$05:Exclusion Case
Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of:
Barry D. Garfinkel, M.D.,
Petitioner,
- v. -
The Inspector General.
Date: November 9, 1995
Docket No. C-95-042
Decision No. CR400
DECISION
On October 19, 1994, the Inspector General (I.G.) notified
Petitioner, Barry D. Garfinkel, M.D., that he was being excluded
from participating in the Medicare, Medicaid, Maternal and Child
Health Services Block Grant and Block Grants to States for Social
Services programs for three years. 1/ The I.G. told Petitioner
that he was being excluded under section 1128(b)(1) of the Social
Security Act (Act) based on his conviction of a criminal offense
related to fraud, theft, embezzlement, breach of fiduciary
responsibility, or other financial misconduct.
Petitioner requested a hearing. Initially, the case was assigned
to Administrative Law Judge Joseph K. Riotto for a hearing and a
decision. On January 17, 1995, the case was reassigned to me. I
held a telephone prehearing conference on January 19, 1995. During
the conference, I set a hearing date of April 4, 1995. On March
31, 1995, the parties requested that I cancel the hearing to give
them time to work out a settlement. I granted the parties'
request.
During a telephone prehearing conference on May 2, 1995, the
parties informed me that, although the I.G. had waived Petitioner's
exclusion as to certain northern Minnesota counties, the I.G.'s
waiver had not accomplished a settlement of the case. 2/
Therefore, on July 24, 1995, I held a hearing in this case in St.
Paul, Minnesota. Following the hearing, both parties submitted
posthearing briefs and responses.
I have considered the evidence 3/, applicable law and regulations,
and the parties' arguments. I conclude that the I.G. had authority
to exclude Petitioner pursuant to section 1128(b)(1) of the Act.
However, I conclude also that Petitioner has proved a mitigating
factor, in that, as a result of his exclusion, no alternative
sources of the type of health care items or services furnished by
Petitioner are available. Based on the evidence relevant to this
mitigating factor, I conclude that the three-year exclusion the
I.G. imposed against Petitioner is excessive. Finally, I conclude
that the remedial considerations of the Act will best be served in
this case by modifying the exclusion to end upon the date of
issuance of this Decision.
I. Issues, findings of fact, and conclusions of law
Petitioner does not dispute that he was convicted of a criminal
offense. However, Petitioner does dispute that his conviction
falls within the ambit of section 1128(b)(1) of the Act.
Specifically, he argues that he was not convicted of a criminal
offense in connection with the delivery of a health care item or
service. 4/ Further, Petitioner asserts that the three-year
exclusion the I.G. imposed against him is unreasonable in light of
the presence of the mitigating factor in his case. Finally,
Petitioner requests that, if I find a basis for his exclusion, the
exclusion should be reduced to the length of time he has been
excluded already.
The issues in this case are thus: 1) whether the I.G. had a basis
upon which to exclude Petitioner; 2) whether, due to Petitioner's
exclusion, alternative sources of the type of health care items or
services furnished by Petitioner are not available; and 3) whether
the length of the exclusion the I.G. imposed against Petitioner is
reasonable.
In deciding to modify Petitioner's exclusion to end as of the date
of issuance of this Decision, I make the following findings of fact
and conclusions of law. In my findings and conclusions, I cite to
relevant parts of the Discussion in which I discuss my findings and
conclusions in detail.
1. Petitioner was convicted of criminal offenses
relating to fraud. Pages 5 - 8.
2. Petitioner's conviction of criminal offenses relating to
fraud was in connection with the delivery of a health care item or
service. Pages 9 - 11.
3. The I.G. was authorized to exclude Petitioner.
Pages 8 - 11.
4. An individual who is excluded pursuant to section
1128(b)(1) of the Act should be excluded for three years, unless
the enumerated aggravating or mitigating factors exist and warrant
lengthening or shortening the exclusion. Pages 8 - 9.
5. Petitioner proved the presence of a mitigating factor, in
that, due to his exclusion, no alternative sources of the type of
health care items or services Petitioner furnishes are available.
Pages 14 - 25.
6. In evaluating the reasonableness of a three-year
exclusion, I must balance the government's interest in protecting
Medicare and Medicaid and the programs' beneficiaries and
recipients from untrustworthy providers, against the competing
government interest of ensuring that beneficiaries and recipients
will not be deprived of needed health care as a result of a
provider's exclusion. Pages 8 - 9.
7. Petitioner proved that program patients are likely to
suffer substantial and irreparable harm by being deprived of needed
health care as a result of prolonging Petitioner's exclusion.
Pages 14 - 29.
8. The I.G. may offset the impact of a mitigating factor by
proving the presence of aggravating factors. Pages 8 - 9.
9. The I.G. proved the presence of an aggravating factor, in
that the acts resulting in Petitioner's conviction, or similar
acts, resulted in a financial loss of $1500 or more. Page 25.
10. The I.G. proved the presence of a second aggravating
factor, in that the acts resulting in Petitioner's conviction, or
similar acts, were committed over a period of one year or more.
Page 25.
11. The I.G. proved the presence of a third aggravating
factor, in that the sentence imposed by the court included
incarceration. Page 25.
12. Weighing the three aggravating factors established by the
I.G. and the one mitigating factor established by Petitioner, I
conclude that the three-year exclusion imposed against Petitioner
is excessive. Pages 26 - 30.
13. The remedial considerations of the Act are served by
modifying the exclusion to end upon the date of issuance of this
Decision. Pages 26 - 30.
II. Discussion
A. Petitioner's Criminal Offenses
On June 8, 1993, Petitioner was convicted of three counts of making
false statements in violation of 18 U.S.C. 1001 and two counts
of mail fraud in violation of 18 U.S.C. 1341. I.G. Exhibit
(Ex.) 1; Petitioner's Brief (P. Br.) at 1, 3 - 4. At the time he
committed these criminal offenses, Petitioner, a psychiatrist, was
the Director of the Division of Child and Adolescent Psychiatry at
the University of Minnesota. P. Ex. 1 at 3; United States v.
Garfinkel, 29 F.3d 1253, 1254 (8th Cir. 1994). In this position,
Petitioner was responsible for teaching, research, and patient
care. Transcript at (Tr.) 71. Petitioner's convictions were based
on criminal offenses he committed as the chief investigator of a
drug study funded by the pharmaceutical company CIBA-GEIGY
Corporation (CIBA-GEIGY). I.G. Exs. 1, 2; Garfinkel, 29 F.3d at
1254.
CIBA-GEIGY commissioned the drug study to comply with Food and Drug
Administration (FDA) regulations. FDA must approve the safety and
effectiveness of new drugs before they are made available to the
general public. To obtain FDA approval, pharmaceutical companies
such as CIBA-GEIGY are required to submit an investigational new
drug application with FDA. Prior to commencing a clinical study of
an experimental drug, a pharmaceutical company must provide FDA
with information on the proposed investigation, including a
detailed study "protocol." Research investigators then compile,
through procedures mandated by the protocols, the data a
pharmaceutical company must file with FDA in order for FDA to
determine whether a drug is safe and effective. I.G. Ex. 2;
Garfinkel, 29 F.3rd at 1253 - 1255.
CIBA-GEIGY proposed to FDA to study the drug Anafranil as a
potential therapy for patients suffering from obsessive-compulsive
disorder (OCD). I.G. Ex. 2; Garfinkel, 29 F.3d at 1254. In 1986,
FDA granted CIBA-GEIGY permission to conduct a clinical study of
the safety and effectiveness of Anafranil for the treatment of
children and adolescents with OCD. The study was designated as
Protocol 64. I.G. Ex. 2 at 4. The first part of Protocol 64 was
a double-blind study, in which neither the investigator nor the
patient knew whether the patient was receiving Anafranil or a
placebo. I.G. Ex. 2 at 5. This part of the study lasted 10 or 11
weeks. I.G. Ex. 2 at 5; Garfinkel, 29 F.3rd at 1254. Data
intended to indicate the safety and effectiveness of Anafranil were
to be collected through weekly patient visits which included the
completion of psychiatric rating scales and physical examinations.
