Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of:
Charles J. Barranco, M.D.,
Petitioner,
- v. -
The Inspector General.
DATE: March 30, 1992
Docket No. C-295
DECISION
In this case, governed by section 1128 of the Social
Security Act (Act), the Inspector General (I.G.) notified
Petitioner by letter dated August 9, 1990, that he was
being excluded from participation in the Medicare and
State health care programs until he obtained a valid
license to practice medicine in the State of New York. 1/
Petitioner was advised that his exclusion resulted from
the surrender of his license to practice medicine in the
State of New York while a formal disciplinary proceeding
was pending before the New York State Board of
Professional Medical Conduct. Petitioner was further
advised that his exclusion was authorized by section
1128(b)(4)(B) of the Act. By letter of September 4,
1990, Petitioner requested a hearing before an
administrative law judge (ALJ), and the case was assigned
to me for hearing and decision.
The parties initially agreed to submit this case on
Motion for Summary Disposition. On April 9, 1991, I
ruled that: 1) the I.G. had authority to exclude
Petitioner pursuant to section 1128(b)(4)(B) of the Act;
2) the I.G. had failed to establish that, as a matter of
law, Petitioner should be excluded from participation in
Medicare and Medicaid programs until he regained his
license to provide health care in the State of New York;
and 3) there were genuine issues of material fact in this
case concerning Petitioner's alleged untrustworthiness.
2/
On August 19 and August 20, 1991, I conducted an in-
person hearing in San Diego, California. Both parties
submitted post-hearing briefs and replies. On January
29, 1992, following the parties submissions, the
Secretary promulgated new regulations containing
procedural and substantive provisions at 57 Fed. Reg.
3298 et seq. Both parties submitted briefs concerning
the potential impact of these regulations. Based on the
record and on the applicable law, I conclude that the new
regulations do not apply to this proceeding. I further
conclude that the indefinite exclusion imposed and
directed against Petitioner by the I.G. is excessive. I
conclude finally that the remedial purpose of section
1128 of the Act will be served in this case by the
earlier of either: 1) a three year exclusion; or 2) an
exclusion until such time as a State licensing agency
reviews all of the factual and legal issues which were
before the State of New York when Petitioner surrendered
his license, and, based on the result of that review,
either a) grants Petitioner a license, or b) if it is the
agency in California, it takes no significant adverse
action against his existing license. I modify the
exclusion accordingly.
ISSUE
Following my Ruling of April 9, 1991, the sole issue
remaining in this case is whether the exclusion imposed
and directed against Petitioner by the I.G. is
reasonable.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
1. Petitioner was licensed to practice medicine by the
New York State Department of Education on August 10,
1953. I.G. Ex. 1/1. 3/
2. At all relevant times, Petitioner was a surgeon in
New York, on staff at Salamanca District Hospital
(Salamanca) and several other hospitals. Tr. 175 - 179.
3. During the late 1970's and early 1980's, Petitioner
was required to provide medical services in Salamanca's
emergency room (ER) on rotation, as were all physicians
with staff privileges at Salamanca. Tr. 202.
4. On December 29, 1988, Petitioner was charged by the
Department of Health, New York State Board for
Professional Medical Conduct (State Board), with: 1)
practicing with negligence on more than one occasion; 2)
practicing with incompetence on more than one occasion;
and 3) failing to keep records that accurately reflect
the medical evaluation of patients. I.G. Ex. 1/6 - 7.
5. These allegations of negligence, incompetence and
failure to keep records relate to Petitioner's care of
eight patients (delineated patients A - H) in 1979 and
1980, one of whom Petitioner operated on at Salamanca,
and seven of whom were Petitioner's patients in
Salamanca's ER. I.G. Ex. 1/1 - 5.
6. Specifically, with regard to patient A, a 43 year
old male on whom Petitioner performed surgery for a
perforated ulcer, the State Board alleged that
Petitioner: 1) improperly performed surgery; and 2)
failed to adequately diagnose his condition and provide
proper treatment after surgery. I.G. Ex. 1/1-2; P. Ex.
1/4.
7. Specifically, with regard to Patient B, a 73 year
old female who had fallen down a flight of stairs, and
complained of a prickly sensation in both shoulders
radiating down her arms to her hands, the State Board
alleged that Petitioner: 1) failed to obtain and/or
document an adequate history; 2) failed to perform and/or
document a complete physical exam; and 3) failed to
provide proper treatment, including inappropriately
prescribing medication. I.G. Ex. 1/2.
8. Specifically, with regard to Patient C, a 58 year old
male with a complaint of heavy chest pressure radiating
into the left arm, the State Board alleged that
Petitioner: 1) failed to properly administer diagnostic
studies to monitor, and treat his possible cardiac
condition; and 2) failed to transfer him to a Coronary
Care Unit (CCU) by advanced life support ambulance. I.G.
Ex. 1/2-3.
9. Specifically, with regard to Patient D, a 92 year old
man with chest and epigastric pain and vomiting, the
State Board alleged that Petitioner: 1) failed to obtain
and/or document an adequate history; 2) failed to perform
and/or document a complete physical exam; 3) failed to
perform and/or document adequate diagnostic studies and
treat him, including improperly prescribing medication;
and 4) failed to order transfer by advanced life support
ambulance. I.G. Ex. 1/ 3 - 4.
10. Specifically, with regard to Patient E, a 33 year
old woman with epigastric pain and nausea, the State
Board alleged that Petitioner: 1) failed to obtain and/or
document a history with emphasis on gastrointestinal
system; 2) failed to perform and/or document diagnostic
studies; 3) failed to perform a complete physical exam;
4) failed to provide adequate treatment, including
improperly administering medications; and 5) failed to
order transfer by ambulance. I.G. Ex. 1/4.
11. Specifically, with regard to Patient F, a 56 year
old woman with complaints of nausea, chest heaviness,
palpitations, and dizziness, the State Board alleged that
Petitioner: 1) failed to perform and/or document a
physical examination; 2) failed to obtain and/or document
an adequate history; 3) failed to order and/or document
adequate diagnostic studies; 4) failed to adequately
treat her, including improperly increasing her
medication. I.G. Ex. 1/4 - 5.
12. Specifically, with regard to Patient G, a 10 year
old girl who had fallen on her left elbow, the State
Board alleged that Petitioner: 1) failed to obtain
and/or document an adequate history; 2) failed to perform
and/or document a physical exam; and 3) failed to record
his interpretation of the x-ray of this patient's elbow.
I.G. Ex. 1/5.
13. Specifically, with regard to Patient H, a 67 year
old man who fainted in church, the State Board alleged
that Petitioner: 1) failed to obtain and/or document an
adequate history; 2) failed to obtain and/or document a
complete physical exam; 3) failed to perform appropriate
diagnostic studies; and 4) inappropriately prescribed
drug therapy. I.G. Ex. 1/5.
14. In the face of these charges, on January 12, 1989,
Petitioner applied to surrender his license to practice
medicine in the State of New York. I.G. Ex. 2.
15. Petitioner specifically stated that he was not
contesting the charges alleged by the State Board. I.G.
Ex. 2/1 - 2.
16. Petitioner agreed not to apply for restoration of
his license for one year. I.G. Ex. 2/2.
17. On April 14, 1989, the New York State Board of
Regents voted to grant Petitioner's application to
surrender his license, and on April 27, 1989, New York's
Commissioner of Education issued an Order executing
Petitioner's license surrender. I.G. Ex. 3.
18. The Secretary of this Department (the Secretary)
delegated to the I.G. the authority to determine, impose,
and direct exclusions pursuant to section 1128 of the
Act. 48 Fed. Reg. 21662, May 13, 1983.
19. Section 1128(b)(4)(B) of the Act authorizes
exclusions from the Medicare and Medicaid programs for
any individual or entity who surrendered a license while
a formal disciplinary proceeding was pending before a
State licensing agency and the proceeding concerned the
individual's or entity's professional competence,
professional performance, or financial integrity.
20. On August 9, 1990, pursuant to section 1128(b)(4)(B)
of the Act, the I.G. excluded Petitioner from
participating in the Medicare program and directed that
he be excluded from participating in Medicaid until he
obtained a valid license to practice medicine in New
York.
21. There do not exist any disputed issues of material
fact in this case that pertain to the I.G.'s authority to
exclude Petitioner; therefore, summary disposition on
that issue is appropriate. Ruling, April 9, 1991; See
Federal Rules of Civil Procedure, Rule 56.
22. Petitioner surrendered to a State licensing
authority his license to practice medicine and surgery
while a formal disciplinary proceeding was pending which
concerned his professional competence, professional
performance, or financial integrity, within the meaning
of section 1128(b)(4)(B) of the Act. FFCL 14 - 17.
23. Petitioner's surrender of his license in the face
of charges, and where he had the opportunity to defend
himself against such charges, creates a presumption or
inference that he is as untrustworthy as an individual
who loses his or her license after litigating the issue
of their professional competence, performance, or
financial integrity. In such circumstances, section
1128(b)(4)(B) authorizes the imposition of some period of
exclusion. S. Rep. No. 109, 100th Cong., 1st Sess. 7,
reprinted in 1987 U.S. Code Cong. & Admin. News 682, 684,
688.
24. Section 1128(b)(4)(B) of the Act does not establish
a minimum or a maximum term of exclusion.
25. The Secretary did not make the regulations
promulgated on January 29, 1992 concerning permissive
exclusions under section 1128(b) of the Act, 42 C.F.R.
1001 Subpart C, apply retroactively to I.G. permissive
exclusion determinations pending ALJ hearings and
decisions at the time the regulations were promulgated.
26. The remedial purpose of section 1128 of the Act is
to protect the integrity of federally-funded health care
programs and the welfare of beneficiaries and recipients
of such programs from individuals and entities who have
been shown to be untrustworthy.
27. An ancillary remedial objective of section 1128 of
the Act is to deter individuals from engaging in conduct
which jeopardizes the integrity of federally-funded
health care programs.
