SUBJECT:

Michael D. Cerny, D.O.,

Petitioner,

The Inspector General

DECISION

I sustain the determination of the Inspector General (I.G.) to exclude Michael D. Cerny, D.O. (Petitioner) from participation in Medicare, Medicaid, and all federal health care programs, as defined in section 1128B(f) of the Social Security Act (Act), until Petitioner's license to provide health care in the State of Iowa is reinstated. I base my decision upon evidence which proves that Petitioner's license to practice medicine in the State of Iowa was revoked and the revocation concerned Petitioner's professional competence, professional performance, or financial integrity, within the meaning of section 1128(b)(4)(A) of the Act. Moreover, having concluded that the I.G. is authorized to exclude Petitioner based on the loss of his license to practice medicine, I am required by statute to sustain the I.G.'s determination that Petitioner remain excluded until his license is reinstated by the State of Iowa.

I. Background

By letter dated July 31, 2002, the I.G. notified Petitioner that he was being excluded from participation in Medicare, Medicaid, and all federal health care programs. The letter explained that Petitioner's exclusion was authorized under section 1128(b)(4) of the Act because Petitioner's "license to practice medicine . . . in the State of Iowa was revoked. . . for reasons bearing on [his] professional competence, professional performance, or financial integrity." Additionally, the I.G. advised Petitioner that his exclusion would remain in effect "as long as [his] license to practice medicine in the State of Iowa is revoked, suspended, or otherwise lost."

By letter dated August 9, 2002, Petitioner requested a hearing before an administrative law judge. The case was assigned to me for hearing and decision. A telephonic pre-hearing conference was held on October 17, 2002, which was memorialized in my Order of October 18, 2002. At that time, the parties agreed this case could be decided based on their written submissions and that an in-person hearing was unnecessary. Thereafter, the parties submitted written arguments and proposed exhibits.

On December 9, 2002, the I.G. submitted The Inspector General's Motion for Summary Affirmance and six proposed exhibits (I.G. Exs. 1-6). On January 7, 2003, Petitioner submitted a response and 21 proposed exhibits (P. Exs. A-U). Petitioner did not object to the I.G.'s proposed exhibits. In the absence of objection, I admit into evidence I.G. Exhibits 1-6.

By written motion to strike, dated January 31, 2003, the I.G. objected to Petitioner's proposed exhibits B, C, E, F, G, H, I, J, K, L, M, N, T, and U. Petitioner filed a response on February 11, 2003. I have considered the I.G.'s argument that Petitioner's proposed exhibits are irrelevant. While a number of Petitioner's proposed exhibits are of limited relevance, I have taken into account that Petitioner is appearing pro se and the proposed exhibits are not overly voluminous. Therefore, I have admitted Petitioner's Exhibits A-U into evidence over the I.G.'s objection so that the materials Petitioner believed were important to a full review of his case are in the record.

II. Applicable Law

Pursuant to section 1128(b)(4) of the Act, the I.G. may exclude an individual or entity-

(A) whose license to provide health care has been revoked or suspended by any State licensing authority, or who otherwise lost such a license or the right to apply for or renew such a license, for reasons bearing on the individual's or entity's professional competence, professional performance, or financial integrity . . . .

Pursuant to section 1128(c)(3)(E) of the Act, the length of an exclusion under section 1128(b)(4)-

shall not be less than the period during which the individual's or entity's license to provide health care is revoked, suspended, or surrendered, or the individual or entity is excluded or suspended from a Federal or State health care program.

III. Analysis

I make the following findings of fact and conclusions of law. My findings and conclusions are set forth as lettered headings in bold type. My legal analysis in reaching each finding and conclusion is set out in the paragraphs which follow each lettered finding and/or conclusion.

A. The I.G. properly excluded Petitioner pursuant to section 1128(b)(4) because his license to practice medicine in the State of Iowa was revoked for reasons bearing on Petitioner's professional competence and professional performance.

Petitioner was issued license number 01991 to practice osteopathic medicine and surgery in Iowa on July 1, 1983. I.G. Ex. 1, at 2. He had begun, however, to take amphetamines while he was a medical resident. I.G. Ex. 2, at 2. In July 1984, Petitioner's privileges at the College of Osteopathic Medicine in Des Moines, where he was employed, were suspended for substance abuse, and he was referred to a substance abuse treatment program. I.G. Ex. 1, at 2. He participated in an inpatient treatment program in Arizona between July 16, 1984 and August 6, 1984. I.G. Ex. 2, at 2.

