North Broward Hospital District, Mount Sinai Medical Center of Florida, Inc., and Naples Community Hospital, Inc., on Behalf of Themselves and All Others Similarly Situated v. State of Florida, Agency for Health Care Administration

CourtDistrict Court of Appeal of Florida
DecidedNovember 6, 2024
Docket1D2021-2485
StatusPublished

This text of North Broward Hospital District, Mount Sinai Medical Center of Florida, Inc., and Naples Community Hospital, Inc., on Behalf of Themselves and All Others Similarly Situated v. State of Florida, Agency for Health Care Administration (North Broward Hospital District, Mount Sinai Medical Center of Florida, Inc., and Naples Community Hospital, Inc., on Behalf of Themselves and All Others Similarly Situated v. State of Florida, Agency for Health Care Administration) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
North Broward Hospital District, Mount Sinai Medical Center of Florida, Inc., and Naples Community Hospital, Inc., on Behalf of Themselves and All Others Similarly Situated v. State of Florida, Agency for Health Care Administration, (Fla. Ct. App. 2024).

Opinion

FIRST DISTRICT COURT OF APPEAL STATE OF FLORIDA _____________________________

No. 1D2021-2485 _____________________________

NORTH BROWARD HOSPITAL DISTRICT, MOUNT SINAI MEDICAL CENTER OF FLORIDA, INC., and NAPLES COMMUNITY HOSPITAL, INC., on behalf of themselves and all others similarly situated,

Appellants,

v.

STATE OF FLORIDA, AGENCY FOR HEALTH CARE ADMINISTRATION,

Appellee. _____________________________

On appeal from the Circuit Court for Leon County. Angela C. Dempsey, Judge.

November 6, 2024

M.K. THOMAS, J.

This appeal requires us to determine whether a 2020 statutory amendment abrogated our 2019 decision prohibiting retrospective audits of hospital claims involving pre-authorized and paid emergency services provided to undocumented immigrants. See Lee Mem’l Health Sys. Gulf Coast Med. Ctr. v. Agency for Health Care Admin., 272 So. 3d 431 (Fla. 1st DCA 2019) (Gulf Coast). We hold that the statutory amendment did not legislatively overrule Gulf Coast, but rather merely clarified existing law. We reverse the summary final judgment to the contrary and remand for further proceedings. 1

I. Statutes

The relevant statutes are part of Florida’s Social Welfare Act, chapter 409 of the Florida Statutes. In pertinent part, the Act implements obligations imposed on Florida by Title XIX of the federal Social Security Act, including the healthcare obligations at issue here. Portions of sections 409.905 and 409.913, Florida Statutes, are controlling.

(A) 2019 Version of Section 409.905(5)(a)

In 2019, when we issued Gulf Coast, section 409.905(5)(a) provided in pertinent part as follows:

(a) The agency may implement reimbursement and utilization management reforms in order to comply with any limitations or directions in the General Appropriations Act, which may include, but are not limited to: prior authorization for inpatient psychiatric days; prior authorization for nonemergency hospital inpatient admissions for individuals 21 years of age and older; authorization of emergency and urgent-care admissions within 24 hours after admission; enhanced utilization and concurrent review programs for highly utilized services; reduction or elimination of covered days of service; adjusting reimbursement ceilings for variable costs; adjusting reimbursement ceilings for fixed and property costs; and implementing target rates of

1 Because we find that the legislature did not abrogate Gulf

Coast when it amended the statute, we need not address whether the trial court erred in determining the amended statute applied retrospectively.

2 increase. The agency may limit prior authorization for hospital inpatient services to selected diagnosis-related groups, based on an analysis of the cost and potential for unnecessary hospitalizations represented by certain diagnoses. Admissions for normal delivery and newborns are exempt from requirements for prior authorization. In implementing the provisions of this section related to prior authorization, the agency shall ensure that the process for authorization is accessible 24 hours per day, 7 days per week and authorization is automatically granted when not denied within 4 hours after the request. Authorization procedures must include steps for review of denials. Upon implementing the prior authorization program for hospital inpatient services, the agency shall discontinue its hospital retrospective review program.

§ 409.905(5)(a), Fla. Stat. (2019) (emphasis added).

(B) 2020 Version of Section 409.905(5)(a)4

In 2020, the legislature amended section 409.905(5)(a) to provide in pertinent part as follows:

Upon implementing the prior authorization program for hospital inpatient services, the agency shall discontinue its hospital retrospective review program. However, this subparagraph may not be construed to prevent the agency from conducting retrospective reviews under s. 409.913, including, but not limited to, reviews in which an overpayment is suspected due to a mistake or submission of an improper claim or for other reasons that do not rise to the level of fraud or abuse.

§ 409.905(5)(a)4., Fla. Stat. (2020) (emphasis added).

The bill affecting this 2020 amendment states that the amended statute “confirms and clarifies existing law.” Ch. 2020- 156, §§ 38–39, Laws of Fla. No reference is made to legislatively overruling Gulf Coast.