28. Petitioner's reason for surrendering his license in
New York was that he did not intend to return to New York
to practice medicine and did not want to incur the cost
of challenging the State Board's charges. Petitioner has
held a license to practice medicine in the State of
California since 1970 and had moved to California in
1984, prior to charges being filed against him in New
York. Tr. 180 - 181, 185 - 186, 263.
29. Petitioner admitted that he did not read the
application surrendering his license, even though it
bears his signature. Tr. 261.
30. In 1979-1980, Salamanca was a 20 - 40 bed hospital
located in a small town with a population of between
5,000 - 6,000. Tr. 194, 413. Salamanca's ER had the
following limitations: 1) it was not staffed by a
physician certified in emergency medicine. Tr. 196, 199 -
202, 388 - 390; 2) it had no medical technicians in the
ER after 4:00 p.m. or on weekends -- they were on call
after that time and were expected to arrive at the
hospital within 15 - 30 minutes. Tr. 195 - 196, 210 -
211, 385; 3) it had no intensive care unit (ICU) or CCU.
Patients needing an ICU would be transferred to the
nearest ICU as soon as possible. The two hospitals with
ICU's closest to Salamanca were 15 - 20 minutes away by
car. Tr. 196 - 197, 384 - 385; 4) it had no advanced
life support ambulance. Salamanca's ambulance had
oxygen, but no electrocardiogram machinery or heart
monitors on board. Tr. 198.
31. It was Petitioner's practice at Salamanca to
transfer patients to other hospitals if they needed
sophisticated emergency treatment. Tr. 230 - 231.
32. In 1979-1980, it would appear from the Salamanca
medical records that it was Petitioner's practice to:
1) have the ER nurses fill out the medical history of
the patients and obtain their blood pressures and
temperatures; and 2) record on patients' charts only
positive findings from his physical examinations.
Tr. 222 - 223, 281 - 282, 297 - 298; P. Ex. 2 - 5.
33. The charges upon which Petitioner's license
surrender are based are very serious, directly relating
to Petitioner's ability to adequately care for
beneficiaries and recipients of the Medicare and Medicaid
programs. FFCL 4 - 13.
34. As Petitioner did not contest the charges against
him in New York, no licensing authority or court has ever
evaluated the evidence against Petitioner and determined
his guilt or innocence.
35. Petitioner admitted to the charges of poor record
keeping in his care of the eight patients in question
and, furthermore, Petitioner did not contest the charges
of negligence or incompetence. FFCL 15, 22, 29; Tr. 261 -
263.
36. With regard to Patient A, the record before me is
insufficient to establish the level of care that
Petitioner provided to Patient A. P. Ex. 1; I.G. Ex. 10;
Tr. 244 - 259, 431 - 433, 435 - 442. The opinions
expressed by the I.G.'s consultant, Frederick C. Lane,
M.D., as they relate to the care provided by Petitioner
to Patient A at Salamanca, cannot be supported by the
record.
37. After reviewing seven patient records (patients B -
H), Dr. Michael Jastremski, the Director of Critical Care
at University Hospital, State University of New York
Health Science Center, Syracuse, New York, concluded that
Petitioner provided substandard care in 1979 - 1980, as
Petitioner's care of these patients failed to meet
acceptable standards of medical care. Jastremski
specifically noted, and I concur, that it is the
responsibility of the treating physician to adequately
document the history and physical of each patient. I.G.
Ex. 11, 19.
38. With regard to Patient B, Petitioner admitted
providing Patient B inadequate care in transferring her
with only a neck collar. Tr. 448. His excuse for the
care provided was the unavailability of a proper neck
brace or materials to stabilize the neck while the
patient was in transit to another hospital for more
adequate treatment. Tr. 447 - 449.
39. Petitioner had responsibility for the emergency
treatment of Patients B, C, D, E, F, G, and H, but failed
to adhere to one or more of the following medical
standards: 1) conducting sufficient diagnostic
procedures to determine accurately the severity and cause
of their symptoms and providing medication prior to such
determination; 2) documenting his specific findings
concerning the nature and severity of their condition;
and 3) properly stabilizing their condition and ensuring
proper medical attention during transport to another
hospital. Tr. 204 - 207, 209 - 220, 226 - 235, 237 -
243, 445 - 470, 472 - 505; I.G. Ex. 11/1 -8, 19/2 - 8;
P. Ex. 2 - 5.
40. Petitioner transferred possibly unstable cardiac
patients (patients C, D, and E) in a regular ambulance
or allowed a transfer by car, rather than requiring
transport in an ambulance with advanced life support
equipment. I.G. Ex. 11, 19.
41. Petitioner has practiced medicine in California
since 1984 at urgent care centers and has performed
surgery. Petitioner has medical staff privileges at
three California hospitals. Tr. 182 -183; P. Br. 6.
42. In 1985, Petitioner was denied staff privileges at
Scripps Memorial Hospital (Scripps), Encinitas,
California, because he had failed to demonstrate his
background, experience, professional training, and
competence with sufficient adequacy to assure the medical
staff of that facility that any patient treated by him
would be given high quality medical care. I.G. Ex. 8, 9.
43. Following Petitioner's exclusion in 1990, the
Medicare and Medicaid programs were billed for
Petitioner's services on two occasions, even though
Petitioner's exclusion prohibited such billings. I.G.
Ex. 15, 16, 17, 18, 20.
44. Petitioner's conduct exhibits a consistent and
continued pattern of a lack of attention to detail and
meeting acceptable standards of medical practices
relating to: 1) care of patients at Salamanca in 1979-
80; 2) properly documenting and supporting his
application for staff privileges at Scripps in 1985; and
3) ensuring the lack of billing of Medicare and Medicaid
after his exclusion in 1990. This pattern of conduct
demonstrates his untrustworthiness to provide services to
the Medicare and Medicaid programs. FFCL 29, 38, 39, 40,
42, 43.
45. While at Salamanca, Petitioner's practice of
documenting history and physical examinations of patients
was deficient, whether or not it was the general practice
of physicians in Salamanca's ER, and does not excuse his
conduct. FFCL 35; Tr. 410. Petitioner's deficiencies in
diagnostic studies, administering of medication or
transport of cardiac/neurological patients were attribu-
table to more than: 1) a lack of diagnostic equipment;
2) absence of an advanced life support ambulance at
Salamanca; 3) lack of personnel to conduct the diagnostic
tests; or 4) advice of cardiac specialists on the care
of cardiac patients prior to transfer to a hospital with
a coronary care unit. FFCL 30; Tr. 198, 211 - 212, 219 -
220, 238 - 239, 449, 462 - 463, 479, 496.
46. Since leaving Salamanca, Petitioner's practice in
California has been to document both negative and
positive findings of physical examinations. Tr. 222 -
223, 225 - 226, 297 - 298. There have been no
allegations concerning the adequacy or competence of
Petitioner's treatment of patients in California.
Tr. 184 - 185.
47. The I.G. has not shown that an exclusion until
Petitioner regains his license to practice medicine in
the State of New York is reasonably necessary to satisfy
the remedial purpose of section 1128 of the Act.
48. The remedial purpose of section 1128 of the Act will
be satisfied in this case by modifying the exclusion
imposed and directed against Petitioner to the shorter of
either: 1) a three year exclusion; or 2) an exclusion
until such time as a State licensing agency reviews all
of the factual and legal issues which were before the
State of New York when Petitioner surrendered his
license, and based on the result of that review either
a) grants Petitioner a license, or b) if it is the
California agency, it takes no significant adverse action
against his existing license.
RATIONALE
In 1979 and 1980, Petitioner was a surgeon in Salamanca,
New York, on staff at Salamanca District Hospital. As a
Salamanca staff physician, Petitioner was expected also
to staff Salamanca's ER on a rotating basis. In 1984,
Petitioner relocated to California, where he had held a
medical license since 1970. In 1988, Petitioner was
charged by the State Board in New York with negligence,
incompetence, and poor record keeping with regard to the
care of eight of his patients at Salamanca in the years
1979 and 1980. In the face of these charges, Petitioner
surrendered his license to practice medicine in the State
of New York.
Based on Petitioner's surrender, the I.G. determined to
exclude him from the Medicare and Medicaid programs until
he regained his license to practice medicine in New York.
In my Ruling of April 9, 1991, I found that while the
I.G. had a basis upon which to exclude Petitioner,
genuine issues of material fact remained with regard to
Petitioner's trustworthiness which issues, when resolved,
might affect the length of Petitioner's exclusion.
Petitioner is now asserting his trustworthiness and
vigorously contesting the reasonableness of the length of
the exclusion imposed and directed against him by the
I.G.
Procedurally, Petitioner argues that: 1) section
1128(b)(4)(B) is not retroactive and does not apply to
him, as the conduct on which it is based occurred some
years prior to section 1128(b)(4)(B)'s 1987 enactment
(P. Br. 2 - 3); 2) because Petitioner has not been able
to obtain copies of all relevant emergency room medical
records from Salamanca, I should not consider the reports
and declarations the I.G. has presented based upon those
medical records (P. Br. 3 - 4); 3) the I.G. abused his
discretion in this case by not performing an adequate
investigation and by ignoring information provided to him
by Petitioner (P. Br. 9 - 10); 4) the I.G. did not
provide evidence of the qualifications and competence of
the experts on which he relied (P. Br. 10 - 11); 5)
neither the I.G. nor the consultants upon whose expert
opinions he relied properly considered the actual
conditions at Salamanca (P. Br. 11 - 13); 6) evidence as
to Petitioner's post exclusion billings should not be
considered because it was not considered by the I.G. in
making the original decision to exclude (P. Br. 26); and
7) the new regulations should not apply to this case.
