Highlight on Florida: Prison for administrator involved in home health Medicare fraud conspiracy

Medicare was scammed of $2.5 million in false and fraudulent claims and another of the conspirators is heading to prison. A home health administrator was sentenced to 126 months in prison for his role in the scheme after a two-week jury trial convicted him in December 2016 of one count of conspiracy to commit health care fraud and wire fraud and one count to defraud the U.S. and pay and receive health care bribes and kickbacks.

While the administrator was the manager of Mercy Home Care Inc. and a billing employee for D&D&D Home Health Care Inc. in Miami-Dade County, Florida, he and others submitted false claims through the companies to Medicare between October 2014 and June 2015, based on services that were (1) not medically necessary, (2) not provided, and (3) for patients brought to the companies through payment of illegal kickbacks to providers and recruiters. The claims the administrator submitted to Medicare were based on forged prescriptions and falsified medical documentation, backdated so services were supposedly provided in prior years, and for beneficiaries who were coached to say they needed services when they were not homebound. According to evidence from trial, he also destroyed evidence prior to his arrest. Medicare paid approximately $2.5 million for false and fraudulent claims submitted by Mercy and D&D&D.

Ten other co-conspirators previously pleaded guilty or were convicted by the Southern District of Florida, including the owner and president of Nerey Professional Services, Inc. That co-conspirator was convicted of one count of receiving kickbacks in connection with a federal health care program and one count of conspiracy to defraud the U.S. and pay health care kickbacks and sentenced to 60 months in prison on May 27, 2016. According to evidence from trial, the co-conspirator was involved in the conspiracy to accept kickbacks in return for referring Medicare beneficiaries to Mercy and D&D&D to serve as patients, even those who did not qualify for home health care services, between October 2014 and September 2015.

Highlight on Florida: State agency paid managed care $26M—for deceased beneficiaries

The Florida state Medicaid agency made an estimated $26 million in overpayments to managed care organizations (MCOs) for deceased Medicaid beneficiaries, according to the HHS Office of Inspector General (OIG). The Florida Agency for Health Care Administration made the payments during the July 1, 2009, through November 5, 2014, audit period due to a failure to timely update dates of death (DODs) in its information management system and a failure to collaborate with other agencies or use additional sources to identify inconsistencies in DODs. The state agency claims to have already recovered $24 million in overpayments and is making efforts to improve collaboration. The OIG emphasized the need for the state agency to remove all beneficiaries with DODs listed in its information management system from managed care plans and improve its system to remove variances from data sources  (OIG Report, A-04-15-06182, November 30, 2016).

Since 2011, the state agency has managed the Florida Statewide Medicaid Managed Care Program (SMMC), which is an expansion of a pilot created through a section 1115 waiver in 2006.  As of 2014, nearly all Medicaid beneficiaries in the state were enrolled in the SMMC. In return for the provision of specified services, the state pays MCOs monthly capitation payments for each enrolled beneficiary, regardless of whether the beneficiary receives services during the covered time period. The state agency maintains the capitation payment database through the Florida Medicaid Management Information System (FMMIS). It uses the FMMIS to ensure that payments are properly adjusted. DODs obtained through three different databases–the State Data Exchange (SDX), the state Department of Health, Bureau of Vital Statistics (BVS), and the Florida Online Recipient Integrated Data Access System (FLORIDA)–are updated in the FMMIS.


The OIG reviewed 124 capitation payments made during a more than five-year time period that were preceded by DODs and focused on 113 overpayments that were recoverable but had not yet been recovered. In 62 of these instances, the state agency did not timely update DODs in the FMMIS and beneficiaries’ enrollments were not updated. In 42 instances, DOD information derived from the three sources was incorrect or inconsistent.  Where data were inconsistent, the state agency removed the DODs from the FMMIS to ensure that beneficiaries would continue to receive services until the DODs were determined.  However, the state agency failed to collaborate with the DOD sources or the Department of Children and Families (DCF) to identify the source of the inconsistencies, and failed to use alternative sources, such as Accurint, the Massachusetts Registry of Vital Records and Statistics, or the Indiana State Department of Health, Vital Records.  In nine instances, DOD information was missing and the FMMIS did not identify the beneficiaries as deceased.


The OIG recommended that the state agency identify and recover more than $26 million in overpayments to MCOs and return the roughly $15 million federal share; perform monthly FMMIS reviews to ensure that deceased individuals are removed from the SMMC; implement policies and procedures for quickly identifying and correcting inaccurate death information; and improve collaboration with the Social Security Administration (SSA), DCF, and BVS to identify and resolve inconsistencies. The state agency indicated that it had recovered roughly $24 million in overpayments and identified slightly more than $200,000 in payments as correct. It also outlined steps it is taking to improve collaboration among agencies. However, it claimed that it could not identify instances in which individuals with DODs were not removed from plans, an argument the OIG combatted with the 62 instances described in its report.  The state agency also indicated that its Medicaid Fiscal Agent Operations (MFAO) bureau already implements an automated system hierarchy to resolve variances, but the OIG determined, based on its findings, that the system is inadequate.

