Florida Insurance Regulators Question Met Life, Nationwide About Payouts on Life Policies
Five-hour hearing aimed to smooth path for beneficiaries getting their money
By: Jim Saunders News Service of Florida | Posted: May 20, 2011 3:55 AM
www.newsserviceflorida.com

 Regulators from Florida and other states hammered insurance executives Thursday with questions about whether companies are trying hard enough to pay life-insurance claims.

Florida Insurance Commissioner Kevin McCarty is leading a multistate probe that he said could involve more than $1 billion in money owed. Executives from MetLife and Nationwide insurance companies testified under oath during a hearing Thursday -- but McCarty said the probe involves all of the nation’s largest life insurers.

“At the end of the day, we fully intend to … make sure that promises made (by insurance companies) are promises kept,’’ McCarty said.

The five-hour hearing, which drew regulators from as far away as North Dakota, centered on how insurers use a database with the ominous name of the “Death Master File.’’

The U.S. Social Security Administration maintains the database, which includes various types of identifying information about people who have died.

Regulators question whether life insurers have used the database enough to determine whether policyholders have died -- which, ultimately, can start the process of paying claims.

But Todd Katz, a MetLife executive vice president, said 99 percent of his company’s claims come through more ordinary channels, such as beneficiaries reporting the deaths of family members. He described the Death Master File as a “safety net” that can help in other circumstances.

“Our goal is to pay every claim that should be paid – pay it accurately and promptly,’’ Katz said.

Regulators, however, repeatedly questioned MetLife officials about the company’s more extensive use of the Death Master File to find out whether customers with annuities have died.

Essentially, regulators accuse insurers of a double standard in the use of the database: If a company finds out a customer with an annuity is dead, it can stop making payments. But if a customer with a life-insurance policy is determined to be dead, the insurer is required to shell out money.

“It seems to me, that’s a little offensive to people,’’ said Belinda Miller, acting general counsel for the Florida Office of Insurance Regulation.

But Katz said his company is trying to make sure it doesn’t erroneously pay annuities after a customer dies. In such cases, the dead person’s family members could have to pay back the improperly paid amounts.

Thursday’s hearing came a day after the Office of Insurance Regulation announced a settlement with the John Hancock Life Insurance Co. on issues related to the Death Master File.

John Hancock denied any wrongdoing, but agreed to pay $3 million to Florida, with $600,000 waived because of the company’s cooperation. Also, it agreed to take other steps aimed at making sure beneficiaries get paid.

Despite the settlement, McCarty said the investigation into the industry’s practices is in the “beginning stages’’ and could take 18 to 24 months. He said many people don’t know their parents or grandparents had life-insurance policies, making it important that the companies follow through on paying claims to beneficiaries.

But MetLife, which faced heavier questioning than Nationwide, indicated that difficulties can occur in paying claims on what are known as “industrial” policies.

Door-to-door agents sold the low-value industrial policies decades ago, and MetLife says it does not have Social Security numbers for many of the policyholders. Executives said that creates problems in trying to match up information from the policyholders with the Death Master File.

But Michael Consedine, the Pennsylvania insurance commissioner, said policy applications included other information that insurers can use to help track down those policyholders. He said the companies also need to use other technology in the searches.



Insurance company reaches multi-million dollar settlement with Florida
Christine Jordan Sexton
May 18, 2011
www.TheFloridaCurrent.com

Florida Insurance Commissioner Kevin McCarty announced on Wednesday that his office inked a multi-million dollar settlement with one of the largest life insurance companies regarding their handling of annuities and death benefits.

John Hancock denied any wrong doing in the 44-page settlement agreement but agreed to modify its future business practices by Oct. 1. The company agreed to return money -- including interest payments -- to beneficiaries. If someone cannot be found Hancock must report that information to the Department of Financial Services. To pay those claims the company must establish a $10 million “Florida Unclaimed Property Account” which must maintain a balance of at least $7.5 million.

At issue is the alleged practice of insurance companies using a list of everyone who died that is compiled by the U.S. Social Security Administration. While companies use what is known as the Death Master File to stop company payments for annuities, they allegedly do not use the same information to pay death benefits on life insurance policies.

The agreement was announced on the eve of a National Association of Insurance Commissioners task force meeting on the same issue.The NAIC is a voluntary organization of insurance officials in the 50 states, Washington, DC and five U.S.territories.

The group is chaired by McCarty. Other states that are represented on the task force include Illinois, Iowa, Louisiana, New Hampshire, New Jersey, North Dakota, Pennsylvania and West Virginia. Two carriers -- Metropolitan Life Insurance Company -- MetLife -- and Nationwide Life Insurance Company have been subpoenaed to testify at the meeting.

Office of Insurance Regulation spokesperson Jack McDermott said the office also is examining other companies. He said that MetLife and Nationwide were subpoenaed because they also are being investigated in other states. “We have made it clear that we believe this may be an industry practice. MetLife and Nationwide are large companies being examined in other states. Someone has to go first.”

According to the Hancock settlement agreement, the Department of Financial Services launched an investigation into John Hancock’s handling of unclaimed property laws in March 2009. The OIR launched its investigation in April 2009 and the OIR and DFS hired contractor Verus Financial to audit the company.

Subsequently the Attorney General's office joined the investigation.

Hancock agreed in the settlement to pay the three agencies $3 million to recoup investigative costs and attorneys’ fees, although $600,000 was waived due to the company’s “cooperation.”


Tags: Belinda Miller, Death Master File, John Hancock Life Insurance, Kevin McCarty, MetLife, Michael Consedine, Nationwide, News, Office of Insurance Regulation, Social Security Administration, Todd Katz, Government


Insurers may owe $1b in unpaid benefits
By Alexis Leondis
Bloomberg News / May 20, 2011

NEW YORK — Life insurers may be keeping at least $1 billion in unclaimed benefits owed to policyholders, beneficiaries, or states, according to a Florida regulator.

Florida Insurance Commissioner Kevin McCarty, who made the estimate, called it a “conservative number’’ during a conference call with reporters yesterday.

