Software Glitches Blamed For Florida's Failure To Pay Health Claims For Sick, Needy Children

MIAMI (CBSMiami/AP) - Officials and executives say Florida failed for nearly three months to pay tens of thousands of healthcare claims for the state's sickest and neediest children due to software glitches blamed on the corporate merger of its two largest payment vendors.

Families with critically ill children who relied on Medicaid-paid health providers were stranded in some cases. A father in Lake Worth was forced to cut back his contractor work to remain home and care for his son when payments stopped. A mother in Ocala said the company that helped care for her 15-year-old disabled son temporarily shut down because of the payment problems.

"We had to find caregivers for him," said AnnMarie Sossong of Ocala, whose son has a neuro-immune condition and profound autism. "You can't do anything else. You can't go to work, you can't go to school, you can't even make a phone call because you've got this kid with such high needs," she said.

Payment problems panicked more families, especially as unpaid bills for nursing care and other home health services began stacking up over months with no quick resolution in sight.

Executives at Sunshine State Health Plan Inc. of Tampa, Florida's largest Medicaid payment vendor, said the payment glitches stemmed from the company's merger on Oct. 1 with the second-largest payment vendor, WellCare of Florida Inc. Combined, Sunshine and Wellcare have multi-year contracts worth $31.6 billion from the state's Agency for Health Care Administration, according to figures from the state's chief financial officer.

It was among the most serious technology meltdowns — affecting one of the most vulnerable populations — under the administration of Gov. Ron DeSantis since unemployment claims overwhelmed Florida's Department of Economic Opportunity early in the pandemic.

"Nobody responded to all these cries for help," said Lavette Gulley, owner of Serenity Companion Service Inc., which cared for Sossong's son. She temporarily closed her company due to unpaid invoices, stranding families that relied on the services she provided. "Some of these kids I've been with six, seven years, and I never had to call those parents and say, 'Hey, I've got to stop service because I'm not getting paid.'"

Dan Miller of Lake Worth is a single father of a 17-year-old son with autism and an electrical contractor. His son's provider, Blessing Hands Services Inc. of nearby Palm Springs, stopped the family's services after it went unpaid for months, forcing him to take time from work to care for his son full-time. He said he was at risk financially of losing his family's home.

"I have jobs right now that I'm in fear of losing because I can't get to them and can't get them finished fast enough," he said. "It's very bad for me right now financially."

Sunshine said it realized the scale of the growing issues paying health-care providers by December, and by January was discussing its serious problems with the Agency for Health Care Administration. The agency confirmed it wasn't aware of problems until January — and indicated it found out about the problems from others, not Sunshine.

Sunshine said the problems affected children receiving care under its Sunshine Health Medicaid program and the Children's Medical Services Health Plan it operates on behalf of the Florida Department of Health, for patients under 21 who are eligible for Medicaid and who have serious, chronic conditions.

Gulley, the owner of the health provider Serenity, said payment problems started far earlier than December. She said she was unable to submit claims in late October. In November, she noticed some children who were clients were missing from Sunshine's system. She said she remained on hold with the company by phone one day for eight hours before the call was disconnected. Parents told her they also were filing grievances with Sunshine over unpaid bills for services for their children.

"At the end of December, I knew I was going to have to shut my doors after 26 years," Gulley said. She was able to restart her business over the last two weeks.

Frustrated families said they did not blame their children's health providers who weren't being paid.

"I don't know how she's staying in business," said Miller, the Lake Worth father who owns Miller Electric Inc. "I couldn't go three months without getting any money coming in and still pay payroll if I had somebody working for me."

The Agency for Health Care Administration said in a statement it was considering "all available recourse options" to punish Sunshine Health — including "liquidated damages and sanctions" — if its investigation determines the company had violated terms of its contract.

The improperly rejected payments were all re-processed by Jan. 31, Sunshine said. Even though the problems involved its work under a government contract, it declined in interviews over six days to specify the number of families it estimated were affected, the number of health-care providers whose payments were rejected, the exact number of claims it improperly rejected – or even identify who at the Agency for Health Care Administration it was notifying.

The company said in a statement that "relatively few" providers were affected, representing what it said were one-half of 1% of its 9.2 million total payment claims it processed during the period. That works out to be 46,000 rejected claims, although the figure is believed to be closer to 30,000 rejected claims from roughly 400 health-care providers.

The company was communicating with the state agency's No. 2 in command, Chief of Staff Cody L. Farrill, who coordinates Medicaid issues with other Florida agencies, the U.S. government and the Legislature. Farill's office has not yet responded to a Feb. 3 request under Florida's public records law for copies of emails or other communications he exchanged with Sunshine about the crisis.

Owners of another health provider, The Lamp Post Therapy Center LLC of Gainesville, also said they weren't paid after the Sunshine corporate merger. It provides occupational and speech therapy services. "It's been since maybe October when they took over, so that's a lot of time to go without a paycheck," CEO Elise Caton said.

The payment problems have drawn almost no public attention. Sunshine acknowledged payment issues in a press release it published on its website Jan. 20, blaming it on an unspecified information-technology problem and not hinting at the scale or seriousness of the issue.

A former Politico health journalist, Alexandra Glorioso of Tallahassee, wrote Jan. 28 in a blog that she had contacted seven health providers offering services across 10 counties that complained that Sunshine wasn't paying them. One provider told her problems were widespread and affecting companies across Florida, but she wrote that the company and government officials wouldn't provide details.

Glorioso said she asked the chairman of the Senate Appropriations Subcommittee on Health and Human Services, Sen. Aaron Bean, R-Jacksonville, about the problems, and he told her they were not widespread. Bean's subcommittee helps oversee the Medicaid program in Florida, and he is president pro tempore in the Senate. Bean did not return messages over three days left on his cell phone or emails sent to him and his legislative staff.

Glorioso said a mutual friend of one health provider, speech pathologist Andrea Clark of Hudson near Tampa, complained Jan. 19 to House Speaker Chris Sprowls, R-Clearwater, and within a day Farrill and the state agency's assistant deputy secretary, Brian Meyer, told Clark they were investigating.

In its statement responding to questions for this news article, the Agency for Health Care Administration said as soon as it was made aware of the problems, in January, it immediately contacted Sunshine for details and answers about how it was fixing the issues.

In its own statement, Sunshine said, "We regularly update our regulators on all aspects of our operations." It said it had notified the state agency in December about what it described as "isolated, integration-related claims issues."

Executives and officials said no one inside the combined health care giant so far has lost their jobs over the payment failures after the merger, for which the companies spent months planning and preparing. "While we do not discuss employee relations matters publicly, Sunshine Health has aggressively worked to fix these provider claims issues," the company said in a statement.

Sossong, the mother in Ocala, said she sacrificed time trying to find alternate care for her son when her provider shut down. The situation left her unsure whether she could work shifts or attend her nursing classes.

"You're hurting these very vulnerable families," she said. "There was a lot of extra stress put on our lives because we weren't able to find care for my son."