The Doc's Clinic, APMC VS State of Louisiana Through The Department of Health & Hospitals

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STATE OF LOUISIANA COURT OF APPEAL FIRST CIRCUIT NUMBER 2007 CA 0480 THE DOC S CLINIC APMC VERSUS I STATE OF LOUISIANA THROUGH THE DEPARTMENT OF OAAJ HEALTH AND HOSPITALS I Judgment Rendered Appealed from November 2 2007 the Nineteenth Judicial District Court in and for the Parish of East Baton Rouge Louisiana Docket Number 525 909 Honorable Timothy E Kelley Bruce M Danner Counsel for Plaintiff Appellant Madisonville LA The Doc Douglas L Cade Kimberly L Humbles Baton Rouge LA Counsel for Defendant s Clinic APMC State of Louisiana Appellee through the Department of Health Hospitals and BEFORE WHIPPLE GUIDRY AND HUGHES JJ 7J ri n v IY f C C C A 14 A4 k Ve Jl l2 SU AD WHIPPLE J The The Doc plaintiff the district dismissing court Review of Administrative litigation reasonable by that judgment Department of out arose Health we reverse Decision The of and a appeals judgment a of denying plaintiffs and claim review dismissed judicial decision a from and amended Petition for Judicial original an expenses overpayments following reasons Clinic APMC s State by the to Hospitals proceedings for of Louisiana alleged Medicaid recoup For the post payment investigation following render and remand FACTS AND PROCEDURAL mSTORY Doc The Clinic s corporation that became licensed Health and Hospitals eligible the Integrity amount to area Unit DHH notified Doc 432 28 51 Procedural thereafter on for the CPT Terminology IThe s to provide has and has August 4 2000 s an amounts paid procedure these codes was procedures codes 94010 therefore Medicaid healthcare services the DHH to recoup Program payments in the billing of Physicians Current codes 94010 94060 and 94375 1 Shortly following another investigation by the CPT codes that fonned the basis of the for these to of persons investigation by concurrent Department five medical clinics in provided of its intent medical professional healthcare operated following pulmonary diagnostic procedures 1 evaluation and 3 respiratory flow bronchospasm between a economically disadvantaged July 20 2000 following of is s the State of Louisiana in 1996 New Orleans exclusively On DHH by Since that time Doc persons metropolitan almost Doc APMC recoupment relate to spirometry with graph 28 432 51 volume loop 94060 and 94375 improper 2 and that the 2 recouping the some overlap concurrent billing of DHH maintained that there In the was Surveillance and Utilization Review Section at DHH notified Doc additional s of its intent to recoup an the UNISYS Corporation 269 393 57 for the alleged improper coding of office visits billing of medically services and DHH was held investigations Thereafter s notifying Doc that the total s was along with its owner September on on Dr Kent be recouped Hickey 4 as result of the a to two exclude Doc s Mike s administratively appealed both the recoupment and exclusion s and the Administrative Law case was In assigned to All three preliminary proceedings UNISYS Corporation is DHH of Medicaid claims submitted s by ALJ fiscal appeals Coreil intermediary performs the administration of the Medicaid program including the review or adjudication ofreimbursement claims 3Under DHH s post payment rules and regulations were consolidated Judge Karla Corei1 authorized health to its contract with the State of Louisiana UNISYS initiate result of a Program for a period of five years Appeals processing as and manager Malcolm H orders to the DHH Bureau of 2The 2000 and that DHH intended Sutter III from the Medical Assistance Coreil 14 3 October 26 2000 DHH issued a letter amount to 297 826 08 investigations Doc unnecessary billing of segmented laboratory and diagnostic procedures An informal discussion 2 granted summary in connection with the care providers Pursuant various services relative to processing payment the Division of and Program Integrity review of services rendered and reimbursement received investigation reveals illegalities improper billing violations These sanctions include but are are imposed on the provider ALJ abuse or fraud not limited to may If the sanctions withholding of payments recoupment and exclusion from the Medicaid Progranl Although a is required by due process on attempts to recover overpayments under a Medicaid hearing prerecoupment hearing to recover alleged overpayments need not be afforded provider so long as prior notice of recoupment is given and a post action hearing is available See 16D c J S Constitutional Law S1996 2007 program a a 4DHH reported Dr Hickey to the State Medical the case following a preliminary investigation also declined to pursue 5Doc S submits that withholding payments to Doc in the s interim DHH commenced for services thereafter 3 performed Board the but the Board recoupments by and billed judgment in favor ofDHH The sanctions remaining to as were small a portion of the recoupment in adjudicated in December 2001 and hearing beginning a thirteen in ending amount 6 administrative day January 2002 The parties submitted post trial briefs following the conclusion of the hearing and the case More than page was submitted year later one to former DHH 7 ALJ Coreil Hood Secretary 8 he April On 3 2003 adopted ALJ Coreil conclusions of law Coreil s W Secretary David of the majority 6During Secretary Hood issued hearing to Hood accepted the exclusion order and the reverse DHH issue motion s Thereafter Doc only appeal Hospitals 2003 See The Doc 0038 La s alleged overpayments granted filed s judge s Judicial District Court the district court further 28 432 51 9 amount for sUlllinary judgment the parties were identified during the DHH to Doc of CPT Codes 80050 and 80058 ALJ Coreil reversal ofthe administrative law ALl in egularities that improper billing dated November 20 2001 to that on One ofthe issues involved 4 705 28 due to Hood final decision wherein a Specifically although Secretary multiple alleged billing investigations of the 155 remaining recoupment recoupment he upheld the majority of the remaining recoupment addressed a findings of fact but in large part rejected her s recommendation February 25 2002 proposed decision recommended reversal s of the exclusion order and the amount on March 23 2003 ALJ Coreil submitted on decision proposed ALJ Coreil for decision to a upheld in the amount By judgment motion for smary judgment as Petition for Judicial Review seeking a DHH decision Clinic s s Following a hearing in the Nineteenth the decision and this Court affirmed APMC App 1st Cir 9 26 03 2003 Doc State v reI ex Dept unpublished opinion on of Health and 855 2d So 435 table 70n February 10 Nineteenth Judicial District Court decision proposed order mandating s seeking Following hearing a filed on that ALJ Coreil render district court further ordered that a Although it is not apparent an Petition for Writ of Mandamus in the order compelling ALJ Coreil to issue 21 2003 the district court issued February proposed a decision within final decision be issued submission ofthe administrative law judge s 8 a proposed The days of decision from the face ofthe that ALJ Coreil recommended reversal of all but by thirty days DHH within ten a an proposed decision DHH submits 362 76 of the remaining recoupment amount 9 Although Secretary Hood 297 826 08 to s it is not clear from the decision dated April 3 2003 DHH submits that final decision reduced the amount to be 261 065 33 4 recouped by DHH from On 1 May 2003 Doc filed s Administrative Decision docketed concluded that decision to application the district State 9 30 04 and s Dept see 1st Cir written E the entire judgment signed on September l0 2 s filings in both Hospitals et DHH 930 So 2d 25 assigned ALJ 2004 al v to disturb La State App 1st Cir 7 1 05 La v 891 2005 0082 La table writ 10 the Judge Gregory Toney review of the record 1 decision after 924 So 2d 514 unpublished opinion remand record Clinic APMC s 2004 1945 Clinic APMC La 5 26 06 Administrative Law See The Doc writ denied 2004 2681 writ action s a sought reversal of the remand order through of Health and 06 a a Kelley administrative separate appeal but this Com1 declined a also The Doc denied 2006 0601 Upon a Doc ruling unpublished So 2d 690 App court reI ex Following Judge Timothy remanded the matter to DHH for rendition of full review of the record writ District Court reviewing first Accordingly pursuant a Suit Number 507 132 in the Nineteenth Secretary Hood acted arbitrarily and capriciously in signing without Judge Kelley 2004 2 August on Petition for Judicial Review of alleging irregulmities in procedure Judicial District Com1 hearing as a review ALJ Toney prepared a of record the to Toney Following proposed decision that a essentially duplicated the prior decision of former Secretary Hood Current lOOn appeal under La R S 49 964 G substantial although the district court has the authority to reverse or modify the agency s decision if it