SUBJECT:

Gregory Vagshenian, M.D.,

Petitioner,

The Inspector General.

DECISION

Petitioner, Gregory Vagshenian, M.D., appeals a determination by the Inspector General (I.G.) to exclude him from participating in Medicare, Medicaid, and all federal health care programs for a period of fifteen years. I find that the I.G. is authorized to exclude Petitioner pursuant to section 1128(a)(2), but has not justified a fifteen year exclusion. For the reasons discussed below, I reduce the period of exclusion to eight years.

I. Background

By letter dated August 31, 2005, the I.G. notified Petitioner that he was being excluded from participation in Medicare, Medicaid, and all federal health care programs for a period of fifteen years. The I.G. advised Petitioner that he was being excluded pursuant to section 1128(a)(2) of the Social Security Act (Act) because of his conviction in the 299^th Judicial District Court of Travis County, Texas, of a criminal offense related to the neglect or abuse of patients in connection with the delivery of a health care item or service. By letter dated October 28, 2005, Petitioner requested a hearing and the case was assigned to me.

On January 27, 2006, I held a prehearing conference by telephone at which the parties agreed that this matter could be resolved based on written submissions. Petitioner acknowledged that he was convicted of a criminal offense, but argued that his conviction does not fall within the scope of section 1128(a)(2) of the Act. See Order of January 27, 2006; P. Brief (Br.) at 4.

The I.G. has filed eight exhibits (I.G. Exs. 1-8) as part of his submission, and Petitioner has filed four exhibits. (P. Exs. 1-4). In the absence of objection, I receive into evidence I.G. Exs. 1-8 and P. Exs. 1-4.

II. Issues

The issues before me are: (1) whether Petitioner was convicted of a criminal offense relating to the neglect or abuse of patients in connection with the delivery of a health care item or service within the meaning of section 1128(a)(2), thus providing a basis for excluding him from participation in the Medicare, Medicaid, and all federal health care programs; and (2) if so, whether the 15-year exclusion falls within a reasonable range.

III. Discussion ⁽¹⁾

A. Because Petitioner was convicted of a criminal offense relating to the neglect or abuse of a patient in connection with the delivery of a health care item or service, the statute requires that he be excluded from participation in federal health care programs for a minimum of five years.

Section 1128(a)(2) of the Act mandates the exclusion from federal health care programs of an individual or entity convicted of "a criminal offense relating to neglect or abuse of patients in connection with the delivery of a health care item or service." Section 1128(i) of the Act defines the term "convicted" to include: (1) when a judgment of conviction has been entered against the individual or entity by a federal, state, or local court, regardless of whether there is an appeal pending or whether the judgment of conviction or other record relating to criminal conduct has been expunged; (2) when there has been a finding of guilt against the individual or entity by a federal, state, or local court; (3) when a plea of guilty or nolo contendere by the individual or entity has been accepted by a federal, state, or local court; or (4) when the individual or entity has entered into participation in a first offender, deferred adjudication, or other arrangement or program where judgment of conviction has been withheld. Act, section 1128(i)(1)-(4).

Petitioner was a psychiatrist practicing at a Veterans Administration clinic in Austin, Texas. That he was convicted of a criminal offense is not in dispute. On February 9, 2004, he was convicted on nine counts of assault, a class C misdemeanor, against three of his patients, and fined $500 per count. I.G. Ex. 1, at 11, 12; I.G. Ex. 2, at 3, 4; I.G. Ex. 3, at 2, 3. Petitioner nevertheless argues that his conviction does not fall within the definition of section 1128(a)(2) because an assault does not constitute abuse or neglect. According to Petitioner, "abuse" only occurs where a party wrongfully strikes, physically assaults, or "willfully mistreats" a patient, and "neglect" necessarily involves willful disregard or inattention to a patient. P. Br. at 4. Petitioner suggests that he was simply "performing physical exams on mental health patients" in an appropriate way. P. Br. at 5

I recognize the difficulty in discerning from the record exactly what conduct by Petitioner constituted assault. Although the indictment sets forth the charges against him in some detail, he was plainly not convicted of the specific facts alleged, which constituted felony sexual assault (see discussion below). He was instead convicted of the "lesser included offense of assault, a class 'C' misdemeanor." Nevertheless, Petitioner's assault conviction precludes my finding that he was appropriately performing physical examinations. Under the Texas Penal Code, a person commits class C misdemeanor assault if he "intentionally or knowingly threatens another with imminent bodily injury," or "intentionally or knowingly causes physical contact with another, when the person knows or should reasonably believe that the other will regard the contact as offensive or provocative." Texas Penal Code �� 22.01(a)(2) and (3); Texas Penal Code �22.01(c).

