Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
In the Case of:
Tajammul H. Bhatti, M.D.,
Petitioner,
- v. -
The Inspector General.
DATE: June 1, 1993
Docket No. C-92-045
Decision No. 1415
FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE DECISION
The Inspector General (I.G.) appealed a December 14, 1992 decision by
Administrative Law Judge (ALJ) Charles E. Stratton modifying
an
exclusion proposed by the I.G. for Tajammul H. Bhatti,
M.D.
(Petitioner). Tajammul H. Bhatti, M.D., DAB CR245 (1992)
(ALJ
Decision). In his decision, the ALJ concluded that although the
I.G.
had authority under section 1128(b)(4) of the Social Security Act
(Act)
to exclude Petitioner from participation in Medicare and State
health
care programs, the I.G.'s determination that the exclusion should
remain
in effect until Petitioner regained his license to practice medicine
in
Wisconsin or South Dakota was unreasonable. 1/ The ALJ
therefore
modified the exclusion to a five-year exclusion.
Based on the analysis below, we conclude that the ALJ applied an
incorrect
legal standard in concluding that a coterminous exclusion
was
unreasonable. We also conclude that a five-year exclusion would
not
satisfy the remedial purpose of the Act. Consequently, we reverse
the
ALJ's determination on the length of the exclusion period and modify
the
ALJ Decision to provide for a period consistent with the
I.G.'s
position: that is, the exclusion will remain in effect until
Petitioner
either regains his license in South Dakota or Wisconsin or until
another
state licensing authority, after Petitioner has fully and
accurately
disclosed to it the circumstances surrounding the exclusion,
grants
Petitioner a new license or takes no significant adverse action as to
a
currently held license.
Background
The following findings of fact and conclusions of law (FFCLs) from the
ALJ
decision were not contested: 2/
1. Petitioner is a psychiatrist and is licensed to practice medicine
in
Virginia and West Virginia.
2. Petitioner was licensed to practice medicine in Wisconsin and
South
Dakota.
3. Petitioner practiced psychiatry in South Dakota from 1976 to 1989.
4. On November 29, 1988, the South Dakota State Board of Medical
and
Osteopathic Examiners (South Dakota Medical Board) filed a
complaint
against Petitioner alleging that he engaged in unprofessional
conduct
and gross incompetence because of his improper sexual contacts with
a
female patient he was treating for bulimia, anorexia, and
depression.
This patient was also employed by Petitioner.
5. South Dakota law provides that the following is
unprofessional
conduct: "the exercise of influence within the
physician-patient
relationship for the purposes of engaging a patient in
sexual activity,
and for the purposes of this statute, the patient is
presumed incapable
of giving free, full and informed consent to sexual
activity with the
physician." S.D. Codified Laws Ann. .
36-4-30(19).
6. Petitioner has admitted that he had a sexual relationship with
a
patient whom he was treating for psychological problems.
7. On March 29, 1989, Petitioner voluntarily entered into a
Stipulation
on Agreed Disposition (Stipulation) with the South Dakota Medical
Board.
The Stipulation provided that Petitioner's license to practice
medicine
would be suspended for four years and that the suspension would
be
stayed during a four-year period of probation if Petitioner met
certain
conditions of probation.
8. The Stipulation required in part that, during probation,
Petitioner
should: (1) obtain an evaluation and/or assessment of his
condition
from Dr. Gary Schoener, a psychologist who specializes in
counseling
sexual misconduct by therapists, or his designee; (2) not
practice
medicine by direct patient care for one year or until his condition
was
successfully treated, whichever was longer; (3) not engage in the
solo
practice of medicine by direct medical care; and (4) not see, treat,
or
enter into a physician-patient relationship with female patients.
9. The Stipulation also provided that the South Dakota Board
could
summarily cancel Petitioner's license to practice medicine if
Petitioner
violated any of the terms of the Stipulation.
10. Petitioner agreed to voluntarily surrender his Drug
Enforcement
Administration (DEA) certificate as a result of the
Stipulation.
11. On February 28, 1992, the South Dakota Medical Board
canceled
Petitioner's license to practice medicine in South Dakota
since
Petitioner violated the Stipulation in the following ways:
(1)
Petitioner engaged in direct patient care within one year of
entering
the Stipulation; (2) Petitioner failed to get an assessment of
his
condition as required; and (3) Petitioner treated female patients
within
four years of entering the Stipulation.
12. The South Dakota Medical Board is a State licensing
authority,
within the meaning of section 1128(b)(4)(A).
13. Physical conduct of a sexual nature between a physician and
patient
is a professional activity and is related to Petitioner's
professional
competence and professional performance.
14. Petitioner's license was revoked by the South Dakota Medical
Board
for reasons bearing on his professional competence and
professional
performance.
15. On February 19, 1991, the Wisconsin Medical Board held a hearing
to
determine whether Petitioner's license to practice medicine in
Wisconsin
should be revoked. Neither Petitioner nor his representative
appeared
at the hearing held by the Wisconsin Board.