determines that this Court concluded that rights have the district court is not required to Comi affirmed the district court s deciding the matter de by arbitrary or capricious administrative findings do upon making such a detennination Thus this action of remanding the matter to DHH rather than been prejudiced novo The Doc so s Clinic APMC 2005 0082 at pp 4 5 Judge Guidry dissented from the majority opinion noting that since the district court specifically found that the decision of Secretary Hood was arbitrary and capricious he believed La RS 49 964 G required that the district court either reverse or modify To hold otherwise Judge Guidry opined would give DHH a the agency s decision second opportunity to render a decision or a second bite at the apple to the prejudice of Doc s Clinic The Doc s Clinic APMC 2005 0082 p 1 Guidry J dissenting 5 DHH Secretary Frederick Cerise recommended action on On October 29 Secretary matter Secretary Cerise October 4 2004 2004 Doc a Petition for Judicial Review of Cerise s decision in the Nineteenth Judicial District Court which docketed was as Suit Number 505 909 Upon motion of Doc s and in light of the fact that the administrative that previously contemplated in Suit Number 507 132 transferred to filing of the Toney into the record of held was issue on November Judge Kelley stated that after of the entire administrative record he found actions in of law excess arbitrary discretion on of DHH or s matter a 15 preponderance of the evidence thorough review signed litigation errors unwarranted exercise of was supported and sustainable by a Accordingly Judge Kelley affirmed the final administrative decision dated October 4 2005 and denied Doc for reasonable 2006 Judge Kelley found that Secretary Additionally Cerise s final administrative decision was constitutional violations no or to by Judge statutory authority unlawful procedures capricious discretion remand the identical Secretary Cerise and ALJ oral argument Following was for consideration court depositions hearing a at proceeding Section 22 of the district After the Kelley s 11 filed s adopted ALJ Toney expenses A written judgment to s claim that effect was December 18 2006 on lIThe findings of fact contained in ALJ Coreil s original proposed decision have been substantially incorporated and adopted in the recommended opinion of ALJ Toney and in the final agency decision issued by Secretary Cerise However unlike ALJ Coreil Secretary Cerise expressed reservations regarding the acceptance of the testimony of Dr Hickey as Ultimately Hickey expert in light of his personal and financial involvement in the an the opinion of Secretary Cerise gave little Also which tests Secretary were found to be are evidence Cerise took issue with medically in fact not recommended and professional a or no number of the tests ordered ALJ Coreil necessary by routine screening as standards of weight to the opinions care Thus by of Dr Doc s that many such explaining by published objective measures Secretary Cerise stated that his acceptance of the recommendations of ALJ Toney should not be construed conCUlTence as a physician to the medical necessity of these tests 6 case as his This appeal by Doc s followed 51 recoupment have been reversed this 432 28 to the August 4 2000 recoupment final agency decision medically funds to recoup unnecessary services for 10 25 1997 12 October 1 1997 Doc s of period on that Doc s billing 197 occasions based February 1996 approximately 13 Doc s through 3 000 patients urges this Court to expenses and adopt agency decision and is entitled to be reimbursed for all litigation 1 on paid for the billing of thereby reversing the final also seeks reasonable allegedly of billing records for the period of UNISYS on seeks review of the s for the patients through October 15 1999 the decision of ALJ Coreil adjudging paid unnecessary services for occasions based 17 003 Doc and the recoupment of funds allegedly medically on appeal relates exclusively Specifically medical records for the recoupment April Since the exclusion order and recoupments made legal interest STANDARD OF REVIEW A person who is aggrieved by adjudicative proceeding is entitled procedures of case states order in an judicial review in accordance with the Act Louisiana affirm the decision of the agency or remand the for further proceedings The court may reverse or modify court may prejudiced conclusions because or the decisions rights 2 In 12This recoupment appellant have been findings inferences are In violation of constitutional excess of the administrative 1 Court or that the decision if substantial on final decision the Louisiana Administrative Procedure Revised Statute 49 964 0 The to a or statutory provisions of the statutory authority of the agency is addressed as Issue II in the final agency decision before this appeal 13This recoupment is addressed as Issue III in the final agency decision before us on appeal Doc s submits that the most significant monetary issue before this Court is Issue III which challenges the review that resulted in the recoupment of 264 023 63 7 3 Made upon unlawful 4 Affected 5 Arbitrary discretion 6 evidence by other error of law capricious or characterized or by abuse of clearly unwarranted exercise of discretion or Not procedure suppOlied or and sustainable by a preponderance of determined by the reviewing court In the as of this application lule the shall its own by a preponderance of the court determination and conclusions of fact make evidence based upon its own evaluation of the record reviewed in its entirety upon judicial review In the application of the rule where the agency has the opportunity to judge the credibility of witnesses by first hand observation of demeanor on the witness stand and the regard shall be given credibility issues to the 4 La 0285 agency determination 1st Cir App La 23 3 When functions Dep t 01 reviewing as an 780 An LSA R S deference is owed court p 6 La of La Supreme aggrieved party court 49 965 by the 126 07 La or 99 2460 p 2001 to the a of court appeal just v 1 st Cir 9 20 06 948 So 2d 174 State as to v Louisiana 5 22 00 770 court s court judgment findings or deference is owed or court review of any final the factual no findings Agency appropriate circuit On review of the district comi the district App 1st Cir may obtain by appeal Court to factual appeal Carpenter App modify 1004 writ denied Bless Home Health 99 0936 p 4 conclusions of the district Louisiana to Allstate Ins Co 774 So 2d 1002 court Hosp judgment of the district appeal is sufficient administrative final decision an appellate 783 statute v of determination s Blanchard due not 787 So 2d 997 of Health and 2d So 10 18 00 does agency Anyone of the six bases listed in the reverse an court reviewing legal conclusions Dep t of Health and Hosp of no legal by the of the 2005 1904 944 So 2d 604 608 writ denied 2006 2804 Consequently this Court will conduct its 8 own review of the record and independent by LSA R apply the standards of review provided S 49 964 G ISSUES ON REVIEW On the and tests necessary was argues that DHH arbitrary and Further Doc sustainable In s s or capricious procedures billed process utilized nurse were by not DHH and s were not characterized or contends that DHH by a preponderance challenging the Registered final administrative decision that s procedures performed and billed by Doc of discretion or Doc appeal s findings are medically by not an abuse supported of the evidence agency determination that the medically necessary Doc majority of the challenges the review s acting through its fiscal intermediary UNISYS Margaret McLaurin Nurse McLaurin was the UNISYS Corporation nurse analyst who conducted the post paYment review involving Doc s outset of At the administrative of her investigation September 1 Doc s 1996 she ordered under the age of 21 the UNISYS system records of the documentation the own 14Nurse ten extrapolation randomly selected scientific s the for the time period which revealed that procedures than its peers the medical records of ten as a sample patients and the of care coding 14 scientific used sample by determine if the necessity of Nurse McLaurin testified that sampling she submitted the records of used in this proceeding fl om true although she has in the past used with the review of other providers she did not use that Nurse McLaurin testified that conjunction to billed the medical review of the medical records McLaurin differentiated the in more from Doc requested supported the level extrapolation Notably 1996 at Nurse McLaurin stated that she reviewed the medical procedures ordered after her provider history up to ten times Thereafter Nurse McLaurin patients a November 30 through routinely ordered Nurse McLaurin testified that hearing method in this instance 9 five of the ten sample patients Palermo for further review did not indicate the medical necessity Nurse McLaurin testified that in addition to records of the ten scientific