P. Reg. Br. 1 - 3.
With regard to his trustworthiness, Petitioner argues
that he has rebutted any presumption of his untrust-
worthiness arising from the surrender of his license by
alluding to his education, training and employment
history, including the fact that he is currently
practicing in California and has medical staff privileges
at three California hospitals (P. Br. 4 - 6) and by
alleging: 1) that his move to California was made for
personal and family reasons only, not to evade the State
Board charges (P. Br. 5 - 7); 2) that he never closely
read the surrender agreement and did not realize that he
was not contesting more than the record keeping charges
(P. Br. 7 - 8); 3) that his reason for not contesting the
State Board charges is that he no longer intended to
practice in New York and did not want to go to the
expense of litigating the matter (P. Br. 8); 4) that he
has not had the chance to prove his innocence in any
other forum (P. Br. 9); 5) that under the conditions
existing at Salamanca in 1979-1980, he treated these
eight patients properly (P. Br. 11 - 26); and 6) with
reference to the post-exclusion billings, that he did
everything he could to prevent such billing by notifying
his employers of the exclusion and asking them to make
sure he did not treat or bill Medicare and Medicaid
patients even if they came to him, as he did not want to
violate his exclusion (P. Br. 32).
The I.G. asserts that the State Board charges represent
serious deviations from accepted medical practice. The
I.G. argues that Petitioner's attempts to rebut these
charges consist of denial and blaming others for his
misconduct. Specifically, Petitioner's failure to
adequately assess and document his patient's conditions
on numerous occasions, and to appropriately diagnose,
treat, and stabilize their conditions prior to transferr-
ing them to another hospital or discharging them
altogether, cannot be excused by medical technicians only
being on an on-call status on weekends. The I.G. argues
that Petitioner's untrustworthiness is proven by sending
patients to other facilities in cars or ambulances, with
no advanced life support equipment or assessment of the
seriousness of their conditions, or attempts to stabilize
the conditions. I.G. Br. 35 - 36.
Further, the I.G. argues that Petitioner has offered no
evidence to demonstrate that he has recognized the
gravity of the charges against him or sought to correct
his behavior. The I.G. asserts that Petitioner has never
acknowledged that he rendered inappropriate or inadequate
care, nor has he offered evidence that he would treat
such patients differently, instead stating that he did
not believe his care was negligent. The I.G. relies on
the testimony of the State Board consultant that
Petitioner should not be practicing in any State (I.G.
Ex. 19/8). I.G. Br. 36.
The I.G. cites in support of Petitioner's exclusion
Petitioner's actions following his move to California,
including: 1) his post-exclusion billings; and 2) the
problems with his application for staff privileges at
Scripps. I.G. Br. 37 - 40; I.G. Ex. 9.
Finally, the I.G. argues that the new regulations apply
to this case and are binding on me, mandating
Petitioner's indefinite exclusion in this case. I.G.
Reg. Br. 2 - 5.
Petitioner's Exclusion Is Not A Retroactive Application
Of Section 1128(b)(4)(B).
Petitioner has argued that because the conduct which gave
rise to the State Board's charges of inappropriate care
and treatment occurred prior to the effective date of
section 1128(b)(4)(B), the law cannot be applied
retroactively to exclude him. I disagree. This issue
was addressed by both the ALJ and the appellate panel in
the context of an exclusion based on a license revocation
under section 1128(b)(4)(A). As the ALJ stated in the
case of Leonard R. Friedman, M.D., DAB CR125 (1991) at 7,
aff'd DAB 1281 at 12 (1991),
The language of subsection 1128(b)(4)(A) is without
qualifying terms or conditions. Furthermore, as
demonstrated by the legislative history, Congress
intended to protect Medicare and Medicaid patients
from physicians whose license had been revoked by
any state licensing authority. Moreover, in
providing the Secretary with discretion to exclude
based on revocation by any state licensing authority
occurring immediately or shortly after enactment
(September 1, 1987), Congress had to know that the
underlying reason for the revocation would likely be
conduct which had occurred prior to the effective
date. Thus, by logical inference, Congress intended
the 1987 amendments to apply even in those cases
where the misconduct or other act which led to
revocation occurred prior to August 18, 1987.
In the context of the issue of the retroactivity of the
Act to Petitioner's case, it is irrelevant that the
Friedman case dealt with the revocation of the
physician's license as the basis for an action under
section 1128(b)(4)(A), as the retroactivity issue is
identical for both sections 1128(b)(4)(A) and
1128(b)(4)(B). Congress had to know that, in the context
of an 1128(b)(4)(B) action, as of the effective date of
the Act, the underlying reason for the license surrender
would likely be conduct which had occurred prior to the
effective date. Again, by logical inference, Congress
intended the 1987 amendments to apply even in cases where
the misconduct or other actions which led to a health
care provider's surrender of his license occurred prior
to the effective date of the Act, as long as the
surrender of the license occurred after the effective
date of the act. See, Betsy Chua, M.D., et. al., DAB
CR76 (1990), aff'd DAB 1204 (1990).
Thus, section 1128(b)(4)(B) applies to any license
surrender occurring after the effective date of the Act
in 1987. Petitioner applied to surrender his license on
January 12, 1989, and the surrender was executed on April
27, 1989. Since Petitioner's surrender occurred after
the effective date of the statute, it is subject to
section 1128(b)(4)(B), and there is no retroactive
application of the Act.
In the absence of relevant medical records, the
documentary evidence of opinions of the State Board's
medical consultants is relevant and can be considered in
evaluating Petitioner's trustworthiness to be a provider
of Medicare and Medicaid.
Petitioner has argued that, since he has not been able to
obtain copies of all relevant medical records from
Salamanca, I should not consider any of the reports and
declarations the I.G. has presented based upon them. I
disagree. Petitioner has admitted to the inadequacy of
his record keeping in the years 1979 and 1980. FFCL 14 -
17. At the time Petitioner admitted to this charge in
1989, copies of all the medical records upon which the
charges were based were available to Petitioner. It is
no one's fault that certain of the Salamanca medical
records now have been destroyed. In the absence of the
medical records of several of the patients (patients B,
C, D) on which the State Board's action was based, I must
rely on secondary evidence of what those absent records
disclosed and the best evidence of that is the opinion of
the State Board's consultant, based on his review of
those records. Petitioner is not prejudiced by such
reliance. He could have called the consultant as a
witness and subjected him to cross examination, but chose
not to do so. Instead, he presented his own testimony
and that of another physician who practiced at Salamanca
during the 1979 - 1980 time period. Thus, I can properly
rely on the evidence presented in this case regarding
Petitioner's practice of medicine at Salamanca in
evaluating his trustworthiness.
The I.G. had authority to exclude Petitioner under
section 1128(b)(4)(B) of the Act. Any complaint by
Petitioner that the I.G. abused his discretion in this
case, by not performing an adequate investigation and by
ignoring information provided to him by Petitioner, is
remedied by the fact that Petitioner was able to offer
any such evidence in the course of the proceeding before
me.
It is an open question as to whether I have the authority
to decide if the I.G. has abused his discretion in this
case. Sheldon Stein, M.D., DAB 1301 (1992) at 8 - 9.
Section 1005.4(c)(5) of the new regulations may preclude
me from considering this question. 4/ I do not, however,
have to reach this question. Notwithstanding whether or
not I have this authority, Petitioner has failed to make
a preliminary showing that there has been any abuse on
the part of the I.G. This is a derivative action. The
I.G. based his decision on the surrender of Petitioner's
license under the circumstances set out in section
1128(b)(4)(B) of the Act, and that is all he needed upon
which to proceed. Moreover, Petitioner's argument with
regard to whether or not the I.G. abused his discretion
is misdirected. Petitioner's real concern is that the
I.G., allegedly by ignoring the evidence Petitioner
presented to him, directed and imposed an unreasonably
lengthy exclusion against him. Petitioner, however, has
had the opportunity to fully present evidence concerning
the reasonableness of his exclusion in the hearing before
me. Any deficiencies perceived by Petitioner in the
I.G.'s investigation of this case have been cured by
Petitioner's full opportunity to present evidence in this
de novo hearing.
I am not relying on expert opinions introduced by the
I.G. without any evidence of the experts' qualifications.
The I.G. has introduced expert medical opinions of two
physicians who reviewed the eight cases in question for
the State Board. One consultant reviewed the medical
record of Patient A, the patient Petitioner operated on
for a perforated ulcer. I.G. Ex. 10. On two occasions,
the other consultant reviewed the charts of the seven
patients Petitioner treated in Salamanca's ER. I.G. Exs.
11, 19.
I do not rely on the expert opinion of Dr. Frederick C.
Lane (I.G. Ex. 10), as I find the record before me
insufficient to establish the level of care provided by
Petitioner to Patient A. 5/ FFCL 36. With regard to the
ER patients, however, I have considered the expert
opinion expressed by the State Board's consultant, Dr.
Michael Jastremski. The I.G. has provided his
qualifications as an expert in emergency medicine. I.G.
Exs. 11 and 19 specifically identify this consultant as
Director of Critical Care at a hospital and as Board
Certified in Emergency Medicine, Internal Medicine, and
Critical Care Medicine, as well as an Instructor of
Emergency Medicine. Again, if Petitioner had a basis to
challenge the qualifications of Dr. Jastremski,
Petitioner could have subpoenaed and cross examined him.
In making my determination as to the reasonableness of
the length of an exclusion, I am able to consider
evidence not available to the I.G. at the time the I.G.
made his decision to exclude.
By reason of section 205(b)(1) of the Act, this hearing
is de novo. Evidence which is relevant to the
reasonableness of an exclusion is admissible whether or
not that evidence was available to the I.G. at the time
the I.G. made his exclusion determination. Kranz, DAB
1286 at 7 - 8 ; Bilang, DAB 1295 at 9., Joel Davids, DAB
1283 (1991) at 7; Vincent Baratta, M.D., DAB 1172 (1990)
at 11. Either the I.G. or the Petitioner may offer such
evidence; Petitioner to prove his trustworthiness (as,
for example, Petitioner has done by introducing P. Exs. 6
- 15), and the I.G. to prove Petitioner is untrustworthy
(as the I.G. has done in offering evidence as to
Petitioner's alleged post-exclusion billings).