This part of the study was followed by a year long extension
protocol, during which certain patients were permitted to receive
Anafranil on an open-label basis, in which both the investigator
and the patient knew Anafranil was being administered. The
extension protocol required also regular patient visits with the
investigator, as well as that the investigator conduct the physical
and psychiatric evaluations required by Protocol 64. I.G. Ex. 2 at
5 - 6, Garfinkel, 29 F.3d at 1255.
Investigators were required to keep detailed records of patient
visits and were given patient report forms (PRFs) to fill out for
each visit. The PRFs tracked the tests required by the protocol
for each visit and detailed the information the investigators were
to provide concerning physical and psychiatric observations. At
the bottom of each page was a signature line for the investigator
making the observation or conducting the test. The investigator
was to submit the completed PRF forms to CIBA-GEIGY at the end of
the study, and CIBA-GEIGY was required to compile the data and to
submit the compiled data to the FDA. I.G. Ex. 2 at 5 - 7.
In approximately June 1987, FDA granted CIBA-GEIGY permission to
conduct a larger open-label study of Anafranil, designated Protocol
62, to provide CIBA-GEIGY with a broader base of information
regarding the safety of the drug and to make Anafranil available to
more OCD patients. I.G. Ex. 2 at 8 - 9; Garfinkel, 29 F.3rd at
1255. Protocol 62 set a schedule of study visits, including a
statement of the physical and psychiatric evaluations which were to
take place at each visit and the requirement that investigators
complete PRFs for each visit. I.G. Ex. 2 at 9.
Between 1986 and 1989, Petitioner was retained by CIBA-GEIGY as the
chief investigator of the Anafranil study at the University of
Minnesota. 5/ Prior to beginning the Anafranil study, CIBA-GEIGY
held a training session for investigators. Garfinkel, 29 F.3d at
1255. There, Anafranil investigators such as Petitioner received
instruction regarding the study protocol and required methodology,
and training in the specific psychiatric review techniques required
by the protocol. The investigators received also specific
instructions regarding completion of PRFs. Using the PRFs, each
investigator specifically was made aware what data must be
collected during each patient visit. I.G. Ex. 2; Garfinkel, 29
F.3d at 1255.
In February 1989, the study coordinator at the University of
Minnesota filed a complaint with the University against Petitioner.
This complaint led to investigations by CIBA-GEIGY and the FDA
which, eventually, led to Petitioner's indictment. The study
coordinator complained that Petitioner ordered her to conduct
entire study visits, including the accumulation of psychiatric and
medical data; ordered her to enter false data on PRFs for visits
that never occurred or for patients that did not fit the protocol
requirements; and prescribed prohibited medications for patients
during the study and ordered her to conceal their use. Garfinkel,
29 F.3d at 1255; I.G. Ex. 2.
Petitioner was indicted on 19 counts of violating the False
Statements Act, 18 U.S.C. 1001, which prohibits the intentional
making of a false statement in a matter within the jurisdiction of
the government. Specifically, following a jury trial, Petitioner
was found guilty of counts 5, 21, and 23 of the Indictment, which
counts charged Petitioner with falsely representing, through his
signatures on PRFs, that he had personally conducted patient visits
on January 29, 1988, September 6, 1988, and September 20, 1988.
Garfinkel, 29 F.3d at 1255 - 1256; I.G. Ex. 1 at 1, 2 at 16.
Petitioner was indicted also on four counts of mail fraud, 18
U.S.C. 1341, and convicted on two, Counts 2 and 3 of the
Indictment. Garfinkel, 29 F.3d at 1258; I.G. Ex. 1 at 1. These
two counts involved November 18, 1988 and March 29, 1989 mailings.
I.G. Ex. 2 at 15. One count was based upon a letter to CIBA-GEIGY
in which Petitioner admitted to prescribing concomitant medications
in violation of protocol, but falsely represented that one of the
prohibited medications had been approved by a CIBA-GEIGY official.
Garfinkel, 29 F.3d at 1260. Based on this conviction, Petitioner
was: sentenced to six months' imprisonment (with work release
privileges), and three years of supervised release; fined $25,000;
assessed $250 and the costs of his imprisonment and supervision;
and ordered to make restitution to CIBA-GEIGY in the amount of
$170,394. I.G. Ex. 1.
As a result of Petitioner's conviction, Petitioner and the
Minnesota Board of Medical Practice (Minnesota Board) stipulated
that the Minnesota Board would stay suspension of Petitioner's
medical license if Petitioner, among other things: served 1000
hours of clinical service at a site selected by the Minnesota
Board; and observed a life-time prohibition from participating as
an investigator in a drug research project. I.G. Ex. 4.
B. Governing Law
The I.G. imposed an exclusion against Petitioner pursuant to
section 1128(b)(1) of the Act. This section permits the exclusion
from Medicare and Medicaid of individuals who have been convicted,
in connection with the delivery of a health care item or service or
with respect to any act or omission in a program operated by or
financed in whole or in part by any federal, State, or local
government agency, of a criminal offense relating to fraud, theft,
embezzlement, breach of fiduciary responsibility, or other
financial misconduct. Act, section 1128(b)(1).
Section 1128 of the Act is a remedial statute. Congress intended
that the Act be applied to protect both the integrity of
federally-funded health care programs and the welfare of the
programs' beneficiaries and recipients, from individuals and
entities who have been shown to be untrustworthy. Exclusions
imposed pursuant to section 1128 have been found reasonable only if
they are consistent with the Act's remedial purpose. Robert
Matesic, R.Ph, d/b/a Northway Pharmacy, DAB 1327 at 7 - 8 (1992);
Bali S. Reddy, DAB CR394 at 3 (1995); Dr. Abdul Abassi, DAB CR390
at 3 (1995); Gary E. Wolfe, D.O., DAB CR395 at 5 (1995).
Regulations published originally in January 1992 (42 C.F.R. Part
1001) implement the I.G.'s authority to exclude an individual for
reasons which include his conviction of a criminal offense relating
to fraud, theft, embezzlement, breach of fiduciary responsibility,
or other financial misconduct committed in connection with the
delivery of a health care item or service. 42 C.F.R.
1001.201(a). The regulation codified at 42 C.F.R. 1001.201
establishes also the criteria by which the length of exclusions
imposed pursuant to section 1128 are to be evaluated. It states
that, in the absence of certain enumerated aggravating or
mitigating factors, the length of the individual's exclusion should
be set at three years. 42 C.F.R. 1001.201(b); Reddy, DAB CR394
at 4. As a consequence, I am authorized to use only the criteria
of the three-year benchmark period and those aggravating and
mitigating factors specified in the regulation in deciding whether
a given period of exclusion is reasonably necessary to protect the
integrity of federally-financed health care programs and the
welfare of the programs' beneficiaries and recipients.
An exclusion must not be punitive. It must comport with the Act's
remedial purpose. The presence of aggravating or mitigating
factors in a case does not alone establish the reasonableness of
any particular exclusion period. The regulations contain no
formula for assigning weight to aggravating or mitigating factors
once their presence is established. Therefore, in deciding the
reasonableness of a particular period of exclusion, I must analyze
the evidence relevant to those mitigating or aggravating factors
present in the case and assign weight to such evidence in
accordance with the remedial purpose of the Act.
C. Basis for Exclusion
1. Petitioner's convictions for fraud are connected to
a health care item or service.