With respect procedures 197 occasions the of to Nurse McLaurin reviewed the reviewing the medical tests the respiratory studies and regard Palermo the to billing billing records Based upon her laboratory records to determine if there own indicated s billed for influenced in that decision the August 4 2000 Nurse were not medically the McLaurin admitted she 17 003 was as also by the patterns previously observed in her review sample patients compiled the results of her investigations and drafted recoupment letter which the According to sample scientific on necessary was signed by the the UNISYS Surveillance and Utilization Review Section Paul 15 again and in accordance with the findings of the billing reports and medical records of the scientific Nurse McLaurin any Nurse McLaurin consulted with Dr procedures that by their diagnoses was Once recommendation of Dr Palermo Nurse McLaurin concluded that occasions Doc three patients identified in the special reports connexity between the procedures ordered and the diagnoses with the performing sample patients she ordered and reviewed hearing to on 15 procedures that were billed special reports related necessity of the review and her collaboration own with Dr Palermo Nurse McLaurin concluded that medical records did Consultant Dr John billed and the medical care Based upon her procedures performed Physician Dr Palermo concluded that the documentation support the level of not UNISYS to manager of Davenport parties Nurse McLaurin found 91 of the procedures billed in medically unnecessary As a result of admissions of error by to be both Nurse McLamin and Dr Palelmo ALJ Coreil recommended reduction ofthe denial rate to 18 nonetheless Despite these admitted errors substantially rejected ALi denial rate to 71 Secretary Cerise DHH s DHH s first decision Coreils recommendations second decision prepared by fmiher reduced the denial rate to 56 10 ALJ by Secretary Hood only reducing the Toney and adopted by On September 14 2000 Nurse McLaurin meeting requested by representatives participated of Doc to recoupments obtain a second made were Dr would have deemed necessary certain confirming the original recoupment With respect inappropriate for arguing that it a was process without to procedures to meeting Dr Mahinda procedures for which the for which recoupment sent amounts in the review process nurse that advised Nurse McLaurin that he Nevertheless in October 2000 DHH made a for full Doc a nurse s first argues that it analyst necessity to conduct the 16 In review the testimony of Dr Charles Lucey the former medical director ofUNISYS At the administrative to overturn a hearing physician Dr s s relies in was on physician supervision Doc was third recoupment letter make decisions of medical inappropriate informal physician opinion regarding Jayasinghe an Following s Nurse McLaurin consulted with another UNISYS Jayasinghe in large part Lucey opined that it is improper medical for a nurse necessity determinations during post payment review because determinations of medical necessity require the Indeed Dr expertise and training of a physician method of post payment review utilized in this unauthorized LSA R S 37 1261 or way doctors case could constitute the practice of medicine in violation of the Medical Practice McLaurin did coverage Lucey suggested that the not et seq stop care Dr from Lucey explained that although Nurse being provided the result of her denial of recommendation of recoupment would practice Act in effect medicine and affect the ultimate care change the available to patients 16Nurse McLaurin testified that in undertaking her review she was not required to defer to the physician consultants in making her determination as to whether billed procedures were medically necessary She also admitted that she did not consult with a physician as to every procedure for which recoupment was made 11 Second Doc argues that s determinations of medical even if nurses necessity DHH failed Medicaid law in several respects Citing 42 C submits that DHH for is health professional responsible personnel and to FR establishing develop and comply with federal to 9456 5 and 456 6 Doc 42 C F R 9440 230 arbitrarily deny or service between necessity 18 Doc reduce the othelwise diagnosis type of illness of federal contravention c or s argues that written criteria use amount scope of or eligible recipients solely Doc has regulations and does not have a it for Likewise a because not required of their argues that DHH acted in clearly was persons not medical defined written review policy opinions of the s not uniform argues that in the absence of such standards other than the duration condition I Medicaid agency may a s plan for the review by a evaluating the appropriateness and quality of Medicaid services citing make to qualified are policy Doc adjudged by s any conducting the review 17DHH not raise this argues that this issue is not properly before this Comi because Doc s did argument during the Oliginal administrative hearing Neveliheless since a necessarily requires a finding that the agency complied will address this argument in the interests ofjustice See Rule 1 3 Unifonn Rules of Louisiana Courts of Appeal review ofpost payment sanctions with federal Medicaid law in we 18In briefs to this Court DHH adopts the definition of medical necessity contained Chapter 15 of the Louisiana Medical Services Manual Therein Medicaid of Louisiana defines with a suspected consistently necessary services as those services delivered in connection confirmed diagnosis Doc s however submits that DHH has not medically or utilized the definition contained in the Medical Services Manual notes that in the recoupment letter dated August 4 2000 Paul Davenport the Surveillance and Utilization Review Section at UNISYS regarding medical a cOlmnented Doc s manager of as follows necessity Following is a definition which should help clarify the concept ofmedical necessity The determination that a service is reasonably necessary to prevent diagnose correct cure alleviate or prevent the worsening of conditions that endanger life or cause suffering or pain or result in illness or infirmity or threaten to cause or aggravate a handicap or cause physical deformity or malfunction There must also be no other equally effective more conservative or substantially less costly course of treatment available or suitable for the client requesting service Please note that the previous statement is not a direct quote of our policy but is included to aid in understanding the intent Given the discrepancy between the definitions Services Manual and in the define medical recoupment letter Doc necessity 12 contained in the Louisiana Medical s notes that DHH has failed to clearly which opinions were not substantiated argues that to the extent that DHH has defined medically those services delivered in connection with as DHH has violated 42 C F R 440 230 diagnosis Third Doc medical contends that DHH erred s necessity determine medical necessity DHH must results test Doc medical record necessity such factors Doc four 20 by UNISYS diagnoses per the submission of was program each As avers a reviewing evident that in order to number of factors environmental conditions and s complete accordingly medical a designed HCFA 1500 form by Doc s patient 1500 form allows the submission of up Thus diagnosis one by UNISYS allows although allow the submission of up to system while the manual Health Care the electronic form utilized patient only forth set HCFA procedure billed in 19It s the electronic claims submission challenges s Financing Administration to confirmed or cannot be ruled out Fourth utilized not are necessary services suspected contemplate argues that without s further c Doc including patient history presenting symptoms and a s by basing its determinations of 19 billing records alone on Doc by any written criteria to Doc four computer s diagnoses for accordance with the instructions for the manual UNISYS was only capable of receiving one diagnosis undisputed that no medical records were inspected in conjunction with the review of billing records for the period of October 1 1997 through October 15 1999 Likewise although both the medical and billing records were inspected in conjunction with the scientific sample Nurse McLaurin testified that if the medical records indicated medical necessity for a given procedure but the corresponding billing records is did not then she concluded there medical records were was no inconsistent Thus where the necessity billing Nurse McLaurin decided that the records and billing records controlled ALJ Coreil concluded that in Medicaid necessity policy and absent detennination could concluded that a a review based on billing records alone is not included review of the medical records possibly be made Secretary Cerise by review of billing records alone is sufficient to make determination under Medicaid 20All a ofthe billings no proper medical contrast a