Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
In the Case of:
Marshall J. Hubsher, M.D.,
Petitioner,
- v. -
The Inspector General.
DATE: August 26, 1992
Docket No. C-303
Decision No. 1353
FINAL DECISION ON REVIEW OF
ADMINISTRATIVE LAW JUDGE
DECISION
Marshall J. Hubsher, M.D. (Petitioner), appealed an April 3, 1992
decision
by Administrative Law Judge Edward D. Steinman (ALJ). See
Marshall J.
Hubsher, M.D., DAB CR188 (1992) (ALJ Decision). The ALJ
affirmed the
determination of the Inspector General (I.G.) to exclude
Petitioner from
participation in the Medicare and Medicaid programs for
a period of five
years.
Petitioner's exclusions were based on section 1128(a) of the
Social
Security Act (Act), which required the Secretary of the Department
of
Health and Human Services, after determination that an individual
has
been convicted of a criminal offense related to delivery of medical
care
or services under the Medicare and Medicaid programs, to bar
that
individual from participation in the Medicare and Medicaid programs.
1/
Factual Background 2/
Petitioner, a psychiatrist practicing in New York, was indicted in
January
1985 on nineteen counts relating to Medicaid fraud. Petitioner
was
charged with submitting Medicaid claims to the State of New York
for
psychiatric services rendered from 1981 through 1984, in
which
Petitioner asserted that he had received no amounts in payment for
his
services, when, in fact, he had received money from two of his
patients
for each of his treatments during this three-year period.
Petitioner
had made house calls on these patients and received $30 from them
for
his travel time and car expenses. Transcript (Tr.) at
35-38.
Petitioner was also charged with altering a New York State
Medical
Assistance Program prior approval form on file with the New
York
Department of Health by adding the words "patient pays for gas" to
the
form.
Petitioner subsequently entered into a plea bargain, whereby on
January
24, 1987, he pled guilty to one count of grand larceny and to one
count
of tampering with public records. On April 24, 1987 Petitioner
was
sentenced to four months of incarceration and to five years
of
probation; additionally, Petitioner was required to pay restitution
in
the amount of $21,444.55 to the State of New York and to reimburse
two
of his Medicaid patients in the amounts of $2,560 and $3,940.
On August 8, 1990, the I.G. notified Petitioner that he was being
excluded
from participation in the Medicare and Medicaid programs for
five years.
The ALJ Decision
Petitioner did not dispute that he was convicted of a crime related to
his
participation in the delivery of Medicaid services. Rather,
Petitioner
challenged before the ALJ only the reasonableness of the
length of the
exclusion sought by the I.G., arguing that a period of
five years was
excessive in light of the following circumstances: the
length of time
that had elapsed since the events that led to his
conviction; the fact that
he had already been suspended by the State of
New York in 1985 from
participation in its Medicaid program; and the
completion of four and a half
years of psychotherapy which Petitioner
asserted had eliminated the mental
disorder which caused him to commit
the offenses that led to his
conviction. Petitioner argued before the
ALJ that his exclusion should
be only for a minimal period of six
months, starting in August 1990.
Thus, the sole issue before the ALJ was the reasonableness of the
length
of Petitioner's exclusion. The ALJ afforded Petitioner the
opportunity
to testify at an in-person hearing. The ALJ stated at the
hearing that
the primary issue before him in determining the reasonableness
of the
length of the exclusion sought by the I.G. was the trustworthiness
of
Petitioner, and that an evidentiary hearing afforded the ALJ
the
opportunity to make a credibility evaluation of Petitioner and to
use
that information in determining Petitioner's trustworthiness. Tr.
at 5.
Upon hearing Petitioner testify at the hearing and receiving
post-hearing
briefing, the ALJ concluded that Petitioner's lack of
trustworthiness posed a
risk to the Medicare and Medicaid programs and
their beneficiaries that
merited a more than minimal period of
exclusion.
