Senate Bill 2124c1
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Florida Senate - 1999 CS for SB's 2124 & 2022
By the Committee on Health, Aging and Long-Term Care; and
Senator Saunders
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1 A bill to be entitled
2 An act relating to Medicaid; amending s.
3 409.906, F.S.; authorizing the Agency for
4 Health Care Administration to develop a
5 certified-match program for Healthy Start
6 services under certain circumstances; amending
7 s. 409.910, F.S.; providing for use of Medicare
8 standard billing formats for certain
9 data-exchange purposes; creating s. 409.9101,
10 F.S.; providing a short title; providing
11 legislative intent relating to Medicaid estate
12 recovery; requiring certain notice of
13 administration of the estate of a deceased
14 Medicaid recipient; providing that receipt of
15 Medicaid benefits creates a claim and interest
16 by the agency against an estate; specifying the
17 right of the agency to amend the amount of its
18 claim based on medical claims submitted by
19 providers subsequent to the agency's initial
20 claim calculation; providing the basis of
21 calculation of the amount of the agency's
22 claim; specifying a claim's class standing;
23 providing circumstances for nonenforcement of
24 claims; providing criteria for use in
25 considering hardship requests; providing for
26 recovery when estate assets result from a claim
27 against a third party; providing for estate
28 recovery in instances involving real property;
29 providing agency rulemaking authority; amending
30 s. 409.912, F.S.; eliminating a requirement
31 that a Medicaid provider service network
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1 demonstration project be located in Orange
2 County; amending s. 409.913, F.S.; revising
3 provisions relating to the agency's authority
4 to withhold Medicaid payments pending
5 completion of certain legal proceedings;
6 providing for disbursement of withheld Medicaid
7 provider payments; creating s. 409.9131, F.S.;
8 providing legislative findings and intent
9 relating to integrity of the Medicaid program;
10 providing definitions; authorizing onsite
11 reviews of physician records by the agency;
12 requiring notice for such reviews; requiring
13 notice of due process rights in certain
14 circumstances; specifying procedures for
15 determinations of overpayment; requiring a
16 study of certain statistical models used by the
17 agency; requiring a report; amending ss.
18 641.261 and 641.411, F.S.; conforming
19 references and cross-references; amending s.
20 733.212, F.S.; establishing the agency as a
21 reasonably ascertainable creditor with respect
22 to administration of certain estates; providing
23 an effective date.
24
25 Be It Enacted by the Legislature of the State of Florida:
26
27 Section 1. Subsection (11) of section 409.906, Florida
28 Statutes, 1998 Supplement, is amended to read:
29 409.906 Optional Medicaid services.--Subject to
30 specific appropriations, the agency may make payments for
31 services which are optional to the state under Title XIX of
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1 the Social Security Act and are furnished by Medicaid
2 providers to recipients who are determined to be eligible on
3 the dates on which the services were provided. Any optional
4 service that is provided shall be provided only when medically
5 necessary and in accordance with state and federal law.
6 Nothing in this section shall be construed to prevent or limit
7 the agency from adjusting fees, reimbursement rates, lengths
8 of stay, number of visits, or number of services, or making
9 any other adjustments necessary to comply with the
10 availability of moneys and any limitations or directions
11 provided for in the General Appropriations Act or chapter 216.
12 Optional services may include:
13 (11) HEALTHY START SERVICES.--The agency may pay for a
14 continuum of risk-appropriate medical and psychosocial
15 services for the Healthy Start program in accordance with a
16 federal waiver. The agency may not implement the federal
17 waiver unless the waiver permits the state to limit enrollment
18 or the amount, duration, and scope of services to ensure that
19 expenditures will not exceed funds appropriated by the
20 Legislature or available from local sources. If the Health
21 Care Financing Administration does not approve a federal
22 waiver for Healthy Start services, the agency, in consultation
23 with the Department of Health and the Florida Association of
24 Healthy Start Coalitions, is authorized to establish a
25 Medicaid certified-match program for Healthy Start services.
26 Participation in the Healthy Start certified-match program
27 shall be voluntary and reimbursement shall be limited to the
28 federal Medicaid share to Medicaid-enrolled Healthy Start
29 coalitions for services provided to Medicaid recipients. The
30 agency shall take no action to implement a certified-match
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1 program without ensuring that the amendment and review
2 requirements of ss. 216.177 and 216.181 have been met.