ultimately necessity medical policy at issue were submitted 13 electronically to Medicaid by Doc s Additionally system does Doc federal law providers to and select which given procedure electronic form of the contrast to the manual form the electronic to diagnoses On procedures argues that the unilateral alteration of the HCFA 1500 form violated a that in notes allow allocation of individual not appeal Doc s s one Doc of several s on Medicaid possible diagnoses best correlated to further argues that the limitations of the coupled with the 22 change 21 improperly placed the burden fact that DHH did not inform its negates the conclusion that UNISYS providers proper in its was alteration of the electronic HCFA 1500 form Doc Lastly s argues that DHH actions s violated constitutional and statutory law were made upon unlawful law Doc s notes that an administrative cites Rule IX sanction is invoked proceedings 10 La hearing are in of its an authority errors of provider by DHH provider including Doc Specifically administrative s appeal hearing the hearing officer shall under submission and shall submit matter case pertinent part Secretary of the Department of Health and proposed decision B to the available a Reg 383 385 1978 At the conclusion of the take the excess against addressing decisions rendered in proceeding which provides A in were remand in this procedure andor were affected by other once a various administrative on to the Human Resources a The proposed decision shall be in wntmg and shall contain findings of fact a determination of the issues presented and 2IAs an order ALl Coreil concluded that UNISYS to this issue electronic HCFA 1500 fonn and thus could not Physician Services Manual acted properly in altering Secretary capture the however ultimately held that UNISYS the electronic HCFA 1500 form and that Doc the instructions for the HCFA 1500 for each Cerise unilaterally altered the infonnation required by the by failing to allocate the most s failed to follow appropriate diagnosis procedure 22DHH electronically submitted were Nurse McLaurin not submit more a no evidence that providers who were notified of the limitations of the UNISYS UNISYS than one employee diagnosis admitted that she per billing 14 approved system was unaware to Indeed that Doc s bill even could C The Secretary of the agency may adopt the proposed decision or he may reject the proposed decision and have a decision prepared based upon the record or he may remand the matter to latter the hearing officer the case Secretary D a new The take additional evidence In the hearing officer thereafter shall submit proposed decision to the decision Secretary of the to shall adoption by the subject only to judicial review by the agency be final upon courts Doc contends s that under the rules predecessor the Department of Health and Cerise had three administrative law evidence upon 3 or 2 judge otherwise remand the modify cold review of the record Issue II ALJ while Hickey the Secretary taking of additional decision based proposed giving expeliise of Dr 23 Hood which 23 were not to elTed in Doc s weight no the or the to out points s opinions a that of Dr Nurse McLaurin refusing also contends to consider the that ALJ Toney was prior opinions of ALJ Coreil and Secretary the part of the original record At the administrative Doc opinions of failing or rehearing based upon a asseliing this argument weight Toney improperly influenced by permit not gave little to some Hickey IX for modification provision under Rule In Toney argues that ALJ s for the matter or reverse reversal of the proposed decision does Doc its review of the record a Doc s argues that the as to Human Resources and 1 affirm the decision of the original upon remand options DHH promulgated by hearing Dr Hickey was 24 tendered accepted by and ALJ expert in general practice medicine and in the treatment of inner city urban poor in the New Orleans area He was also permitted to testify as a fact witness Coreil as an 24Doc s a prepare also argues on appeal that ALJ proposed decision Specifically Doc employed by the DHH Bureau of months and that the first task was to prepare during his decision a proposed deposition prior to this on case for Toney points s lacked sufficient out that ALJ total experience Toney of was Appeals period approximately to him during his tenure of employment for assigned decision in the instant January and had 28 2005 absolutely determinations like those at issue in the instant 15 a case upon remand that he had no never only three DHH ALJ Toney admitted a proposed medical necessity prepared experience regarding case to Doc Additionally Toney of proposed s s decision that avers Secretary Cerise s adoption of ALJ inappropriate was Doc Secretary Cerise were particularly egregious deposition record nor signing on January 28 2005 the decision no on prior decisions of and ultimately issued in in that he admitted ALJ Coreil and communications with ALJ remand argues that the actions during his that he neither reviewed the administrative the decision dated October 4 2004 that he had s Secretary Hood prior Secretary Cerise to also testified Toney who prepared the proposed the decision that had only reviewed parts of Doc response to the remand order s contends that Secretary Cerise accordingly disregarded the instructions of the district and this court i e In court of the light adopt numerous a decision based alleged errors the decision of ALJ Coreil decision dated October 4 2005 and to the record DHH in the of the reasonable pursuant litigation expenses Louisiana Revised Statute 49 965 1 to reverse post payment Doc s urges this the administrative render judgment in favor of Doc reimbursement with interest 25 by on during the administrative proceedings review process and Court to to prepare amounts recouped to LSA R S Doc also seeks 5 Although 49 965 1 petition seeking 1 relief from the application or enforcement of an agency rule or regulation 2 judicial review ofthe validity or applicability of an agency rule 3 judicial review of an adverse declaratory order or ruling or 4 judicial review of a final decision or order in an adjudication proceeding the petition may include a claim against the agency for the recovery of reasonable litigation expenses If the small business prevails and the court detennines that the agency acted without substantial justification the court may award such expenses in addition to granting any other appropriate relief When B A small business shall be deemed to have a small business files a prevailed in an action disposition its position with respect to the agency rule or declaratory ruling is maintained or when there is no adjudication stipulation or acceptance ofliability on its part However a small business shall not be deemed to have prevailed if the action was commenced at the instance of or on the basis of a complaint by anyone other than an officer agent or employee ofthe agency and was dismissed by the agency on a finding of no cause for the action or settled without a when in the final order or finding offault on the part ofthe small business 16 for s provides A s litigation expenses contends that this and to appeal arises no assignments of submits is not employed by it Doc altered to regard amount recoverable except peliinent issues s has in its and medical as necessity by UNISYS review process Instead DHH argues the real issue is whether matter a multiple The real issue DHH whether the post paYment or defective was routinely s the whether the claims submission process utilized improperly was to multiple procedures DHH argues that Doc confused the enor limit Doc s 26 the extent of its actual expenses opposition to the appeal 7 500 00 per claim to of recoupment for out accordingly there should be In limited statutorily are as of practice billed defined for procedures without DHH in accordance with federal by Medicaid law In medical arguing that necessity Doc DHH Russell Burkett Drs D physicians treated patients without regard s points to Hickey the testimony of Dr Kent and Burkett testified that the to Hickey and Dr physicians at the As used in this Section 1 Reasonable exceeding seven means not expenses any expenses thousand five hundred dollars in connection with anyone litigation claim reasonably inculTed in opposing or contesting the agency action including costs and expenses inculTed in both the administrative proceeding and the judicial proceeding fees and expenses of expert or other witnesses 2 and attorney fees Small business means a small business as defined Business Administration factors meets Regulations 26In the the which for purposes of size applicable criteria set forth in 13 Part 121 plior as by the Small eligibility or other Code of Federal amended distlict court proceedings docketed as Suit No 507 132 Doc s submitted the affidavit of its manager Malcolm H Sutter III certifying that Doc s has annual receipts of less than 5 000 000 00 and has fewer than 500 employees