The ALJ, while acknowledging that Petitioner had already been
effectively
suspended by the New York State Medicaid program for a
period of five years
and that three and a half years had passed between
Petitioner's conviction
and the I.G.'s exclusion determination,
nevertheless concluded that the
five-year exclusion proposed by the I.G.
was reasonable. In reaching
this conclusion, the ALJ described
Petitioner as "a manifestly untrustworthy
individual." ALJ Decision at
26. The ALJ found that Petitioner
continued to engage in a pattern of
dissembling and evading the truth, and
that a five-year exclusion under
these circumstances was not excessive.
Petitioner's Exceptions
In reaching his decision that Petitioner should be excluded for five
years
from participation in the Medicare and Medicaid programs, the ALJ
made 46
findings of fact and conclusions of law (FFCLs). In his appeal
before
this Panel, Petitioner took exception to 23 of the FFCLs. For
the
purposes of our analysis, we have grouped the FFCLs to which
Petitioner
excepted into four categories:
I. Petitioner's Criminal Offenses
3. During the period from January 1, 1981 to July 31,
1984,
Petitioner improperly accepted reimbursement from Medicaid
for
providing psychiatric services to Medicaid recipients
in
addition to accepting payment from these same services
directly
from the patients. 3/
4. At the time his improper billing practices were
being
investigated, Petitioner altered a Medicaid prior approval
form
to make it appear that Medicaid had given him
written
authorization to accept direct payments from Medicaid
recipients
for his services.
8. In pleading guilty to the grand larceny count,
Petitioner
admitted that he knowingly presented improper bills to
Medicaid
for reimbursement for psychiatric services when he had
already
received payment from patients.
II. Petitioner's Credibility and Trustworthiness
5. Petitioner falsely testified before a grand
jury
investigating his billing practices that Medicaid had given
him
written approval to accept payments from Medicaid patients.
18. The remedial purpose of section 1128 of the Act is
to
assure that federally-funded health care programs and
their
beneficiaries and recipients are protected from individuals
and
entities who have demonstrated by their conduct that they
are
untrustworthy.
20. The grand larceny offense involved a large number
[of]
separate claims which were submitted over a protracted period
of
time.
23. The fact that Petitioner attempted to conceal
his
wrongdoing by altering a Medicaid prior approval form is
strong
evidence that he is untrustworthy.
24. The fact that Petitioner lied under oath to a grand
jury
investigating his billing practices is compelling evidence
that
Petitioner possesses a contempt for the law and those
who
enforce it.
29. Petitioner violated laws intended to regulate
controlled
substances on two separate occasions. In 1982,
Petitioner was
convicted of the misdemeanor offense of knowingly
and
intentionally possessing approximately 2,000
methaqualone
tablets. In 1983, the Commissioner of Health found
that
Petitioner issued a prescription for a controlled substance
with
a false date in violation of the Public Health Law.
These
episodes are additional evidence that Petitioner
is
untrustworthy.
30. In 1988, Petitioner submitted to the United States
Drug
Enforcement Administration (DEA) an application for
registration
in which he falsely stated that he had never been
convicted of a
crime in connection with controlled substances.
31. Petitioner's explanation for misrepresenting his
criminal
history on his 1988 DEA application form was that he
completed
the form without reading it.
32. Although Petitioner's explanation for misstating
his
criminal history on the 1988 application form is
not
controverted by the record, it shows that Petitioner failed
to
recognize a duty to read questions before answering them on
the
DEA application form. This is evidence that
Petitioner
possesses a reckless disregard for making truthful
statements to
a government agency charged with enforcing laws related
to
controlled substances.
33. As a result of his misstatement on his 1988
application
form combined with his prior criminal record, the DEA
restricted
Petitioner's license to prescribe and dispense
controlled
substances in 1989. This is evidence of the serious
nature of
Petitioner's offenses.
