megan wall

Megan Wall, esq

Summary of the iBudget Rule Challenge Final Hearing before DOAH

Earlier this month, I attended the three day rule challenge hearing before the Division of Administrative Hearings (“DOAH), at which Holland & Knight attorneys Gigi Rollini, Karen Walker and Matthew Mears represented developmentally disabled consumers challenging the third version of proposed rules to implement the iBudget.  Like so many other consumers receiving services through Florida’s Developmentally Disability Services Waiver, all four Petitioners received significant proposed reductions under the iBudget further depleting their already inadequate funding.  Because this case impacts every Waiver consumer, I am summarizing what occurred for those who could not attend.

In response to the rule challenge, APD hired five private attorneys, in addition to two in-house lawyers. The team of seven lawyers had significant resources at their disposal to defend the rule.

In Florida, rule challenges are fast track cases meant to be heard within 30 days from the filing of the petition.  This hearing was scheduled the very first full week in July. The Holland & Knight lawyers fought hard (and succeeded) against APD’s attempts to delay the hearing. While it is difficult to go to a full-scale hearing so quickly, the Holland & Knight team was concerned that to give APD more time to prepare would drive up the expense of the case. Amazingly, despite the holiday weekend, the hearing began as originally scheduled, which was difficult but strategically important.

The case at its core is simple. The iBudget statute directs APD to set each client’s funding for services at an amount based on a statistically valid algorithm, and then consider if the person needs an increase to that amount because of extraordinary, one-time, temporary or changed needs.  Florida law prohibits APD from enacting rules that run contrary to, or expand the implementing statute. Despite these legal limitations, the evidence in the case showed that:

1.         APD used the algorithm only as a starting point for setting funding because, in APD’s own words, the algorithm APD designed produced “harsh results” for many. Because the algorithm does not result in an equitable allocation of the funds for DD waiver clients, APD created an elaborate and subjective “methodology” to decide whether or not to use the algorithm to set a client’s iBudget. This supplemental “methodology” treats some groups of people differently, even where clients in those groups have the exact same needs.  Most glaringly, APD’s “methodology” targets existing DD waiver clients and singles them out to receive lower budgets than a new client with identical needs. Given that the law requires an “equitable allocation” of funds based on “the client’s level of need,” the evidence showed at the hearing that APD’s actual system is not consistent with the system described in the iBudget statute.

2,         APD told the Florida Legislature that if it adopted an iBudget system for Florida, then 64% of existing Waiver clients would see an increase in their budgets as a result of the iBudget.   However, APD later made a “policy decision” that funding increases simply would not be given and the algorithm would be used only to reduce, not increase a client’s allocation of funds.

3.         Former University of Florida Professor Dr. McClave (an expert in statistics and econometrics who has written text books on these types of models and created successful Florida Medicaid models) reviewed and tested the APD algorithm and testified on behalf of the Petitioners that it was statistically unreliable, including that APD’s chosen algorithm had a margin of error of over 40%!  He said that this is not a model based on a valid statistics approach, and that the model was unacceptable in his field. He memorably testified that APD’s chosen model is as accurate as “throwing darts at a wall of numbers.”

4.         APD identified no specific legal authority that allowed it to implement the iBudget the way it is being done. APD could point to no legal authority to use a statistically unreliable algorithm, to reduce amounts determined by the algorithm, to use a “decision tree” process to reduce existing client’s budgets, to single out existing clients and assign them lower budgets, or to reduce budgets without any final rules at all.  Recognizing the shortcomings of its own position, APD admitted it asked the Florida Legislature in 2012 to change the iBudget statute to  conform to how APD was actually implementing the program.  The Legislature declined to make the revisions. Regardless, APD simply continued to implement the system using its system rather than one consistent with the statute.