Thereafter, in 1985, Petitioner applied for and received a medical licence in Pennsylvania. Id. at 2-3. Petitioner responded "no" on his application to a question concerning past substance abuse. Id. at 2. ⁽¹⁾ In 1988, Petitioner applied for a license in Ohio. Id. at 3. On his Ohio application, Petitioner again responded "no" to the question that asked if he had ever been addicted to or excessively used alcohol, narcotics, barbiturates or other drugs affecting the central nervous system, or any drugs which may cause physical or psychological dependence. Id. The Ohio State Medical Board investigated Petitioner's application by contacting the Iowa clinic where Petitioner had previously been employed and referred to a drug treatment program. P. Ex. A, at 2. The Ohio State Medical Board then denied Petitioner's application because he had falsely answered "no" to the question involving substance abuse. I.G. Ex. 2, at 3.

Because he had received an offer of employment in Illinois, Petitioner did not refile his application in Ohio. Id. Petitioner also, around this time, filed a "partial" application to renew his Iowa license that had expired in 1987 (this reapplication was never completed). P. Ex. A, at 2. In 1989, Petitioner applied for and was granted a medical license from the State of Illinois. I.G. Ex. 2, at 4. On his Illinois application, Petitioner answered "yes" to the question of prior substance abuse and treatment. P. Ex. A, at 2. Illinois gave Petitioner a probationary license for 3 years during which time Petitioner was to participate in random urine screens. Id.; see also I.G. Ex. 2, at 4.

While in Illinois in 1989, Petitioner had a relapse and received outpatient treatment for substance abuse. P. Ex. E, at 2. Nonetheless, Illinois lifted Petitioner's probationary status in 1992. I.G. Ex. 2, at 4. Petitioner practiced in Illinois from March 1989 until June 1995. Petitioner returned to practice in Pennsylvania in March 1996 and stayed until November 1997. P. Ex. A, at 2-4.

In August 1990, the Iowa State Board of Medical Examiners (ISBME) filed a Statement of Charges against Petitioner, alleging that he provided false information on his Iowa license application and that he had failed to inform the ISBME of the Illinois Consent Order and his probationary license in Illinois. I.G. Ex. 1, at 3. Thereafter, Petitioner entered into an informal settlement with ISBME which placed his Iowa license on indefinite probation, for "knowingly making misleading, deceptive, untrue or fraudulent representations in the practice of the physician's profession." I.G. Ex. 1, at 3; I.G. Ex. 3, at 1. Petitioner's Iowa license was reinstated on April 10, 1997, but remained in lapsed status. I.G. Ex. 1, at 3.

In August 1996, Petitioner applied to renew his DEA registration. I.G. Ex. 2, at 4. As part of his application, Petitioner answered "no" to a question about past licenses having been either revoked, suspended, denied or placed on probation. Id.

Petitioner had been experiencing his own medical problems with repeat kidney stones and spinal problems. Around 1997, he also became involved in a bitter divorce. P. Ex. A, at 3-4. For whatever reason, the Pennsylvania State Board of Osteopathic Medicine became aware of Petitioner's former probationary status in Illinois, the denial of his license application by the State of Ohio, and his false statement to DEA on his DEA registration application. I.G. Ex. 2, at 1-4. The Pennsylvania Board also learned that Petitioner, during the time period of December 1996 to August 1997, had purchased substantial quantities of controlled substances such as diazepam, propoxyphene, and hydrocodone for his own use. Id. at 4-5. As a result of these issues, Petitioner entered into a consent agreement with Pennsylvania around December of 1998. Id. at 9. As part of the agreement, he surrendered his license and consented to the issuance of an Order revoking his license to practice osteopathic medicine in Pennsylvania. Id. at 6.

In the meantime, in June 1997, Petitioner had been granted a license to practice in Georgia. I.G. Ex. 4, at 1. ⁽²⁾ Around 1998, Petitioner moved to Pine Ridge, South Dakota, and began a practice on the Pine Ridge Reservation. P. Ex. A, at 6.

In March 1999, the ISBME filed a Statement of Charges against Petitioner charging him with being disciplined by the medical licensing authority of another state, i.e., Pennsylvania. I.G. Ex. 1, at 4. As part of resolving his problems with Iowa, Petitioner participated in an alcohol and drug assessment at the Hazelden Clinic in Minnesota. Id.; see also P. Ex. F. The report concluded that Petitioner was unlikely to have an active addiction. P. Ex. F. Nonetheless, because of his adamant denial of a chemical dependency problem, it was recommended that Petitioner be required to participate in random drug screening. I.G. Ex. 1, at 4; P. Ex. F.

In April 2000, Petitioner entered into a settlement agreement with the ISBME to resolve the Statement of Charges against him and the ISBME accepted the agreement terms in June 2000. I.G. Ex. 5, at 5-6. As part of the final order, Petitioner's license was subject to several permanent restrictions with respect to prescription writing and he was placed on probation for five years. Id. at 2-3. Petitioner was required also to comply with ISBME's drug screening program and provide random blood or urine specimens for the screening. I.G. Ex. 5, at 3-4.