3 (C) Section 409.913

Also relevant to this analysis is section 409.913(1)(e), which the legislature did not amend after Gulf Coast. It governs the Agency’s obligation and authority to ensure the integrity of the Medicaid program, including recovery of overpayments. In pertinent part, it provides as follows:

The agency shall operate a program to oversee the activities of Florida Medicaid recipients, and providers and their representatives, to ensure that fraudulent and abusive behavior and neglect of recipients occur to the minimum extent possible, and to recover overpayments and impose sanctions as appropriate.

*****

(e) “Overpayment” includes any amount that is not authorized to be paid by the Medicaid program whether paid as a result of inaccurate or improper cost reporting, improper claiming, unacceptable practices, fraud, abuse, or mistake.

Section 409.913 includes multiple additional provisions for recouping overpayments, which again were not changed in 2020 (or thereafter). See §§ 409.913(11), (15)(i), (16)(c), (16)(j), (20), (25)(c), (27), Fla. Stat.

II. Facts

The relevant facts are similar to those detailed in Gulf Coast. See id. at 432–34. Through the Alien Audit Program (AAP), Florida’s Agency for Health Care Administration (the Agency) reviews all paid in-patient hospital claims for pre-approved emergency services provided to undocumented immigrants. Before Gulf Coast, if the Agency’s after-the-fact review demonstrated that it had erred in determining the existence or duration of the emergency medical condition, the Agency demanded repayment. We held in Gulf Coast that the Agency could not recoup such previously approved payments, even if the Agency later

4 determined its pre-approval had been mistaken or overbroad. 2 Following Gulf Coast, the Agency issued refunds to Lee Memorial, but not to the Appellants here (collectively, NBH). Relying on Gulf Coast, NBH sued the Agency for breach of contractual provider agreements, seeking a refund of the improperly recouped amounts. NBH alleged that, after pre-authorizing and paying for inpatient emergency services for undocumented immigrants, the Agency lacked authority to demand repayment based on its own error in determining the existence or duration of the emergency medical condition—the very question we resolved adverse to the Agency in Gulf Coast.

NBH sought summary judgment as to liability, arguing that the 2020 amendment to section 409.905(5) is consistent with Gulf Coast and does not abrogate it. NBH advanced three arguments. First, section 409.905(5)(a) still precludes the Agency from conducting general retrospective reviews of previously authorized claims. Second, the legislature did not amend section 409.913 to give the Agency new authority to conduct general retrospective reviews of previously authorized claims, but rather clarified that section 409.905(5)(a) did not limit the Agency’s existing authority under section 409.913. Third, the statutory change did not supplant the common law doctrine of administrative finality.

2 In Gulf Coast, in response to the Centers for Medicare and

Medicaid Services’ federal audit, the Agency initiated the Undocumented Alien Project (“the Project”). 272 So. 3d at 433.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Florida Dept. of Educ. v. Cooper
858 So. 2d 394 (District Court of Appeal of Florida, 2003)
Joshua v. City of Gainesville
768 So. 2d 432 (Supreme Court of Florida, 2000)
DIRECT GENERAL INS. CO. v. Morris
884 So. 2d 1077 (District Court of Appeal of Florida, 2004)
STATE EX REL SZABO FOOD SERV., INC., OF NC v. Dickinson
286 So. 2d 529 (Supreme Court of Florida, 1973)
Bautista v. State
863 So. 2d 1180 (Supreme Court of Florida, 2003)
Holly v. Auld
450 So. 2d 217 (Supreme Court of Florida, 1984)
Palm Beach County Canvassing Bd. v. Harris
772 So. 2d 1273 (Supreme Court of Florida, 2000)
Clay Elec. Co-Op., Inc. v. Johnson
873 So. 2d 1182 (Supreme Court of Florida, 2003)
GTC, INC. v. Edgar
967 So. 2d 781 (Supreme Court of Florida, 2007)
Major League Baseball v. Morsani
790 So. 2d 1071 (Supreme Court of Florida, 2001)
Zold v. Zold
911 So. 2d 1222 (Supreme Court of Florida, 2005)
GULFSTREAM PARK RACING v. Tampa Bay Downs
948 So. 2d 599 (Supreme Court of Florida, 2006)
Lee Memorial Health System etc. v. State of Florida, Agency For Agency For Health etc.
272 So. 3d 431 (District Court of Appeal of Florida, 2019)
Kuria v. BMLRW, LLLP
101 So. 3d 425 (District Court of Appeal of Florida, 2012)
Prison Rehabilitative Industries v. Betterson
648 So. 2d 778 (District Court of Appeal of Florida, 1994)
M.D. v. State
993 So. 2d 1061 (District Court of Appeal of Florida, 2008)

Cite This Page — Counsel Stack

Bluebook (online)
North Broward Hospital District, Mount Sinai Medical Center of Florida, Inc., and Naples Community Hospital, Inc., on Behalf of Themselves and All Others Similarly Situated v. State of Florida, Agency for Health Care Administration, Counsel Stack Legal Research, https://law.counselstack.com/opinion/north-broward-hospital-district-mount-sinai-medical-center-of-florida-fladistctapp-2024.