Petitioner's conviction is not reviewable in this forum (42 C.F.R. � 1001.2007(d)), ⁽²⁾ so I must conclude that he assaulted his patients, and any conduct toward a patient that falls within the definitions of assault must be considered abuse. I therefore find that the I.G. has a basis for excluding Petitioner from participation in federal health care programs.

B. A fifteen-year exclusion does not fall within a reasonable range.

Having found a basis for exclusion, I next consider whether the fifteen year exclusion imposed falls within a reasonable range.

The statute mandates a five-year minimum exclusion. Act, section 1128(c)(3)(B); 42 C.F.R. � 1001.2007(a)(2). Specific aggravating factors that are not offset by specified mitigating factors may justify increasing the period of exclusion beyond the five-year minimum. 42 C.F.R.� 1001.102. Here, the I.G. cites three of the nine aggravating factors listed in the regulations as bases for lengthening Petitioner's period of exclusion: (1) the acts that resulted in the conviction, or similar acts, were committed over a period of one year or more (42 C.F.R. � 1001.102(b)(2)); (2) in this case involving patient abuse or neglect, the action that resulted in the conviction was premeditated, was part of a continuing pattern of behavior, or consisted of non-consensual sexual acts (42 C.F.R. � 1001.102(b)(4); and (3) Petitioner has been the subject of other adverse action by a federal, state, or local government agency or board, based on the same set of circumstances that serves as the basis for imposition of the exclusion (42 C.F.R. � 1001.102(b)(9)). ⁽³⁾

Specific mitigating factors may be considered as a basis for reducing the period of exclusion if aggravating factors justify an exclusion longer than five years. 42 C.F.R. � 1001.102(c). Here, however, Petitioner cites no such mitigating factors.

The Secretary has delegated to the I.G. the authority to impose exclusions. 42 C.F.R. � 1001.101(b). So long as the amount of time chosen for the exclusion imposed on Petitioner by the I.G. is within a reasonable range, based on demonstrated criteria, I have no authority to change it. Joann Fletcher Cash, DAB No. 1725, at 7 (2000), citing 57 Fed. Reg. 3298, 3321 (1992).

1. The crime that resulted in Petitioner's conviction occurred over a period of more than one year . 42 C.F.R. � 1001.102(b)(2).

Petitioner challenges the I.G.'s assertion that his actions were committed over a period of more than one year. He concedes that he treated the patients he was convicted of assaulting for more than a year, but points out that appointments were monthly or every three months. Maintaining once more that he was only providing physical exams, he argues that he did not even perform such exams on every patient visit. P. Br. at 5.

For the reasons discussed above, I may not conclude that Petitioner was performing appropriate physical exams. Based solely on the actual court judgments, I find convictions for assaults on patients occurring on August 31, 1998 (I.G. Ex. 1, at 11), April 28, 2000 (I.G. Ex. 2, at 3), and February 8, 2001. I.G. Ex. 3, at 2. The remaining six counts of assault fall somewhere in between. Because the convictions involved actions that occurred over a period of more than one year, the I.G. may justifiably increase the period of exclusion beyond the mandatory five years.

2. The I.G. has not established that the action that resulted in Petitioner's conviction was premeditated, was part of a continuing pattern of behavior, or consisted of non-consensual sexual acts.

Actions that are premeditated, or are committed as part of a continuing pattern, or involve non-consensual sexual acts evidence significant risk to program beneficiaries and would certainly justify a marked increase in the length of an exclusion. 42 C.F.R. � 1001.102(b)(4). Pointing to the indictments here, the I.G. asserts that Petitioner's actions were premeditated, and part of a continuing pattern of behavior. He concedes that Petitioner was not actually convicted of sexual assault, but, citing the indictments, asserts that the "assault offenses of which he was convicted consisted of non-consensual sexual acts with patients under his care." I.G. Br. at 8.

The problem with these assertions is that this record does not contain sufficient information to support them. In fact, although charged with multiple counts of felony sexual assault against his patients, Petitioner was acquitted of those charges, and convicted only of relatively minor misdemeanors. In an unusual submission, the state trial judge characterizes as "unfounded" the suggestion that his ruling involves anything other than finding a class C misdemeanor. He emphasizes that he acquitted Petitioner of the sexual assault offenses charged in the indictment. P. Ex. 1. And, as discussed above, I may not reexamine the fairness of the state court action.