Officials from MetLife Inc., the largest US life insurer, and Nationwide Mutual Insurance Co., the policyholder-owned insurer, were subpoenaed to appear at a hearing in Tallahassee by the Florida Office of Insurance Regulation to explain how they determine when policyholders have died.

“We want to ensure that insurance companies use as much effort to find and pay benefits as they do to find and collect premiums,’’ McCarty said during the call with reporters.

The hearing, which was attended by representatives from about 15 states, was held to help determine whether life insurers use Social Security Administration death records to stop annuity payments, without using that same data to identify policyholders who have died.

Liability for life insurance begins when the company receives proof of death, which is different than what happens in the annuity business, according to testimony by Todd Katz, executive vice president of insurance products for New York-based MetLife. If annuities continue to be paid out to deceased recipients, the insurer may have to reclaim those payments, he said.

MetLife began using Social Security data to stop some annuity payouts starting in the late 1980s, Katz said. The insurance company started using the death list to identify some life insurance policyholders’ deaths around 2004. The insurer used the death record to conduct a sweep of most of its life insurance policies in 2007 and in 2010 decided it would check the list at least once a year. When matches are made, an investigation begins and beneficiaries are contacted, Katz said.

MetLife paid more than $11 billion to beneficiaries in 2010 and turned over $51 million to the states, according to a statement from the insurer.

MetLife has also been subpoenaed to a hearing in California on Monday. The National Association of Insurance Commissioners has formed a task force, led by Florida, to help coordinate investigations into whether companies failed to pay benefits to beneficiaries.

Passed by Florida's Legislature on May 2, 2011 and awaiting action by Florida Governor Rick Scott,  CS/CS/HB 647, also known as "The Florida Volunteer Protection Act," codified in s. 768.1355, F.S., provides that any person who volunteers to perform any service for any nonprofit organization, without compensation, shall be considered an agent of such nonprofit organization when acting within the scope of any official duties performed under the volunteer services. Such person may not incur civil liability for any act or omission by the person which results in personal injury or property damage under specified circumstances.

The bill amends the Act to specify that, as long as a volunteer is not being compensated by the nonprofit organization for which he or she is volunteering, liability for the volunteer’s acts still may be shifted to the nonprofit organization, provided the other criteria of the Act are satisfied. In addition, if the volunteer is being compensated by another source and is not acting as an agent of the source of compensation, neither the volunteer nor the source of the compensation may  incur any liability for the volunteer’s acts or omissions if the other criteria of the Act are also met.

Specifically, under the bill, any person who volunteers for any nonprofit organization, including an officer or director of such organization, without compensation from the nonprofit organization, regardless of whether the person is receiving compensation from another source, except reimbursement for actual expenses, shall be considered an agent of such nonprofit organization when acting within the scope of any official duties performed under such volunteer services.

The bill also provides that the volunteer and the source that provides compensation, if the volunteer is not acting as an agent of the source, may not incur any civil liability for any act or omission by the volunteer which results in personal injury or property damage if other specified criteria in the Act are also met.

If approved by the Governor, these provisions take effect July 1, 2011, and apply to causes of action accruing on or after that date.

As Florida Governor Rick Scott considers whether to sign or veto this year's crop of bills, the outcomes of Florida's 2011 Legislative Session are starting to register, particularly in regard to senior issues.  The Tampa Tribune reports below:


Session leaves advocates fearing for the elderlyTALLAHASSEE -- She had driven through the night from Tampa and signed up early to testify. But the state House committee hearing was ending, and still no one had called her. Nervously, Anna Spinella stood up and demanded to speak.

It was March 1999. The state Legislature was contemplating tougher standards for nursing homes. Spinella had traveled to tell lawmakers about her family members — such as Kenny, the brother-in-law whom nursing staff had so often left soaked in urine and the remains of his last meal. And Helen, the sister who suffered from a bad bedsore after staff sheared off a mole by mistake and then failed to treat it.

Spinella got her three minutes at the podium. Two years later, Gov. Jeb Bush signed a fiercely negotiated deal that combined new lawsuit protections for nursing homes with an increase in mandatory staffing. But while the legal reforms have stuck, the staffing levels are dropping as the state pares back Medicaid payments to nursing homes.

Faced with the worst budget year in recent history, Florida lawmakers chopped those Medicaid reimbursements this spring by 6.5 percent and scaled back staffing requirements below 2003 levels.

"Staffing is everything," said Spinella, now legally blind and hobbled with a bad leg. Unable to drive and being the primary caregiver for her frail, 79-year-old husband, Joe, she can't make it to Tallahassee anymore. "This is killing me."

The cutbacks are among the more controversial outcomes of the legislative session that will directly affect seniors. Others include privatizing Medicaid into a managed-care program — starting with seniors in long-term care, over objections from advocates for the elderly.

GOP lawmakers insist they were looking out for seniors. They point out that despite a nearly$4 billion shortfall, they funded more than 2,000 new slots in sought-after programs that enable seniors to age in their homes and communities instead of an institution.

Meanwhile, funding for the Department of Elder Affairs was left intact, said Rep. Matt Hudson, R-Naples, the House health care budget chairman. "In a tough budget year, seniors fared very well," he said. "When you make virtually no cuts to an entire agency in such a year, I call that miraculous."

* * * * *

The 2001 nursing home reforms required a one-hour minimum of daily care by licensed nurses and phased in a minimum of 2.9 hours by certified nursing assistants. A University of South Florida study found in 2009 that with the added staffing, "deficiencies per facility have decreased," especially the serious violations.

But as budget pressures have intensified, lawmakers have loosened the requirements. This spring, they knocked the CNA mandate down to 2.5 hours, and a combined minimum weekly average of CNA and licensed nursing down from 3.9 to 3.6 hours.

Sen. Joe Negron, the Senate's health budget chief, said during floor debate that he didn't like reducing those minimums required of nursing homes. But "it's not fair to cut their reimbursements and then keep their fixed costs the same," he said.

The final reductions, Negron said, were a compromise with the House, which had proposed a 10 percent cut to preserve funding for mental health and substance abuse treatment.

Negron, R-Stuart, was also the Senate's main architect behind overhauling Medicaid into a manage-care system, which will likely be dominated by for-profit HMOs. Seniors in long-term care will feel the effects first, starting in 2012.