Applicability of new regulations to this case
Effective January 29, 1992, the Secretary promulgated new
regulations (Parts 1001 - 1007) pertaining to his
authority under the Medicare and Medicaid Patient and
Program Protection Act (MMPPPA), Public Law 100-93, to
exclude individuals and entities from reimbursement for
services rendered in connection with the Medicare and
Medicaid programs. 6/ These regulations also included
amendments to the civil money penalty authority of the
Secretary under MMPPPA. For purposes of this
proceeding, the specific regulatory provisions relating
to permissive exclusions under section 1128(b)(4) of the
Act (Section 1001.501) and appeals of such exclusions
(Part 1005) must be considered in terms of their
applicability to this case.
The I.G. argues that these regulations are binding on me
in determining the reasonableness of the indefinite
exclusion imposed on Petitioner and apply even though the
hearing was held prior to the effective date of the
regulations. 7/ I.G. Reg. Br. 2 - 5; I.G. R. Reg. Br. 1
-4. In essence, the I.G. argues that under section
1001.501(b) Petitioner's exclusion must be for at least a
period equivalent to the indefinite exclusion imposed on
Petitioner, and the exceptions of subpart (c) do not
apply to this case. 8/ The I.G. further cites sections
1005.4(c)(1) and (5) to demonstrate that I have no
authority to: 1) find the above cited regulation
invalid; or 2) review the I.G.'s exercise of discretion
to exclude or the scope or effect of such exclusion.
Thus, once I ruled that the I.G. had authority to exclude
Petitioner under section 1128(b)(4), there was nothing
left for me to hear, as I have no authority to review or
alter the period of exclusion chosen by the I.G.
In opposition, Petitioner argues that under the
applicable case law the new regulations should be applied
prospectively absent clear legislative intent under MMPPA
that they be applied retroactively. P. Reg. Br. 1 - 3.
Petitioner argues for imposition of an exclusion of one
and a half years. Id. at 6. If, however, the I.G.'s
interpretation of sections 1001.501(b) and 1005.4(c) is
accepted and the regulations are applied retroactively, I
cannot modify the I.G.'s mandated indefinite coterminous
exclusion. Accordingly, the entire record of the hearing
on the reasonableness of Petitioner's exclusion would be
rendered a nullity, since I would be compelled to find
that the I.G.'s coterminous exclusion is reasonable.
Prior to the effective date of these regulations, there
were no regulations implementing the I.G.'s permissive
exclusion authority under section 1128(b) of the Act.
The prior regulations relating to mandatory exclusions
under section 1128(a) of the Act, 42 C.F.R.
1001.125(b), were used as guidance in determining the
reasonableness of exclusions under section 1128(b).
The essential question to be resolved under the prior
regulations, once it is determined that the I.G. has
authority to exclude, is the length of time needed to
protect program beneficiaries and recipients from an
untrustworthy provider. The I.G. need only show that
the exclusionary period imposed is "not extreme or
excessive". See, 48 Fed. Reg. 3744 (1983).
Petitioners subject to exclusions imposed by the I.G.
under section 1128 of the Act have the right to a de novo
hearing under section 205(b)(1) of the Act. Generally,
such hearings involve consideration of whether: 1) the
I.G. had authority under the Act to impose the exclusion;
and 2) the exclusion comports with the remedial purposes
of the Act. Kranz, DAB 1286 at 7 - 8, Bilang, DAB 1295
at 9. In reaching a determination as to whether an
exclusion meets the remedial purpose of the Act, the ALJ
may consider all evidence regarding the reasonableness of
an exclusion, including that which may not have been
available to the I.G. when the decision to exclude was
made. Davids, DAB 1283 at 7; Baratta, DAB 1172 at 11.
Also, evidence of a petitioner's culpability, based on
review of the derivative actions upon which the I.G. has
authority to exclude, can properly be considered by the
ALJ in determining the length of an exclusion. Bilang,
DAB 1295 at 9.
Examination of the statutory language of section
205(b)(1) fails to demonstrate any restrictions on the
scope or breadth of hearings held to review a prior
decision of the Secretary, or, in this case, the I.G. as
the Secretary's lawful delegate. 9/ Moreover, as relates
to exclusions based on license revocation or surrender,
an appellate panel of the DAB, upon review of the
statutory purpose of section 1128 in general and section
1128(b)(4) in particular, has concluded:
The scheme Congress established in section 1128
permits the Secretary to conserve program
resources by relying where possible on other
federal or state court or administrative
findings. However, Congress did not require
imposition of an exclusion on all providers who
surrender their licenses, nor mandate any
particular period of exclusion in such
circumstances. Bilang, DAB 1295 at 8.
Similarly, the DAB has considered whether section
1128(b)(4) requires the imposition of a coterminous
exclusion in all cases where the I.G. has authority to
act based on the derivative action of a state licensing
agency. An appellate panel concluded that:
. . . [Considering the] permissive nature of an
exclusion under section 1128(b)(4) of the Act
[,] Congress did not require that any exclusion
be imposed based on the action of a licensing
board, much less that the period of exclusion
be coterminous with licensure revocation.
Kranz, supra at 11. 10/
The I.G. maintains that the new regulations are binding
on me as of the effective date, January 29, 1992, and
that they require me to affirm the coterminous exclusion
imposed on Petitioner. Section 1001.501(b) establishes a
coterminous exclusion as the minimum period of exclusion,
except as provided in section 1001.501(c), in situations
where, prior to the I.G.'s notice of exclusion, other
licensing authorities, having been apprised of the
licensing action upon which the exclusion is based,
impose a lesser period of time, or decide to take no
adverse action against a petitioner's existing license.
There is no evidence of record to support application of
either exception in this case.
Moreover, section 1001.501(b)(2) limits the factors that
can be considered in lengthening or shortening the
minimum period of exclusion. More importantly, however,
this section of the regulations provides that the factors
to be used to reduce the exclusion can only be considered
when there exist one of the specified factors to increase
the exclusion beyond the coterminous period provided for
in section 1001.501(b). In this case, the I.G. is not
seeking a longer period of exclusion than the minimum
period. Thus, the regulations will not permit
consideration of factors to reduce the exclusion.
Furthermore, since I have already ruled that the I.G. has
the authority to exclude under section 1128(b)(4)(B),
there would be no purpose for any further hearing on the
reasonableness of Petitioner's exclusion.
In essence, the I.G. argues that the new regulation
imposing a minimum coterminous exclusion in license
revocation and suspension cases renders the State action
upon which the exclusion is based determinative of the
federal exclusion in cases where the I.G. offers no
evidence to justify a longer period of exclusion. Such a
position is totally contrary to a recent appellate panel
opinion that concluded:
If Congress had intended the state action to be
determinative for federal purposes, Congress
would not have made the exclusion permissive,
nor have provided for de novo review. Bilang,
DAB 1295 at 9.
If I conclude this regulation is binding on me even where
its effective date is after 1) the date the I.G. made his
determination to exclude and 2) an in-person hearing was
provided Petitioner pursuant to existing DAB precedent,
11/ then it is apparent that application of this
regulation at this juncture of the proceeding profoundly
impacts on the scope and breadth of the de novo hearing
that Petitioner is provided by section 205(b)(1) of the
Act. Acknowledging that I must follow these regulations
and have no authority to declare them ultra vires, there
still remains a question as to whether the Secretary
intended these regulations to apply to pending cases. 12/
While the Federal Register notice accompanying the
promulgation of these regulations provides for an
effective date of January 29, 1992, it contains no
indication, other than silence, as to whether the
regulations are to apply to pending cases. Moreover,
there is no indication in the legislative history of the
MMPPPA or its statutory provisions that implementing
regulations are to be applied retroactively. 13/
As I have indicated, the regulations pertaining to
license revocation and suspension, section 1001.501,
substantially alter the de novo hearing rights of a
petitioner who objects to the imposition of a coterminous
exclusion. Even though the proposed regulations have
been pending since 1990, appellate panels of the DAB have
concluded that such regulations are not binding on
pending cases. Moreover, existing DAB precedent also
demonstrates that the mandatory application of a minimum
coterminous exclusion in section 1128(b)(4) cases, as
required by section 1001.501(b), at best involves a new
and different statutory interpretation of the Act.
It has generally been held that administrative rules
should not be applied retroactively unless their language
specifically requires that application. Bowen v.
Georgetown University Hospital et al., 488 U.S. 204
(1988). Moreover, a statutory grant of rulemaking
authority will not generally be understood to encompass
the power to promulgate retroactive rules unless that
power is conveyed by Congress in express terms.
Georgetown University Hospital, 488 U.S. at 208. 14/ As
indicated previously, there is nothing in the Act
expressly granting the Secretary the power to promulgate
retroactive rules, nor do the new regulations expressly
state that they apply retroactively.
It is also a generally accepted axiom of law that
statutes affecting substantive rights and liabilities are
presumed to have only prospective effect. United States
v. Murphy, 937 F. 2d 1032, 1037 (6th Cir. 1991). The
Court of Appeals considered and distinguished the legal
argument cited by the I.G. that "[a] court is to apply
the law in effect at the time it renders its decision,
unless doing so would result in manifest injustice or
there is statutory direction or legislative history to
the contrary." Bradley v. School Board of City of
Richmond, 416 U.S. 696, 711 (1974); see also, Thorpe v.
Housing Authority of City of Durham, 393 U.S. 268, 281 -
283 (1969); I.G. R. Reg. Br. 2 - 4. It held that:
1) Bradley is to be read narrowly and the phrase
"substantive rights and liabilities" is to be construed
broadly; and 2) where retroactive application would
impose greater liabilities and affect substantive rights,
then the law should be prospective only. Murphy, 937 F.
2d at 1038.
As to the issues of "manifest injustice" and, arguably,
"substantive rights and liabilities", the I.G. contends
that since Petitioner was on notice of the coterminous
exclusion and had an opportunity to be heard, he is not
adversely affected by application of the new regulations.
