Florida Senate - 2025 SB 1478 By Senator Rodriguez 40-01148A-25 20251478__ 1 A bill to be entitled 2 An act relating to patient referrals by Medicaid 3 managed care organizations and managed care plans; 4 amending s. 409.913, F.S.; authorizing the Agency for 5 Health Care Administration to conduct or cause to be 6 conducted reviews, investigations, analyses, audits, 7 and combinations thereof to determine if managed care 8 organizations, managed care plans, and their 9 subcontractors violate the Medicaid program integrity 10 in their patient referrals; providing penalties; 11 amending s. 409.967, F.S.; prohibiting managed care 12 organizations, managed care plans, and their 13 subcontractors from violating the Medicaid program 14 integrity by referring Medicaid recipients for 15 treatments and services to entities having certain 16 financial relationships and arrangements with the 17 organizations, plans, and their subcontractors; 18 providing an effective date. 19 20 Be It Enacted by the Legislature of the State of Florida: 21 22 Section 1.Subsections (2) and (16) of section 409.913, 23 Florida Statutes, are amended to read: 24 409.913Oversight of the integrity of the Medicaid 25 program.The agency shall operate a program to oversee the 26 activities of Florida Medicaid recipients, and providers and 27 their representatives, to ensure that fraudulent and abusive 28 behavior and neglect of recipients occur to the minimum extent 29 possible, and to recover overpayments and impose sanctions as 30 appropriate. Each January 15, the agency and the Medicaid Fraud 31 Control Unit of the Department of Legal Affairs shall submit a 32 report to the Legislature documenting the effectiveness of the 33 states efforts to control Medicaid fraud and abuse and to 34 recover Medicaid overpayments during the previous fiscal year. 35 The report must describe the number of cases opened and 36 investigated each year; the sources of the cases opened; the 37 disposition of the cases closed each year; the amount of 38 overpayments alleged in preliminary and final audit letters; the 39 number and amount of fines or penalties imposed; any reductions 40 in overpayment amounts negotiated in settlement agreements or by 41 other means; the amount of final agency determinations of 42 overpayments; the amount deducted from federal claiming as a 43 result of overpayments; the amount of overpayments recovered 44 each year; the amount of cost of investigation recovered each 45 year; the average length of time to collect from the time the 46 case was opened until the overpayment is paid in full; the 47 amount determined as uncollectible and the portion of the 48 uncollectible amount subsequently reclaimed from the Federal 49 Government; the number of providers, by type, that are 50 terminated from participation in the Medicaid program as a 51 result of fraud and abuse; and all costs associated with 52 discovering and prosecuting cases of Medicaid overpayments and 53 making recoveries in such cases. The report must also document 54 actions taken to prevent overpayments and the number of 55 providers prevented from enrolling in or reenrolling in the 56 Medicaid program as a result of documented Medicaid fraud and 57 abuse and must include policy recommendations necessary to 58 prevent or recover overpayments and changes necessary to prevent 59 and detect Medicaid fraud. All policy recommendations in the 60 report must include a detailed fiscal analysis, including, but 61 not limited to, implementation costs, estimated savings to the 62 Medicaid program, and the return on investment. The agency must 63 submit the policy recommendations and fiscal analyses in the 64 report to the appropriate estimating conference, pursuant to s. 65 216.137, by February 15 of each year. The agency and the 66 Medicaid Fraud Control Unit of the Department of Legal Affairs 67 each must include detailed unit-specific performance standards, 68 benchmarks, and metrics in the report, including projected cost 69 savings to the state Medicaid program during the following 70 fiscal year. 71 (2)(a)The agency shall conduct, or cause to be conducted 72 by contract or otherwise, reviews, investigations, analyses, 73 audits, or any combination thereof, to determine possible fraud, 74 abuse, overpayment, or recipient neglect in the Medicaid program 75 and shall report the findings of any overpayments in audit 76 reports as appropriate. At least 5 percent of all audits shall 77 be conducted on a random basis. As part of its ongoing fraud 78 detection activities, the agency shall identify and monitor, by 79 contract or otherwise, patterns of overutilization of Medicaid 80 services based on state averages. The agency shall track 81 Medicaid provider prescription and billing patterns and evaluate 82 them against Medicaid medical necessity criteria and coverage 83 and limitation guidelines adopted by rule. Medical necessity 84 determination requires that service be consistent with symptoms 85 or confirmed diagnosis of illness or injury under treatment and 86 not in excess of the patients needs. The agency shall conduct 87 reviews of provider exceptions to peer group norms and shall, 88 using statistical methodologies, provider profiling, and 89 analysis of billing patterns, detect and investigate abnormal or 90 unusual increases in billing or payment of claims for Medicaid 91 services and medically unnecessary provision of services. 92 (b)The agency may conduct, or cause to be conducted by 93 contract or otherwise, reviews, investigations, analyses, 94 audits, or any combination thereof, to determine if a managed 95 care organization or managed care plan or its subcontractor has 96 violated the program integrity under s. 409.967(2)(g)2. by 97 referring a Medicaid recipient for a covered treatment or 98 service rendered by or in the office of a provider, another 99 subcontractor, or a third-party entity that is owned or 100 partially owned by the managed care organization or managed care 101 plan or the subcontractor, or that has a profit-sharing 102 arrangement with the managed care organization or managed care 103 plan or the subcontractor. 