"We specifically advised that they should not put long-term care first," said Jack McCray, AARP advocacy manager. "… You've got health issues, financial issues, access issues, transportation for caregivers. Long-term care is a very complicated issue."

Negron said those in nursing homes will experience little change, since the state will continue to pay directly for the care they receive within the nursing home, without passing the money through a managed-care plan.

The main change will come for seniors who can remain at home with support services, he said. Managed care will make it easier to provide those services, which most seniors would prefer over a nursing home, Negron said. Over time, the state will save money from more people "aging in place."

Richard Polangin, government affairs director for the Florida Alliance of Retired Americans, worries about where the savings will come from if HMOs are in charge.

"HMOs have to make a profit; they have to reward investors," he said. "Where does that profit come from? From our perspective, and all the research we're familiar with, it comes from reducing services."

Few entities provide medical care on a not-for-profit basis, said Michael Garner, president and CEO of the Florida Association of Health Plans.

"I'm sorry; I'm not going to apologize for the fact that we need to keep our doors open, just like every hospital or physician. … The argument that profits will keep care from getting delivered is unsubstantiated."

* * * * *

McCray said AARP is still waiting to see the effects of a bill that reduces reporting requirements for assisted-living facilities. It also stops requiring the Agency for Health Care Administration to develop and disseminate a list of such facilities sanctioned or fined for violations. AHCA currently posts the report on its website.

Hudson, the bill's sponsor, said it eliminates only outdated, arcane requirements for assisted-living facilities, and he argued that few people use the state report violations.

That wasn't enough reassurance for Michelle Rehwinkel-Vasilinda, one of three House Democrats who voted no.

"I just felt like we need more oversight of the ALFs, and this was removing oversight," the Tallahassee legislator said.

"When you're looking at facilities for children, or for elders who can't speak up for themselves, we need to be watching and making sure people are doing the right thing — especially when there's a profit motive involved."
cwhittenburg@tampatrib.com

(850) 222-8382

By CATHERINE WHITTENBURG | The Tampa Tribune
Published: May 18, 2011

The Orlando Sentinel columnist Scott Maxwell wrote this week about how the 2011 Florida Legislature has passed a series of cruel legislation that would plunge Florida frail elderly in nursing homes and assisted living facilities even further into neglect and abuse . . . much of which has gone unpunished at the hands of Florida's government and regulatory agencies.  Mr. Maxwell concludes that, apparently, "There may be profit in mistreating the elderly."

Florida is taking elderly down a dark, deadly path

The St. Petersburg Times published the following editorial on Saturday, May 14, 2011, about bills passed this year that unfairly target the poor and elderly, such as HB 7109, which would place a $300,000 cap on pain-and-suffering damages for the state's nearly 3 million Medicaid recipients, including those in nursing homes:

Devaluing the lives of poor, elderly

Leaders in the Florida Legislature frequently talk about their fiscal conservative principles. But in passing four bills that would make it harder to bring personal injury cases and cap the damages that courts can award, lawmakers have closed or curtailed access to the courts for thousands of injured Floridians. That makes it far more likely that the cost of catastrophic injuries due to medical malpractice or a faulty vehicle design will shift to taxpayers. If Gov. Rick Scott signs the bill he will signal he would rather let wrongdoers off the hook and shift the burden to taxpayers.

During the session that ended May 7, the Republican-led Legislature basically authorized a two-tier justice system, where the poor or elderly would no longer have their injuries due to medial malpractice compensated to the same extent as others. That raises real constitutional concerns about equal protection and access to the courts.

As part of the state's plan to turn the state-federal Medicaid program over to managed care organizations, HB 7109 would place a $300,000 cap on pain-and-suffering damages for the state's nearly 3 million Medicaid recipients, including those in nursing homes. That cap is far lower than the conventional medical malpractice award.

But the real outrage isn't that Medicaid victims will ultimately collect less. It's that the cap makes it far less likely they can even find a lawyer to take their case on a contingency basis. The high cost of medical malpractice cases will make if financially impossible for many attorneys to finance even legitimate cases. Ultimately that means the cost for long-term care for these poor Floridians will move to taxpayers rather than being borne by the doctors, nurses and hospitals that caused the harm.

The same concerns apply to SB 1676, which would give medical faculty of the University of Miami the same "sovereign immunity" — or protection from major malpractice judgements — when teaching at Miami's public Jackson Memorial Health System. Sovereign immunity, a holdover from British law, limits government's liability. In Florida, a victim of medical malpractice by a government-financed doctor is limited to $100,000. Any judgment above that amount must be approved by the Legislature. But UM is not a government institution. It's a private medical school that shouldn't be shielded from liability or from the cost of defending lawsuits when its doctors severely injure a patient.

Lawmakers also tipped the scale against injured patients with HB 479, by forcing additional state regulation on medical expert witnesses, including requiring them to obtain state certification and subjecting them to discipline, such as the potential loss of their license, if they give deceptive testimony. The goal is to make it harder for personal injury lawyers to bring cases by intimidating and harassing the pool of medical professionals willing to testify.

Lawmakers were also willing to let automakers limit their liabilities from product defects. Currently, under the "crashworthiness" doctrine, a person injured in a car wreck can sue the automaker separately, claiming that injuries were caused or exacerbated by a defect in the vehicle's design. But SB 142 would let juries apportion blame among all the responsible parties to an accident — such as a drunken driver or a driver who was texting — which potentially lets car companies escape liability for problems built into their vehicles.

Legislative leaders have bragged that all four bills are good tort reform. But what these bills really do is make it much harder for severely injured Floridians to obtain compensation through the legal system, meaning those with catastrophic injuries will likely have to turn to taxpayers for care. There is nothing fair or fiscally conservative about it.

 Florida's on-again, off-again prescription drug database has run into several hurdles after being passed during the final day of Florida's 2011 Legislative Session.   The Florida Independent reports on the status of the contended program below:

After delays, DOH set to finalize drug database contract early next week
By Virginia Chamlee | 05.13.11 | 3:56 pm

Reprinted from:  The Florida Independent

Though Florida’s 2011 legislative session only recently came to a close, a program that emerged as one of its key successes has fallen behind schedule.