16. The Wisconsin Medical Board determined that Petitioner had
failed
to obtain the psychological evaluation and treatment required by
his
Stipulation with the South Dakota Medical Board.
17. The administrative law judge presiding at the hearing at
the
Wisconsin Medical Board determined that Petitioner's failure to
obtain
counseling as required by his Stipulation with the South Dakota
Board
left an "unanswered question as to whether or not [Petitioner]
suffers
from any psychological and/or physical condition(s) adversely
effecting
his ability to practice . . . it is my opinion that the
protection of
the public requires that [Petitioner] not be permitted to
practice
medicine and surgery in the State of Wisconsin at this time."
18. On March 20, 1991, the Wisconsin Medical Board revoked
Petitioner's
license to practice medicine.
19. The Wisconsin Medical Board revoked Petitioner's license because
of
activities bearing on his professional competence and
professional
performance, within the meaning of section 1128(b)(4)(A) of the
Act.
20. By letter dated December 12, 1991, the I.G. excluded
Petitioner
from participating in the Medicare program and directed that he
be
excluded from participation in the Medicaid program until he obtained
a
valid license to practice medicine in Wisconsin, pursuant to
section
1128(b)(4)(A) of the Act.
21. During the period August 1989 through November 1990, Petitioner
was
employed at Southwestern Virginia Mental Health
Institute
(Southwestern).
22. While employed at Southwestern, Petitioner failed to comply
with
the terms and conditions of the South Dakota Stipulation. Within
one
year of the Stipulation, Petitioner engaged in direct patient care;
he
failed to get counseling for his condition; and within four years of
the
Stipulation, he treated female patients.
23. On at least 11 occasions while practicing at
Southwestern,
Petitioner failed to obtain a physician countersignature on
Schedule IV
drugs, despite the fact that he did not hold a valid DEA
certificate.
24. On October 25, 1990, Petitioner prescribed Haldol for a
female
patient with a history of neuroleptic malignant syndrome, despite
the
fact that Haldol is contraindicated for patients with that
condition.
The patient required intensive care and treatment because of the
harm
resulting from that erroneous prescription.
25. Petitioner was terminated from employment at Southwestern due
to
patient abuse in the form of neglect and failure to follow
hospital
policy.
26. In August 1991, the Virginia Board of Medicine (Virginia
Board)
held a formal administrative hearing on Petitioner's violation of
the
laws governing the practice of medicine in that State.
27. In its October 29, 1991 decision, the Virginia Board of
Medicine
concluded in effect that: (1) because of the restrictions on
his
license by the South Dakota Medical Board, Petitioner's practice
of
medicine in Virginia was in violation of . 54.1-2915.A(3) of
the
Virginia Code; (2) Petitioner's violation of the Stipulation with
the
South Dakota Medical Board constituted a violation of .
54.1-2915.A(3)
as defined in . 54.1-2914.A(9) of the Virginia Code; (3)
Petitioner's
prescribing of Haldol to a patient when the medication
was
contraindicated was gross carelessness and constituted a violation of
.
54.1-2915.A(4) of the Virginia Code; and (4) Petitioner's
prescribing
medications without the proper DEA certificate constituted a
violation
of . 54.1-3303 of the Virginia Code.
28. Based on its findings, the Virginia Board of Medicine
suspended
Petitioner's license to practice medicine in Virginia.
29. The Virginia Board of Medicine stayed its suspension
of
Petitioner's license based on terms and conditions, including:
(1)
Petitioner should be evaluated by a clinical psychologist
or
psychiatrist approved by the Virginia Board of Medicine and it
should
receive a report of the evaluation; (2) Petitioner should authorize
free
communication between the Virginia Board of Medicine and his
evaluators;
(3) Petitioner's psychiatric practice should be limited to a
group
medical setting or his practice should be supervised by the
Virginia
Board of Medicine; and (4) Petitioner should appear before an
informal
conference committee of the Virginia Board of Medicine in one
year.
30. Petitioner has not yet complied with the terms and
conditions
imposed by the Virginia Board of Medicine.
31. The Secretary of the Department of Health and Human
Services
delegated to the I.G. the authority to determine, impose, and
direct
exclusions of individuals whose license to provide health care has
been
revoked or suspended by any State licensing authority, for
reasons
bearing on the individual's professional competence,
professional
performance, or financial integrity.
32. The regulations concerning permissive exclusions pursuant
to
section 1128(b), to be codified at 42 C.F.R. . 1001, subpart
C,
published at 57 Fed. Reg. 3298, 3330-42 (Jan. 29, 1992), were
not
intended to apply retroactively to ALJ hearings regarding I.G.
exclusion
determinations in which the request for the ALJ hearing was made
prior
to the date the regulations were published.
33. The regulations concerning permissive exclusions pursuant
to
section 1128(b), to be codified at 42 C.F.R. . 1001, subpart
C,
published at 57 Fed. Reg. 3298, 3330-42 (Jan. 29, 1992), were
not
intended to govern administrative review of I.G.
exclusion
determinations.