I.G. R. Reg. Br. at 3. The I.G.'s analysis defies logic.
While it is conceded that the I.G. sought the same
coterminous exclusion both prior to and after retroactive
application of section 1001.501(b), there can be no
doubt, as shown below, that Petitioner's hearing rights
and opportunity for consideration of alternative forms
of exclusion have been significantly narrowed, if not
abrogated, by the new regulations if applied as
interpreted by the I.G. Clearly, Petitioner's
"substantive rights and liabilities" would be
significantly impacted by the retroactive application of
the new regulations. Moreover, even applying the test in
Bradley, such retroactive application would equally
result in "manifest injustice."
Consideration of these regulations must be made
consistent with existing interpretations of the statutory
provisions from which the regulations derive and with the
requirements of due process. Greene, DAB 1078 at 17.
Petitioner's expectation of continued participation as a
program provider is a property interest protected by the
due process clause of the Fifth Amendment. Ram v.
Heckler, 792 F.2d 444, 447, (4th Cir. 1986).
Accordingly, my interpretation of the retroactive
effect of these regulations must include concern for
Petitioner's due process rights in terms of his ability
to present evidence to: 1) rebut the inference of
untrustworthiness arising from his surrender of his
license in New York; and 2) to show that the coterminous
exclusion in his case is extreme or excessive, in that
other relief is available which comports with the
remedial purposes of the Act.
Retroactive application of section 1001.501, particularly
adopting the I.G.'s interpretation of section
1005.4(c)(5) concerning the impact of the scope of review
under section 205(b)(1), will have a profound affect on
Petitioner's due process rights and his ability to obtain
a fair hearing as contemplated by the Act. At this point
in the proceeding (post an in-person hearing and the
submission of briefs on issues raised at such hearing),
to accept the I.G.'s position on applicability of the new
regulations would amount to not only tilting the playing
field but also changing the field entirely.
Absent a specific instruction in the Act or the Federal
Register statement accompanying the regulations directing
that they apply to pending cases, I must conclude, in the
context of this case, that the Secretary did not intend
to substantially alter Petitioner's rights and render
his previously conducted hearing a nullity. 15/ To do
otherwise would result in an injustice and deprive
Petitioner of due process and the fair hearing
contemplated by the Act. Hanlester Network, et al.,
CR181 (1992) at 45 - 48. 16/
Even assuming arguendo that the new regulations apply to
this proceeding, there remains the question of whether
Part 1001 is binding on the breadth and scope of a
hearing held under section 205(b)(1) of the Act. The
I.G. would apply section 1001.501(b) as imposing a
mandatory minimum period of exclusion without any
opportunity for Petitioner to seek review other than the
I.G.'s authority to exclude. Moreover, the I.G. has
argued that his indefinite exclusion of Petitioner in
this case was an exercise of discretion which is not
subject to review. While I believe that the I.G.'s
position is a fair reading of the new regulation, as I
have indicated in my discussion of applicable DAB
precedent, the I.G.'s position is contrary to prior
specific interpretations of sections 1128(b)(4) and
205(b)(1) of the Act. Such an interpretation makes a
nullity of Part 1005 pertaining to appeals of exclusions,
since the elaborate hearing procedures set forth there
would not be available in any case in which the I.G.'s
exclusion is for the minimum period provided by the
regulation. In short, in a case in which the I.G.
imposed the minimum period of exclusion, petitioners
would be deprived of the ALJ review of the reasonableness
of the exclusion. Thus, under this regulation, the I.G.
would make these minimum periods "mandatory" permissive
exclusions similar to the minimum mandatory five year
exclusion established by Congress for section 1128(a)
violations. This interpretation seems to fly in the face
of clear and direct statutory language and legislative
history indicating that no minimum period of exclusion
applies in matters arising under section 1128(b).
As an ALJ, my role is to follow applicable precedent,
regulations, and statutes. I have no authority to do
otherwise. Here, however, I am trying to reconcile
regulations which arguably reflect the Secretary's
interpretation of sections 1128 and 205(b)(1) with
DAB precedent which also reflects the Secretary's
interpretation of these statutory provisions. This
conflict in interpretation can be reconciled only by
utilizing the following interpretation.
It is clear that Part 1001 sets forth the policy and
guidelines that the I.G. will follow in determining
whether he has authority to exclude in a particular case
and it describes what the scope and duration of that
exclusion should be. It is customary, in hearings on
exclusions, for the I.G. to call his special agent or
analyst to describe the process that led to the decision
to exclude. In this case, the analyst was called and
described the process and factors that resulted in the
decision to exclude Petitioner coterminous with the
denial of his license to practice in New York. Tr. 60 -
97. Oftentimes there is reference to the "I.G. manual"
which analysts use to support their exclusion
recommendations. Thus, one clear purpose of Part 1001
is to codify factors to be considered by the I.G. in
exclusion cases and the types of exclusions that will be
sought in particular factual situations under sections
1128(a) and (b) of the Act.
There is no support in the language of the regulations,
the preamble, or in the comments and responses, for a
conclusion that Part 1001 limits the scope of hearings
held pursuant to section 205(b)(1) of the Act. Part 1001
contains references to the I.G. and what actions or
factors he will consider in imposing an exclusion under
section 1128 of the Act. In contrast, the scope of the
ALJ's hearing authority is covered under Part 1005. It
is evident under section 1005.4(c) that the ALJ cannot:
1) invalidate Federal statues or regulations; 2) review
the I.G.'s exercise of discretion in implementing section
1128(b) of the Act or determine the scope or effect of an
exclusion arising thereunder 17/; or 3) set the period of
exclusion to zero once the ALJ concludes that the I.G.
has authority to exclude. However, section 1005.20
allows the ALJ to increase, decrease, or reverse the
exclusion imposed by the I.G. 18/
My reading of Parts 1001 and 1005 leads me to conclude
that Part 1001 relates solely to the exercise of the
I.G.'s discretion to exclude. However, Part 1005 also
makes it clear that, except for the limitations on my
authority set out in section 1005.4(c), one of the
purposes of the hearing is to address the issue of the
reasonableness of the exclusion. 19/ Why else provide
that my decision may result in a change in the period of
an exclusion imposed by the I.G.? In contrast, as
previously discussed, accepting the I.G.'s interpretation
of sections 1001.501 and 1005.4(c)(5) would deprive
parties of the opportunity for ALJ review of the
reasonableness of the exclusion in similar cases. This
is a dramatic departure from the past and amounts to a
significant curtailment of a petitioner's due process
right to a hearing to review the I.G.'s determination
under section 205(b)(1) of the Act.
Without an express statement from the Secretary that this
was his intention in promulgating Parts 1001 and 1005, I
cannot accept an interpretation that is in direct
conflict with unambiguous DAB precedent which reaches a
contrary conclusion. Such a fundamental change in the
rights of parties seeking review of I.G. determinations
pursuant to section 205(b)(1) of the Act must be based
on an explicit pronouncement from the Secretary. 20/
At this point, none exists. My interpretation is a
reasonable reading of Parts 1001 and 1005. It is
consistent with applicable precedent with regard to the
I.G.'s authority under section 1128(b) and does not do
violence to the fundamental due process hearing rights
afforded petitioners under section 205(b)(1) of the Act.
21/
Exclusion of Petitioner until such time as he regains his
license to practice medicine in the State of New York is
so extreme or excessive as to be unreasonable.
In deciding whether or not an exclusion under section
1128(b)(4)(B) is reasonable, I must review the evidence
with regard to the purpose of section 1128 of the Act.
Davids, DAB CR137; Roderick L. Jones, DAB CR98 (1990);
Frank J. Haney, DAB CR81 (1990).
Congress enacted the exclusion law to protect the
integrity of federally funded health care programs.
Among other things, the law was designed to protect
program recipients and beneficiaries from individuals who
have demonstrated by their behavior that they threaten
the integrity of federally funded health care programs or
that they could not be entrusted with the well-being and
safety of beneficiaries and recipients. S. Rep. No. 109,
100th Cong., 1st Sess., reprinted in 1987 U.S. Code Cong.
and Admin. News 682.
An exclusion imposed and directed pursuant to section
1128 of the Act advances this remedial purpose. The
principal purpose is to protect programs and their
beneficiaries and recipients from untrustworthy providers
until the providers demonstrate that they can be trusted
to deal with program funds and to properly serve
beneficiaries and recipients. As an ancillary benefit,
the exclusion deters other providers of items or services
from engaging in conduct which threatens the integrity of
programs or the well-being and safety of beneficiaries
and recipients. H. R. Rep. No. 393, Part II, 95th Cong.
1st Sess., reprinted in 1977 U.S. Code Cong. & Admin.
News 3072.
Deterrence cannot be a primary purpose of imposing an
exclusion. Where deterrence becomes the primary purpose,
section 1128 no longer accomplishes a civil remedial
purpose, but punishment becomes the end result. Such a
result has been determined by the Supreme Court to
contravene the Constitution and is beyond the purpose of
a civil remedy statute. United States v. Halper, 490
U.S. 448 (1989).
An exclusion imposed and directed pursuant to section
1128 will likely have an adverse financial impact on the
person against whom the exclusion is imposed. However,
the law places program integrity and the well-being of
beneficiaries and recipients ahead of the pecuniary
interests of providers. An exclusion is not punitive if
it reasonably serves the law's remedial objectives, even
if the exclusion has a severe adverse financial impact on
the person against whom it is imposed.
No statutory minimum mandatory exclusion period exists
in cases where the I.G.'s authority arises from section
1128(b)(4), nor is there a requirement that a petitioner
be excluded until he or she obtains a license from the
State where their license was surrendered or revoked.
Mikolinski, DAB 1156 at 20. As indicated previously,
the appellate panel in Bilang, DAB 1295 at 8, was quite
explicit in describing the scope of remedial relief, if
any, which may be warranted based on surrender of a
license under section 1128(b)(4)(B):
"... Congress did not require imposition of an
exclusion on all providers who surrendered
their licenses, nor mandate any particular
period of exclusion in such circumstances."