3 Section 2. Subsection (21) of section 409.910, Florida
4 Statutes, 1998 Supplement, is renumbered as subsection (22),
5 and a new subsection (21) is added to that section to read:
6 409.910 Responsibility for payments on behalf of
7 Medicaid-eligible persons when other parties are liable.--
8 (21) Entities providing health insurance as defined in
9 s. 624.603, and health maintenance organizations as defined in
10 chapter 641, requiring tape or electronic billing formats from
11 the agency shall accept Medicaid billings that are prepared
12 using the current Medicare standard billing format. If the
13 insurance entity or health maintenance organization is unable
14 to use the agency format, the entity shall accept paper claims
15 from the agency in lieu of tape or electronic billing,
16 provided that these claims are prepared using current Medicare
17 standard billing formats.
18 Section 3. Section 409.9101, Florida Statutes, is
19 created to read:
20 409.9101 Recovery for payments made on behalf of
21 Medicaid-eligible persons.--
22 (1) This section may be cited as the "Medicaid Estate
23 Recovery Act."
24 (2) It is the intent of the Legislature by this
25 section to supplement Medicaid funds that are used to provide
26 medical services to eligible persons. Medicaid estate recovery
27 shall generally be accomplished through the filing of claims
28 against the estates of deceased Medicaid recipients. The
29 recoveries shall be made pursuant to federal authority in s.
30 13612 of the Omnibus Budget Reconciliation Act of 1993, which
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1 amends s. 1917(b)(1) of the Social Security Act (42 U.S.C. s.
2 1396p(b)(1)).
3 (3) Pursuant to s. 733.212(4)(a), the personal
4 representative of the estate of the decedent shall serve the
5 agency with a copy of the notice of administration of the
6 estate within 3 months after the first publication of the
7 notice, unless the agency has already filed a claim pursuant
8 to this section.
9 (4) The acceptance of public medical assistance, as
10 defined by Title XIX (Medicaid) of the Social Security Act,
11 including mandatory and optional supplemental payments under
12 the Social Security Act, shall create a claim, as defined in
13 s. 731.201, in favor of the agency as an interested person as
14 defined in s. 731.201. The claim amount is calculated as the
15 total amount paid to or for the benefit of the recipient for
16 medical assistance on behalf of the recipient after he or she
17 reached 55 years of age. There is no claim under this section
18 against estates of recipients who had not yet reached 55 years
19 of age.
20 (5) At the time of filing the claim, the agency may
21 reserve the right to amend the claim amounts based on medical
22 claims submitted by providers subsequent to the agency's
23 initial claim calculation.
24 (6) The claim of the agency shall be the current total
25 allowable amount of Medicaid payments as denoted in the
26 agency's provider payment processing system at the time the
27 agency's claim or amendment is filed. The agency's provider
28 processing system reports shall be admissible as prima facie
29 evidence in substantiating the agency's claim.
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1 (7) The claim of the agency under this section shall
2 constitute a Class 3 claim under s. 733.707(1)(c), as provided
3 in s. 414.28(1).
4 (8) The claim created under this section shall not be
5 enforced if the recipient is survived by:
6 (a) A spouse;
7 (b) A child or children under 21 years of age; or
8 (c) A child or children who are blind or permanently
9 and totally disabled pursuant to the eligibility requirements
10 of Title XIX of the Social Security Act.
11 (9) In accordance with s. 4, Art. X of the State
12 Constitution, no claim under this section shall be enforced
13 against any property that is determined to be the homestead of
14 the deceased Medicaid recipient and is determined to be exempt
15 from the claims of creditors of the deceased Medicaid
16 recipient.
17 (10) The agency shall not recover from an estate if
18 doing so would cause undue hardship for the qualified heirs,
19 as defined in s. 731.201. The personal representative of an
20 estate and any heir may request that the agency waive recovery
21 of any or all of the debt when recovery would create a
22 hardship. A hardship does not exist solely because recovery
23 will prevent any heirs from receiving an anticipated
24 inheritance. The following criteria shall be considered by the
25 agency in reviewing a hardship request:
26 (a) The heir:
27 1. Currently resides in the residence of the decedent;
28 2. Resided there at the time of the death of the
29 decedent;
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1 3. Has made the residence his or her primary residence
2 for the 12 months immediately preceding the death of the
3 decedent; and
4 4. Owns no other residence;
5 (b) The heir would be deprived of food, clothing,
6 shelter, or medical care necessary for the maintenance of life
7 or health;
8 (c) The heir can document that he or she provided
9 full-time care to the recipient which delayed the recipient's
10 entry into a nursing home. The heir must be either the
11 decedent's sibling or the son or daughter of the decedent and
12 must have resided with the recipient for at least 1 year prior
13 to the recipient's death; or
14 (d) The cost involved in the sale of the property
15 would be equal to or greater than the value of the property.