5.         APD’s statistics expert (Dr. Niu), who designed the algorithm, testified that he did what his client (APD) asked him to do and he did his best.  He did not consider other state’s algorithms. His reason was that he did not need to because he “only relies on [him]self.”  He used a very few variables (about seven), and assumed he could drop out some variables (such as the entire physical status portion of the QSI) on the basis that other, similar variables (such as the behavioral status portion of the QSI) tended to measure about the same thing—not realizing that every DD client doesn’t have both physical and behavioral needs, or does not have them in equal force. The result—those with significant physical needs, but no significant behavioral needs, will get substantially lower budgets than those with equally costly behavioral needs.

Also, it was shocking to learn that Dr. Niu “meant to do testing” to ensure the validity of the model, but then just did not get around to performing the type of testing necessary to ensure the validity of the model.  He did no testing against other years’ budgets (as is commonly done in statistics, apparently), or “log” method testing (as is typically done in statistics, apparently, when the model is a budget allocation or distribution model).  This was the case even though Dr. Niu has done a much simpler distribution model for the Florida Department of Transportation, and he did do “log” method testing for that model.

Dr. Niu also had no response to the UF Professor’s testimony that the algorithm was not statistically valid.  In fact, he said complimentary things about the other expert, Dr. McClave, and hoped his model “would get better over time.”

NoteAPD testified that it will analyze each client’s iBudget every 12 months to determine what further cuts can be made.  When APD decides it is appropriate, it may (or may not) re-run the inaccurate algorithm in any year it wants.  Under the proposed rules, APD has authority to use the proposed subjective methods in the rule to further reduce client services at its discretion. However, for future years, the processes which permit increases for extraordinary, one-time, temporary and changed needs will no longer be available to the person whose services are being reduced.  Of course, if the algorithm dictates an increase for a DD client, APD will still have the ability to find that award is “really just not medically necessary,” since APD continues to be the sole determiner of what is and what is not medically necessary.

APD’s arguments in response to Petitioners’ case were as follows: We worked really hard on this system; the Tier system has expired and, if this new system is thrown out, APD cannot return to the Tier system; we did our best; we do have authority to do what we did (without specific reference to any law or statute); and, mainly, the Florida Legislature is very happy with APD because APD has substantially cut the cost of the DD waiver program with APD’s interpretation of the iBudget system!  In fact, APD testified that the Legislature “rewarded” APD as a “thank you” for doing such a good job with two additional appropriations totaling $60 million, which APD used internally and to bring people off the waitlist.  [The judge asked if APD should have put that into the iBudget calculations and reappropriated the money to the existing DD clients, and APD said no; the Judge asked if APD had re-run the algorithm since APD first did it (one time) based upon each years’ new appropriation, and APD said, “No, and we are not going to.”]

And, finally, there was the real client example offered at the hearing: An amazing and articulate father of a DD 26-year-old came in and told his son’s story—with a 20 IQ, he lives in a home inherited by his father, which permits his son and two other DD clients to have extremely reduced rent.  All need 24-hour supervision, which they can barely piece together between the three of them—with less and less money each year, less and less of a rate of payment each year.  And, now, all three have been given iBudget reduction notices (his son’s, alone, is an over $8,000 reduction under iBudget).  They were barely making it since their budget is already to the bone (even with the father’s substantial assistance). With the cuts now proposed, there is no hope and nowhere for them to live, except an institution were these cuts to be implemented.

With that, the story of this proposed iBudget system was told.  The agency admitted it was not following the statute to implement the system and the model being used cannot be shown to be statistically reliable.  They agreed that cuts may continue each year. Even if every client could bring into an individual hearing an expert statistician to object to algorithm used to calculate the proposed reduction, the DCF Fair Hearing Officers lack the authority to find the rules invalid. Only DOAH has that authority.  Thus, the reason why this case is before DOAH for a decision, and why it is so crucial a test case.