On November 1, 2001, the ISBME determined that Petitioner had failed to cooperate with the terms of his probation to which he had agreed as part of the settlement agreement with the ISBME. I.G. Ex. 1, at 8-9. The ISBME issued an order revoking Petitioner's license to practice medicine in Iowa as a result. Id. It is this revocation action that led to the exclusion at issue herein.

Petitioner's main argument in this case is that the ISBME's revocation of his license had nothing to do with his professional competence or performance. Other arguments subsumed in his primary contention are that:

•All charges against him were instigated by his ex-wife.

•His drug abuse problems are ancient history and have not at all affected his ability to practice medicine. He has no current problems with drug abuse.

•The ISBME has been particularly difficult to deal with; he has no interest in returning to Iowa to practice medicine; he has tried several times voluntarily to give up his Iowa license, which was actually lapsed at the time the Board started its action against him.

•The ISBME's Order revoking his medical license contains numerous factual misstatements that he should be allowed to rebut.

•He is needed on the Pine Ridge Reservation because he is the only OB/GYN for 35,000 Lakota Sioux residents and his peers hold him in high esteem.

•States other than Iowa have the same knowledge about his past and have chosen not to revoke his license. For example, he has an active license in Georgia.

The essential question presented in this case is whether the ISBME's revocation of Petitioner's license was based on reasons bearing on Petitioner's professional competence, professional performance, or financial integrity.

While Petitioner argues that I should not accept as fact the statements made in the ISBME's revocation order, such an argument constitutes a collateral attack on the actions of the State licensing authority. Such collateral attacks on the actions of a State licensing authority are not permitted in the context of an exclusion proceeding under section 1128(b)(4) of the Act. Jagdish Mangla, M.D., DAB CR470 (1997); John W. Foderick, M.D. , DAB No. 1125 (1990); see also Barry Kamen, RPA, DAB CR493 (1997).

The ISBME gave the following reasons for having revoked Petitioner's license. The Petitioner did not cooperate with the Board's drug screening program as required by his settlement agreement and the final order of June 2000. I.G. Ex. 1, at 8-9. Additionally, the Petitioner, who as part of his settlement agreement had been required to inform any treating health care provider of his history of substance abuse prior to obtaining any prescription drug, failed to comply with that condition of his probation. Id.

Numerous administrative decisions support the conclusion that substance abuse impacts unfavorably on an individual's professional competence and professional performance, thereby establishing a basis for exclusion under section 1128(b)(4) of the Act. Tracey Gates, R.N., DAB CR708 (2000), aff'd DAB No. 1768 (2001).

While Petitioner's license was not revoked directly for substance abuse but rather for failing to follow the order of the ISBME that had incorporated the Petitioner's settlement agreement, the ISBME clearly indicated its concern, in the settlement agreement, about Petitioner's possible substance abuse because of the requirements permanently restricting Petitioner from:

•prescribing, administering, or dispensing medication to family members within the third degree of affinity or consanguinity;

•purchasing or dispensing any controlled substance and/or controlled substance samples;

•consuming alcohol; and

•using any controlled or prescription drug in any form unless the controlled or prescription drug has been prescribed for his use by another treating health care provider.

I.G. Ex. 5, at 2-3. In addition, the settlement agreement required Petitioner to submit to and comply with all requirements of the ISBME regarding drug screening, prescription documentation, and informing Petitioner's health care providers of his history of substance abuse. Id. at 3-4.

The DAB has held that when a health care license has been revoked for a violation of conditions placed on the license, it is appropriate, in determining whether the revocation was for reasons bearing on professional competence, professional performance or financial integrity, to look at the reasons why conditions were placed on the license in the first place. Roy Cosby Stark, DAB No. 1746 (2000); cf. Charles Sutherland, D.O., DAB CR561 (1998).

Petitioner makes much of the fact that his treatment for substance abuse was many years ago in 1984. He less frequently mentions that he had a relapse in 1989 which required outpatient treatment and that he ordered numerous medications for himself in 1996 and 1997, the use of which could have affected his professional performance. He does not deny that he continues to experience significant pain with the need to take pain medications. These facts support the ISBME's initial concerns and explain the requirements included in the settlement agreement with Petitioner. Thus, the underlying reasons why conditions were placed on Petitioner's license in the first place related to substance abuse and, thus, to his professional performance.