However, an exclusion until a petitioner obtains a
license from the State where his or her license was
revoked is not per se unreasonable. Lakshmi N. Murty
Achalla, M.D., DAB 1231 at 9 (1991); Richard L. Pflepsen,
D.C., DAB CR132 (1991); John W. Foderick, M.D., DAB 1125
(1990).
By not mandating that exclusions from participation in
the programs be permanent, however, Congress has allowed
the I.G. the opportunity to give individuals a "second
chance." An excluded individual or entity has the
opportunity to demonstrate that he or she can and should
be trusted to participate in the Medicare and Medicaid
programs as a provider. Achalla, DAB 1231.
As I stated above, this hearing is, by reason of section
205(b)(1) of the Act, de novo. Evidence which is
relevant to the reasonableness of an exclusion is
admissible whether or not that evidence was available to
the I.G. at the time the I.G. made his exclusion
determination. I do not, however, substitute my judgment
for that of the I.G. An exclusion determination will be
held to be reasonable where, given the evidence in the
case, it is shown to fairly comport with legislative
intent. "The word 'reasonable' conveys the meaning that
. . . [the I.G.] is required at the hearing only to show
that the length of the [exclusion] determined . . . was
not extreme or excessive." (Emphasis added.) 48 Fed.
Reg. 3744 (1983).
Determining the reasonableness of an exclusion is based
in large part on the trustworthiness of a petitioner to
provide health care to program recipients and
beneficiaries in the future. The assessment of
trustworthiness in the context of a hearing under section
205(b)(1) of the Act frequently requires consideration of
the degree of a petitioner's culpability for the acts and
practices arising from criminal offenses or other conduct
upon which the I.G. derives his authority to exclude.
Such assessment is not relevant to whether the I.G. had
authority to exclude in the first place, but only to
whether the length of the exclusion mandated and directed
by the I.G. is reasonable. Thus, here I considered
evidence from Petitioner's license surrender proceeding,
not to review the I.G.'s exercise of discretion in
deciding to exclude Petitioner in August 1990 (see I.G.
Ex. 6), but to evaluate the reasonableness of the
indefinite exclusion sought by the I.G. and to give
Petitioner an opportunity to rebut the presumption or
inference of untrustworthiness arising from the surrender
of his license in the face of disciplinary proceedings
regarding his professional competency and performance as
a health care provider.
The determination of when an individual should be trusted
and allowed to reapply to the I.G. for reinstatement as a
provider in the Medicare and Medicaid programs is a
difficult issue. Prior to the recent promulgation of
regulations pertaining to permissive exclusions under
section 1128(b) of the Act, there were no regulations
directly applicable to permissive exclusions. The prior
regulations at 42 C.F.R. 1001.125(b) pertaining to
mandatory exclusions under section 1128(a) of the Act
did generally provide some guidance in making this
determination. Baratta, DAB CR62, aff'd DAB 1172;
Leonard N. Schwartz, DAB CR36 (1989). However, these
regulations were adopted by the Secretary to implement
the law as it existed prior to adoption of the 1987
revisions to section 1128, which revisions included
section 1128(b)(4)(B). They specifically applied only to
exclusions for program-related offenses (convictions for
criminal offenses related to the Medicare and Medicaid
programs). This case involves the surrender of a license
for reasons which are not concerned with program
violations and where there has been no immediate program
impact, no program damages, no incarceration, and no
previous record of sanctions against Petitioner. Thus,
these regulations are largely inapplicable. Their
overriding principle, however, that a balance be struck
between the seriousness and program impact of the offense
and any existing factors which may demonstrate
trustworthiness, or the lack thereof, guides my
decisionmaking in this case. Kranz, DAB 1286 at 8.
The reasonableness of the exclusion is determined by
considering the circumstances which indicate the extent
of an individual's or entity's trustworthiness to be a
program provider of services. Essentially, I evaluate
the evidence to determine whether the exclusion comports
with the legislative purposes outlined above. Thus, a
determination of an individual's trustworthiness in a
section 1128(b)(4)(B) case necessitates an examination of
the following considerations: 1) the nature of the
license surrender and the circumstances surrounding it;
2) the impact of the surrender on the Medicare and
Medicaid programs; 3) whether and when the individual who
surrendered his license recognized the gravity of the
conduct that initiated the disciplinary proceeding; 4)
the type and quality of help sought to correct the
behavior leading to the license surrender; and 5) the
extent to which the individual has succeeded in
rehabilitation. Thomas J. DePietro, R.Ph., DAB CR117
(1991); Myron R. Wilson, Jr., M.D., DAB CR146 (1991);
Dillard P. Enright, DAB CR138 (1991); Stein, DAB CR144.
In this case, Petitioner surrendered his license in the
face of serious charges of professional misconduct which,
if true, could have grave implications for the care of
Medicare and Medicaid beneficiaries and recipients.
Petitioner had moved to and was practicing medicine in
California several years before the New York State Board
instituted its proceeding against him. FFCL 28. These
charges of misconduct occurred eight to nine years before
the State Board's action. However, the State Board
apparently felt that Petitioner's actions were grave
enough to take action against his license years after the
alleged activity occurred and even after Petitioner had
left New York. Petitioner alleges that he surrendered
his license only to avoid the expense of contesting
charges against him in a State in which he never again
intended to practice, not to escape the State Board's
charges, and he notes that no court or licensing
authority has ever made findings based on these
allegations. Furthermore, Petitioner now also argues
that the eight patients in question were properly
treated.
Accepting that Petitioner surrendered his license to
avoid the expense of litigation, that does not mean
that the charges were baseless or that, while old and
unlitigated, they do not impact on Petitioner's
trustworthiness to participate in the Medicare and
Medicaid programs today. In fact, in his application to
surrender his license, Petitioner specifically admitted
to the truth of these charges of incompetence,
negligence, and poor record keeping. FFCL 14, 15. Even
now, Petitioner admits that, while he did not intend to
admit to the charges of incompetence and negligence when
he surrendered his license, he did intend to admit to the
charge of poor record keeping. FFCL 29; Tr. 261 - 263.
With regard to the specific patients in question, in
evaluating the evidence submitted in this case, which
includes patient records, testimony from Petitioner and
from Dr. Paul Sum, a colleague of Petitioner's from
Salamanca, concerning the patients in question and the
quality of care at Salamanca in 1979-1980, and the
opinions of the two State Board consultants which
underlay the State Board charges, I find that the
evidence is insufficient in the case of Patient A to
establish the level of care that Petitioner provided
Patient A at Salamanca.
In order to establish that level of care, I would need to
see the medical records from Salamanca, which have been
destroyed. P. Ex. 16. I do have Patient A's medical
record from Erie, where Patient A was transferred when,
approximately six days after surgery for a perforated
ulcer, he developed spiked fever, elevated pulse rate,
drop in systolic blood pressure, and discharge from his
surgery site. P. Ex. 1/8, 12, 16 - 20. Relying on
Patient A's nursing care record from Erie, Petitioner
argues that Patient A's condition on admission to Erie
was "nonurgent". P. Br. 16. However, the nursing care
record is contradicted by medical assessments of
physicians who evaluated Patient A upon his admission to
Erie. The surgical attending note in Patient A's Erie
medical record reflects an impression of reperforation of
ulcer with abscess formation, pulmonary failure, and
cardiac and respiratory failure. P. Ex. 1/19. However,
after emergency surgery was performed on Patient A at
Erie, no reperforation of the ulcer or abscess was found
in Patient A's progress notes, operative record, or
autopsy. P. Ex 1/20, 305 - 306, 342.
There is no explanation in the Erie records for Patient
A's apparent deterioration after surgery performed by
Petitioner at Salamanca. What is apparent from such
records is that, when Erie personnel inserted a chest
tube in Patient A, he suffered injury to his liver and
that complications from this injury apparently led to his
death. P. Ex. 1/305, 341. The I.G. relies on Dr. Lane's
opinion to support his position that Petitioner failed to
properly treat Patient A at Salamanca. I.G. Br. 20 - 24.
Dr. Lane's conclusion that Petitioner's treatment of
Patient A resulted in reperforation of his ulcer and
abscess, and that this was the cause of Patient A's
deterioration at Salamanca, is not supported by the
subsequent treatment records from Erie. Moreover, Dr.
Lane provided no supplemental opinion based on the Erie
records in the State Board proceeding involving
Petitioner and was unavailable to give further opinion in
this proceeding. In short, the record supports a finding
that Patient A's condition began to deteriorate after
surgery at Salamanca, but I have no adequate basis to
conclude that Petitioner's treatment of Patient A while
at Salamanca was the cause of that deterioration. Having
examined the degree of culpability of Petitioner as
pertains to Patient A, even assuming his admission to the
State Board, I conclude that he has rebutted the
inference of untrustworthiness arising from his care and
treatment of this patient.
With regard to Petitioner's seven ER patients, however, I
am able to determine that, in some respects, Petitioner's
care of these patients was substandard, even considering
the limitations he faced at Salamanca. In 1979-1980,
Salamanca was a small hospital in a rural area with
limitations in terms of its ER equipment and staffing,
from medical technicians to ambulance service. FFCL 30.
When an emergency patient appeared at Salamanca, if that
patient needed an ICU or a CCU or sophisticated emergency
care, the patient was transferred to a hospital that
could provide those services. FFCL 31. Petitioner has
asserted that, given Salamanca's limitations, his care of
his ER patients was acceptable. I am not so persuaded.
From my review of the existing medical records from
Salamanca for patients E, F, G, and H (P. Ex. 2 - 5), the
testimony offered at the hearing, and the opinions
offered by Dr. Jastremski, the State Board's consultant,
accepted standards of medical practice indicate that
Petitioner should have conducted more extensive
diagnostic studies, been more diligent in his
administration of medication, and ensured that high risk
ER patients (e.g. cardiac or neurological) were
stabilized prior to transfer and that any transport of
such patients to another hospital was in a properly
equipped ambulance.
