21)

provides that " [t]he aud it report, supported by agency work

papers, showing an overpayment to the provider constitutes

evidence of the overpayment. " Thus, AHCA can make a p rima facie

case by proffering a properly supported audit report, which must

be received in evidence. See M az Pharmaceuticals, Inc. v. Ag .

for Health Care Admin . , DOAH Case No. 97 - 3791, 1998 Fla. Div.

Adm. Hear. LEXIS 6245, *6 - 7 (DOAH March 20, 1998). It is then

" incumbent upon the provider to rebut, impeach, or otherwise

undermine AHCA ' s evidence. " See Ag . f or Health Care Admin. v.

Bagloo , DOAH Case No. 08 - 4921 (DOAH September 10, 2009).

47 . AHCA failed to demonstrate that documentation provided

by A Therapy for its therapy services failed to comply with

Medicaid requirements. For each treatment provided, A Therapy

used two forms. One gave a narrative description of the

recipient ' s status with treatment, the progress achieved, and the

plan for future treatments; this form was signed and dated,

accounting for all dates of service. The other form was a flo w

chart that provided a detailed explanation of the exact treatment

provided, and the time period for each service provided; this

form was also dated and initialed daily by the therapist. These

forms, used together, satisfy the Medicaid requirements for

d ocumentation for therapy services.

48 . AHCA did demonstrate, by a preponderance of the

evidence, that A Therapy improperly billed Medicaid for some

physical, speech, and occupational therapy for certain

recipients, before a valid prescription had been re ceived, as

detailed in the Find ings of Fact. As explained in the Findings

of Fact , in some instances, A Therapy successfully rebutted

AHCA ' s prima facie case, and brought forth evidence of proper

billing with a valid prescription.

49 . AHCA also demonstr ated, by a preponderance of the

evidence, that A Therapy improperly billed Medicaid for therapy

services provided prior to having an authorized plan of care in

place. These instances are detailed in the Findings of Fact.

And, as explained above, in some instances, A Therapy

successfully rebutted AHCA ' s prima facie case, and brought forth

evidence of proper billing with a valid plan of care.

50 . A Therapy conceded improper billing in many instances,

as detailed in the Findings of Fact.

51 . Overpayment s owed to AHCA bear interest at the rate of

ten percent per annum from the date of determination of the

overpayment. § 409.913(25)(c).

52 . Fines on overpayments are limited by Florida

Administrative Code Rule 59G - 9.070 (7)(e) and (4)(a), which

state , res pectively :

For failure to comply with the provisions of

of the Medicaid laws: For a first offense,

$1,000 fine per claim found to be in

violation. For a second offense, $2,500 fine

per claim found to be in violation. For a

third or subsequent offense, $ 5,000 fine per

claim found to be in violation.

. . .

Where a sanction is applied for violations of

Medicaid laws . . . and the violations are a

" first offense " as set forth in this rule, if

the cumulative amount of the fine to be

imposed as a result of the violations giving

rise to that overpayment exceeds twenty -

percent of the overpayment, the fine shall be

adjusted to twenty - percent of the amount of

the overpayment.

53 . As to costs, section 409.913(23)(a) allows AHCA to

recover its investigative, legal, and expert witness costs. AHCA

filed a Notice of Filing Costs after the date of the hearing;

that amount was not contested by A Therapy.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that AHCA iss ue a final order and note

therein that:

1. A Therapy properly documented all therapy services

provided to all recipients, in full compliance with Medicaid

requirements;

2 . AHCA should recalculate, using generally accepted

statistical methods, the total overpayment determination to

reflect that A Therapy was not overpaid for certain services

provided to certain recipients, as set forth in the Findings of

Fact;

3. A Therapy was overpaid for all other services

identified in the FAR and AHCA is entitled t o recoup the

overpayments as set forth in the Findings of Fact;

4. AHCA is entitled to statutory interest on the

overpayment;

5. AHCA is entitled to recover its costs in this matter;

and

6. AHCA is entitled to impose against A Therapy an

administrative fine as set forth in F lorida Administrative Code

Rule 59G - 9.070 (7)(e) and (4)(a).

DONE AND ENTERED this 18th day of July , 2012 , in

Tallahassee, Leon County, Florida.

S

JESSICA E. VARN

Administrative Law Judge

Division o f 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 18th day of July , 2012 .

COPIES FURNISHED:

Erin M. Bengele, Esquire

Nicholson and Eastin, LLP

Suite 301

707 Northeast Third Avenue

Fort Lauderdale, Florida 33301

[e-mail]

Rachic Avanni Wilson, Esquire

Agency for Health Care Administration

Fort Knox Buildi ng 3, M ail Station 3

Suite 3431

2727 Mahan Drive

Tallahassee, Florida 32308

[e-mail]

Richard J. Shoop, Agency Clerk

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

Elizabeth Dudek, Secretary

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 1

Tallahassee, Florida 32308

Stuart Williams, General Counsel

Agency for Health Care Administration

2727 Mahan Drive, Mail Stop 3

Tallahassee, Florida 32308

NOTICE OF RIGHT TO S UBMIT 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.