As a basis for the Petitioner's exclusion in this case, section
1128(b)(1) requires only that Petitioner: a) be convicted; b) in
connection with the delivery of a health care item or service; c)
of a criminal offense relating to fraud. The implementing
regulation adds that "[i]n connection with the delivery of any
health care item or service" includes the performance of management
or administrative services relating to the delivery of such items
or services. 42 C.F.R. 1001.201(a).
Petitioner admits that he was convicted of criminal offenses and
that they relate to fraud. P. Br. at 1 - 4. However, Petitioner
asserts that his convictions were not in connection with the
delivery of a health care item or service and that the I.G. thus
lacks authority to exclude him. P. Br. at 8. Specifically,
Petitioner argues that his fraud convictions relate to his
scientific research, not to his practice of medicine. P. Br. at 8
- 9; Petitioner's Reply Brief (P. R. Br.) at 2 - 3.
In making his assertion, Petitioner has taken an overly narrow view
of what is "in connection with the delivery of a health care item
or service." Effectively, Petitioner is maintaining that the I.G.
could exclude him only if his criminal offenses had occurred within
the ambit of his direct provision of psychiatric services to his
patients, not within the ambit of his scientific research. I
disagree. A provider's conviction need only be "in connection
with" health care delivery. See Chander Kachoria, R.Ph., DAB 1380
at 4 (1993). Neither the Act nor the regulation requires a
physician/patient relationship, and the individual need not have
been indicted or convicted under a statute which refers
specifically to health care.
Here, the very nature of the scientific research Petitioner
undertook was connected to the delivery of a health care item or
service. The entire purpose of the Anafranil study was to
determine the efficacy and safety of a drug which CIBA-GEIGY wished
to market as a medication to treat a mental disorder or illness.
CIBA-GEIGY was investigating Anafranil as a treatment for OCD, and
CIBA-GEIGY was utilizing Petitioner to test Anafranil's safety and
effectiveness on individuals suffering from OCD. The protocol
Petitioner utilized necessarily involved the provision of Anafranil
6/ to individuals suffering from the mental disorder or illness of
OCD. The protocol required Petitioner and other investigators to
conduct physical and psychiatric examinations of individuals
(health care services) in order to ascertain the effect of
Anafranil on their OCD.
In addition, Petitioner's failure to personally conduct certain
patient visits in order to report his physical and psychological
observations of patients was a material element of his convictions
under Counts 5, 21, and 23 of the indictment. Garfinkel, 29 F.3d
at 1255 - 1256; I.G. Ex. 2 at 5 - 7. The fact that Petitioner had
prescribed concomitant medications (also a health care item) to
patients in the Anafranil study was also a material element of his
conviction on Count 3 of the indictment. 7/ Garfinkel, 29 F.3d at
1259 - 1260. In the context of this case, it is immaterial
whether, in providing or failing to provide these health care items
or services, Petitioner used his special skills as a psychiatrist,
or whether Petitioner had the medical discretion to provide
alternative health care services to the test patients, or whether
Petitioner was required to follow a set protocol. P. Br. at 8 -
12; P. R. Br. at 2 - 3.
Accordingly, I conclude that Petitioner's conviction was in
connection with the delivery of a health care item or service.
2. Petitioner was not convicted of fraud withrespect to
any act or omission in a program operated by or financed in whole
or in part by any federal, State, or local government agency.
The I.G. asserts as an alternative basis for excluding Petitioner
that his convictions were with respect to acts and omissions in a
program operated by FDA, a federal government agency.
Specifically, the I.G. argues that: FDA regulates the testing of
new drugs; FDA approved CIBA-GEIGY's proposed Anafranil testing and
Protocol 64, the extended protocol, and Protocol 62; FDA's
regulations governed Petitioner's participation in the testing; and
Petitioner's convictions resulted from his acts and omissions in
the Anafranil study, which was carried out under FDA auspices for
regulating the testing of investigational new drugs. I.G. Brief
(Br.) at 10 - 11. I am not persuaded by the I.G.'s argument.
In order to conclude that Petitioner's conviction was with respect
to acts and omissions in a program operated by the FDA, I would
need to find that every research project in the country which is
evaluating the safety and effectiveness of a new drug for FDA
approval is a program operated by the federal government simply
because the FDA regulates the process. This conclusion is
over-broad and would require a distorted reading of the FDA
regulations cited by the I.G.. Moreover, in ordinary usage, the
word "operate" means to have control. I find inadequate evidence
of control by the FDA in this case to support the I.G.'s argument
that the FDA operated the Anafranil study.
CIBA-GEIGY is a private company that manufactures pharmaceutical
products. I.G. Ex. 2 at 1. The FDA is a federal regulatory agency
with the authority to approve or disapprove the safety and
effectiveness of new drugs before they are made available to the
general public. I.G. Ex. 2 at 2. Thus, in order to market
Anafranil, CIBA-GEIGY had to prove to the FDA that Anafranil was
safe and effective. The FDA did not suggest, plan, initiate, or
require the study of Anafranil. The FDA did not prepare the
investigation plan or protocol for studying Anafranil's safety and
effectiveness. Nor did the FDA seek out CIBA-GEIGY or any other
entity to conduct the study. CIBA-GEIGY, a private company,
contracted with the University of Minnesota, employing Petitioner
as the chief investigator, to carry out a study on the safety and
effectiveness of Anafranil. I.G. Ex. 2 at 8. There is no evidence
that the involvement of the University of Minnesota, or Petitioner,
in the Anafranil study was at the FDA's suggestion or insistence.
CIBA-GEIGY, not the FDA or any other federal, State, or local
agency, paid for the study. As held by the judge during
Petitioner's sentencing proceedings, CIBA-GEIGY was the only victim
of Petitioner's fraud. P. Ex. 2 at 29. Even though the FDA could
object to a proposed study outlined in a study protocol and could
refuse to allow a study outlined in a protocol to go forward (I.G.
Ex. 2 at 3), the FDA is without the authority to require that a
company (CIBA-GEIGY in this case) fund or proceed with any approved
study if the company decides not to do so after having obtained the
FDA's approval on the protocol. Thus, what the FDA gave to the
Anafranil study in this case was the FDA's permission for the study
to be conducted in accordance with the protocol submitted by
CIBA-GEIGY. See I.G. Ex. 2 at 4, 8.
Accordingly, I find that the I.G. did not prove that the program
which was the victim of his fraud was operated by or financed in
whole or in part by a government agency
3. I do not have the authority to find thatthe Double
Jeopardy Clause of the Fifth Amendment to the United States
Constitution bars the I.G. from excluding Petitioner.
Petitioner asserts that the Double Jeopardy Clause of the Fifth
Amendment prohibits his exclusion. Petitioner argues that his
exclusion is punitive, not remedial, and that, under the decision
in United States v. Halper, 490 U.S. 435 (1989), an individual
punished in a criminal proceeding can be sanctioned in a subsequent
civil proceeding only if the sanction is solely remedial.
Petitioner argues further that no remedial purpose is to be served
by his exclusion and that his is one of the rare cases in which the
exclusion sanction is punitive and a violation of the Double
Jeopardy clause. P. Br. at 12 - 14.
In support of his argument, Petitioner specifically asserts that he
did not defraud the programs, did not harm a program beneficiary or
recipient, did not abuse government funds or attempt to defraud a
government agency, and that the only victim in this case was a
private corporation. Petitioner asserts also that neither the
judge who sentenced him nor the Minnesota Board found that he was
a threat to patients, and that both the judge and the Minnesota
Board made efforts to ensure his ability to continue his medical
practice. Petitioner believes that his exclusion imposes a
financial punishment upon him, in that it bars him from receiving
payment for treating program patients. Further, Petitioner asserts
that the I.G.'s action is designed to deter his future misconduct,
which Halper deems to be punishment for purposes of Double
Jeopardy.