A decision will be issued around the end of August or early September.  The lawyers for the Petitioners agreed to file this case without sufficient cash in hand on the hope that once the DD community knew the truth about the proposed iBudget system, they would join together to support efforts to compel APD to use an algorithm that is statistically reliable  and a process that follows the law. The Petitioners’ lawyers brought this David and Goliath case, did it in an unbelievably short period of time and, as a result, kept the costs to a bare minimum ($225,000).  Our team, led by Gigi Rollini, presented a clear, articulate, and persuasive case.  And, now, we have to pay her!  [And did I mention that in addition to APD’s seven attorneys and the work they all created, there was also surprise evidence sent by APD at 8:30 am the final day of trial, and surprise witnesses on the final day of witness disclosure—less than one week before hearing—including an expert APD brought in at the last minute and paid $85,000 for his service. And despite the additional work and expense tied to this surprise witness, he ultimately did not even testify because he had nothing to say after hearing Dr. McClave.]

Please contribute now to help us to meet our $125,000 goal!  To get there, we are asking that you consider donating at least at the $10,000 level.  We also specially thank those increasing this to the $20,000 level—we could not do this without you!

Please be a part of the solution!  There are two easy ways to contribute to the APD iBudget Proposed Rule Challenge:

(1)       Checks may be made out to Holland & Knight LLP, and sent to ATTN:  Gigi Rollini, Post Office Drawer 810, Tallahassee, Florida32302; or

(2)          Payment by wire transfer to:

Wells Fargo Bank N.A.

420 Montgomery Street

San Francisco, CA 94104-1207

ABA # 121000248

Account # 2090002390441

For Credit to: Holland & Knight, LLP

Please indicate “APD iBudget Proposed Rule Challenge” as the Beneficiary Reference in the wire.

Thank you!

–Megan Wall, Managing Attorney, St. Johns County Legal Aid

Notice of APD iBudget Workshop Hearing

Agency for Persons with Disabilities
65G-4.020: iBudget Florida

The The Agency For Persons with Disabilities announces a workshop to which all persons are invited.

DATE AND TIME: April 3, 2012, 2:00 PM-4:00 PM
PLACE: Agency for Persons with Disabilities
4030 Esplanade Way Suite 301

Tallahassee, Florida 32399

GENERAL SUBJECT MATTER TO BE CONSIDERED: Implementation of iBudget Florida.
A copy of the agenda may be obtained by contacting: The agenda and any other materials will be posted on the Agency website:

For more information, you may contact: Kathy Palmer
Agency for Persons with Disabilities 4030 Esplanade Way
Tallahassee, Florida 32399 (850)488-4877

The complete statewide schedule for iBudget Florida implementation is as follows:


4/1/12 – Final component implemented for customers in areas 1 and 2, except Consumer-Directed Care Plus (CDC+) participants. Read more…
7/1/12 – Full implementation for all customers* in areas 4, 12, and 13 and for CDC+ participants in areas 1 & 2.
10/1/12 – Full implementation for all customers* in areas 14 and 23 (Suncoast Area).
1/1/13 – Full implementation for all customers* in areas 3 and 7.
4/1/13 – Full implementation for all customers* in areas 8, 9, and 15.
7/1/13 – Full implementation for all customers* in areas 10 and 11.


APD Residential Fee Collection


On April 1, 2012, the Agency for Persons with Disabilities Residential Fee Collection Rule will be fully implemented State-wide. Attached below, please find four documents which you will need in order to implement this new policy. Please review them carefully . They are as follows: (1) The official notice regarding the residential fee collection initiative (with time frames/requirements), (2) A list of frequently asked questions (along with responses to those questions), (3) A fee calculation worksheet that may be completed by the representative payees, and (4) A copy of the rule notice.


1.   65G-2.016 Residential Fee Collection


2.  Residential Fee Collection FAQs


3.  Residential Fee Collection Notice


4.  Residential Fee Collection Work Sheet


APD Continues Cost Containment Efforts

On April 1, Agency for Persons with Disabilities (APD) will reduce the rates it pays for therapy assessments and all nursing services to the standard rate paid by the Medicaid State Plan.  Currently, the APD Home and Community-Based Services Medicaid waiver pays higher rates for most of these services.
This rate change is the latest cost containment effort by APD to work toward bringing waiver expenses closer to the agency’s Legislative appropriation for the waiver.