34. Petitioner made misstatements under oath regarding
his
suspension from Medicaid in the 1989 DEA hearing.
35. Petitioner explained these misstatements by asserting
that
there was an error in the transcript of the DEA hearing.
This
explanation is self-serving and highly suspect. Contrary
to
Petitioner's explanation, his misstatements conform to
his
pattern of disregarding the truth when it suits his
own
interests and is further evidence that Petitioner does
not
respect the importance of making truthful statements
to
government officials.
36. Petitioner's statement in a brief submitted to me that
he
has had no legal problems since 1984 ignored the fact
that
several adverse legal actions had been taken against
Petitioner
after 1984. This statement is additional evidence
of
Petitioner's indifference to the truth.
37. Throughout this proceeding, Petitioner repeatedly
and
consistently disavowed that he possessed the requisite
criminal
intent at the time he committed his Medicaid-related
offenses.
38. Petitioner's testimony regarding his state of mind at
the
time he committed the Medicaid-related offenses is not
credible,
and it is additional evidence of his propensity
to
mischaracterize the truth when he believes that it is to
his
advantage to do so.
39. Throughout this proceeding, Petitioner has attempted
to
minimize his culpability by providing
unconvincing
rationalizations for his misconduct. This leads to
the
conclusion that Petitioner has not fully accepted
responsibility
for his offenses and that he cannot be trusted to
handle
Medicare and Medicaid trust funds.
III. Personality Disorder
40. The psychological evidence of record establishes
that
Petitioner has suffered from a personality
disorder
characterized by an inclination to defy authority, break
rules,
and take risks. This is additional evidence that the
remedial
purpose of the Act would be served by a lengthy exclusion.
41. The opinion of Petitioner's treating psychotherapist
that
Petitioner has completely recovered from his
personality
disorder and that he is unlikely to engage in unlawful
conduct
is unconvincing because it is contradicted by other evidence
of
record.
IV. Reasonableness of Length of the Exclusion
45. A lengthy exclusion is needed in this case to satisfy
the
remedial purposes of the Act.
46. The five year exclusion imposed and directed by the I.G.
is
reasonable.
In making his exceptions, Petitioner essentially repeated the
arguments
that he had previously made before the ALJ. Petitioner
continued to
insist that, as a result of his four and a half years of
psychotherapy,
he is now responsible and trustworthy. Petitioner argued
that he was
rehabilitated and no longer a threat to the Medicaid program, and
that,
accordingly, there was no need for the lengthy five-year
exclusion
affirmed by the ALJ. Petitioner argued that the ALJ was
mistaken or
prejudiced in his conclusions.
Analysis
Our standard of review on disputed issues of fact is whether the
ALJ's
decision is supported by substantial evidence and on disputed
legal
issues is whether the ALJ's decision was erroneous. See Joyce
Faye
Hughey, DAB 1221 (1991) at 11.
As we stated above, Petitioner's exceptions to the ALJ Decision
fall
generally into four areas. First, Petitioner challenged three
FFCLs
(Nos. 3, 4, and 8) regarding Petitioner's conviction for
criminal
offenses related to his participation in the delivery of medical
care or
services under the Medicaid program. Petitioner objected to the
ALJ's
findings that Petitioner submitted improper claims for
Medicaid
reimbursement and that he tried to justify those claims by
illegally
altering a Medicaid document.
Petitioner's challenges to these FFCLs are simply without any
merit
whatsoever. Petitioner's exceptions raise extraneous issues and
do not
bring into question whether these FFCLs were incorrect or unsupported
by
substantial evidence. We find that there is clearly
substantial
evidence in the record to support these findings by the
ALJ. Petitioner
presented no reason why the ALJ was not reasonable in
treating
Petitioner's guilty plea as an admission of the offenses to which
he
pled. Petitioner questioned the ALJ's use of the word "improperly"
in
FFCL No. 3 to describe Petitioner's acceptance of
Medicaid
reimbursement. Petitioner raised a similar exception to FFCL
No. 8.