I recognize that this leads to a baffling result. Without the allegations of sexual misconduct, the indictments do not seem to suggest any criminal misconduct, much less establish premeditation or pattern of criminal conduct. It is therefore virtually impossible to discern from this record the specific criminal actions that provide the basis for this exclusion. See I.G. Exs. 1-3. Moreover, unlike other aggravating factors, which allow the I.G. to consider "the acts that resulted in the conviction, or similar acts" ((emphasis added); (42 C.F.R. � 1001.102(b)(1), (2), (3)), subsection (b)(4) allows the I.G. to consider only "the action that resulted in the conviction." Certainly, the I.G. may not consider accusations of which Petitioner was explicitly acquitted. And, aside from the conviction itself, this record is devoid of any reliable evidence that could be used to determine the nature of the actions that resulted in Petitioner's conviction.

Without the unproven allegations of the indictment, all the I.G. has shown is a conviction on relatively minor charges of misdemeanor assault, which is not sufficient to establish an aggravating factor under 42 C.F.R. � 1001.102(b)(4).

4. Petitioner has been the subject of other adverse action by a state agency or board, and the adverse action is based on the same set of circumstances that serves as a basis for imposition of the exclusion.

Finally, the I.G. points to actions by the medical boards of California and Texas as aggravating factors, justifying an increase in the length of exclusion under 42 C.F.R. � 1001.102(b)(9). On February 15, 2002, the Texas State Board of Medical Examiners temporarily suspended Petitioner's medical license, referring to the criminal investigation and citing specific accusations of sexual misconduct, similar to the charges set forth in the indictment. I.G. Ex. 4, at 14-20.

On October 8, 2004, the Texas State Board issued a Mediated Agreed Order. That order acknowledges that Petitioner was acquitted of all charges of felony sexual assault, and that, under the Texas Penal Code, conviction of a Class C misdemeanor "does not impose any legal disability or disadvantage." I.G. Ex. 5, at 3. The order also acknowledges that Petitioner continued to deny any wrongdoing, but wished to resolve the matter, having spent considerable time and effort in costly proceedings. Nevertheless, under its authority to take disciplinary action based on Petitioner's conviction, the Board ordered that Petitioner's medical license be restricted, and that he limit his practice to administrative, non-clinical medicine only. I.G. Ex. 5, at 4. I consider this an adverse action within the meaning of the regulation.

On January 25, 2005, Petitioner agreed to surrender his California medical license. The Stipulated Surrender of License specifies that "cause exists to discipline" Petitioner, based on action taken by the Texas State Board of Medical Examiners and Petitioner's criminal convictions. I.G. Ex. 4, at 3. The California Medical Board accepted the stipulation on February 9, 2005, with its decision effective February 16, 2005. I.G. Ex. 4, at 1.

Although Petitioner was acquitted of most of the accusations that formed the basis for the initial state actions against him, both states ultimately took adverse actions based on Petitioner's misdemeanor convictions. The I.G. may therefore consider this an aggravating factor.

IV. Conclusion

The I.G. has a basis for imposing an exclusion under section 1128(a)(2) because Petitioner was convicted of assaulting his patients.

The statute's purpose is remedial - the protection of federally funded health care programs and the beneficiaries of those programs - and the I.G.'s regulations establish criteria to assess the degree of risk an individual poses. Here, the initial accusations against Petitioner were particularly ugly, and would have justified a significant period of exclusion. However, inasmuch as the most serious accusations were explicitly rejected by the criminal court, the I.G. may not rely on them. Without those accusations, this record contains virtually no factual underpinning upon which to assess the risk Petitioner poses.

Therefore, based on the record before me, I cannot find that a 15-year exclusion falls within a reasonable range, and based on my assessment of the remaining two aggravating factors, I reduce the period of exclusion to eight years.

Carolyn Cozad Hughes

Administrative Law Judge

1. In the Discussion section of this decision, I make findings of fact and conclusions of law, which are set out, in italics and bold, as separate headings.

2. See also, Joann Fletcher Cash, DAB No. 1725 (2000); Chander Kachoria, R.Ph., DAB No. 1380, at 8 (1993) ("There is no reason to 'unnecessarily encumber the exclusion process' with efforts to reexamine the fairness of state convictions."); Ira Katz, Little Five Points Pharmacy, DAB CR1044 (2003).

3. Another aggravating factor listed in the regulations is: that the acts that resulted in the conviction, or similar acts, had a significant adverse physical, mental, or financial impact on one or more program beneficiaries or other individuals. 42 C.F.R. � 1001.102(b)(3). The I.G. neither alleges, argues, nor proffers any evidence that this factor is present in this case.