so as to qualify as 49 965 1 a small business Additionally under the Code of Federal in that same proceeding Doc s attorney Bruce M Danner who certified that he expended that Regulations and LSA R S submitted the affidavit of its approximately 850 hours on of 215 00 per hour which well exceeded the statutory maximum for appeal 1 965 litigation expenses set forth by La R S 49 at a rate 17 General Practice Management Clinic employed regularly formulate met The list population and collaborated list of recommended a was where same on his presenting complaint ran patients the for their s as baseline DHH diagnosis fit into the definition of medical though its method imperfect one necessity if one provider than individual likely compares the to make were patient diagnosis simply orders and bills avers that for to the extent that a However DHH argues that Doc appeal procedure during the under the regardless of their treatment or a testing does DHH argues that even to of medical the service billed procedures with no by the regard for large number of the procedures the result of preventive healthcare UNISYS is irrelevant for each performed correct determinations in the electronic claims submission system on Further Dr post payment review admittedly may have been more one how such diagnoses DHH billed if is of to argues that such now necessity to general patient necessity tests formerly experience group of tests and practice is in violation of Medicaid law in that such not their on of medical same at Doc initial or both were admittedly compiled without regard testified that he often procedures based procedures procedures fit into Medicaid s definition Hickey they time so as to that s to or any option payment this precluded 27 to s defect by cites such defects submit a separate claim DHH further contends that litigation there a purported review process utilized the extent that Doc had the ensure period relevant Louisiana law to screens registered was no nurse prohibition from making Although arguing that medical necessity is an individualized determination and on membership in a demographic group DHH admits there is an exception for early and periodic screening diagnostic and treatment services EPSDT The Medicaid program provides for reimbursement on a flat fee basis for providers who perfonn a menu of specific diagnostic procedures for Medicaid eligible patients under the age of 21 According to DHH providers who wish to take part in the program must enroll in Louisiana KidMed and use specific KidMed codes when billing DHH contends that because Doc s was not enrolled in KidMed the preventive care provided by Doc s cannot be made based was not appropriate 18 medical independent review DHH contends that Nurse McLaurin whether logic patient to Doc based upon out care was review of a same billing record but that 385 which La that s a was s and the sanctions imposed of should be to an administrative administrative preparer have sampling the entire universe to remand on billing claim actually favored regulations do were set out the adjudication before on 1971 upheld regulations that who shall prepare the decision DHH not s proper and in procedure be Bureau of Appeals contain any behalf of the to specification Secretary or that the prior experience with Medicaid policy and medical necessity Instead Rule IX merely requires the Secretary based upon the record reassigning issue in this Sehrt 246 So 2d v validity attaches DHH contends that its actions DHH argues that the rules and to at writ refused 248 So 2d 334 La extrapolated its findings accordance with the rules and followed in be ruled cannot Nurse McLaurin chose to review each individual Finally as no by UNISYS should be upheld if it has Thus DHH argues under these facts the review process Doc that there is impossible and that Nat l Bank of Abbeville presumption medical records and of claims on DHH argues that while it could have used statistical enactments of Doc citing First App 1st Cir 1971 held effect no sometimes be confirmed necessity every medical record the post paYment review method used 382 can avers given the sheer volume of claims analysis of each and any rational basis DHH paYment basis DHH argues that the provided Additionally a post on decisions had s argument that medical necessity s using that case determinations necessity the case to DHH ALl Likewise DHH submits that avers to have that under the rule it Toney for preparation of to the a extent 19 that Doc s a decision was prepared warranted in proposed decision has suggested that it was improper for ALl Toney Hood Doc Secretary result of ALl alleges has failed with respect that there is matter of a long so was no the actions of to requirement as assigned it is based to ALl on of that decision was decision should be affirmed the evidence justification DHH Division of any Medicaid s billings that he once the even as provider was upon initiated litigation more an as a remand regulations that be familiar with the the to extent that the Secretary Cerise s whole the final agency supported by preponderance a warranted because DHH did receipt as a was should of a DHH statute to open not act without out that the points an investigation of complaint and that result of a valid the review of complaint from Bob DHH Program Integrity initiated DHH discovered that Doc tests per sense Doc s pursuant to LSA R S 49 965 1 DHH was s was substantially and therefore reasonable are not warranted DHH does not contest the assertion term is used in LSA R S 49 965 1 20 avers than other urban Medicaid recipient DHH submits that in this 28In asserting this argument qualifies as a small business as that s of award of litigation expenses pursuant investigating and sanctioning expenses on if this Court believes that Doc required by the investigation physician clinics in as a Program Integrity is obligated routinely ordering justified Thus the record on Patience the former Section Chief of DHH that even DHH argues that appeal on not as Secretary Cerise under the rules and the record in the district court LSA R S 49 965 1 is Doc harm potential justified DHH argues that prevailed substantial or Toney for review of the record and preparation DHH contends that based to or proposed decision based thereon adoption have show any real to he draft the final agency decision decision prior decisions of ALl Coreil and Toney s review of the prior decisions Similarly DHH s review the to by 28 Doc s that it LEGAL ANALYSIS In the considering first observe that in our capricious and based Secretary have a remand of the ALl view DHH remand on we arbitrary were Rule IX appeal and on for that purpose that the requires based upon the record prepared Despite the Secretary Cerise admittedly adopted reviewing the proposed decision in its entirety Secretary Cerise conceded that he details of the case when he Under these circumstances or actions parties Toney s proposed decision without reviewing the administrative record and without were s improper procedure on decision case of the respective arguments arbitrary and capricious only superficially familiar with the was adopted ALl Toney s find that the agency we Thus Notably we must actions s on remand consider whether reversal now modification of the agency decision pursuant 9 proposed decision to LSA R S 49 964 0 is 30 necessary In reviewing DHH decision s we are unable find any inherent to defect in the fact that Nurse McLaurin conducted the post payment review despite the to our reservations to as practical effect of such a nurse second guessing the time of review there 29Secretary a this Court doctor a Cerise admitted specific facts ofthis case but and experience as a physician Although review in during 2005 were authority treatment s his were deposition not previously we where instances may be decisions based as here tantamount Nonetheless at internal DHH rule or that the reservations on expressed familiarity with the his general knowledge intimate rather disclaimers based upon to DHH under similar circumstances had the some practice statutory provision was no in the decision dated October 4 30 the soundness of such 31 affirmed the district court s remand of the case noted in that instance that the district court also under LSA R S 49 964 G to reverse or modify the See The Doc agency s decision of the proceedings s Clinic APMC 2005 0082 at p 5 Thus at this stage where the district comi has affinned the agency s final decision following a review of the record we will now proceed to review the merits ofthe agency s decision i e 31There is no dispute unnecessary medical services initiate such review that DHH has the or 21 to recoup payments Program Integrity is right that the Division of made for empowered to specifically prohibiting post payment review by that time the legislature has enacted LSA R S 37 934 nurses to to since expressly authorize perform post payment utilization review of claims submitted for reimbursement under the Louisiana