The claims Petitioner submitted to Medicaid were improper because
they
contained false representations that Petitioner had received no
amounts
in payment for the services listed on the claims. The fact
that
Petitioner later reimbursed his patients, as part of his sentencing,
has
nothing to do with his original offense and does not render the
Medicaid
claims he submitted "proper."
Further, in his exception to FFCL No. 4, Petitioner did not point to
any
corroborative evidence to support his claim that he altered the
Medicaid
document with approval of a Medicaid official.
Next, Petitioner challenged numerous FFCLs relating to the
ALJ's
assessment of Petitioner's credibility and trustworthiness. See
FFCL
Nos. 5, 18, 20, 23, 24, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, and
39.
Again, Petitioner's exceptions raise generally extraneous issues and
do
not demonstrate that any of the FFCLs were incorrect or unsupported
by
substantial evidence. Many of the issues raised were already
addressed
in the ALJ's exhaustive analysis of Petitioner's
trustworthiness.
During the hearing the ALJ conducted an intensive
examination of
Petitioner. As reflected in the transcript of the
hearing, Petitioner's
explanations for his numerous encounters with legal and
regulatory
authorities strain credulity. For example, Petitioner's
explanation
concerning his admission to a misdemeanor in 1982 for the
illegal
possession of a bottle containing 2,000 tablets of Methaqualone in
his
office was that another doctor had ordered them and placed them
in
Petitioner's office without his knowledge. Tr. at 67-68 and
113-116.
Petitioner's claims that other of his difficulties could be traced to
an
official permitting Petitioner to alter public documents (Tr. at
40-41),
inaccuracies in transcripts (Tr. at 97), misunderstandings as to
what
the judge asked him during his plea (Tr. at 92-97), not
carefully
reading DEA forms (Tr. at 61-64), mistakes in proofreading the
briefs he
submitted to the ALJ (Tr. at 100-103), or misrepresentations made
by his
attorney before the sentencing judge (Tr. at 107) all reflect a
pattern
on Petitioner's part to shift blame for his actions on to
others. We
agree with the ALJ's assessment that this pattern
demonstrates a lack of
trustworthiness on Petitioner's part.
Furthermore, the ALJ was in the best position to evaluate
Petitioner's
credibility. The ALJ heard Petitioner's testimony, the ALJ
questioned
Petitioner and heard his responses, the ALJ observed
Petitioner's
demeanor in person. Findings by an ALJ based on witness
demeanor and
credibility are entitled to particular weight since we lack
the
opportunity to observe the witness testifying. Joyce Faye
Hughey,
supra, at 7. Resolving such credibility issues is primarily
the
function of the ALJ. Id. Accordingly, we uphold all of the
challenged
FFCLs concerning Petitioner's credibility and trustworthiness.
In taking exception to FFCL No. 18, Petitioner argued that the ALJ did
not
mention the "approximately 35 letters from Medicaid and Medicare
patients,
administrators and physicians who attest to my honesty
and
trustworthiness." Petitioner's Brief at 3. However, the ALJ
is not
required to address specifically every item of evidence and
could
reasonably have concluded that these letters need be given
limited
weight in comparison to the extensive number of other
evidentiary
factors relating to Petitioner's honesty and trustworthiness.
Accordingly, we uphold all of the challenged FFCLs relating
to
Petitioner's credibility and trustworthiness.
Petitioner also challenged two of the ALJ's FFCLs relating to
Petitioner's
personality disorder. See FFCL Nos. 40 and 41. In his
supporting
analysis, the ALJ rejected any possibility that Petitioner's
personality
disorder could be considered a mitigating factor in
determining the duration
of Petitioner's exclusion. ALJ Decision at
22-23. Moreover, the
ALJ found that Petitioner's actions showed that he
had not yet completely
recovered from his personality disorder and that
Petitioner's personality
disorder posed a continuing risk to the
Medicare and Medicaid programs that
justified a lengthy exclusion.