Highlight on Florida: Hurricane causes hospital closures, requires extra support for vulnerable patients

Florida health care facilities were forced to make serious operating choices when Hurricane Matthew hit, and provided recommendations to the public that may be important during future emergency situations. In such situations, hospitals strive to allocate staffing and provisions to best meet patients’ needs, and rely on locals to seek shelter elsewhere.

Hospital closures, evacuations

The state of Florida faced some serious health care delivery concerns when Hurricane Matthew hit last week. Jackson Health System, a major hospital system in Miami, planned to operate as normally as possible, except for some clinics that closed Thursday and Friday. Broward Health, a five-hospital system, took the opposite approach and closed all hospitals except for emergencies and trauma patients. All outpatient procedures were canceled on Thursday and Friday. Baptist Health kept hospitals and emergency rooms open, but closed some of its centers. Cape Canaveral Hospital, Baptist Medical Center Beaches, and three Florida Hospital locations were forced to evacuate patients. Although Florida Hospital Flager remained opened for emergencies, Ormond Beach and New Smyrna Beach locations closed their ERs.

Storm considerations

Hospitals offered some advice for locals, and urged patients not to plan on using hospitals as a last-minute shelter option. One official said that every year, some individuals show up seeking to wait out the hurricane at the hospital, requiring staff to be diverted away from patient care. According to the Orlando Sentinel, counties established shelters for those with special needs that are staffed with nurses and have some equipment. Hospitals also warned that patients needing medications would not be able to pick them up at a hospital and would be forced to proceed through the ER to get prescriptions.

Jackson Health posted a special advisory for women planning to deliver their baby at one of its facilities, outlining who should report to the hospital when a hurricane warning takes effect. Women carrying multiple babies who are at least 34 weeks along, having a history of preterm labor, or have placental implantation issues at least 28 weeks into their pregnancy were encouraged to come to the hospital and be prepared for admission. Others were told to call their physician and report to the hospital if referred.

Other patients, such as those requiring oxygen and dialysis, were also particularly vulnerable in this situation. Over 500,000 such patients were in the hurricane’s path. Chen Senior Medical Centers identified many vulnerable patients and called them individually, asking about their conditions and needs. Oxygen was provided at no cost to those who needed it. There was also a federal Disaster Distress Helpline staffed to provide immediate crisis counseling.


Medicaid plans as shifting as the sands, states weighing options

State Medicaid programs continue to change in response to various factors, from Florida changing its hepatitis C treatment policy to favor patients, to non-expansion states considering the financial impact of potential options. Louisiana just began enrolling the newly eligible this week, and the state projects that many more will seek coverage. South Dakota’s governor is employing some creative techniques to argue that expansion will not cost the state additional funds, and North Carolina is trying to shift plan oversight to outside organizations.

Florida and Hepatitis C

Florida is now providing vital medications to Medicaid patients with hepatitis C at an earlier stage of the disease. In the past, patients have only been offered the drug when they were at fibrosis level three or four, which indicates a high level of scar tissue in the liver and is sometimes the point where patients are in need of a transplant. These drugs are expensive to the program, costing as much as $31,000 each month. Florida amended its program criteria on June 1, 2016, removing the fibrosis level from the criteria.

Louisiana, welcome to Medicaid expansion

Louisiana opened its enrollment process to those newly eligible under the program’s expansion on June 1. The Department of Health and Hospitals (DHH) projects that about 375,000 individuals will eventually receive coverage under the expansion, although the department has been communicating with about 175,000 people about qualification. It is uncertain what effect this will have on other Louisiana health issues, such as doctor training programs. Budgetary problems, including proposed cuts to hospitals, is causing residents to go out of state for training- where they are likely to stay. Safety net hospitals, which treat many poor and uninsured patients, are particularly concerned about the reduction in funding as the state legislature attempts to resolve a budget shortfall.

Utah’s expansion comes with much less fanfare

After Utah’s legislature decided to pass a very reduced expansion plan, one that Democrats bemoaned as a “cruel trick” and “fiscal insanity,” little has been said about the matter–an extreme contrast to years of fighting over the plan of action. The plan will provide coverage to somewhere around 10,000 citizens, a reduced estimate from the original 16,000 tally. Officials expect that the money to be invested in the expansion will not stretch far to cover very many residents due to the high health costs associated with those who have gone without care. Although there has been an opportunity for hearings and public comment, the state has received little input. Some blame the timing of hearings, which would require those interested to come in during a workday, while others believe that the public feels that the legislature is uninterested in their opinions.

North Carolina seeks waiver

North Carolina is requesting that CMS allow it to transfer Medicaid oversight to three managed care organizations and provider-led entities. Although a representative felt that the state provider community has embraced the plan, the state legislature is less than united. The state Senate recently unanimously rejected House changes to its reform bill, which would require the state agency to provide progress reports and disclose a work plan for changes to be made to state health care programs.

South Dakota wants to expand Medicaid without spending more money

South Dakota Governor Dennis Daugaard (R) believes that he can figure out how to expand the state’s Medicaid program to cover about 50,000 more citizens without increasing state spending. Although he believes the math can work if the federal government shoulders more Medicaid costs for Native Americans in the state, the governor is concerned about pushback from the legislature.