Medical Assistance that such review is Here Moreover nurses Program provided performed under the direction of a licensed physician Nurse McLaurin determinations s to as medical necessity were 32 not completely unilateral Instead following her initial review Nurse McLaurin consulted medical to some extent of the necessity regarding the with UNISYS adviser Dr Palermo care number of records reviewed that as was scientific a Pretermitting whether the rendered sample were sufficient it is McLaurin submitted the records of five of the ten scientific sample patients and eleven other detailed billing reports for Dr Palermo review undisputed s Nurse Thereafter recoupment communicated affinning her initial conclusion that there that were Nurse McLaurin Also medically unnecessary requires paliicipating and x 32Louisiana ray services essentially pattern of billing for we are to medical unable to say 2 now was of services which outpatient hospital added by services Acts 2003 No 673 provides prohibit a registered nurse who is properly recognized by the board from perfonning prepayment or post payment utilization review of claims submitted for reimbursement under the Louisiana Medical Assistance Program provided review is performed under the direction of a licensed 22 physician 3 screening in this Part shall licensed and The individuals nursing facility services 4 that necessity provide qualified specified categories Revised Statute 37 934 effective August 15 2003 and Nothing as McLaurin a Thus states to 1 inpatient hospital services laboratory was initiated until after Dr unable to find that DHH violated federal law with financial assistance in celiain include to unilaterally made decisions we are Medicaid Act findings not Nurse Palermo procedures his was that such SI and servIces family planning services 33 and 5 physician services VS C 10 g1396a 438 440 441 97 S Ct 2366 2368 2369 53 L Ed 2d 464 However A 42 V S C Beal 432 V S a tate s standards at for for Act 42 V S C states to assistance 2371 2369 at medical that only for In addition Medicaid appropriate limits utilization control on and procedures such those based to the standards on on be states 9440 230 We find that the definition and patients alike on review DHH applied by authority to necessity place or on d DHH has chosen to limit albeit suspected a loosely or as confirmed to put notice of the limitations of services under the Also the limitation be 97 S Ct adopted by DHH is adequate state Medicaid program to at 444 and necessity Medical necessity is defined in those services delivered in connection with providers reasonable the on of medical extent the Medicaid of Louisiana Medical Services Manual diagnosis objectives of the the basis of medical 42 C F R medical reasonable extent of medical Beal 432 U S In accordance with federal Medicaid law services provide language confers broad discretion regulations grant services to merely requires that consistent with the of the Act objectives states must include adopt standards for determining the reqUIrIng Doe 432 V S v 1977 requires Instead the Act are This 17 1396a Beal assistance plan which 9 consistent with the at 5 1 falling within the five general categories determining eligibility assistance under the the treatment 441 97 S Ct plan a in the Medicaid Act nothing funding for all medical 9 1396d 42 personnel sets an Thus appropriate standard of we find no merit to the argument that DHH violated 42 C F R 9456 5 and 456 6 which require written criteria for 33The nursmg statute evaluating the appropriateness of Medicaid services provides three subcategories care 23 of nursing care one ofwhich is skilled We likewise medical The mere no DHH has necessity type of illness find attempted condition or at with its post paYment review of the review process on contention that limit services based to the patients diagnoses in on based The record evidences no in c conjunction without not diagnosis invalidate the on intent diagnosis 440 230 S patient billing records does coverage defining by DHH to deny coverage the basis of the kind of medical condition that occasioned the need for services at 4 deny to s in contravention of 42 C F R fact that DHH looked evidence of intent to Doc merit the Rather Nurse McLaurin and Dr Palermo testified that patient diagnoses specifically correlation with the care provided to Thus determine whether there we contravention of the provisions of 42 C F R Nonetheless must we process utilized in this do not S440 230 c conClude that the overall post paYment review tainted case was Specifically we find merit in Doc addressed in the decision of ALl Coreil was discussion of Issue III which dealt with whether DHH funds paid for the billing of allegedly medically 17 003 occasions based of October 1 Coreil 1997 weighed the UNISYS on a was find that DHH acted in contention that UNISYS electronic claims submission process This argument they looked 15 testimony offered at 1999 In as flawed part of her properly recouped unnecessary services billing records for through October was a s on recoupment period addressing this issue the administrative ALl hearing regarding 34In rejecting the argument that DHH attempted to limit services based on c in which states diagnosis we distinguish those cases involving 42 C F R 230 g440 have attempted to provide services only for certain illnesses See White v Beal 555 F 2d 1146 3rd Cir 1977 where the court concluded that Pennsylvania s decision to provide eyeglasses for those suffering from eye disease but not for those with non pathological eye trouble violated the regulations medical disorder and because it need see noted that also Preterm basing the Inc v provision was both because it discriminated based Dukakis on a factor not 591 F 2d 121 of abortion services death situations made their availability turn on ofneed 24 on the basis of reasonably related Cir 1979 lst on a a to medical where the court distinction between life and medical condition rather than on degree the computer systems utilized by both Doc and UNISYS and s relating to the electronic claims submission process The parties do dispute that the electronic claims submission not system employed by UNISYS 1500 fonn The were to the manual RCFA duplicate substantially different WebMD35 employee submission discrepancies intended testimony however reveals that the manual form and the electronic system claims was Karen Raborn testified at the an expert in the field of electronic administrative between the manual RCFA hearing to as the 1500 form and the UNISYS system and the incompatibility of the UNISYS system with the billing system used by Doc s Raborn manual RCFA 1500 form are pointed out that the relevant boxes 21 24 and 24 E Specifically the manual RCFA 1500 form contains four spaces for diagnoses Box 24 various columns allocation one a to the by providers to input service information and contains procedure codes There is individual a pointer to the manual form and the electronic system used by diagnoses Raborn testified that the UNISYS system does diagnosis in box procedures Doc box 21 of 24 contrasting 35WebMD used of the in box 21 21 to be transmitted that the electronic system does 21 to column for in box 24 E that links UNISYS than relates turn including procedures in box In in portions not in box 24 is the company that 36 owns allow more Further Raborn testified permit allocation Raborn not of the diagnoses in Box opined that in the absence of and manages the computer any billing system s 36UNISYS Deputy Project Manager Royce Watts who testified that the electronic system only allows the input of eight bytes relative to patient diagnoses cOlToborated Raborn s testimony as to capacity of the electronic claims submission system and admitted that only one diagnosis code can fit in the designated space 25 allocation feature comparable to the allocation in box 24 E of the pointer manual form the electronic system rendered box 24 useless RabOIn further testified that the Doc the manual HCFA 1500 form in that the Doc of up to have a four s Thus the system allocated all according to Raborn the with system allows the submission diagnoses per claim Also although the Doc pointer allocation procedure billing system complies s most system does s diagnoses not for each appropriate diagnosis was always submitted for each procedure Based on that UNISYS could unilaterally altered the electronic HCFA 1500 form and thus We agree and this issue patient adopt While the Doc the UNISYS system diagnosis Since the s ALl Coreil reaching of the this conclusion to provider indicate the Insofar to as four to was we had most as to diagnoses per of accepting one multiple diagnoses the fatally flawed reject any suggestion by comply with the instructions for box 24 E appropriate diagnosis for DHH that which direct the each procedure the UNISYS electronic system omitted any allocation feature for electronic claims DHH most patients Services and conclusions findings undisputedly