16 (11) Instances arise in Medicaid estate-recovery cases
17 where the assets include a settlement of a claim against a
18 liable third party. The agency's claim under s. 409.910 must
19 be satisfied prior to including the settlement proceeds as
20 estate assets. The remaining settlement proceeds shall be
21 included in the estate and be available to satisfy the
22 Medicaid estate-recovery claim. The Medicaid estate-recovery
23 share shall be one-half of the settlement proceeds included in
24 the estate. Nothing in this subsection is intended to limit
25 the agency's rights against other assets in the estate not
26 related to the settlement. However, in no circumstances shall
27 the agency's recovery exceed the total amount of Medicaid
28 medical assistance provided to the recipient.
29 (12) In instances where there are no liquid assets to
30 satisfy the Medicaid estate-recovery claim, if there is
31 nonhomestead real property and the costs of sale will not
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1 exceed the proceeds, the property shall be sold to satisfy the
2 Medicaid estate-recovery claim. Real property shall not be
3 transferred to the agency in any instance.
4 (13) The agency is authorized to adopt rules to
5 implement the provisions of this section.
6 Section 4. Paragraph (d) of subsection (3) of section
7 409.912, Florida Statutes, 1998 Supplement, is amended to
8 read:
9 409.912 Cost-effective purchasing of health care.--The
10 agency shall purchase goods and services for Medicaid
11 recipients in the most cost-effective manner consistent with
12 the delivery of quality medical care. The agency shall
13 maximize the use of prepaid per capita and prepaid aggregate
14 fixed-sum basis services when appropriate and other
15 alternative service delivery and reimbursement methodologies,
16 including competitive bidding pursuant to s. 287.057, designed
17 to facilitate the cost-effective purchase of a case-managed
18 continuum of care. The agency shall also require providers to
19 minimize the exposure of recipients to the need for acute
20 inpatient, custodial, and other institutional care and the
21 inappropriate or unnecessary use of high-cost services.
22 (3) The agency may contract with:
23 (d) No more than four provider service networks for
24 demonstration projects to test Medicaid direct contracting.
25 One demonstration project must be located in Orange County.
26 The demonstration projects may be reimbursed on a
27 fee-for-service or prepaid basis. A provider service network
28 which is reimbursed by the agency on a prepaid basis shall be
29 exempt from parts I and III of chapter 641, but must meet
30 appropriate financial reserve, quality assurance, and patient
31 rights requirements as established by the agency. The agency
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1 shall award contracts on a competitive bid basis and shall
2 select bidders based upon price and quality of care. Medicaid
3 recipients assigned to a demonstration project shall be chosen
4 equally from those who would otherwise have been assigned to
5 prepaid plans and MediPass. The agency is authorized to seek
6 federal Medicaid waivers as necessary to implement the
7 provisions of this section. A demonstration project awarded
8 pursuant to this paragraph shall be for 2 years from the date
9 of implementation.
10 Section 5. Paragraph (a) of subsection (24) of section
11 409.913, Florida Statutes, is amended to read:
12 409.913 Oversight of the integrity of the Medicaid
13 program.--The agency shall operate a program to oversee the
14 activities of Florida Medicaid recipients, and providers and
15 their representatives, to ensure that fraudulent and abusive
16 behavior and neglect of recipients occur to the minimum extent
17 possible, and to recover overpayments and impose sanctions as
18 appropriate.
19 (24)(a) The agency may withhold Medicaid payments, in
20 whole or in part, to a provider upon receipt of reliable
21 evidence that the circumstances giving rise to the need for a
22 withholding of payments involve fraud or willful
23 misrepresentation under the Medicaid program, or a crime
24 committed while rendering goods or services to Medicaid
25 recipients, up to the amount of the overpayment as determined
26 by final agency audit report, pending completion of legal
27 proceedings under this section. If the agency withholds
28 payments under this section, the Medicaid payment may not be
29 reduced by more than 10 percent. If it is has been determined
30 that fraud, willful misrepresentation, or a crime did not
31 occur an overpayment has not occurred, the payments withheld
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1 must be paid to the provider within 14 60 days after such
2 determination with interest at the rate of 10 percent a year.
3 Any money withheld in accordance with this paragraph shall be
4 placed in a suspended account, readily accessible to the
5 agency, so that any payment ultimately due the provider shall
6 be made within 14 days. Furthermore, the authority to withhold
7 payments under this paragraph shall not apply to physicians
8 whose alleged overpayments are being determined by
9 administrative proceedings pursuant to chapter 120. If the
10 amount of the alleged overpayment exceeds $75,000, the agency
11 may reduce the Medicaid payments by up to $25,000 per month.