Petitioner has sought to blame Salamanca, or the doctors
upon whose advice he relied, for any purported
deficiencies in the care of these patients. 22/ For
example, Petitioner has asserted that the hospital didn't
provide the proper equipment for immobilizing one
patient's neck, that the lack of medical technicians and
the poor quality of Salamanca's laboratory work limited
what he could do to diagnose ER patients' conditions, and
that when he prescribed Demerol for his cardiac patients
and transferred them, it was done on the advice of a
cardiac consultant. FFCL 30, 38, 45. Petitioner cannot,
however, escape his own responsibilities for treating
these patients. I accept that Petitioner was primarily a
surgeon and was relying on his cardiac consultant's
advice. However, as a physician also functioning in an
ER on a regular basis, Petitioner bore some
responsibility for acquainting himself with the latest ER
techniques for managing potentially life-threatening
situations.
Further, Petitioner transferred patients, some with
possible cardiac problems, to other hospitals in an
ambulance without life support equipment, not even
attempting to call an ambulance from another hospital
which had such life support equipment. Tr. 231 - 234.
Finally, while Petitioner asserts that he fully examined
each of the ER patients and only recorded positive
findings, from the medical records in evidence (P. Ex. 2 -
5), and because of Petitioner's admittedly poor record
keeping, it is impossible to determine the extent of his
examination of each patient. The notes in Petitioner's
handwriting are sketchy and strongly suggest very limited
histories and physicals being conducted by Petitioner.
Most of the writing on the ER records is of the ER nurse
who took a history and obtained vital signs from the
patient. Moreover, it appears that Petitioner issued
orders by telephone on some ER patients, directing their
disposition without personally obtaining any history or
conducting any physical examination of them to ascertain
the severity of their condition.
In sum, I find that the ER patient records, the
testimonial evidence of Petitioner and Dr. Sum, and the
opinions expressed by Dr. Jastremski support a finding
that Petitioner failed to follow accepted standards of
medical practice in his care and treatment of ER patients
while at Salamanca in 1979-1980, including the conduct of
history and physicals of such patients. 23/ Moreover,
Petitioner's poor record keeping illustrates an
indifference to detail and a lack of care on his part
which extends beyond the State Board's charges of poor
record keeping and permeates other areas of his
professional life. Such carelessness could impact
adversely on Petitioner's trustworthiness as a
participating physician. Other instances in the record
of Petitioner's professional carelessness include: 1)
Petitioner's assertion that, without reading it, he
signed the surrender of his license to practice medicine;
2) Petitioner's misstatement of his qualifications on his
application for staff privileges at Scripps Memorial
hospital; and 3) Petitioner's lack of care to make sure
that the clinics he worked for did not bill for his
services after his exclusion from the Medicare and
Medicaid programs. Such a physician has the potential
for harming both beneficiaries and recipients of the
programs, and in careless billing practices, the programs
themselves.
At the same time, and recognizing Petitioner's propensity
for indifference to detail, since 1979-1980 Petitioner
does appear to have made some attempt to change his
behavior. Petitioner now charts more than negative
findings. Further, there is no evidence in the record
and no assertion by the I.G. that Petitioner, other than
the incident at Scripps and the billing incident referred
to above, has been practicing in anything but a competent
manner since relocating to California (and even in the
four years between the incidents which led to these
charges and Petitioner's relocation to California). The
incidents for which Petitioner was charged happened a
very long time ago, and the issues involving these ER
patients, while significant, can be easily remedied. In
fact, it appears that Petitioner is both practicing
surgery and functioning as a physician in urgent care
clinics in California without questions being raised as
to his competence. P. Ex. 8. Thus, Petitioner has made
progress in remedying the alleged behavior which led to
the State Board charges.
The question here is what exclusion period is reasonably
necessary to assure that Petitioner fully appreciates the
seriousness of the unprofessional conduct which I have
found, and the State Board charged, and what will ensure
that he will not in the future engage in such conduct
again. Kranz, DAB 1286 at 9. In this case, I find that
the I.G.'s remedy, an exclusion until such time as
Petitioner regains his license to practice medicine in
the State of New York, is not reasonably related to this
goal, and is, furthermore, not required by the Act.
The fact is that Petitioner never intends to return to
practice medicine in the State of New York. Petitioner
has vigorously argued that the very reason he did not
contest the charges against him in the first place was
that he did not want to incur the cost and time to seek
licensure in a State in which he had no intention of
practicing. Further, New York has no interest in
Petitioner. To force New York to expend its limited
resources in a license proceeding in which it has little
interest, as the outcome of that proceeding would have no
impact on New York residents, is unreasonable. It is
extreme and excessive to force two uninterested parties
into a State licensing proceeding for the sole purpose of
laying a predicate for Petitioner being a provider of
goods and services to the Medicare and Medicaid programs.
Such an intrusion is arguably inconsistent with the
remedial purposes of the Act, especially where
beneficiaries and recipients of the Medicare and Medicaid
programs, and the programs themselves, can be adequately
protected by less onerous means. Such a punitive result
is the type of outcome that the Supreme Court concluded
in Halper is inconsistent with the remedial intent of
statutes such as section 1128 of the Act. Since there
exist remedial actions available to protect program
recipients and beneficiaries short of requiring
Petitioner to obtain reinstatement of his license to
practice medicine in New York, such an exclusionary
requirement in the context of this case would be
tantamount to punishment, and constitutionally
prohibited.
Petitioner did surrender his license in the face of
serious allegations of misconduct. Where the danger
of harm to patients is great, a lengthy exclusion is
justified to insure that program recipients and
beneficiaries are protected from even a slight
possibility that they will be exposed to such danger.
Bernard Lerner, M.D., DAB CR60 (1989); Michael D. Reiner,
M.D., DAB CR90 (1990); Norman C. Barber, D.D.S., DAB
CR123 (1991); Wilson, DAB CR146. While, as I stated
above, Petitioner has appeared to make some attempts to
alter the practices that led to charges being filed
against him, I am concerned that his propensity towards a
lack of care in the details of his professional life, as
illustrated by the incidents concerning Petitioner's
post-exclusion billings, might still present some danger
to the programs and their recipients and beneficiaries.
In this case, I am excluding Petitioner for three years,
which period of exclusion is sufficiently lengthy for
Petitioner to demonstrate his trustworthiness to provide
services to the Medicare and Medicaid programs.
Alternatively, Petitioner's exclusion could be less than
three years if a State licensing agency reviews all of
the factual and legal issues which were before the State
of New York when Petitioner surrendered his license and,
based on the result of that review, either: 1) grants
Petitioner a license; or 2) if a review is done by the
licensing agency in the State of California, takes no
significant adverse action against his existing license.
At the end of three years, or when a State licensing
agency takes the actions described above, whichever is
sooner, Petitioner would be eligible to apply for
readmission to the programs.
I have fashioned an exclusion which provides Petitioner
with a reasonable period of time to reaffirm his
trustworthiness as a program provider, absent a current
and thorough review of the New York charges by a State
licensing agency. In the alternative, where such a
review is undertaken by a State which has an interest in
whether Petitioner is licensed to treat its citizens,
and where Petitioner has an interest in proving his
competency and integrity to practice there, I have
established an indefinite exclusion. In past cases under
section 1128(b)(4), the I.G. has sought and been upheld
by appellate panels of the DAB in obtaining exclusions of
an indefinite duration based on relicensure in the State
where the original license was revoked, suspended or
surrendered. Friedman, DAB 1281; Foderick, DAB 1125;
Stein, DAB 1301. As the appellate panel concluded in
Friedman, such a remedy is reasonable since that State,
in exercising its decision on relicensure, would act in a
careful and prudent manner in the best interest of its
citizens. Friedman, DAB 1281 at 7. In such
circumstances, it is appropriate for the Secretary, in
discharging his responsibilities to the Medicare and
Medicaid programs, to defer to such State in determining
that a petitioner has demonstrated sufficient
trustworthiness to justify seeking application for
readmission into the program. Here, the State of New
York has no further interest in Petitioner -- he does not
intend to practice there and the citizens of New York are
not presently patients of his medical practice. As I
have indicated, it is unreasonable and bears no relation
to Petitioner's trustworthiness to impose an exclusion
for an indefinite period (in Petitioner's case, for life)
based on relicensure in New York. If Petitioner chooses
not to seek a license in another State, or the State of
California declines to review Petitioner's circumstances
or takes no significant adverse action against
Petitioner, a three year exclusion is a sufficient time
for Petitioner to demonstrate his trustworthiness to seek
readmission into the program. 24/
CONCLUSION
Based on the evidence in this case and the law, I
conclude that the exclusion imposed and directed against
Petitioner by the I.G. is so extreme and excessive as to
be unreasonable. Therefore, I am modifying the exclusion
to the earlier of either: 1) a three year exclusion; or
2) an exclusion until such time as a State licensing
agency reviews all of the factual and legal issues which
were before the State of New York when Petitioner
surrendered his license and, based on the result of tha
review, either a) grants Petitioner a license, or b) if
the review is done by the California licensing agency,
takes no significant adverse action against his existing
license.
____________________________
Edward D. Steinman
Administrative Law Judge
1.
"State health care program" is defined by section
1128(h) of the Social Security Act, 42 U.S.C. 1320a-
7(h), to cover three types of federally-assisted
programs, including State plans approved under Title XIX
(Medicaid) of the Act. I use the term "Medicaid"
hereafter to represent all State health care programs
from which Petitioner was excluded.
2.
In my Ruling of April 9, 1991, I left open the
possibility that additional evidence might be presented
concerning the regulatory provisions of the licensing
process in New York as it related to whether or not
Petitioner had a license to practice medicine in New York
in 1988. Ruling at 5. No further evidence was presented
on this issue, and Petitioner did not argue this issue in
his post-hearing briefing.
3.