As an administrative law judge, my delegation of authority to hear
and decide cases brought pursuant to section 1128 does not include
the authority to rule on the constitutionality of either federal
statutes or the I.G.'s actions. Thus, I have no authority to rule
on the constitutionality of Petitioner's exclusion. See 42 C.F.R.
1005.4.
I note, however, that federal courts, and Departmental Appeals
Board administrative law judges and appellate panels, have held
consistently that exclusions imposed pursuant to section 1128 are
remedial in nature. See, e.g., Manocchio v. Sullivan, 961 F.2d
1539, 1541 - 1543 (11th Cir. 1992); Greene v. Sullivan, 731 F.
Supp. 838, 839 - 840 (E.D. Tenn. 1990); Francis Shaenboen, R.Ph.,
DAB CR97 (1990), aff'd DAB 1249 (1991). The purpose of section
1128 is not to punish, but to protect Medicare and Medicaid funds
and the programs' beneficiaries and recipients from untrustworthy
providers. If a provider has been convicted of a criminal offense
covered by the Act, that provider is presumed by Congress to be
untrustworthy and a potential threat to the programs and their
beneficiaries and recipients. Such exclusion will likely have an
adverse financial and personal impact on the provider against whom
the exclusion is imposed, and it may appear to that provider to
constitute a punishment. The law, however, places program
integrity and the well-being of beneficiaries and recipients ahead
of the financial and personal interests of providers. Syed
Hussaini, DAB CR193 (1992); Halper, 490 U.S. at 447 n.7; See also
Manocchio, 961 F.2d at 1542.
In this case, I have concluded that Petitioner's conviction falls
within the ambit of section 1128(b)(1), authorizing the I.G. to
take an exclusion action. Petitioner was convicted of serious
criminal offenses. The I.G. may conclude from the nature of
Petitioner's offenses that remedial action is appropriate to
protect Medicare and Medicaid and the programs' beneficiaries and
recipients. I am without the authority to set aside the I.G.'s
exercise of discretion to exclude Petitioner under section
1128(b)(1) of the Act. See 42 C.F.R. 1005.4(c)(5).
D. The Presence of Aggravating and MitigatingFactors
The controlling regulation at 42 C.F.R. 1001.201 requires that,
in cases of exclusions imposed pursuant to section 1128(b)(1) of
the Act, the exclusion imposed will be for three years, unless
specified aggravating or mitigating factors form a basis for
lengthening or shortening the period of exclusion. 42 C.F.R.
1001.201(b). The regulations state specifically the factors which
may be classified as aggravating or mitigating. Under the
regulations, evidence which relates to factors not among those
specified as aggravating or mitigating is not relevant to my
examination of the reasonableness of the length of an exclusion.
The I.G. imposed the three-year exclusion against Petitioner on
October 19, 1994. October 19, 1994 Notice Letter (Notice). Since
the inception of this case, Petitioner has consistently asserted
that the three-year exclusion should be shortened because a
mitigating factor exists. Specifically, Petitioner asserts that no
alternative sources of the type of health care items or services he
furnishes are available due to his exclusion. 42 C.F.R.
1001.201(b)(3)(iv); Petitioner's December 9, 1994 Hearing Request;
P. Br. at 14. Over the course of the proceedings before me, the
I.G. has decided to raise certain aggravating factors to defend
against the possibility that Petitioner may succeed in proving the
existence and effect of the alleged mitigating factor.
I conclude that, on October 19, 1994, the I.G. imposed the
three-year benchmark exclusion period specified by 42 C.F.R.
1001.201(b)(1), because she did not refer to any aggravating or
mitigating factor in her Notice. The I.G.'s Notice informed
Petitioner only that he was being excluded for three years based on
his conviction of a criminal offense relating to fraud, theft,
embezzlement, breach of fiduciary responsibility, or other
financial misconduct.
During my initial prehearing conference with the parties, the I.G.
agreed to provide notice prior to hearing if she wished to allege
any aggravating factor or concede the existence of any mitigating
factor. January 20, 1995 Order and Notice of Hearing. Thereafter,
the I.G. informed me that she was not conceding to any mitigating
factor; however, she informed me also that two aggravating factors
(those at 42 C.F.R. 1001.201(b)(2)(i) and (ii)) "appear to
apply" and that she was reserving "the right to raise such factors
during or after the hearing ...." Letter from I.G.'s Counsel to me
dated March 17, 1995. The I.G. is asserting now that three
aggravating factors exist. I.G. Br. at 18. The I.G. does not
argue, however, that these factors should be applied to increase
the length of Petitioner's exclusion beyond three years. The I.G.
argues, instead, that if I conclude that a mitigating factor
exists, I should consider the presence of the three aggravating
factors alleged by the I.G. to sustain the three-year exclusion the
I.G. imposed. I.G. Br. at 12 n.18.
1. Petitioner has provided credible andpersuasive
evidence proving that the mitigating factor at 42 C.F.R.
1001.201(b)(3)(iv) has been met and that alternative sources of the
type of health care he provides are not available to program
beneficiaries and recipients due to his exclusion.
Petitioner has the burden of coming forward with evidence and
proving that alternative sources of the type of health care items
or services he provides are not available due to his exclusion.
The standard of proof in this proceeding is preponderance of the
evidence. January 20, 1995 Order and Notice of Hearing; 42 C.F.R.
1001.2007(c). In this case, I find that Petitioner has established
by a preponderance of the evidence that the mitigating factor at 42
C.F.R. 1001.201(b)(3)(iv) applies.
An "alternative source" is a source which offers program
beneficiaries and recipients a comparable alternative to the items
or services furnished by a health care provider. Program
beneficiaries and recipients must have access to this source
without unreasonable hardship. Scott Meggison, DAB CR329 at 15
(1994); John H. Holmes, M.D., DAB CR270 at 13 - 14 (1993). Under
the regulations, the availability of alternative sources of health
care items or services is relevant only as it applies to Medicare
and Medicaid beneficiaries and recipients. Exclusion from Medicare
and Medicaid is intended to safeguard the welfare of program
beneficiaries and recipients. An exclusion imposed against a
caregiver does not prevent the caregiver from billing for services
to patients who do not seek reimbursement from Medicare or
Medicaid. Thus, the regulations permit me to reduce the period of
exclusion only if the lack of an alternative source would adversely
affect program beneficiaries and recipients. Meggison, DAB CR329
at 15 - 16.
The mitigating factor contained in 42 C.F.R. 1001.201(b)(3)(iv)
is established when a provider proves by a preponderance of the
evidence that, during the period he or she is excluded from
participating in the programs: 1) there will be no other health
care provider in the geographical area served by that provider
reasonably accessible to program beneficiaries and recipients; or
2) a significant number of beneficiaries and recipients will be
deprived of reasonable access to comparable health care services.
To establish this mitigating factor, a provider must prove
significant adverse changes in the services previously available to
program beneficiaries and recipients. Moreover, the mitigating
factor does not apply where an exclusion does no more than reduce
the number of available health care providers in a community. Mere
diminution of previously available health care services is
insufficient. Meggison, DAB CR329 at 16. There is, however, no
requirement that the individual prove that he was or is the sole
source of a given type of service. Under this mitigating factor,
the focus is on reasonable access by program beneficiaries or
recipients -- not on whether an alterative source exists at all.
At the hearing, Petitioner testified and offered the testimony of
four witnesses to prove that this mitigating factor was met. Three
of Petitioner's witnesses were physicians (one a psychiatrist, one
an internist, and one a pediatrician) who had worked or consulted
with Petitioner over a ten year period. Tr. 35 - 36, 62 - 64, 109.