As with the ALJ's findings concerning Petitioner's trustworthiness,
we
find that these FFCLs were supported by substantial evidence. The
ALJ
had before him all the documents from Petitioner's psychotherapist
and
psychiatrist relating to Petitioner's personality disorder. The ALJ
had
the opportunity to weigh those documents against his observation
of
Petitioner on the witness stand and against other evidence of
record
relating to Petitioner's personality disorder. Petitioner failed
to
demonstrate that these FFCLs, which determined the appropriate weight
to
be given to evidence presented by Petitioner, were either incorrect
or
unsupported by substantial evidence.
Finally, Petitioner challenged the ALJ's ultimate conclusions on
the
reasonableness of the exclusion period by taking exception to FFCL
Nos.
45 and 46. Concerning the reasonableness of an exclusion period,
we
have said:
Since the reasonableness of an exclusion turns on the length
of
time necessary to establish that a provider is not likely
to
repeat the type of conduct which precipitated the exclusion,
the
ALJ must evaluate the myriad facts of each case. These
include
the nature of the offenses committed by the provider,
the
circumstances surrounding the offense, whether and when
the
provider sought help to correct the behavior which led to
the
offense, how far the provider has come toward
rehabilitation,
and any other factors relating to the provider's
character and
trustworthiness.
Robert Matesic, R.Ph., DAB 1327 (1992) at 12.
The ALJ clearly based his decision on the reasonableness of the length
of
Petitioner's exclusion on an evaluation of
Petitioner's
trustworthiness. The ALJ found Petitioner wanting in this
regard.
While Petitioner may have considered some of the ALJ's comments in
the
decision unduly harsh to Petitioner, we find nothing in the record
that
shows that the ALJ was in any way prejudiced against Petitioner.
We
find that there were more than adequate grounds for the ALJ to find
that
Petitioner's untrustworthiness merited a substantial exclusion
from
participation in the Medicare and Medicaid programs. The ALJ
provided a
lengthy and detailed analysis of all of the factors relating to
the
reasonableness question.
Additionally, we note that, had Petitioner's conviction occurred a
few
months later, his exclusion would have been for a minimum of five
years
under the revision of section 1128(c)(3)(B) of the Act by
Congress. The
penalties Congress subsequently enacted reflect its
concerns about fraud
and abuse in the Medicare and Medicaid programs.
Here, in view of the
pattern of conduct found by the ALJ, a five-year
exclusion was warranted
even considering the time that had elapsed from
Petitioner's conviction
.
Accordingly, we find that Petitioner's exceptions to FFCL Nos. 45 and
46
are without merit.
Conclusion
Based on the foregoing analysis, we affirm the ALJ's decision
upholding
the exclusion of Petitioner for five years. In so doing, we
affirm each
and every one of the ALJ's findings of fact and conclusions of
law and
adopt them as our own.
____________________________ Judith A. Ballard
____________________________ M. Terry Johnson
____________________________ Donald F.
Garrett
Presiding Panel Member
1. As Petitioner was convicted in January 1987, his exclusion was
based
on the version of section 1128(a) in effect at that time. At that
time
the Act did not specify a minimum period of exclusion for a
person
convicted of a criminal offense related to such
individual's
participation in the delivery of medical care or services under
the
Medicare and Medicaid programs. Congress revised the Act in August
1987
to require a minimum exclusion of five years from participation in
the
Medicare and Medicaid programs for an individual or entity convicted
of
a criminal offense related to the delivery of an item or service
under
Medicare or any State health care program. See section
1128(c)(3)(B)
of the Act, as amended.
2. This summary of the facts is not intended as a substitute for
the
more detailed factual findings in the ALJ Decision.
3. Throughout this decision, we omit the ALJ's citations to the
Act,
regulations, other FFCLs, or the record before him from our
restatement
of his