Contracting delays have thrown the implementation of a prescription drug database intended to aid the state’s crackdown on pill mills database off schedule by at least two weeks. A spokeswoman for the state Department of Health says the contract has taken longer than expected to finalize, but should be ready in the next few days.

A Prescription Drug Monitoring Program designed to crack down on pill mills was approved by the Legislature at the close of the session, and is awaiting the signature of Gov. Rick Scott. Though Scott was initially skeptical of the program, he has since championed its efforts to thwart Florida’s notorious prescription drug problem, and helped preside over the House of Representatives after a bill supporting a tougher crack down on pill mills was salvaged on the final day of the session. #

Scott had worried the database could pose privacy issues and be too costly for the state to implement. Even after receiving an offer of $1 million from Purdue Pharma (makers of the pain pill OxyContin) to support the program, Scott rejected the money. #

Questions concerning the funding of the drug-monitoring database still abound. A federal grant program (NASPER) that would have given the PDMP financial support was cut in April, and, as the bill is written, the database can only be funded by grants and private donations. #

The PDMP Foundation already has around $1.3 million set aside – enough to fund the Program for up to 18 months. Should the federal NASPER grant program be reinstated, the program would have another source of funding. Attorney General Pam Bondi has committed to provide forfeiture funds (via seizures of drugs, cars and other items by local law enforcement agencies) to the program, so that there will likely be a steady revenue stream even after the existing dollars run out.

But now, yet another delay to its implementation has surfaced. The Department of Health (which is in charge of implementing the PDMP) has yet to sign the contract authorizing the program. The original target date to execute the contract was May 1, but due to scheduling constraints, that date has been moved back to May 16.

“The contract is simply going through an internal routing process,” says Nancy Blum, Communications Director of the state Department of Health. “We are dotting the I’s and crossing the T’s and we expect the contract to be ready early next week.”

According to Greg Giordano, Chief Legislative Aide for Sen. Mike Fasano, a New Port Richey Republican who is one of the program’s most outspoken supporters), the delay means that the program is already two weeks behind schedule.

“With 90 days for installation, followed by 30 days of required training, that would push the ‘go-live’ date back two weeks to September 11,” he says.

Giordano says that he has no reason to believe that the delay was intentional, but was merely the result of the Department being behind schedule.

“Given that the governor was on hand when the House passed out the final version of HB 7095 last Friday, I would hope politics is no longer part of the discussion.  It is definitely time for the work of the past nine years to come to fruition later this summer,” said Giordano.

The Florida Agency for Health Care Administration Nursing Home Guide lists nursing homes by region and county. 

The Guide also includes facility-specific comparative information including a star ranking based upon deficiencies cited during inspections. The electronic version of the Guide is updated quarterly and posted on the Agency's web site approximately 45 days after the end of the calendar quarter (by the 15th calendar day of the second month following the end of the calendar quarter).

The Nursing Home Guide includes a Watch List which identifies nursing homes that are operating under bankruptcy protection or met the criteria for a conditional status during the past 30 months. A conditional status indicates that a facility did not meet, or correct upon follow-up, minimum standards at the time of an inspection. Immediate action is taken if a facility poses a threat to resident health or safety. (Under Florida law, nursing homes have a right to challenge state sanctions. Facilities challenging a conditional license are noted as under Appeal. Watch List information is subject to change as appeals are processed; information is updated regularly on this web site. Electronic Watch List data is updated daily.)

Nursing Home Guide/Watch List Posting Instructions

Health Care Facility and Provider Inspection Reports links to copies of regular inspection and complaint inspection reports and Florida Health Finder provides basic information and maps for nursing homes and other health care facilities and providers regulated by the Agency.

The Federal Centers for Medicare and Medicaid Services also publishes a Nursing Home Compare web site that provides additional information to compare nursing homes in Florida and the nation.

Florida Governor Rick Scott, who was previously forced to resign as CEO of Columbia/HCA Hospitals after the company was found guilty of Medicare fraud, has initiated a review of Florida's taxpayer-funded hospitals.  

The meetings, the first of which is scheduled for May 27, 2011, will run for eight months at the Florida Agency for Health Care Administration in Tallahassee.  A report will be issued on January 1, 2012.  

The article below is reprinted from The Florida Current:
Scott's review of taxpayer funded hospitals ready to gear up

Christine Jordan Sexton, 05/10/2011 - 06:31 PM

Fresh off a bruising legislative session Florida hospital lobbyists will kick into gear again in May when a gubernatorial panel begins meeting to discuss the role of taxpayer funded public hospitals.

Dominic Calabro, chairman of the Commission on Review of Taxpayer Funded Hospital Districts, released in an email a list of a dozen projected meeting times over the next eight months, the first being scheduled May 27 in Tallahassee.

Lobbyist Ron Book predicted that the commission will be closely watched given Gov. Rick Scott’s interest in the issue, as well as the attempt this session by the for profit hospital industry to require judicial oversight of the sale or lease of any public hospital. For profit hospital chains Health Management Associates and HCA Healthcare lobbied aggressively to pass HB 619 and SB 1448.

“Anybody that is in the public hospital business that doesn’t pay attention, doesn’t participate, is extremely foolish,” said Book, whose clients include the North Broward Hospital and South Broward Hospital districts.

The bills -- both opponents and proponents agree -- were in play until the waning hours of the session before they ultimately died. The battle over the legislation drew dozens of high powered lobbyists on both sides of the issue trying to persuade legislators. There are a combined 31 lobbyists representing two of the largest for profit chains in Florida, Health Management Association and HCA Healthcare.

According to registration records, there are 49 registered lobbyists with the two large hospital associations that opposed the bill, the Safety Net Hospital Alliance of Florida and the Florida Hospital Association. Those numbers don’t include individuals like Book who lobby for individual facilities.

The industry infighting over the bill was so intense that an amendment appeared to the Medicaid overhaul that would have prevented public hospitals from using taxpayer dollars on lobbyists.