12 Section 6. Section 409.9131, Florida Statutes, is
13 created to read:
14 409.9131 Special provisions relating to integrity of
15 the Medicaid program.--
16 (1) LEGISLATIVE FINDINGS AND INTENT.--It is the intent
17 of the Legislature that physicians, as defined in this
18 section, be subject to Medicaid fraud and abuse investigations
19 in accordance with the provisions set forth in this section as
20 a supplement to the provisions contained in s. 409.913. If a
21 conflict exists between the provisions of this section and s.
22 409.913, it is the intent of the Legislature that the
23 provisions of this section shall control.
24 (2) DEFINITIONS.--For purposes of this section, the
25 term:
26 (a) "Active practice" means a physician must have
27 regularly provided medical care and treatment to patients
28 within the past 2 years.
29 (b) "Medical necessity" or "medically necessary" means
30 any goods or services necessary to palliate the effects of a
31 terminal condition or to prevent, diagnose, correct, cure,
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1 alleviate, or preclude deterioration of a condition that
2 threatens life, causes pain or suffering, or results in
3 illness or infirmity, which goods or services are provided in
4 accordance with generally accepted standards of medical
5 practice. For purposes of determining Medicaid reimbursement,
6 the agency is the final arbiter of medical necessity. In
7 making determinations of medical necessity, the agency must,
8 to the maximum extent possible, use a physician in active
9 practice, either employed by or under contract with the
10 agency, of the same specialty or subspecialty as the physician
11 under review. Such determination must be based upon the
12 information available at the time the goods or services were
13 provided.
14 (c) "Peer" means a Florida licensed physician who is,
15 to the maximum extent possible, of the same specialty or
16 subspecialty, licensed under the same chapter, and in active
17 practice.
18 (d) "Peer review" means an evaluation of the
19 professional practices of a Medicaid physician provider by a
20 peer or peers in order to assess the medical necessity,
21 appropriateness, and quality of care provided, as such care is
22 compared to that customarily furnished by the physician's
23 peers and to recognized health care standards, and to
24 determine whether the documentation in the physician's records
25 is adequate.
26 (e) "Physician" means a person licensed to practice
27 medicine under chapter 458 or a person licensed to practice
28 osteopathic medicine under chapter 459.
29 (f) "Professional services" means procedures provided
30 to a Medicaid recipient, either directly by or under the
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1 supervision of a physician who is a registered provider for
2 the Medicaid program.
3 (3) ONSITE RECORDS REVIEW.--As specified in s.
4 409.913(8), the agency may investigate, review, or analyze a
5 physician's medical records concerning Medicaid patients. The
6 physician must make such records available to the agency
7 during normal business hours. The agency must provide notice
8 to the physician at least 24 hours before such visit. The
9 agency and physician shall make every effort to set a mutually
10 agreeable time for the agency's visit during normal business
11 hours and within the 24-hour period. If such a time cannot be
12 agreed upon, the agency may set the time.
13 (4) NOTICE OF DUE PROCESS RIGHTS REQUIRED.--Whenever
14 the agency seeks an administrative remedy against a physician
15 pursuant to this section or s. 409.913, the physician must be
16 advised of his or her rights to due process under chapter 120.
17 This provision shall not limit or hinder the agency's ability
18 to pursue any remedy available to it under s. 409.913 or other
19 applicable law.
20 (5) DETERMINATIONS OF OVERPAYMENT.--In making a
21 determination of overpayment to a physician, the agency must:
22 (a) Use accepted and valid auditing, accounting,
23 analytical, statistical, or peer-review methods, or
24 combinations thereof. Appropriate statistical methods may
25 include, but are not limited to, sampling and extension to the
26 population, parametric and nonparametric statistics, tests of
27 hypotheses, other generally accepted statistical methods,
28 review of medical records, and a consideration of the
29 physician's client case mix. Before performing a review of the
30 physician's Medicaid records, however, the agency shall make
31 every effort to consider the physician's patient case mix,
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1 including, but not limited to, patient age and whether
2 individual patients are clients of the Children's Medical
3 Services network established in chapter 391. In meeting its
4 burden of proof in any administrative or court proceeding, the
5 agency may introduce the results of such statistical methods
6 and its other audit findings as evidence of overpayment.
7 (b) Refer all physician service claims for peer review
8 when the agency's preliminary analysis indicates a potential
9 overpayment, and before any formal proceedings are initiated
10 against the physician, except as required by s. 409.913.