The fourth witness was the coordinator of a project for the parents
of children with emotional and behavioral disorders at a
Minnesota-wide parent information and resource center for families
of children with disabilities. The project coordinator has known
Petitioner for more than 10 years also. Tr. 122 - 123. I found
the testimony of both Petitioner and his witnesses to be credible
and persuasive.
Based on the record before me, I find that Petitioner has satisfied
his burden of proof and proved by a preponderance of the evidence
that no alternative source exists for the type of health care
services he has provided to program patients.
The testimony of Petitioner and his witnesses (which I will discuss
below) establishes that Petitioner is unique in that: 1)
Petitioner is a specialist in diagnosing and treating only the most
complex cases, cases in which other child and adolescent
psychiatrists have failed; 2) no other psychiatrist in Petitioner's
geographical area (the State of Minnesota, including Minneapolis
and St. Paul) will modify their schedules to provide the services
to children and adolescents in crisis situations as quickly as
Petitioner does; 3) other psychiatrists will not spend the amount
of time with their patients, without regard to the source or the
amount of remuneration, that Petitioner does; and 4) Petitioner has
a cross-cultural understanding which enables him to make correct
diagnoses for Native American children and to secure the trust of
their families. This trust is necessary in order to provide
effective treatment for these children.
Petitioner and his physician witnesses testified that Petitioner is
a nationally and internationally known expert in the field of child
and adolescent psychiatry, specifically in the areas of suicide and
attention deficit disorder (ADD) or attention deficit hyperactivity
disorder (ADHD). Tr. 36, 65, 75; See also P. Exs. 1, 3. They
testified that Petitioner is an expert also in the field of
psychopharmacology (the use of drugs to treat psychiatric
disorders) and that Petitioner has an expertise in diagnosing and
treating difficult psychiatric conditions and in understanding and
providing treatment for psychopharmacological conditions. Tr. 36
- 37, 55, 65 - 66; P. Ex. 1.
One of the physicians who testified on Petitioner's behalf, Dr.
Jonathan Jensen, is a psychiatrist and Director of the University
of Minnesota's program for training child and adolescent
psychiatrists. Tr. 35 - 36, 40. In the latter capacity, he
teaches pharmacology to residents. Tr. 56. He has known
Petitioner for over 10 years and has worked with him at the
University for three or four hours per week. Tr. 36, 56. For at
least 10 years prior to his beginning private practice on January
3, 1995, Petitioner was Division Chair at the University and also
provided patient care. Tr. 36, 71 - 72.
Dr. Jensen called Petitioner the premier child and adolescent
psychiatrist in Minnesota. Tr. 38. He testified also that there
are very few psychopharmacologists, and there are too few child and
adolescent psychiatrists in Minnesota and elsewhere in the nation.
Tr. 37, 40. 8/ At the University of Minnesota, as well as in
private physician practices, individuals in need of treatment must
wait months in order to see a qualified child and adolescent
psychiatrist. Tr. 38. (For example, at the University of
Minnesota, a new patient has a wait of two or three months from the
time he or she requests an evaluation to the evaluation itself.
Id..) During the waiting period, a patient with suicidal ideation
will persist in his depression, stop eating, fail in school, and
lose friends. Tr. 39. Some may actually commit suicide. Id..
Children with untreated ADHD may develop juvenile delinquency
problems, get in trouble with the law, drop out of school, or
become physically or verbally aggressive with others. Id..
Recovery becomes more difficult as the patients' conditions worsen
during the waiting period caused by the shortage of specialists
available to treat these disorders. Id..
In Dr. Jensen's opinion, even though there are approximately 12
physicians in Minnesota who could begin to treat ADHD and suicide
ideation, only six to eight of these doctors would accept patients
receiving governmental medical assistance, and none has
Petitioner's expertise and background in diagnosing complicated
cases. Tr. 37 - 38, 41 - 42, 55. The University of Minnesota
still accepts Medicaid payments, but may find it necessary to limit
the number of Medicaid patients it will accept. Tr. 41 - 42. Two
area hospitals have stopped accepting Medicaid patients. Tr. 41.
Many of the psychiatrists Dr. Jensen considers to be good are
working under group health plans and cannot see Medicare or
Medicaid patients as a result. Tr. 57. Due to the low
reimbursement levels of the program, Medicaid recipients are
finding it increasingly difficult to obtain treatment from the
already small pool of child and adolescent psychiatrists in the
State. Tr. 41 - 42.
Dr. Jensen testified further that the University of Minnesota is a
tertiary care center, where only the most complicated cases (those
patients who have failed care elsewhere) are treated. Of 10 new
patients a week who seek treatment at the University, one-third to
one-half of them are probably Medicaid patients. In Dr. Jensen's
opinion, approximately three Medicaid patients a week, or at least
150 Medicaid patients a year, from the University's waiting list
could benefit a great deal from Petitioner's services. Tr. 38 -
39, 59. Currently, there is a wait of two months for the
University's outpatient services. Tr. 59.
Dr. David Abelson, an internist in private practice, called
Petitioner a "last resort" for children who have failed other
programs, and he cited as an example a case of a child he had
referred to Petitioner who had failed other treatment but who was
successfully diagnosed and treated by Petitioner. Tr. 63 - 67. In
Dr. Abelson's opinion, Petitioner is unique in Minnesota in that he
is the only psychiatrist who can combine psychotherapy and
psychopharmacology and excel at both. Tr. 66. Dr. Abelson
testified that most psychiatrists in the city do either
psychopharmacology or psychotherapy well -- but not both. Id..
Dr. Abelson works for the Park Nicollett Medical Center, a managed
care program, which has psychiatrists Dr. Abelson considers to be
"excellent." Tr. 63 - 64, 67. Depending on which physicians the
patients may see under their insurance plans, Dr. Abelson has made
referrals to the psychiatrists at Park Nicollett. Tr. 64.
However, if a patient has no limitations under his insurance plan,
Dr. Abelson's number one referral choice is Petitioner. Id.. In
the cases of "very difficult" children who have limited insurance
options but have failed treatment in other programs and under other
psychiatrists, Dr. Abelson often refers such children to
Petitioner. Id.. Park Nicollett and its physicians do not accept
Medicare or Medicaid patients. Tr. 68.
The third physician witness called by Petitioner was Dr. Robert
Karasov, a pediatrician with the Park Nicollett Medical Center, who
has known and worked with Petitioner for several years. Tr. 108 -
109. Dr. Karasov has referred to Petitioner the most complicated
cases, the patients who have been to several other psychiatrists or
developmental pediatricians without having obtained good success.
Tr. 110 - 111. In the typical complex cases, the children have
problems with impulse control, act very wildly and frequently
destructively with uncontrollable temper tantrums, behave
obsessively (such as needing to wash their hands or refusing to
touch other people) to the point where their behavior interferes
with their activities of daily living. Tr. 115. In these typical
complex cases, parents and teachers do not known how to control the
behavior. Tr. 111. The longer these conditions go untreated, the
greater the stress becomes for the family, the further the children
will fall behind in school, the more ostracized the children will
become socially, and the greater their sense of helplessness and
hopelessness. Tr. 116. There exists a statistical correlation
between the foregoing types of behavior in children and criminal
behavior during adulthood. Id..
Dr. Karasov testified that Petitioner's diagnostic ability and
psychopharmacological knowledge, plus his rapport with his patients
and their families, make him unique. Tr. 111 - 113. Dr. Karasov
explained that the same medications are available for every
physician to prescribe, but it is frequently difficult to find the
right medications that will control the child's behavior with the
least amount of side effects. Tr. 111. The difficulty is caused
by the complexity of the underlying causation of the behavior
problems, such as ADD, depression, compulsions, obsessions, and the
combinations or permutations of these disorders. Id.. In Dr.