HCA Healthcare lobbyist Steve Ecenia -- who often is at odds with Book at the Capitol -- agrees that the commission will be worth watching.

“I think this commission is extremely important,” he said. “I think if nothing else, there are questions about what is going on with the sale and lease of these hospitals and I think it underscores the importance [of the issue] by having a commission look at this.”

Calabro has scheduled all the meetings in Tallahassee at the Agency for Health Care Administration headquarters. The commission will meet once a month through August then will hold meetings bimonthly through December. The commission is slated to release a report by Jan. 1, 2012.

Very few bills relating to home health care were filed during the 2011 Florida Legislative Session, and even less were successful. CS/HB 843 was among the successful legislation relating to Florida home health care agencies that was passed. A full Florida Senate legislative analysis is below:

CS/HB 843: Teaching Agency for Home and Community-Based Care

Passed during Florida’s 2011 Legislative Session, but not yet signed by Florida Governor Rick Scott (as of May 15, 2011), CS/HB 843 bill creates s. 430.81, F.S., which, effective July 1, 2011, authorizes the Florida Department of Elder Affairs to designate a home health agency as a teaching agency for home and community-based care if the home health agency meets certain requirements. 

The bill defines the term “teaching agency for home and community-based care” as a home health agency licensed under part III of chapter 400, F.S. that has access to a resident population of sufficient size to support education, training, and research relating to geriatric care. It also provides that home health agencies seeking designation as a teaching agency for home and community based care may demonstrate proof of financial responsibility as provided in s. 430.80(3)(g), F.S., in lieu of general and professional liability insurance coverage.

Finally, the bill authorizes a teaching agency to be affiliated with a Florida academic research university that meets certain criteria.

Current Situation

Lead Agencies

The Florida Department of Elder Affairs (“Department”) administers programs and services through designated planning and service areas. The Department is designated as the State unit on aging as defined in the federal Older Americans Act (“the act”) and must exercise all responsibilities pursuant to that legislation.

The Older Americans Act requires the Department to fund a service delivery system through designated area agencies on aging in each of the State’s 11 planning and service areas. In addition, chapter 430, F.S. requires the Department to fund service-delivery lead agencies that coordinate and deliver care at the consumer level in the counties comprising each planning and service area.

Lead agencies are designated by Area Agencies on Aging once every six years through a competitive procurement process. Lead agencies provide and coordinate services for elders in designated areas. There are 58 lead agencies serving all of Florida’s 67 counties. Lead agency providers are either non-profit corporations or county government agencies. Further, lead agencies are the only entities that can provide fee-for-service case management on an ongoing basis.

Lead agency services include:

Care Management
Adult Day Care
Adult Day Health Care
Home Delivered Meals
Case Aide
Chore Service
Companionship
Consumer Medical Supplies
Counseling
Escort
Emergency Alert Response
Emergency Home Repair
Home Health Aide
Homemaker
Home Nursing
Information and Referral
Legal Assistance
Medical Therapeutic Services
Personal Care – help with bathing, eating and dressing.
Respite Care
Shopping Assistance
Transportation

A “Home health agency” is defined in part III of chapter 400, F.S. as an organization that provides home health services and staffing services. Home health services are health and medical services and medical supplies furnished to an individual in the individual’s home or place of residence.

These services include:

• Nursing care;
• Physical, occupational, respiratory, or speech therapy;
• Home health aide services;
• Dietetics and nutrition practice and nutrition counseling; and
• Medical supplies, restricted to drugs and biologicals prescribed by a physician.

There are 2,317 licensed home health agencies in Florida as of February 23, 2011. They must be licensed by the Agency for Health Care Administration (“AHCA”).

The licensure requirements for home health agencies are in the general provisions of part II of chapter 408, F.S., the specific home health agency provisions of part II of chapter 400, F.S. and chapter 59A-8 of the Florida Administrative Code.

Florida law prohibits unlicensed activity and authorizes AHCA to fine unlicensed providers $500 for each day of noncompliance, and authorizes state attorneys and AHCA to bring an action to enjoin unlicensed providers. Unlicensed activity is a second-degree misdemeanor and each day of continued operation is a separate offense.

The requirements for training of health care professionals are under the Florida Department of Education and the requirements for licensing and continuing education are determined by the Board of Nursing and other boards under the Department of Health.

Section 400.497(1), F.S. permits home health agencies to train their own home health aides. However, home health agencies must become licensed by the Department of Education as a career education school in order to train any home health aides that will be employed by other home health agencies to train certified nursing assistants or others.

Home health agencies can become certified for Medicare and/or Medicaid, but they must meet the Medicare Conditions of Participation in 42 Code of Federal Regulations, Part 484 prior to certification. The federal regulations require applicants to comply with a complex comprehensive assessment prior to an initial certification survey.

Academic Health and Science Centers

Academic Health and Science Centers in the State University System have three primary purposes:

• Teach students going into healthcare professions;
• Conduct research to advance healthcare knowledge; and
• Serve patients with health care problems.

These centers provide facilities, faculty and staff, curriculum and opportunities for health science students to train in the various health science areas and get practical experience in their disciplines during their training. There are two state Academic Health and Science Centers in Florida. These centers are located at the University of Florida and the University of South Florida. Currently, there are two other medical education programs in the State University System, however they are not as extensive as health centers, which include multiple health education programs.

Funding for the Academic Health and Science Centers is provided annually by the Legislature in the form of specific appropriations in the General Appropriations Act to the two centers.

For Fiscal Year 2009-10, the program received a total of $222.3 million from legislative appropriations, $143.7 million in general revenue, and $14.2 million in revenue from lottery, and $52.6 million from the student fee budget authority.

Teaching Nursing Home Pilot Project

Section 430.80, F.S. was created by the Florida Legislature in 1999 to establish a pilot project, allowing AHCA to implement a comprehensive multidisciplinary program of geriatric education and research in a nursing home facility designated by AHCA as a teaching nursing home. Prior to HB 843, there is no statute that provides a similar program for home and community-based care.