104 (16)The agency shall impose any of the following sanctions 105 or disincentives on a provider or a person for any of the acts 106 described in paragraph (2)(b) or subsection (15): 107 (a)Suspension for a specific period of time of not more 108 than 1 year. Suspension precludes participation in the Medicaid 109 program, which includes any action that results in a claim for 110 payment to the Medicaid program for furnishing, supervising a 111 person who is furnishing, or causing a person to furnish goods 112 or services. 113 (b)Termination for a specific period of time ranging from 114 more than 1 year to 20 years. Termination precludes 115 participation in the Medicaid program, which includes any action 116 that results in a claim for payment to the Medicaid program for 117 furnishing, supervising a person who is furnishing, or causing a 118 person to furnish goods or services. 119 (c)Imposition of a fine of up to $5,000 for each 120 violation. Each day that an ongoing violation continues, such as 121 refusing to furnish Medicaid-related records or refusing access 122 to records, is considered a separate violation. Each instance of 123 improper billing of a Medicaid recipient; each instance of 124 including an unallowable cost on a hospital or nursing home 125 Medicaid cost report after the provider or authorized 126 representative has been advised in an audit exit conference or 127 previous audit report of the cost unallowability; each instance 128 of furnishing a Medicaid recipient goods or professional 129 services that are inappropriate or of inferior quality as 130 determined by competent peer judgment; each instance of 131 knowingly submitting a materially false or erroneous Medicaid 132 provider enrollment application, request for prior authorization 133 for Medicaid services, drug exception request, or cost report; 134 each instance of inappropriate prescribing of drugs for a 135 Medicaid recipient as determined by competent peer judgment; and 136 each false or erroneous Medicaid claim leading to an overpayment 137 to a provider is considered a separate violation. 138 (d)Immediate suspension, if the agency has received 139 information of patient abuse or neglect or of any act prohibited 140 by s. 409.920. Upon suspension, the agency must issue an 141 immediate final order under s. 120.569(2)(n). 142 (e)A fine, not to exceed $10,000, for a violation of 143 paragraph (15)(i). 144 (f)Imposition of liens against provider assets, including, 145 but not limited to, financial assets and real property, not to 146 exceed the amount of fines or recoveries sought, upon entry of 147 an order determining that such moneys are due or recoverable. 148 (g)Prepayment reviews of claims for a specified period of 149 time. 150 (h)Comprehensive followup reviews of providers every 6 151 months to ensure that they are billing Medicaid correctly. 152 (i)Corrective action plans that remain in effect for up to 153 3 years and that are monitored by the agency every 6 months 154 while in effect. 155 (j)Other remedies as permitted by law to effect the 156 recovery of a fine or overpayment. 157 158 If a provider voluntarily relinquishes its Medicaid provider 159 number or an associated license, or allows the associated 160 licensure to expire after receiving written notice that the 161 agency is conducting, or has conducted, an audit, survey, 162 inspection, or investigation and that a sanction of suspension 163 or termination will or would be imposed for noncompliance 164 discovered as a result of the audit, survey, inspection, or 165 investigation, the agency shall impose the sanction of 166 termination for cause against the provider. The agencys 167 termination with cause is subject to hearing rights as may be 168 provided under chapter 120. The Secretary of Health Care 169 Administration may make a determination that imposition of a 170 sanction or disincentive is not in the best interest of the 171 Medicaid program, in which case a sanction or disincentive may 172 not be imposed. 173 Section 2.Paragraph (g) of subsection (2) of section 174 409.967, Florida Statutes, is amended to read: 175 409.967Managed care plan accountability. 176 (2)The agency shall establish such contract requirements 177 as are necessary for the operation of the statewide managed care 178 program. In addition to any other provisions the agency may deem 179 necessary, the contract must require: 180 (g)Program integrity. 181 1.Each managed care plan shall establish program integrity 182 functions and activities to reduce the incidence of fraud and 183 abuse, including, at a minimum: 184 a.1.A provider credentialing system and ongoing provider 185 monitoring, including maintenance of written provider 186 credentialing policies and procedures which comply with federal 187 and agency guidelines; 188 b.2.An effective prepayment and postpayment review process 189 including, but not limited to, data analysis, system editing, 190 and auditing of network providers; 191 c.3.Procedures for reporting instances of fraud and abuse 192 pursuant to chapter 641; 193 d.4.Administrative and management arrangements or 194 procedures, including a mandatory compliance plan, designed to 195 prevent fraud and abuse; and 196 e.5.Designation of a program integrity compliance officer. 197 2.Each managed care organization or managed care plan or 198 its subcontractor may not refer a Medicaid recipient for a 199 covered treatment or service rendered by or in the office of a 200 provider, another subcontractor, or a third-party entity if the 201 managed care organization or managed care plan or its 202 subcontractor has any ownership or profit-sharing arrangement 203 with the provider, the other subcontractor, or the third-party 204 entity. 205 Section 3.This act shall take effect July 1, 2025.