Karasov's opinion, Petitioner has the unique skill of finding the
right medications in the right combinations, and in the right
dosages, with the least amount of side effects, to treat the most
severe cases. Tr. 111 - 112.
In Dr. Karasov's opinion, Petitioner is also more uniquely
effective in the psychiatric community because the families of
patients trust him and he makes himself very available to them.
Tr. 112 - 113. Dr. Karasov acknowledges that there are other
psychiatrists in the area community; but to him, the critical issue
is which psychiatrists provide what type of care to patients. Tr.
120.
Dr. Karasov testified also that Petitioner is more accommodating
and flexible with his hours than other psychiatrists in the
community. Tr. 113. He cited the example of a young patient who
was being dismissed from a day care center, whose family was
"falling apart," and who could not afford the time to wait for
treatment. Tr. 113. (The waiting time for obtaining psychiatric
treatment for children at Park Nicollett, for example, is six to
eight weeks. Tr. 114, 117.) Dr. Karasov called Petitioner and
explained that the case was an emergency. Petitioner then saw the
child after hours within the following week. Tr. 113, 120. Dr.
Karasov testified also concerning a Medicaid patient he referred to
Petitioner after the exclusion took effect. Tr. 116. That
Medicaid patient paid for Petitioner's services out of private
funds. Tr. 117.
With regard to his practice, Petitioner testified that he applies
current information from both a psychopharmacological and
psychotherapeutic perspective. Petitioner testified further that
he takes only the most severe cases, patients who have failed other
treatment at least once (and most often two or three times), or who
have failed other medications and require a complex approach to
treatment, such as mixing two or three different medications. Tr.
80 - 81. Having been in private practice for only six months prior
to the date of hearing, Petitioner has already accrued a waiting
list of patients. Id.. He does not accept patients whose care can
be provided by other doctors. He takes on only those he considers
"treatment failures." Id..
In response to my questions, Petitioner acknowledged that there are
only nine or 10 individuals with his specialty in the nation: for
example, there are two in New York, one in Salt Lake City, and one
in Boston. Tr. 101. There are too few child psychiatrists for the
number of persons in need of their services. Id.. Currently, 80
percent of his patients come to him from the seven counties of the
Twin Cities area. Of the remaining 20 percent, one out of five
patients comes from Wisconsin, Iowa, or the Dakotas. Tr. 102.
Also, he has patients who fly in from Chicago and New York. 9/ Tr.
102.
Since obtaining a waiver to treat program patients in the northern
counties, Petitioner has been treating patients on the White Earth
Indian Reservation and other impoverished patients in the remaining
rural areas covered by the waiver. Tr. 100. He plans to continue
treating these people in the northern regions as part of his desire
to perform public service. Id..
With regard to the numbers of program patients Petitioner was
treating prior to his exclusion, Petitioner testified that, in
September 1994, he was treating approximately 20 Medicaid patients,
five for suicidal ideation and the rest for ADD and learning
disabilities. Tr. 87 - 88, 92. By September of 1994, he knew that
an exclusion was forthcoming, and he had been reducing his Medicare
and Medicaid patient load. Tr. 87. When he left the University of
Minnesota to begin private practice in January 1995, Petitioner had
12 to 15 Medicare or Medicaid patients in active treatment. Tr. 78
- 79, 92. He explained to them that he was no longer able to bill
the program for their care and that they would need to pay on their
own, albeit at a reduced fee, if they wished to continue their
treatment with him. Tr. 79. Five of these patients have remained
with Petitioner; the others could not afford even a modest fee
sufficient only to cover Petitioner's overhead. Tr. 79.
To Petitioner, the biggest problem for the Medicaid patients he has
continued to treat on a private pay basis is that the program
cannot be billed for the medications prescribed by him. Tr. 79.
It is his opinion that these Medicaid patients are not able to
afford the cost of the medications out of their own funds, and,
consequently, they do not take the medications prescribed by
Petitioner for their treatment. Id.. He concludes that these
patients are getting only a half measure of their treatment because
their treatment is 50 percent medication. Tr. 80. These patients
are not progressing as they might otherwise. Id..
Petitioner testified that he would "go to all efforts" to help
adolescents with suicidal ideation, giving them his home number and
making himself available for 24-hour-a-day calls. Petitioner
testified that he has never treated a young patient who later
committed suicide. Tr. 93 - 94. He sees all his patients for a
full hour, even if he is not being reimbursed for all of that time.
Standard practice is for a psychiatrist to see a patient for 15 to
20 minutes, due to the psychiatrists' unwillingness to treat
Medicaid patients or to the psychiatrists' scheduling restrictions.
However, in Petitioner's opinion, there is very little that can be
accomplished with a suicidal young person during 15 to 20 minutes,
for example. Tr. 94.
Dixie Jordan, the coordinator of the project for children with
emotional and behavioral disabilities, testified that she works
primarily with children from poor Hispanic, Native American, and
culturally diverse families, many of whom are Medicaid eligible.
Tr. 122 - 124, 147. One of her primary responsibilities is to help
the families of children with emotional and behavioral disabilities
locate and gain access to available resources. Tr. 122. During
the previous year, for example, her office received 6100 telephone
calls for help. Tr. 133. Families call her generally only when
there is an acute crisis in the family, such as when a child is
having an acute psychotic episode, perhaps threatening to kill
himself or his family, and the family needs to talk to a
psychiatrist immediately. Tr. 125, 132.
Ms. Jordan testified that Petitioner is the only psychiatrist she
has worked with who will see a child immediately. She testified
that he has always come through for her, even in the middle of the
night. Tr. 125 - 127, 145 - 146. She testified further that, in
her experience, no one provides what Petitioner provides to the
communities she works with. Tr. 128.
Ms. Jordan described what she typically encounters when she
attempts to secure help for children in crisis from providers other
than Petitioner. Tr. 143 - 144. When she calls the hospitals
where the doctors practice and asks them to admit children who have
attempted suicide at school or at home, she would be told that the
facilities are full. The attending psychiatrists would fail to
return her calls, and when she reaches them, they would typically
respond that the families should watch the children carefully over
the weekend and that the doctors would try to fit these children in
as soon as possible. If the acute episode dissipates over the
weekend, the children would then wait for two or three months at a
time before they are seen by the doctors. Id.. Due to the absence
of psychiatrists able or willing to see these children in crisis,
Ms. Jordan has had to resort to telling parents to have their
children throw rocks through a hospital's window in order to
establish that the children are in crisis and thereby gain
admission to the hospital for treatment. Tr. 143.
Ms. Jordan testified that, even in the Twin Cities area, finding
immediate care for a Medicaid-eligible child is extraordinarily
difficult. Tr. 148 - 149. In the rural areas of Minnesota
especially, when a child is experiencing an emotional crisis due to
a mental illness, Ms. Jordan has found that, in most instances,
there is no one except Petitioner to whom she can send that child.
Tr. 126. The number of doctors who will accept Medicaid patients
has been declining due to the low reimbursement rate. Id.. Some
consulting psychiatrists fly into the rural parts of the State once
a month, but they do not take advance appointments. Tr. 145. In
addition, Ms. Jordan has found that children in acute episodic
crisis do not respond well to physicians specializing in adult
psychiatry; these physicians have made misdiagnoses or no diagnoses
of children in crisis. Tr. 126.
Ms. Jordan testified also that Petitioner is the only psychiatrist
she will use for certain Native American children, because Native
American families trust him and trust him not to misdiagnose their
childrens' conditions. Tr. 125 - 127. She testified that she has
used Petitioner especially as a referral source for culturally
diverse parents from around the State. Tr. 123 - 124. She
testified that it is very easy for a doctor to miss the cultural
representations that children of the Native American community
experience. Tr. 127.