11 (c) By March 1, 2000, the agency shall study and
12 report to the Legislature on its current statistical model
13 used to calculate overpayments and advise the Legislature
14 what, if any, changes, improvements, or other modifications
15 should be made to the statistical model. Such review shall
16 include, but not be limited to, a review of the
17 appropriateness of including physician specialty and case-mix
18 parameters within the statistical model.
19 Section 7. Section 641.261, Florida Statutes, is
20 amended to read:
21 641.261 Other reporting requirements.--
22 (1) Each authorized health maintenance organization
23 shall provide records and information to the Agency for Health
24 Care Administration Department of Health and Rehabilitative
25 Services pursuant to s. 409.910(20) and (21) (22) for the sole
26 purpose of identifying potential coverage for claims filed
27 with the agency Department of Health and Rehabilitative
28 Services and its fiscal agents for payment of medical services
29 under the Medicaid program.
30 (2) Any information provided by a health maintenance
31 organization under this section to the agency Department of
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1 Health and Rehabilitative Services shall not be considered a
2 violation of any right of confidentiality or contract that the
3 health maintenance organization may have with covered persons.
4 The health maintenance organization is immune from any
5 liability that it may otherwise incur through its release of
6 information to the agency Department of Health and
7 Rehabilitative Services under this section.
8 Section 8. Section 641.411, Florida Statutes, is
9 amended to read:
10 641.411 Other reporting requirements.--
11 (1) Each prepaid health clinic shall provide records
12 and information to the Agency for Health Care Administration
13 Department of Health and Rehabilitative Services pursuant to
14 s. 409.910(20) and (21) (22) for the sole purpose of
15 identifying potential coverage for claims filed with the
16 agency Department of Health and Rehabilitative Services and
17 its fiscal agents for payment of medical services under the
18 Medicaid program.
19 (2) Any information provided by a prepaid health
20 clinic under this section to the agency Department of Health
21 and Rehabilitative Services shall not be considered a
22 violation of any right of confidentiality or contract that the
23 prepaid health clinic may have with covered persons. The
24 prepaid health clinic is immune from any liability that it may
25 otherwise incur through its release of information to the
26 agency Department of Health and Rehabilitative Services under
27 this section.
28 Section 9. Paragraph (a) of subsection (4) of section
29 733.212, Florida Statutes, is amended to read:
30 733.212 Notice of administration; filing of objections
31 and claims.--
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1 (4)(a) The personal representative shall promptly make
2 a diligent search to determine the names and addresses of
3 creditors of the decedent who are reasonably ascertainable and
4 shall serve on those creditors a copy of the notice within 3
5 months after the first publication of the notice. Under s.
6 409.9101, the Agency for Health Care Administration is
7 considered a reasonably ascertainable creditor in instances
8 where the decedent had received Medicaid assistance for
9 medical care after reaching 55 years of age. Impracticable and
10 extended searches are not required. Service is not required
11 on any creditor who has filed a claim as provided in this
12 part; a creditor whose claim has been paid in full; or a
13 creditor whose claim is listed in a personal representative's
14 timely proof of claim if the personal representative notified
15 the creditor of that listing.
16 Section 10. This act shall take effect July 1, 1999.
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1 STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
COMMITTEE SUBSTITUTE FOR
2 Senate Bills 2124 and 2022
3
4 The bill combines the provisions of Senate Bill 2124 and
Senate Bill 2022. The bill enables the agency for Health Care
5 Administration (agency) to pursue a certified match program to
use local and state Healthy Start funding to draw down federal
6 matching funds in the event that the federal government does
not approve the pending Healthy Start waiver; requires that
7 heath insurers and health maintenance organizations who are
liable for Medicaid costs use the standard tape or electronic
8 format or paper claims in the Medicare program format; creates
the "Medicaid Estate Recovery Act"; deletes the requirement
9 that one of the four provider service network demonstration
projects be conducted in Orange County; enables the agency to
10 withhold payments based on reliable evidence that a provider
is engaged in fraud or abuse of the Medicaid program or a
11 crime is being committed while rendering goods or services to
Medicaid recipients; provides standards for the return of
12 withheld funds; requires the agency, when performing reviews
of medical necessity for physician services, to use physicians
13 of the same specialty as the physician under review to the
extent possible; requires the agency to give advance notice,
14 use valid and accepted statistical models, and refer claims it
believes are overpayments for peer review when it is trying to
15 recover overpayments to physicians; requires a study of the
agency's overpayment calculation methodology; and conforms
16 certain reporting requirements for HMOs and prepaid health
clinics.
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