was only capable majority Doc s failed s system transmitted up electronic claims submission system In testimony ALl Coreil concluded capture the information required by the Physician not Manual RabOIn s uncontradicted cannot now claim that Doc s appropriate diagnoses for the procedures billed particularly flawed failed to DHH s allocate the argument is given that Doc s computer system submitted all diagnoses for each procedure We also reject procedure billed via policy pennit each any a argument that Doc separate claim procedure to should have submitted each The HCFA 1500 form and DHH be billed 26 s separately or for all procedures of out arising a single office visit Doc s chose to bill for its services with DHH compliance administrative action the providers policy the on UNISYS to be concurrently using Doc billed in now be grounds that unbeknownst to electronic claim claim form per office visit in one should s one claims not submission subjected to it and other process was inconsistent with the manual HCF A 1500 form In addition the to problem with the electronic claims submission find merit in Doc contention that DHH acted system we making determinations of medical This argument was a review based and absent policy necessity based as defects in a UNISYS to set on a billing records alone is not review based Physician Services on records alone as part of her of a medical proper medically Manual is not necessary possible The billing records alone coupled with the fact that altered the electronic HCFA 1500 form led ALl Coreil recommend that the recoupment based reversed in included in Medicaid review of the medical records forth in the unilaterally billing improperly considering this argument ALl Coreil concluded necessity determination using the definition services on addressed in the decision of ALl Coreil discussion of Issue III In that s on the billing records should be 37 37 Alternatively in the event that the Secretary of DHH found that UNISYS was in the alteration of the HCFA 1500 form and that a review of proper billing records alone was sufficient to make a medical ALl necessity detennination under Medicaid Coreil recommended 1 page 30 ofher decision be used routine health examination and procedures policy necessity included in the chart at for the billed diagnosis of health supervision ofchild or other like diagnoses and that any funds recouped for that the of medical findings thus found medically necessary be reimbursed to Doc s 2 that the opinions of the medical experts when offered on pmiicular diagnoses be applied as discussed in ALl Coreils analyses of the procedures under Issue II and that funds recouped for procedures thus found medically necessary be reimbursed to Doc s 3 that any test for which DHH their s medical witnesses testimony including Nurse McLaurin and Dr Palermo result in reimbursement to Doc Nurse McLaurin be s and 4 that the medical changed opinion of applied in accordance with ALl Coreil s legal analysis under Issue II Patient Elliott for diagnoses and procedures which were not discussed in the chart beginning on page 30 or under Issue II and that funds recouped for procedures thus found medically necessary be reimbursed to Doc s 27 Based ALl Coreil on the testimony at conclusion that s the administrative review based a hearing billing on insufficient In particular Dr Hickey testified that based a as physician the only necessity is to look at way to make the a 38 original medical record review based on records often review based billing upon a review of several mistakes in billing is possible possible ALl to or testimony 38In relying in part Toney and Secretary a of any a on the records and Both Nurse hearing that upon recoupments had been made based for procedures that were in actuality Nurse McLaurin admitted that she made and that she error was herein due to unable to the sheer of former UNISYS director Dr Charles particularly insightful Dr Lucey testified that while it necessity based negate necessity solely expert witness as an expert is were unaware case determine medical to Similarly although the administrative percentage of her issue in this this issue to experience they both admitted that billing determining medical necessity We also find the as records Importantly estimate the total number at at medical records medically necessary Lucey they records otherwise apparent in the not patient volume of claims his pertinent information regarding the patient McLaurin and Dr Palermo admitted review of the on billing records had obvious limitations in that the medical contain diagnosis that is on records alone is firm determination of medical Nurse McLaurin and Dr Palermo testified that policy prohibiting agree with we on that basis testimony Cerise that bias of Dr on a Dr diagnosis it is not Lucey testified that it is Hickey we reject the suggestions of Dr Hickey from qualifying as an precludes To the contrary this Court has held that the fact that a witness proposed party or an employee of a party does not preclude his qualification as an Pelts Skins any potential bias may be explored on cross examination Ltd v State ex reI Dep t ofWildlife Fisheries 97 2300 p 4 La App 1st Cir Export 1 4 99 735 So 2d 116 122 writs denied 99 2036 and 99 2042 La 29 10 99 748 expert as So 2d 1168 opportunity on Moreover to LSA R S the credibility judge the witness stand issues Thus due credibility Hickey was a reliable expert we 49 964 0 regard will provides that where the agency has the by first hand observation of demeanor of the witness shall be give given to the agency s determination of deference to ALl Coreil s determination that Dr witness 28 not possible without and a conclusively rule to complete picture Dr physical sYmptoms determinations based as to the s an unsound practice that review based a billing records alone on definition of medical own necessity policy requires only that services be connected with confirmed will diagnosis never However indicate Undisputedly diagnosis such information is complete medical DHH suspected a s or given the format used herein billing records suspected a procedure We agree observe that is inconsistent with DHH a history presenting complaints s billing reports alone is on we patient of necessity Lucey opined that the making of necessity results in fatally flawed decisions Additionally the medical out that was ultimately rejected only attainable from a review of the records Considering the definition of medical necessity contained in the Medicaid Services Manual that the medical records make a proper medical along at are with the testimony of the medical experts minimum a determination necessity that DHH s recoupment of funds based alone cannot stand Even if Doc definition of medical does not support a helpful on a physicians s we were treatment By questioning the services while failing to patient health proper DHH failed necessity under even its Furthermore conclusions of law not we as own to a care the s that factor alone was unnecessary complete picture of determination of medical standards find to make at billing reports cognizant of DHH provided look to agree with ALl Coreil review of the necessity in providing patient conclusion that the and often necessary that Issue II ALl Coreil s findings of fact and dealing with whether DHH properly recouped funds paid for the billing of allegedly medically unnecessary services recoupment on 197 occasions based on medical records from 29 a period of February addressing 1 1996 through April ten testimony offered the medical are as to procedures necessity of each such procedure the preponderance of the evidence ALl Coreil drew conclusions procedures found to be To the extent medically scientific offered to findings are the medical we based on note on a necessity clearly supported by recommendation 18 are s thorough review of the of each of the In adopting Issue II which reduced the recoupment ALl Coreil rate necessity determinations diagnosis on the was no billing medical necessity record controlled the medical records Thus based tainted for the same 30 reasons to Specifically sample patients not she She testified that she over on it is apparent that her review with respect was s from 91 necessity but the corresponding billing record did then concluded that there sample patients testimony that Nurse McLaurin admitted she sometimes deferred indicated medical testimony the to procedures and her Nurse McLaurin admitted that if the medical records of the contained in the made for those were conclusions with respect the record the billing records in making medical felt the as to be reimbursed s find that ALl Coreil we sample patients as recoupments Based necessmy ALl Coreil recommended that the recoupments be reversed and that Doc On review In correct patients in the scientific sample and discussed the necessity of each procedure to 1997 this issue ALl Coreil identified the individualized ordered for each of the on 25 the information Nurse McLaurin