Subject: Urgent – iBudget assault on providers

August 13, 2011
Dear members and friends,
The workshop on the Medwaiver iBudget Handbook on August 9th was a bit of a surprise, there was little or no advanced warning about it.  There are several changes in the handbook, and we strongly suggest that if you are a Medwaiver provider, if you work for a Medwaiver provider, or if you are thinking of becoming a provider, you go to the link and review the manual for yourself.  It is located at:, click on the ibudget handbook.
We would also suggest you have others, like your consumer’s advocates, look at it as well.  Feedback must be received by AHCA by 5:00 pm on Tuesday, August 16th.  Please submit feedback by Sunday evening to, in order to allow time to consolidate the information. If your agency belongs to Florida ARC or FARF, you may also want to express your concerns to them, or email your comments directly to (or fax: 850.414.1721 to Susan’s attention).  Please do not read this and send back a general response saying “I don’t like this”, or something similar.  Read the manual and give specific questions or feedback with page references!  The handbook process should also include a hearing before it is adopted, but keep in mind October is the projected time ibudget will start in the Tallahassee area.  Please forward this email to as many providers as you can, there is not much time to respond.
The changes of greatest concern to behavior analysis providers at this point seem to be:
Changes to the definition of “Agency”, an agency is now defined as: (Page 3-8) “An agency provider is a business or organization enrolled to provide a waiver service(s) that has four or more staff employed to carry out the enrolled service(s).”  Also, contractors are prohibited, staff must be EMPLOYEES.
Providers required to submit service logs shall at a minimum do so via the client central record system as follows; For services that are billed at the daily or quarter hour rate;
Supplies and equipment; and assessments – within 15 calendar days after the date on which services were rendered. For monthly rates – within 15 days after the month ends.  You will not be able to bill until all paperwork is entered into the system. ADTs (and maybe other services) can only bill once a month.  
Training with changes. (Starts on 3-1) Mandatory training for all staff would include:
1. The iBudget Florida waiver program: The iBudget Florida pre-service training will include brief introductions on subjects including; promoting choice, person centered approaches, incident reporting procedures, HIPAA, recognition of abuse, neglect and exploitation, domestic violence and sexual assault, and health and safety responsibilities
2. CPR/ First Aid (CPR must be taught via classroom setting by a trainer certified by either the American Heart Association or the Red Cross. Online CPR training is not acceptable training to meet this requirement)
3. iBudget Florida Coverage and Limitations Handbook
4. HIV/AIDS and infection control
5. Zero Tolerance (must be received by all agency employees prior to providing direct service and shall be completed at least once three years)
6. Medication Administration: Chapter 65G-7, Florida Administrative Code
It is the responsibility of the provider to ensure that training which carries an expiration date (CPR/First Aid, HIV/ AIDS, Infection Control and HIPAA) is received prior to the expiration date to avoid any lapse in certification.
Changes to ADT include: (Page 4-10) 1:3 and 1:1 staffing ratios require that the individual meet criterion for Behavior Focus or Intensive Behavioral ResHab. (From Page C-3) “At all times when individuals are present, a minimum of a least one staff member or 50 percent of all staff at the facility (whichever is greater), must have been trained on Reactive Strategies and Medication Administration.”  
ResHab – (Page 4-47) IBResHab qualifications includes significant behavioral events within the past 6 months.  If a consumer is in a highly prostheticized environment, and they haven’t had a major even in the past six months because of lots of staff pre-crisis intervention, they may lose IB designation.  Also, IB ResHab requires a BCBA Level I as clinical director of the IB program.
Changes to Behavior Analysis – (Page 4-81)There is a lot of wording regarding training caregivers such as “Training for parents, caregivers and staff is also an element of the services to ensure maximum effectiveness of the services and because these persons are integral to the implementation or monitoring of a behavior analysis services plan.”  The problem is, those of us who work with adults may be working with individuals who do not have a caregiver to train.  It is inappropriate to ask the city bus driver or the consumer’s employer to implement a behavior program.  Also, with the high turnover of support staff, training PCAs, Respite Providers, In Home Support Personnel, siblings, ADT staff, etc., we are unable to realistically provide an environment where the staff and primary caregivers are trained.