She testified further that while a Native American child may not
have his or her health jeopardized by another physician's
treatment, the family may not accept the treatment prescribed by
another physician. Tr. 135. When Ms. Jordan made referrals to
other doctors, there have been Native American parents who said
that they would not take their children to those doctors. Tr. 135
- 136. Ms. Jordan believes that, in the 87 counties of Minnesota,
and, with the exception of those counties for which Petitioner has
obtained a waiver, there is "practically" no psychiatrist other
than Petitioner whom the families would feel was competent to
address their cultural needs. Tr. 129.
Ms. Jordan testified also that Medicaid patients may not be able to
receive prompt treatment because of Petitioner's exclusion. These
children tend to wind up in residential treatment or in the
criminal justice system. Tr. 129 - 130. She testified further
that, in the period since Petitioner was excluded, at least one
child has committed suicide. Tr. 144. When she fails to get
results through other avenues and with other psychiatrists, she
calls Petitioner's office and always has been able to get his
prompt assistance for those in need. Tr. 146.
Ms. Jordan testified that, prior to Petitioner's exclusion, she
referred approximately three or four dozen Medicaid patients to
Petitioner a year. Tr. 146. In some Native American tribes,
suicide is the second leading cause of death for children. Tr.
127. She knows of a number of children living on reservations who
urgently need services. Because Petitioner is not available to see
them on the reservations, she has to bring them to the city to find
help for them. Tr. 147. Even though Petitioner is currently
providing services to program patients on the White Earth
Reservation in the northern part of the State, more than half of
the tribe's enrolled members live in urban areas, primarily in
Minneapolis and St. Paul. Tr. 128. Ms. Jordan testified that the
Twin Cities have the third largest Native American population in
the nation. Id.. Ms. Jordan testified also that, outside of the
northern counties where Petitioner is authorized to provide
services under the programs and outside of the Twin Cities area,
there are many Medicaid patients in need of services. Tr. 147.
She pointed out that there is the eastern side of the State to
consider as well. Tr. 148.
2. Evidence submitted by the I.G. proves the existence
of three aggravating factors.
The I.G. presented no testimony or statements of witnesses.
To rebut the effect of the above-described mitigating factor, the
I.G. asserted the existence of three aggravating factors. I.G. Br.
at 12 n.18.
The I.G. has proved the existence of the three aggravating factors.
Specifically, the I.G. proved the presence of the aggravating
factors set forth at 42 C.F.R. 1001.201(b)(2)(i), (ii), and
(iv). Section 1001.201(b)(2)(i) states that it is an aggravating
factor if the acts resulting in a provider's conviction result in
financial loss to an entity of $1500 or more. Here, CIBA-GEIGY
sustained a loss of $170,394 which was ascribed to Petitioner's
criminal offenses. I.G. Ex. 1 at 5. Section 1001.201(b)(2)(ii)
states that it is an aggravating factor if the acts resulting in a
provider's conviction were committed over a period of one year or
more. The facts before me establish that Petitioner was convicted
of similar acts occurring for a period of over one year. I.G. Ex.
2 at 15 - 16; I.G. Ex. 1. Section 1001.201(b)(2)(iv) states that
it is an aggravating factor if the sentence imposed by the court
included incarceration. Here, Petitioner received a six month term
of imprisonment. I.G. Ex. 1 at 2.
3. Weighing the aggravating and mitigatingfactors
proved, I find that it is reasonable to terminate Petitioner's
exclusion as of the date of issuance of this Decision.
The evidence establishes that Petitioner is not the only child and
adolescent psychiatrist in the State of Minnesota, or the only
child and adolescent psychiatrist in the State of Minnesota who
accepts patients with suicide ideation, ADD, or ADHD. I.G. Ex. 10;
Tr. 55, 78 - 79, 85, 93 - 94, 112 - 115, 119 - 120. The I.G.
argues that the mitigating factor is not met because there are
other child and adolescent psychiatrists who, according to one
witness, could provide adequate treatment in the same specialty
areas as Petitioner. I.G. Reply Brief (I.G. R. Br.) at 9.
However, the credible testimony of Petitioner and his witnesses
establishes that no other health care provider with Petitioner's
medical specializations, understanding of Native American culture,
and scheduling flexibility is reasonably accessible to program
patients. All of the witnesses testified to the weeks and months
of waiting a patient must undergo in order to see a psychiatrist
who is willing and able to accept Medicaid payments. I do not
consider weeks and months of waiting for an appointment to
constitute an available alternative source, especially given the
evidence of the harm that has and could result to program
beneficiaries and recipients due to such a waiting period. Even
though Petitioner discharged all but a handful of his program
patients when his exclusion began, the evidence shows that
Petitioner's services are still needed by program beneficiaries and
recipients. Witnesses testified to the onset of suicidal ideation
or the crisis phases of mental illness in children not previously
Petitioner's patients. Such types of cases, plus the fact that
Petitioner specializes in and treats only patients who have failed
under the care of other psychiatrists, indicates that there are and
will continue to be other Medicare or Medicaid patients who need
his services as the physician of last resort. In sum, I am
persuaded that Petitioner has proved the mitigating factor by a
preponderance of the evidence.
The I.G. proved the existence of three aggravating factors, as
discussed above. However, the I.G. has never argued or attempted
to prove the manner in which the three aggravating factors make the
three-year exclusion period reasonable, or the weight each factor
should have. Instead, the I.G. concludes only: "Given these three
separate aggravating factors, Petitioner's three-year exclusion
should be upheld, even if the mitigating factor alleged by
Petitioner is found to exist." I.G. Br. at 19.
As explained in the preamble to the relevant regulations, none of
the enumerated aggravating and mitigating factors has been assigned
a specific value by the regulation, because each factor should be
evaluated based on the circumstances of each case. 57 Fed. Reg.
3314. The preamble gives the example of a case where many
aggravating factors exist, but the single mitigating factor was so
significant that it is appropriate to give that single mitigating
factor more weight than all the aggravating factors. Id.. This is
such a case. When I weigh the evidence relevant to the aggravating
and mitigating factors in light of the Act's intent to protect the
programs and their beneficiaries and recipients, I can find no
remedial purpose in Petitioner's three-year exclusion.
The evidence relevant to the aggravating factors proved by the I.G.
militates against the conclusion that only a three-year exclusion
will adequately protect the programs and their beneficiaries and
recipients. For example, the $170,394 loss suffered by CIBA-GEIGY
was calculated based on the amount of money paid to the University
of Minnesota for the part of the Anafranil study that was
compromised by Petitioner's conduct. P. Ex. 2 at 24 - 25. There
is no evidence that Petitioner derived any personal or financial
benefit from his actions. Even though the government alleged that
Petitioner had defrauded a federal entity, the FDA, the court
rejected that allegation during the sentencing proceedings. P. Ex.
2 at 28 - 29. The court noted during the sentencing proceedings
that, even though the government accused Petitioner of having filed
hundreds of false claims and alleged that Petitioner had engaged in
more than the minimal planning that is typical for commission of
the offense in a simple form, Petitioner was convicted of only two
counts of mail fraud and acquitted of two other counts of mail
fraud. Further, Petitioner was convicted of only three of 19
counts of making a false statement. The government failed also to
prove the existence of more than the minimal planning necessary for
committing the offenses for which Petitioner was convicted. I.G.
Ex. 2 at 26 - 29. The witnesses' testimony establishes that
Petitioner has led an exemplary life, with the exception of his
conduct during the Anafranil study. The I.G. does not allege
otherwise.