Citations to the record and to Board cases in this
decision are as follows:
I.G. Exhibits I.G. Ex. (number/page)
I.G. Brief I.G. Br. (page)
I.G. Reply I.G. R. Br. (page)
Brief
I.G. Regulations Brief I.G. Reg. Br. (page)
I.G. Reply Regulations I.G. R. Reg. Br. (page)
Brief
Petitioner's Exhibits P. Ex. (number/page)
Petitioner's Brief P. Br. (page)
Petitioner's Reply P. R. Br. (page)
Brief
Petitioner's Regulations P. Reg. Br. (page)
Brief
Findings of Fact and FFCL (number)
Conclusions of Law
Departmental Appeals DAB CR(decision no.)(date)
Board ALJ Decisions
Departmental Appeals DAB (decision no.) (date)
Board Appellate
Panel Decisions
4.
A full discussion of the new regulations and their
affect on this case follows.
5.
Dr. Lane offered his opinion relying solely on the
medical records of Patient A while at Salamanca and did
not have the opportunity to review the subsequent record
of Patient A at Erie County Medical Center where further
medical evaluation of Patient A placed in doubt a number
of the premises upon which Dr. Lane based his criticism
of Petitioner's care of Patient A at Salamanca.
Apparently, the I.G. could not locate Dr. Lane to obtain
further clarification of his earlier opinions based on
the records from Erie.
6. These regulations can be found at 42 C.F.R. 1001
et seq., 57 Fed. Reg. 3298 et seq.
7.
The I.G. argues that the new regulations became
effective on January 29, 1992 and "apply to any exercise
of ALJ authority on and after that date, and accordingly
control all cases pending on January 29, 1992." I.G. R.
Reg. Br. at 1. He further argues that "[t]he final
regulations establish the current standards governing the
implementation of the MMPPPA and therefore they must be
given effect by the ALJ." Id. at 1.
8.
Proposed regulations covering the subject matter of the
final regulations were published in the Federal Register
on April 2, 1990. Since such publication, the I.G. has
argued that the indefinite exclusionary period in Section
1001.501 reflects the intent of the Secretary as to the
minimum exclusion, absent other factors, that is required
in license revocation or surrender cases. ALJs and
appellate panels of the DAB have uniformly concluded that
such proposed regulations can be considered as guidance
only, since the regulations were not yet published in
final form and made effective. Walter J. Mikolinski,
Jr., DAB 1156 (1990) at 20; Baratta, DAB 1172 at 8.
9.
Section 205(b)(1) of the Act provides in part:
Upon request by any . . . individual . . . who makes
a showing in writing that his or her rights may
be prejudiced by any decision the Secretary has
rendered, he shall give such . . . individual
reasonable notice and opportunity for a hearing
with respect to such decision, and, if a
hearing is held, shall, on the basis of
evidence adduced at the hearing, affirm,
modify, or reverse his findings of fact and
such decision.
10.
The DAB panel did note that the I.G. had proposed
regulations which would make the minimum period of
exclusion coterminous with the license suspension, or
period of revocation, that is the basis for the
exclusion. Kranz, DAB 1286 at 11.
11.
DAB precedent suggests that Petitioner has a right to
rebut an inference of untrustworthiness arising from the
surrender of his license and to present evidence
demonstrating the unreasonableness of the I.G.'s
coterminous exclusion.
12.
42 C.F.R. 1005.4(c)(1) expressly prohibits ALJs from
finding "invalid Federal statutes or regulations". Thus,
I do not have the authority in hearing this case to
decide that any regulation is ultra vires the Act. To
the extent that regulations explicitly require me to act
in a particular manner, I am obligated to apply that
authority without questioning its lawfulness. I must
apply the plain meaning of the regulations to this case,
even though I might conclude that such application could
be ultra vires the Act. Therefore, I make no analogies
here as to whether the regulations are ultra vires the
Act. However, I am also obligated to apply the
regulations in a manner which is consistent with
congressional intent, to the extent that I do not
contravene the regulations' plain meaning. Therefore, in
interpreting the regulations, I must read them consistent
with the language of the Act. To the extent that the
regulations are unclear or ambiguous, I must look to the
language of the Act as controlling.
13.
When Congress in 1987 amended the MMPPPA to require a
minimum mandatory five year exclusion in section 1128(a)
cases, the legislative history explicitly stated that new
section 1128(c)(3)(B) of the Act would apply only to
cases where the conviction occurred after the Act was
amended. Act, Section 1128, footnote 54. In contrast,
the I.G. argues that his "mandatory" coterminous
exclusion of Petitioner as required by section
1001.501(b) should be applied retroactively.
14.
Further, in a concurring opinion, Justice Scalia
indicated that the Administrative Procedure Act (APA) at
5 U.S.C. 551(4) in defining "rule" refers to its
"future effect" and consequently such rules can only be
applied prospectively. Georgetown University Hospital,
488 U.S. at 215 - 216.
15.
Arguably, in circumstances such as exist in this case,
where exclusions are put in place prior to a hearing and
there is an acknowledged deprivation of property rights,
in order not to contravene a petitioner's due process
rights, any post-exclusion hearing must provide for a
full review of the circumstances surrounding that
exclusion.
16.
In Hanlester, the I.G. contended that: 1) the
regulations are not intended to be applied retroactively
to alter parties' preexisting substantive rights or to
produce manifest injustice to the parties; and 2) Part
1001 of the regulations is not applicable to exclusion
determinations by the I.G. which arose prior to the
effective date of the regulations. Hanlester, at 44 -
45. There is nothing unique about the case at bar which
warrants a different result from that which the I.G.
conceded was proper in Hanlester. Moreover, the I.G's
interpretation of the effect of section 1005.4(c)(5) to
insulate his exclusion determination from review in a
hearing held pursuant to section 205(b)(1) of the Act
clearly is an alteration of Petitioner's preexisting
rights and amounts to a manifest injustice adversely
impacting on Petitioner's substantive rights and
liabilities. See, Hanlester at 46 - 48.
17.
While this is a fair reading of the regulation, whether
this precludes an ALJ from examining issues related to
the scope of the I.G.'s discretion, or to an alleged
abuse of discretion, is an open question. Stein, DAB
1301 at 8 - 9.
18.
This regulatory provision comports with the statutory
language of section 205(b)(1) of the Act pertaining to
the scope of review provided in a hearing held relating
to objections raised to a decision by the Secretary.
19.
I cannot accept the I.G.'s interpretation of section
1005.4(c)(5) relating to his exercise of discretion as
insulating his exclusion determinations from review under
section 205(b)(1) of the Act. Even if it is ultimately
concluded that I cannot review the I.G's exercise of
discretion, this limitation should not be construed so
broadly as to abrogate a petitioner's right to challenge
the reasonableness of an exclusion imposed by the I.G.
20.
The I.G.'s interpretation of these regulations is
tantamount to an unfettered exercise of his permissive
exclusion authority. Once it is determined that the I.G.
has authority to exclude, the length of an exclusion
based on the minimum periods set forth in Part 1001 is
completely insulated from any administrative or judicial
review. Moreover, the duration of that exclusion is
totally within the control of the I.G. and also not
subject to administrative or judicial review (See,
section 1001.3004 of the regulations relating to
reinstatement of excluded parties). Such unbridled
action on the part of the I.G. is not contemplated by the
Act. The statutory scheme provides for post-exclusion
hearings on the assumption that a meaningful due process
review would be provided individuals or entities subject
to exclusions imposed by the I.G. Under the I.G.'s
application of these regulations, an individual's or
entity's right to a hearing under section 205(b)(1) has
been essentially eliminated. Such a result is likely to
invite further judicial intervention into the I.G.'s
section 1128 exclusion determinations, in order to ensure
that the due process rights of excluded parties are
protected and that a meaningful review of the I.G.'s
actions is provided.
21.
The I.G. is now regularly asserting in pending section
1128(b) cases that ALJs are bound by Parts 1001 and 1005
and that where the minimum exclusion has been imposed
there is no purpose to holding a hearing in response to a
petitioner's challenge to the reasonableness of an
exclusion. In fact, in a recent case, the I.G. argued
that petitioner's hearing request should be summarily
dismissed. Based on the principles discussed in this
Decision, I will be affording petitioners the right to
in-person hearings in these cases.
22.
In Petitioner's brief concerning the effect of the new
regulations to his case, Petitioner, although stating
that the regulations do not apply to his case, asked that
the I.G.'s reasoning with respect to the definition of
professionally recognized standards of health care be
considered. 57 Fed. Reg. 3301. First, Petitioner must
recognize that this definition does not apply to
exclusions pursuant to section 1128(b)(4), but rather to
exclusions pursuant to section 1156 or section 1128(b)(6)
of the Act. I have, however, taken into consideration
all of the surrounding circumstances, including the
capabilities of the facility, in my assessment of
Petitioner's conduct at Salamanca as it relates to
whether minimum professional standards were met by
Petitioner in his transfer of the patients in question.
23.
The standard of care that I am using to measure
Petitioner's conduct at Salamanca is not based on the
care that would be provided at a critical care unit in a
trauma center. The deficiencies noted are basic to the
proper and prudent care of patients in any circumstance.
24.
The I.G., at 42 C.F.R. 1001.501(c)(2) of the new
regulations pertaining to license revocation or
suspension, provides for the consideration of early
reinstatement in circumstances similar to those set forth
in the indefinite part of my modification of Petitioner's
exclusion. Thus, it appears that the I.G. recognizes the
harshness of a narrow indefinite exclusion of the type
originally directed and imposed against Petitioner.
However, due to the uncertainty regarding the
applicability of these regulations to this Petitioner, I
have incorporated a similar provision in Petitioner's
exclusion. Moreover, absent a triggering event by a
State licensing authority, either on its own initiative
or at Petitioner's, an exclusion of only an indefinite
duration could lead to an unreasonable result where the
exclusion lasts in excess of three years. As I have
indicated, the record supports my conclusion that
Petitioner's untrustworthiness to be a provider of
services to the Medicare and Medicaid programs should be
dissipated within three years.