Changes to Behavior Assistant  – (Page 4-84) These services are now a travesty.  Originally designed to provide a behaviorally-trained paraprofessional to implement behavior programming to individuals with challenging behaviors, they are now defined as: “The primary role of the BAS provider is to assist the Behavior Analyst or provider licensed under Chapter 490 or 491, F.S. in training paid and unpaid caregivers for the service recipient in the consistent and accurate implementation of the BASP and recording of related data. Unlike other services, the BAS provider’s focus is more on working with the caregivers to provide them with the skills to execute the procedures as detailed in the BASP, rather than, the BAS provider intervening directly with the service recipient.”  It goes on to state that the Behavior Assistant can work with consumers for a “brief” period, but then must focus on transferring the intervention to others.  Obviously, this is problematic when one is working with an adult, a family with several other small children, or with elderly parents who may have difficulty implementing a behavior program with an aggressive individual.  Services are limited to 8 hours a day, services for 6 hours or more a day require monthly LRC approval, or as “deemed appropriate” by the LRC.  Assistants are required to have 2 hours of supervision by a certified behavior analyst or 490/491 licensed individual per month.  Supervision is not defined (ie: in the presence of the consumer, privately in-office, etc).  Also, no indication if the supervision is billable for either party.  
Transportation – Fifteen-passenger vans that are not lift-equiped cannot transport more than 10 individuals.
Recoupment – There are draconian recoupment policies for late paperwork for the following services: adult day training, non-residential support services, residential habilitation, supported employment and supported living coaching. (Page 5-3)
Behavior Analysis Documentation:
Copy of claim(s) submitted for payment;
Copy of service log;
Copy of assessment report, when as assessment report has been requested
Quarterly summary of monitoring including who, what, when and where of the monitoring events; or other content as required by the Agency.
Quarterly summary of each quarter of the support plan year. The fourth quarterly summary also serves as the annual report and must include a summary of the previous three quarters  
• Behavior analysis service plan and services provided including graphic display of acquisition and reduction behaviors related to implementation of the behavior analysis service plan, and
• Dated evidence of LRC reviews, approval and recommendations specific to target behaviors and the behavior plan, as required and consistent with 65G-4.010, F.A.C.,
Behavior Assistant Documentation –
1. Copy of claim(s) submitted for payment;
2. Copy of service log;
3. Quarterly summary of monitoring of program implementation including the who, what, when, and where of the monitoring events;
4. Quarterly summary of each quarter of the support plan year. The fourth quarterly summary also serves as the annual report and must include a summary of the previous three quarters
5. Copy of the behavior analysis service plan must be in the recipient’s file prior to claim submission.
5. Monthly data displays;
6. A record of the LRC review of the behavior services plan and data displays must be provided if the targeted reduction behaviors meet the requirements identified in 65G-4.009, F.A.C.; and
7. A record of the LRC review of the behavior services plan and data displays must be provided if more than 65 quarter hours of behavior assistant services are approved daily.
Various Appendices identify the specific training requirements, look them over!
Sorry to be the bearers of bad news, but we encourage you to read the manual carefully and give your input. 
Good news for the mentally challenged community in Florida.  Thanks to the self-advocates who lobbied long and hard to make this happen!
It appears APD folks were left out of Medicaid reform!

This is from the
The one group that is excluded from managed care is Medicaid recipients who are developmentally disabled, roughly 30,000 people. Developmental disabilities advocates lobbied lawmakers for months to exclude them from that plan and let them use the “iBudget,” an individualized spending plan that is capped. The House plan had originally looped them into the managed care plan, but the Senate insisted that they be allowed to use the iBudget.