The evidence relevant to the aggravating factors shows also that
there has never been any question concerning Petitioner's care of
and dedication to his psychiatric patients. U.S. District Judge
Doty, who imposed sentence upon Petitioner, recognized that
Petitioner is a fine physician. Judge Doty structured Petitioner's
imprisonment to allow him to continue to treat patients. P. Ex. 2
at 26, 40. I agree with the following thoughts expressed by Judge
Doty during Petitioner's sentencing:
Something is very, very clear to this court, Doctor Garfinkel,
and that is that you are a fine physician ...
The one thing that concerned me the most about all of this
from the beginning, and still concerns me, is that there are a lot
of people who not only think you are a wonderful physician, but
depend on you day-to-day -- today, tomorrow. And I want to make
sure that, by doing what we're doing here, that we're not
committing a worse crime ....
P. Ex. 2 at 40.
The court's recognition that Petitioner poses no threat to patients
is consistent with the Stipulation and Order of the Minnesota
Board, which required Petitioner to perform medical services at a
site selected by the Minnesota Board. I.G. Ex. 4. By waiving
Petitioner's exclusion in the eight northern Minnesota counties,
the I.G. herself appears to have recognized that Petitioner does
not threaten the health of program patients.
The evidence relevant to the mitigating factor proven by Petitioner
shows that, rather than safeguarding the health of program
patients, continuing Petitioner's exclusion is likely to harm many
program patients, especially those of the Native American
population, who need Petitioner's prompt and specialized services.
As discussed above, the testimony of Ms. Jordan, who works
primarily with poor Medicaid-eligible children of diverse cultural
backgrounds, establishes that at least one child has come to actual
harm since Petitioner's exclusion. Other children in similar
situations are likely to injure themselves or others during acute,
crisis phases of their illnesses, because other physicians are not
willing to provide immediate treatment, lack the expertise to treat
complex cases or to treat cases where patients have failed
treatment by other providers, or who cannot secure the cooperation
of the families in following prescribed treatment. Already some
Medicaid patients have paid from their own funds in order to
continue their treatment with Petitioner. However, it is unlikely
that these Medicaid patients benefitted fully from Petitioner's
treatment, because it is not likely that they were able to afford
the cost of the medications prescribed by Petitioner during his
exclusion.
In addition, the mental disorders or conditions described by the
witnesses at hearing require proper diagnosis and ongoing
treatment, even when there is no acute, crisis episode. Petitioner
testified that he does not accept patients who can be treated
successfully by other doctors. Petitioner's colleagues justifiably
consider him the psychiatrist of last resort for children and
adolescents who have failed one or more treatments elsewhere.
During Petitioner's exclusion, patients under private insurance
plans or with private funds to pay for his services are coming to
him for treatment from as far away as Iowa, Wisconsin, the Dakotas,
Chicago, and New York. These people are able to benefit from
Petitioner's services during his exclusion. Thus, Petitioner's
exclusion impacts adversely only upon program beneficiaries and
recipients who lack adequate financial resources and live in the
Twin Cities area or in parts of Minnesota not covered by the I.G.'s
eight-county waiver.
Petitioner testified that he wants to treat program patients
because he has spent his life in the public sector, and he has
entered private practice only reluctantly, in order to pay legal
bills, fines, and restitution. Tr. 100 - 101. I believe that he
is sincere in wishing to provide care wherever and whenever he is
needed, as evidenced by the witnesses' accounts of his continued
willingness to see patients in crisis after hours and immediately
as needed. Petitioner's private practice since his exclusion is no
doubt successful, as he already has a waiting list of patients not
on Medicare or Medicaid. Despite the low level of Medicaid
reimbursement that has prompted other providers to stop accepting
Medicaid patients, and despite Petitioner's waiting list of
patients who can pay more for his services, Petitioner wants to
treat program patients.
I conclude, based on the record as a whole and the relative weight
of the evidence relevant to the mitigating and aggravating factors
proven by the parties, that the interest of the programs and their
beneficiaries and recipients can be better served by not prolonging
Petitioner's exclusion beyond the date of issuance of this
Decision.
III. Conclusion
Based on Petitioner's conviction, it was reasonable for the I.G. to
impose an exclusion against Petitioner. However, it is
unreasonable for the I.G. to have excluded Petitioner for three
years. The remedial purposes of the Act are not being served by
such an exclusion. Accordingly, I modify Petitioner's exclusion to
end upon the date of issuance of this Decision.
Mimi Hwang Leahy
Administrative Law Judge
1. Unless the context indicates otherwise, in this decision I
use the term "Medicaid" to represent all programs other than
Medicare from which Petitioner was excluded, one of which is the
Medicaid program in the State of Minnesota. See Transcript at
(Tr.) 52.
2. In response to a request made by the State of Minnesota, the
I.G. waived Petitioner's exclusion in the Minnesota counties of
Mahnomen, Becker, Clearwater, Norman, Polk, Marshall, Red Lake and
Kittson. Petitioner's Brief (P. Br.) at 5.
3. Petitioner argues that I should not have admitted I.G. Ex.
2, the indictment in Petitioner's criminal case, as an exhibit in
this case. P. Br. at 22 - 23. Specifically, Petitioner argues
that he was convicted of only five of the 25 counts brought against
him, that the jury returned general verdicts, that there is no way
to determine which allegations in the indictment the jury found to
be true, that Petitioner never agreed to the accuracy of the
indictment or the allegations in it, and that Petitioner could have
argued on appeal that the jury verdict was inconsistent with the
indictment. Petitioner's arguments do not convince me that I
should have rejected I.G. Ex. 2. What Petitioner might have argued
on appeal is irrelevant in this proceeding. Extrinsic evidence is
admitted routinely in administrative adjudication at the
Departmental Appeals Board to explain the facts surrounding a
conviction. Bruce Lindberg, D.C., DAB 1280 (1993); Norman C.
Barber, D.D.S., DAB CR123 (1991); Gene Blankenship, DAB CR42
(1989). Here, Petitioner was convicted of five counts of an
indictment, each of which incorporates by reference the underlying
facts set forth in the 46-paragraph introduction to all counts of
Petitioner's indictment, which information is included also in
published decisions regarding Petitioner's case. See I.G. Ex. 2;
United States v. Garfinkel, 29 F.3d 451 (8th Cir. 1994); United
States v. Garfinkel, 29 F.3d 1253 (8th Cir. 1994); See also United
States v. Garfinkel, 822 F. Supp. 1457 (D. Minn. 1993). As I
assured the parties I would do (Tr. 7), I have analyzed I.G. Ex. 2
in conjunction with Petitioner's convictions, as well as with the
other evidence. I have disregarded matters that were not proven at
trial or were not relevant to the issues before me.
4. Petitioner asserts also that the Double Jeopardy clause of
the United States Constitution prohibits the I.G. from excluding
him. See infra at 13.
5. CIBA-GEIGY was conducting research into Anafranil at four
other sites also. I.G. Ex. 2 at 7; Garfinkel, 29 F.3d at 1254 n.3.
6. Only in Protocol 64 would a placebo have been used.
7. The I.G. argues that Petitioner's actions "demonstrate that
he was capable of prescribing prohibited medications ...." I.G.
Reply Brief at 5. The term "prohibited medications" used by the
I.G. is misleading. There is no evidence that Petitioner was
prohibited from prescribing such medications as a physician.
Instead, it is the research protocol that did not provide for the
prescription of these medications.
8. According to a federal report, three times the current
number of child and adolescent psychiatrists are needed in the
United States. Tr. 40.
9. Petitioner testified that only about 30 percent of children
outgrow ADD and learning disabilities, learn to cope with them, or
learn to cover them up. Tr. 77 - 78. A large part of Petitioner's
practice includes this adult ADD and learning disabled group. Tr.
77.