Pursuant to s. 430.80(3), F.S. nursing home licensees must meet the following requirements to be designated as a teaching nursing home:

· Provide a comprehensive program of integrated senior services that include institutional services and community-based services;

· Participate in a nationally recognized accreditation program and hold a valid accreditation;

· Have been in business in Florida for a minimum of 10 consecutive years;

· Demonstrate an active program in multidisciplinary education and research that relates to gerontology;

· Have a formalized contractual relationship with at least one accredited health profession education program located in Florida;

· Have senior staff members who hold formal faculty appointments at universities that have at least one accredited health profession education program; and

· Maintain insurance coverage pursuant to s. 400.141(1)(s) or proof of financial responsibility in a minimum amount of $750,000.10

Special Insurance Provision

Section 400.141(1)(s), F.S. requires all licensed nursing home facilities to maintain general and professional liability insurance coverage that is in force at all times. In lieu of general and professional liability insurance coverage, a State-designated teaching nursing home and its affiliated assisted living facilities created under s. 430.80, F.S., may demonstrate proof of financial responsibility as provided in s. 430.80(3)(g), F.S.

In providing proof of financial ability to operate in the required minimum amount of $750,000, such proof may include:

· Maintaining an escrow account consisting of cash or assets eligible for deposit in accordance with s. 625.52, F.S., or;

· Obtaining and maintaining pursuant to chapter 675, F.S. an unexpired, irrevocable, nontransferable and nonassignable letter of credit issued by any bank or savings association organized and existing under the laws of Florida or any bank or savings association organized under the laws of the United States that has its principal place of business in this State or has a branch office which is authorized to receive deposits in this State.

Effect of Proposed Changes

CS/HB 843 creates s. 430.81, F.S., which authorizes the Florida Department of Elder Affairs to designate a home health agency as a teaching agency for home and community-based care. The requirements to receive designation as a teaching agency for home and community-based care are similar to the requirements for nursing homes seeking designation as a teaching nursing home under the teaching nursing home pilot project. In order to receive this designation, home health agencies must:

· Have been a not-for-profit, designated community care for the elderly lead agency for home and community-based services for more than 10 consecutive years;

· Participate in a nationally recognized accreditation program and hold valid accreditation;

· Have been in business in Florida for a minimum of 20 consecutive years;

· Demonstrate an active program in multidisciplinary education and research that relates to gerontology;

· Have a formalized affiliation agreement with at least one established academic research university with a nationally accredited health professions program in Florida;

· Have salaried academic faculty from a nationally accredited health professions program;

· Be a Medicare and Medicaid certified home health agency that has participated in the nursing home diversion program for a minimum of five consecutive years; and

· Maintain insurance coverage pursuant to s. 400.141(1)(s), F.S., or proof of financial responsibility in a minimum amount of $750,000.

Proof of financial responsibility may include maintaining an escrow account or obtaining and maintaining an unexpired, irrevocable, nontransferable, and non-assignable letter of credit issued by any bank or savings association authorized to do business in the State.

CS/HB 843 provides that the letter of credit is to be used to satisfy the obligation of the agency to a claimant upon presentation of a final judgment against the facility or upon presentation of a settlement agreement signed by all parties to the agreement when the final judgment or settlement is a result of a liability claim against the agency.

The bill also provides a definition of the term “teaching agency for home and community-based care” as a home health agency that is licensed under part III of chapter 400, F.S. and has access to a resident population of sufficient size to support education, training, and research related to geriatric care.

Finally, CS/HB 843 authorizes a teaching agency for home and community-based care to be affiliated with an academic health center in the state in order to foster the development of methods for improving and expanding the capabilities of home health agencies to respond to the medical, health care, psychological and social needs of the frail and elderly population. The bill provides that a teaching agency for home and community-based care is to serve as a resource for research and for training health care professionals in providing health care services in homes and community-based settings to the frail and elderly persons.

On April 5, 2011, the House Health and Human Services Access Subcommittee adopted a strike-all amendment to CS/HB 843. The amendment:

· Revised the bill to change the agency authorized to designate home health agencies as teaching agencies to the Department of Elderly Affairs instead of the Agency for Health Care Administration;

· Removed the requirement that home health agencies must serve a geographic area with a minimum of 200,000 adults age 60 and older to qualify as a teaching agency;

· Changed the requirement in the bill that home health agencies must be in business in this state for a minimum of 30 years, instead to a minimum of 20 years to qualify as a teaching agency;

· Removed the authority of the Agency for Health Care Administration to charge a fee of up to $250 to home health agencies seeking designation as a teaching agency.

The bill was reported favorably as a Committee Substitute. The above analysis reflects the substance of the Committee Substitute.

CS/HB 843 is reprinted below:

CS/HB 843

1	A bill to be entitled
2	An act relating to a teaching agency for home and
3	community-based care; creating s. 430.81, F.S.; providing
4	a definition; authorizing the Department of Elderly
5	Affairs to designate a home health agency as a teaching
6	agency for home and community-based care; establishing
7	criteria for qualification; authorizing a teaching agency
8	to be affiliated with an academic research university in
9	the state that meets certain criteria; authorizing a
10	teaching agency to be affiliated with an academic health
11	center; providing an effective date.
12
13	Be It Enacted by the Legislature of the State of Florida:
14
15	Section 1.  Section 430.81, Florida Statutes, is created to
16	read:
17	430.81  Implementation of a teaching agency for home and
18	community-based care.-
19	(1)  As used in this section, the term "teaching agency for
20	home and community-based care" means a home health agency
21	licensed under part III of chapter 400 that has access to a
22	resident population of sufficient size to support education,
23	training, and research relating to geriatric care.
24	(2)  The Department of Elderly Affairs may designate a home
25	health agency as a teaching agency for home and community-based
26	care if the home health agency:
27	(a)  Has been a not-for-profit, designated community care
28	for the elderly lead agency for home and community-based
29	services for more than 10 consecutive years.
30	(b)  Participates in a nationally recognized accreditation
31	program and holds a valid accreditation, such as the
32	accreditation awarded by the Community Health Accreditation
33	Program.
34	(c)  Has been in business in this state for a minimum of 20
35	consecutive years.
36	(d)  Demonstrates an active program in multidisciplinary
37	education and research that relates to gerontology.
38	(e)  Has a formalized affiliation agreement with at least
39	one established academic research university with a nationally
40	accredited health professions program in this state.
41	(f)  Has salaried academic faculty from a nationally
42	accredited health professions program.
43	(g)  Is a Medicare and Medicaid certified home health
44	agency that has participated in the nursing home diversion
45	program for a minimum of 5 consecutive years.
46	(h)  Maintains insurance coverage pursuant to s.
47	400.141(1)(s) or proof of financial responsibility in a minimum
48	amount of $750,000. Such proof of financial responsibility may
49	include:
50	1.  Maintaining an escrow account consisting of cash or
51	assets eligible for deposit in accordance with s. 625.52; or
52	2.  Obtaining and maintaining, pursuant to chapter 675, an
53	unexpired, irrevocable, nontransferable, and nonassignable
54	letter of credit issued by any bank or savings association
55	authorized to do business in this state. This letter of credit
56	shall be used to satisfy the obligation of the agency to the
57	claimant upon presentation of a final judgment indicating
58	liability and awarding damages to be paid by the facility or
59	upon presentment of a settlement agreement signed by all parties
60	to the agreement when such final judgment or settlement is a
61	result of a liability claim against the agency.
62	(3)  A teaching agency for home and community-based care
63	may be affiliated with an academic health center in this state.
64	The purpose of such affiliation is to foster the development of
65	methods for improving and expanding the capability of home
66	health agencies to respond to the medical, health care,
67	psychological, and social needs of frail and elderly persons by
68	providing the most effective and appropriate services. A
69	teaching agency for home and community-based care shall serve as
70	a resource for research and for training health care
71	professionals in providing health care services in home and
72	community-based settings to frail and elderly persons.
73	Section 2.  This act shall take effect July 1, 2011.

CODING: Words stricken are deletions; words underlined are additions.

The Florida Current, known for its timely news about state politics, issues and the Florida Legislature, posted this excellent summary of health care legislation in the 2011 State Legislative Session:

2011 session summary: Health Care
Christine Jordan Sexton, 05/11/2011 - 09:37 AM

When it comes to health care and health insurance, the 2011 session will be remembered for what lawmakers did, as well as what they didn't do.

Lawmakers passed a far-reaching overhaul of the $22 billion Medicaid program, requiring most Medicaid patients to enroll in managed care plans over the next four years. It also passed a spate of lawsuit protections for doctors and hospitals that treat Medicaid patients and agreed to require out-of-state doctors to register with the state before they can testify as expert witnesses in lawsuits.

But other high-profile health issues -- such as requiring medical loss ratios for health insurance carriers as mandated by federal law, or making changes to state employee health insurance -- didn't pass. There were different reasons for inaction on those issues: While there was no support for changing state insurance law to bring the MLR requirement in line with federal law, there was support to trim state administrative overhead. Many embraced the idea of making state employee health insurance policies more reflective of the commercial market.

But at the end of the day, the chambers started to bicker, and the issue was dropped, a victim of the session's last dysfunctional hours.

KEY ISSUES

MEDICAID: Arguably this was the No. 1 issue of the 2011 session, after the chambers couldn’t reach a compromise on the issue last year. The final bills approved by legislators, HB 7107 and 7109, require Medicaid patients to enroll in managed care plans beginning October 2013 for long-term care and 2014 for traditional health care generally provided for women and children. Under the revised Medicaid program, the state would be divided into 11 regions and competitively bid among interested managed care plans. The bill dictates a minimum and maximum number of plans for each region, and requires at least one provider service network in each.

The revised Medicaid program would allow the state to assess premiums for participation, and also would allow for co-payments for inappropriate use of emergency rooms. The changes require Florida to submit a new waiver to the federal government for approval before any changes can be made. Before submitting the waiver, the state must hold a handful of meetings across the state to get input from Floridians.

One of the overhaul measures, HB 7109, includes limits on lawsuits against Medicaid providers. The measure limits non-economic damages for personal injury or wrongful death to $300,000 per claimant. The cap can be pierced if the plaintiff can prove by clear and convincing evidence that the provider acted wrongfully. Hospitals include ambulatory surgical centers and mobile surgical facilities licensed under a hospital. No practitioner is liable for more than $200,000 in non economic damages unless the injured patient can prove by clear and convincing evidence that the practitioner acted wrongfully,

LIABILITY PROTECTIONS: There were a number of lawsuit protections passed this year to the benefit of Florida hospitals and doctors. The Legislature gave the nod to HB 395, which makes operational changes to Shands hospitals in Gainesville and Jacksonville, and gives the hospitals and their affiliated physicians and clinics sovereign immunity. The Legislature also approved a bill, SB 1676, that will give the University of Miami and its employees sovereign immunity when working at Jackson Memorial Hospital.

The Florida Medical Association pushed its tort agenda separately from Medicaid legislation, focusing on HB 479. Doctors pushed measures that would allow them to buy insurance policies giving them the right to veto any offer for admission of liability, as well as the right to arbitrate any offer that is within policy limits.

FMA President Madelyn Butler, M.D., said in a statement that the organization was “extremely pleased” with the bill. “For over a decade (the FMA has considered) the passage of this legislation to be major step forward in making Florida a more friendly place to practice medicine.”

But lawmakers rejected proposals that would have limited lawsuits against Florida nursing homes. Senate Rules Chairman Sen. John Thrasher said simply that they'd hit their limit on lawsuit protections.

HEALTH CARE BUDGET: The overall health care budget included in SB 2000 appropriates nearly $30 billion for health care and human services, or a 5 percent increase. The final budget includes funding for the Medically Needy and MEDS-AD program, while also providing a $36.2 million increase for Florida KidCare and a reimbursement rate increase for dentists who serve children. But there are also plenty of cuts in the final budget. Hospitals will have their Medicaid reimbursement rates cut by 12 percent, county health departments’ rates will be cut 10 percent, nursing home rates will be cut by 6.5 percent and development disabled providers will receive a 3 percent rate cut. The budget also cuts money set aside for biomedical research from $50 million to $30 million.