I understand Petitioner's argument that the reason he violated the terms of his settlement agreement with the ISBME was because he was in the unusual position of practicing in a remote location away from a major city and in an area with limited back-up physicians. He objected to traveling a long distance for drug screening and he indicated it was totally impossible for him to participate in random screening for two weeks out of the month. P. Ex. J - T. While Petitioner claims the ISBME was difficult to work with, it is interesting to note that Petitioner's own exhibits show he was unusually inflexible in accepting any inconvenience occasioned by the terms of the settlement agreement he had signed. After he signed the settlement agreement, Petitioner attempted to change a number of terms in the agreement. For example, he objected to the laboratory group that had a contract to do drug screening and contended the proposed drug screening was impossible because of his work schedule. See I.G. Ex. 1; P. Ex. J - T. To keep his license, however, Petitioner was obligated to work out the terms necessary to assuage ISBME's initial concerns about substance abuse and professional performance.

Additionally, I have considered whether it was appropriate to exclude Petitioner, essentially, for not participating in drug screening when it is likely his drug screens would have been negative. ⁽³⁾ I find, however, that if providers could avoid exclusion by refusing drug screening, the beneficiaries of federal health care programs would lose an essential protection from providers who were compromising their professional performance by abusing controlled substances. A showing of current, frequent use of controlled substances affecting professional performance or competence is not required for exclusion under section 1128(b)(4) of the Act. Roy Cosby Stark, DAB CR676, aff'd DAB No. 1746 (2000); Tracey Gates, R.N., DAB CR708 (2000), aff'd DAB No.1768 (2001); Wilbur D. Hilst, M.D., DAB CR621 (1999).

Petitioner also argues that he has had an exemplary record in the lack of malpractice suits filed against him in his field of OB/GYN. Petitioner also points out that the psychological evaluation he underwent at the behest of the ISBME showed he was not at all impaired cognitively. Moreover, Petitioner submitted letters from colleagues indicating he is highly esteemed in his profession. P. Ex. E, I. The DAB, however, has determined that no showing of inadequate care is required for an exclusion under section 1128(b)(4) of the Act if the elements of 1128(b)(4) are present, as they are in this case. Roy Cosby Stark, DAB No. 1746 (2000).

B. The I.G. properly excluded Petitioner until his medical license is reinstated by the Iowa State Board of Medical Examiners.

Section 1128(c)(3)(E) of the Act requires that an individual excluded pursuant to section 1128(b)(4) remain excluded for no less than the period during which the individual's license is revoked, suspended, or surrendered. See also 42 C.F.R. § 1001.501(b)(1); Tracey Gates, R.N., DAB No. 1768, at 9. Thus, there is no issue regarding the reasonableness of the period of exclusion as it is mandated by section 1128(c)(3)(E) of the Act. In the present case, the I.G. has excluded Petitioner until he regains his license to practice medicine in Iowa. This is the minimum period of exclusion prescribed by law. Accordingly, I must conclude that the term of the exclusion is reasonable and proper.

Petitioner argues that he has no intent to ever return to Iowa to practice medicine. Nonetheless, the term of exclusion is derivative and linked by regulation to the state that revoked his license. I have no authority to set a period of exclusion less than that required by the statute and regulations. Tracey Gates, R.N., DAB No. 1768, at 10. While I may sympathize with Petitioner's dilemma, Congress has concluded that the loss or surrender of a license to practice a health care profession under circumstances described in section 1128(b)(4) is evidence of untrustworthiness and, thus, grounds for exclusion to protect federal health care programs and their beneficiaries and recipients. Congress has determined that the licensing authority that took action against the individual's license is in the best position to determine whether or not the reasons for the disciplinary action have been remediated. Therefore, in the present case, Petitioner's representations must be addressed to the ISBME.

IV. Conclusion

For the reasons stated, I conclude that the I.G. was authorized to exclude Petitioner because his license to practice medicine was revoked by the State of Iowa for reasons concerning his professional competence or professional performance, within the meaning of section 1128(b)(4)(A) of the Act. Because Petitioner was properly excluded pursuant to section 1128(b)(4)(A), his exclusion must remain in effect until the Iowa State Board of Medical Examiners again grants him a license to practice medicine.

Anne E. Blair

Administrative Law Judge

1. The question was: "Are you now or have you ever been addicted to or excessively used alcohol, narcotics, barbiturates, or habit forming drugs?" I.G. Ex. 2, at 2.

2. Eventually in 2001, Petitioner also entered into a consent agreement with the Georgia Board. I.G. Ex. 4, at 8-9.

3. Of course, minor infractions not relating to quality of care should not be the basis of an exclusion. The legislative history of the 1128(b)(4) includes a note that, "[T]he Committee expects that the Secretary will not use his discretion under this authority to exclude individuals whose licenses have been suspended . . . for minor infractions not related to quality of care, such as failure to pay licensing fees or violation of strict advertising requirements." S. Rep. No. 109, 100^th Cong., 1^st Sess. 7 (1987).