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Lawmakers target Medicaid fraud

By Christine Jordan Sexton
3/31/2009 © Health News Florida

Calling Miami-Dade County “ground zero” for Medicaid fraud, the Legislature is cracking down on rogue home health agencies, clinics and equipment suppliers in South Florida.

Today, the House Health and Family Services Policy Council will consider a bill (CS/HB 1487) that would prevent any new home health agencies from operating in Miami-Dade and Broward counties until July 2010.

Sponsored by Rep. David Rivera, R-Miami, the bill would also require that the person who holds controlling interest in a home health agency, equipment provider or clinic be a legal U.S. resident for five years or put up a $500,000 surety bond. (Many of those indicted in recent months for similar fraud in Medicare were from other countries, especially Cuba.)

A Senate bill on the same theme is significantly broader, affecting all Medicaid providers across the state, including doctors, HMOs and clinics.

“Since we have the worst problem in the nation, we need the most effective solution,” said Sen. Don Gaetz, co-sponsor with Sen. Durell Peaden.

Putting an exact dollar amount on the amount of fraud and abuse in the Medicaid systems is difficult. The Office of Program Policy Analysis and Government Accountability last year estimated the range of abuse to be anywhere between 5 percent and 20 percent of total program costs. If you take the average--12.5 percent—that would amount to $2 billion a year.

“If we can save (this money) for Medicaid, we can redirect it to those people who really need it,” said Peaden, R-Crestview.

The number of home health agencies in Miami-Dade, population 2.5 million, nearly equals the total for the entire state of California, population 38 million. Billing for HIV/AIDS clinics in Miami-Dade and Broward counties is 22 times greater than all other states combined.

“Either we have an astounding opportunity for a New England Journal of Medicine article or we have fraud and abuse that is rife,” said Gaetz, a Republican from Fort Walton Beach.

The Senate bill will, for the first time, require all Medicaid home health care services to be ordered by a physician. The doctor’s identifying information must be included on the order and any claim for reimbursement.

AHCA will be required to fine any home health agency that demonstrates a pattern of billing for medically unnecessary services. The agency would be able to exclude abusive billers from the program.

The Senate bill would implement two South Florida anti-fraud projects to verify that services are actually delivered and medically necessary. They are expected to save about $6 million annually for Florida and another $10 million in matching federal dollars.

While much of the bill focuses on home health agencies in South Florida, it would affect all the providers that participate in the Medicaid system, including doctors.

The Department of Health will be required to post information online about doctors and advanced registered nurse practitioners who have been kicked out of the Medicaid program. And the state medical boards won’t be allowed to issue or renew a license, certificate, or registration to anyone who has been barred from the federal Medicare program or another state’s Medicaid program.

A draft report created late last June by the staff of then-Inspector General Linda Keen of the Agency for Health Care Administration showed about 60 doctors and other health-care providers who had lost the right to bill Medicaid independently had become treatment providers in Medicaid HMOs and other managed care networks.

Michael Garner, president and CEO of Florida Association of Health Plans, said his group supports the Senate bill, which he described as one of the toughest pieces of fraud legislation ever introduced in Florida.

“We don’t want bad actors to be part of our networks,” said Garner.

Co-sponsors Gaetz and Peaden held a press conference after the bill cleared the Senate Health Regulation Committee last week. Joining Peaden were AHCA Secretary Holly Benson and Chief Assistant Attorney General David Lewis, who specializes in health care fraud.

AHCA Secretary Benson said the tough new provisions in the bill “will really help us continue to do an ever better job of fighting fraud.”

--Contact Christine Jordan Sexton.