A stand-alone health care budget conforming bill -- SB 2144 -- diminishes the impact of the nursing home cuts by decreasing staffing requirements to 3.6 hours per resident each day.

FEDERAL HEALTH CARE REFORM: While the state moves through the courts with its challenge of federal health care reform, the Florida Legislature also took steps to blunt the impact of the overhaul. SJR 2, filed by Senate President Mike Haridopolos, R-Merritt Island, is a proposed constitutional amendment that would thwart the effect of the federal law by making clear that mandates don’t apply to Floridians. It is one of at least 7 amendments that could appear before voters in November 2012.

The Legislature also passed HB 1193, which further attempts to ensure that any effort to implement federal health reform is weakened by creating a new section of insurance law, a prohibition against requiring the purchase of health insurance. There are exceptions in the law for driving workers compensation and any “activity between private persons.”

Also, the state didn’t move ahead with implementing any changes to insurance laws to reflect the numerous health insurance reforms that went into effect September 23. And it made no effort to begin rate review of large group or out-of-state health insurance plans. Both issues appeared on an Office of Insurance Regulation 2011 list of legislative priorities.

ABORTION: With an anti-abortion governor at the helm, the Legislature passed a number of bills that, if signed into law, could slow down the process for women wanting to obtain abortions. The Legislature passed five abortion-related bills, the most high-profile being HB 1127, which requires a woman seeking an abortion in the first trimester to get an ultrasound. Gov. Charlie Crist vetoed a similar bill last year. Sen. Nancy Detert, R-Venice, voted against the bill, saying she “personally resent(s) a Legislature that acts like I am too stupid to make decisions about my own body.”

The Legislature also passed HB 1247, which makes it more difficult for minors to get court waivers from Florida’s parental notification law by adding time delays. Another measure, HB 1179, will ask voters to weigh in on public funding of abortions -- which already is prohibited by federal law -- and exempt abortion from the right to privacy in Florida’s constitution.

While Florida opposes the federal health reform act -- a central part of which is the establishment of insurance exchanges in 2014 -- legislators took steps to ensure that no health plan sold through an exchange can include abortion as part of the policy. Under HB 97, abortion coverage effectively will have to be sold separately through an insurance rider, which many pro-choice advocates say just won't happen in practice.

The Legislature also gave the nod to HB 501, which transfers responsibility of allocating the funds generated by sales of license plates from counties to the entity Choose Life Inc. The bill also authorizes Choose Life, Inc. to use 15 percent of the money collected through the sale of the license plates for administration and promotion.

PRESCRIPTION DRUGS: A resolution was brokered in the waning hours of the legislative session by Gov. Rick Scott, Attorney General Pam Bondi, and Haridopolos, who was counseled by his physician/wife, Stephanie, and House leaders. The end product keeps intact pain management clinic regulations and provides enhanced criminal and administrative penalties targeting doctors and clinics engaged in prescription drug trafficking. HB 7095 also bans dispensing of most abused narcotics, but makes exceptions for doctors who dispense the drugs for surgical purposes.

Moreover, the Legislature gave the nod to HB 1039, which permanently bans the sale and use of so called “bath salts.” Bondi nixed the sale of methylenedioxypyrovalerone after being elected in January via an emergency rule. The bill codifies the emergency rule.

AGENCY MERGER: Speculation heading into the 2011 session centered around folding the state’s health care agencies into a single entity. There were several bills filed that would have done just that, but in the end nothing occurred. Fueling the anticipation of consolidation was the creation in the House of a Select Committee on Government Reorganization. In the end, though, there were no changes, and the state’s social and health care agencies remain distinct.

Indeed, Scott appointed former Florida Medial Association President Frank Farmer to head the Florida Department of Health and Liz Dudek, who had been acting AHCA Secretary, to fill the position full-time. David Wilkins, a member of the transition team, has been named Secretary of the Department of Children and Families.

Scott has had less success finding a secretary for the Agency for Persons with Disabilities. Scott named former legislator Carl Littlefield to head the agency, but Littlefield resigned just one day before he was scheduled to appear before a Senate committee, where he was expected to field some tough questions regarding his handling of allegations that a group home for developmentally disabled adults allowed sex between residents. Littlefield was the area administrator for APD that oversaw Human Development Center in Seffner.

There still is no secretary at APD.

Health Care Legislation Passed During Florida's 2011 Regular Session:

SB 2 - Relating to Health Care Services, by HaridopolosHB 97 - Relating to Health Insurance, by Gaetz (M)HB 137 - Relating to Prostate Cancer Awareness Program, by RenuartHB 155 - Relating to Privacy of Firearms Owners, by BrodeurHB 395 - Relating to University of Florida J. Hillis Miller Health Center, by O’TooleHB 445 - Relating to Wellness or Health Improvement Programs, by IngramHB 479 - Relating to Medical Malpractice, by Horner and CampbellSB 702 - Relating to Umbilical Cord Blood Banking, by FloresHB 843 - Relating to Teaching Agency for Home and Community-Based Care, by DiazHB 935 - Relating to Health Care Price Transparency, by CorcoranHB 1037 - Relating to Continuing Care Retirement Communities, by Bembry and PassidomoHB 1039 - Relating to Controlled Substances, by PatronisHB 1085 - Relating to Women's Health, by PlakonHB 1125 - Relating to Health and Human Services, by CorcoranHB 1127 - Relating to Abortions, by PorterHB 1179 - Relating to Abortion/Public Funding/Construction of RightsHB 1193 - Relating to Health Insurance, by HudsonHB 1247 - Relating to Parental Notice of Abortion, by StargelHB 1319 - Relating to Certificates and Licenses for Certain Health Care Practitioners, by HarrellSB 1366 - Relating to Child Welfare/Mental Health/Substance Abuse, by StormsSB 1676 - Relating to Sovereign Immunity, ThrasherSB 2144 - Relating to Medicaid, by BudgetHB 4027 - Relating to Obsolete Health Care Provisions, by HornerHB 7095 - Relating to Controlled Substances, by Health & Human ServicesHB 7107 - Relating to Medicaid Managed Care, by Health & Human Services CommitteeHB 7109 - Relating to Medicaid, by Health & Human Services Committee