to the ten that we s scientific conclude her conclusions and review premised on Following our independent the billing records alone review of the record was we are skewed unable to 39 find that the decision of Secretary Cerise is supported by a preponderance of the evidence insofar he as rejected the conclusions and recommendations of the original healing officer ALJ Coreil with respect upholding recoupments the substantial based Doc rights of defective review the decision on a rendition of valid medical services Therefore population We further conclude prejudiced by Doc s has Coreil the an otherwise that because Doc However it is has in full and 39We are if not widely recognized agencies state NY 70 2d S 583 as a that the clear from use of valid method of YAD 3 Dept Ill App 1 Dist 1990 Medicaid agencies Specifically DHH may 1993 substantially a 4 demand i e review of the record ifDHH of the filing was made We original petition No 507 132 for for all extrapolation or scientific sampling has been conducting post payment Medicaid review by see Nevertheless use been judicial proceedings in Suit See Matter of Clin Path Inc N has s when such recoupment so of administrative aware 4o is entitled to interest in its favor s therefore award interest from the date of the judicial review adopt the findings and from the date of the first May 1 2003 prejudiced disadvantaged patient Issues II and III to recoupment Doc requested interest recouped as to the decision and we reverse recommendations of ALJ By receive paYment under Medicaid for the to s Issues II and III to v New York State also Lebaio in this extrapolation or cannot argue that statistical v case Dep sampling 598 Aid 569 N E 2d find DHH we scientific Dep t of Soc Serv tofPub argument that s be irrelevant sampling extrapolation was utilized to or where Nurse McLaurin admitted that when the suppOlied different determinations as to medical billing reports and medical records necessity she based her opinion on the individual ten billing records Moreover we are not convinced that the medical records of patients constitutes a representative sample where as here the matter involved over 17 000 claims 40 We that ALl Coreil offered alternative recommendations as to Issue Evid Box I Adm Hr g Tr at 142 143 we adopt and Specifically incorporate by reference herein her primary recommendation that the recoupment of funds based on recognize III billing records alone 41 should be reversed Pursuant to La Const art suit but also immunity through Dep t of Health from XII liability S 10 the state not which includes and Human Resources 451 1984 31 legal 2d So only waives interest 1282 1283 immunity See Carr La App v from State 1st Cir amounts improperly recouped by However for any later amounts DHH of the date that suit as improperly recouped was interest shall filed accrue from the actual date of recoupment Additionally justification we because find merit litigation expenses litigation expenses such litigation intended the one to Thus limit the we La App 4th Cir 1992 that penal statutes must in nature 1369 applied to La an awarding 7 500 00 in to cases was such award for reasonable litigation as expenses La State Bd of Dentistry 603 So 2d 238 243 well settled rule of statutory construction a strictly construed and their provisions shall be the fair to in connection with the State provision 1990 However in multiple medical necessity determinations for v be statutory consider whether LSA R S 49 965 1 of such expenses It is sense the purpose of the 1365 must to denial of reasonable court s 49 965 1 genuine construction according taken in their usual to Allen the district LSA R S to provides penal contention that it is entitled s we reverse amount it is a Doc hand which involve at Because the statute given to pursuant expenses find that DHH acted without substantial we context Russland v import of their words and with reference Enterprises This rule of construction has been administrative law Gibbs Constr Inc Co v 555 So 2d specifically State Dep t of Labor 540 So 2d 268 269 La 1989 According to Black s Law Dictionary aggregate of operative facts giving rise See Black not s Law whether this Dictionary 8th case involves ed 2004 Patience regarding Doc s a term right claim enforceable refers by a to the court Under that definition the issue is multiple medical necessity determinations but whether such determinations arise Here the recoupments to the were out of the same the result of Moreover 32 a operative facts single complaint by Bob all of the recoupments at issue on appeal relate the to investigation and Utilization Review under the 7 500 00 LSA R S 49 plain language of the Thus while we find merit to notwithstanding of expenses in excess by the UNISYS Surveillance Section and arise Interpreting recoupment conducted 1 965 D this this claim Doc of that statute s of the out strictly August we 2000 conclude that we appeal involves 4 single a claim limit the award of expenses argument that this case warrants to award an 42 amount CONCLUSION For the above and foregoing dated December 18 2006 affirming Cerise dated October 4 2004 and is reversed expenses judgment court s the final agency decision of denying With respect the district reasons Doc request for administrative s to Issue II Secretary dealing with whether DHH properly recouped funds paid for the billing of allegedly medically unnecessary services on 197 occasions based recoupment period of February 1 ALl Coreil s medical findings 1996 s recommendation and be medically were made for those Moreover hereby to specifically order that the recoupment the provider we litigation note that LSA R S 49 965 1 expenses was are patterned Small Businesses of Reasonable on Distr appeal 1990 California Leg Regular statutory provision was where the trial court had not already possible of 7 500 00 33 on respondent in House Minutes ofJune 10 1982 and interpreted narrowly to award additional awarded the PROC Litigation Expenses of Labor Standards Enforcement 268 Cal Rptr 669 which held that it 7 500 00 for House Bill 1243 Before the Committee has likewise been Wang extent after CAL Crv Session Div the to limited to and Governmental Affairs 1982 v the to respect we that the parallel adopt we procedures which ALl Coreil found that reasonable Recovery by Opposing Agency Action Hearing See 1997 a necessary 42In concluding anyone claim CODE S 1 028 5 25 of fact and conclusions of law with be reversed and that reimbursement be made said recoupments medical records from through April necessity of the procedures ordered adopt ALl Coreil to on the 675 Cal fees 2 App attorney statutory maximum s on With funds recouped serVIces to respect on Issue III 17 003 occasions based that UNISYS could not unilaterally a and since review of Physician Services Manual is hereby 1999 we To the is hereby s possible based was based on be reimbursed rendered improperly and conclusions determination of the precise not adopt ALl Coreil s primary we be reversed and that Doc reimbursed for any recoupments foregoing findings necessity using the order that the recoupment that Accordingly judgment of the 15 a altered the electronic HCFA 1500 form and billing records alone billing records alone herein records from through October proper determination of medical a recommendation and findings 1997 billing capture the information required by the Physician Services definition included in the on UNISYS on adopt ALl Coreil s findings of fact and conclusions of law extent Manual properly paid for the billing of allegedly medically unnecessary recoupment period of October 1 likewise with whether DHH dealing ordering made that Doc s be in accordance with the We remand this matter to DHH for amounts a due in accordance with ALl Coreil s of fact and conclusions of law consistent with the views together with interest in favor of Doc s to run expressed from the date of filing original petition for judicial review of administrative proceedings in Suit No 507 132 for all recoupments made as of the date that suit was filed and from the date of all subsequent recoupments order that any necessary proceedings be conducted and completed and these amounts due to Doc proceedings within 90 s made if any We further be calculated and entered into the record of these days of the date of this 34 opinion Judgment is further rendered in favor of Doc reasonable litigation of 7 500 00 s and expenses pursuant to La R S 49 against DHH for 1 965 in the amount assessed against 43 Costs of this appeal in the amount of 1 935 64 are DHH REVERSED RENDERED AND REMANDED WITH INSTRUCTIONS 43See LSA CC P mi 2164 see also State ex reI Louisiana Riverboat Gaming Louisiana State Police Riverboat Gaming Enforcement Div 99 2038 p 6 La 22 App 1st Cir 9 00 768 So 2d 284 287 writ denied 00 2926 La 1 5101 778 So 2d 598 and McSweeney v Louisiana Bd of Veterinary Medicine 600 So 2d 890 La 1st Cir 1992 App Com nv 35

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