34. The I.G. had authority to impose and direct an exclusion
against
Petitioner pursuant to section 1128(b)(4)(A) of the Act.
36. The remedial purpose of section 1128 of the Act is to assure
that
federally funded health care programs and their beneficiaries
and
recipients are protected from individuals and entities who
have
demonstrated by their conduct that they are untrustworthy.
37. The primary purpose of section 1128(b)(4) of the Act is to
protect
the Medicare and Medicaid programs from fraud and abuse and to
protect
the beneficiaries of those programs from incompetent practitioners
and
from inappropriate or inadequate care. S. Rep. No. 109, 100th
Cong.,
1st Sess. 1-2, reprinted in 1987 U.S.C.C.A.N. 682.
38. An additional purpose of section 1128(b)(4) is to
prevent
individuals or entities from evading sanctions by moving from their
home
jurisdiction to avoid sanctions imposed there, and thus protect
the
integrity of State regulation of medical professional standards.
S.
Rep. No. 109, 100th Cong., 1st Sess. 3-4, reprinted in 1987
U.S.C.C.A.N.
682.
39. Petitioner's admission that he had a sexual relationship with
a
patient he was treating for psychiatric problems is evidence of
his
untrustworthiness to treat Medicare and Medicaid program
beneficiaries
and recipients.
40. Petitioner's failure to obtain the counseling required by the
South
Dakota Medical Board is evidence of his untrustworthiness to
treat
Medicare and Medicaid program beneficiaries and recipients.
41. Petitioner's violation of his Stipulation with the South
Dakota
Medical Board is evidence of his untrustworthiness to meet
his
obligations under the Medicare and Medicaid health care programs.
42. Petitioner has failed to admit his responsibility for
noncompliance
with the obligations to which he voluntarily bound himself in
his
Stipulation with the South Dakota Medical Board.
43. Petitioner's use of his move to Virginia to avoid the
obligations
to which he voluntarily bound himself in his Stipulation with the
South
Dakota Medical Board is evidence of his untrustworthiness to meet
his
statutory and regulatory obligations under the Medicare and
Medicaid
health care programs.
44. Petitioner offered no evidence to show that he had changed
his
conduct to comport with the Stipulation entered into with the
South
Dakota Medical Board, or the terms imposed on him by the
Wisconsin
Medical Board or the Virginia Board of Medicine.
45. Considering the nature of the allegations against Petitioner,
any
continuation of such activities could place beneficiaries and
recipients
of the Medicare and Medicaid programs at risk.
ALJ Decision at 3-8 (citations omitted). We affirm and adopt
these
FFCLs.
The I.G.'s Exceptions
The I.G.'s exceptions involved FFCLs 35, 46 and 47:
35. The exclusion imposed and directed against Petitioner by the
I.G.
is extreme and excessive.
46. The I.G. has not shown that an exclusion until Petitioner
regains
his license to practice medicine in either Wisconsin or South Dakota
is
reasonably necessary to satisfy the remedial purpose of section 1128
of
the Act.
47. 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 a five-year exclusion.
ALJ Decision at 9.
The ALJ's rationale for rejecting the I.G.'s proposed term of
exclusion
was:
In light of Petitioner's intention not to resume the practice
of
medicine in Wisconsin or South Dakota, there is no
rational
basis to condition reinstatement on his obtaining a license
in
either Wisconsin or South Dakota. In order for an exclusion
so
conditioned to be reasonable, the evidence would have
to
demonstrate that there is little or no possibility
that
Petitioner would become trustworthy unless and until he
changed
his mind and chose to return to one of those two States.
The
I.G. has presented no such evidence.
ALJ Decision at 16 (citation omitted). The ALJ also opined that --
Because Petitioner has indicated no interest in returning
to
Wisconsin or South Dakota, it would be unreasonable to
insist
that Petitioner and the States of Wisconsin and South
Dakota
expend their resources to reinstate Petitioner's Wisconsin
or
South Dakota license simply to enable Petitioner to
treat
Medicare and Medicaid beneficiaries in another State.
ALJ Decision at 19.
The I.G. contended that these FFCLs were not supported by the
record,
because there was no evidence that Petitioner would have to return
to
the practice of medicine in Wisconsin or South Dakota in order to
regain
his license in those states. The I.G. also contended that the
proposed
exclusion would not have required Petitioner to return to Wisconsin
or
South Dakota as a precondition for reinstatement in the Medicare
and
state health care programs because regulations adopted
after
Petitioner's exclusion was proposed (42 C.F.R. . 1001.501(c)(2))
would
permit Petitioner to apply for reinstatement if, after Petitioner
fully
and accurately discloses the circumstances surrounding his
license
revocation to a licensing authority of a different state, that
state
either grants Petitioner a new license or takes no significant
adverse
action against a currently held license.
The I.G. also argued that the ALJ had adopted an incorrect legal
standard
by requiring the I.G. to prove that Petitioner would become
trustworthy
only if he changed his mind about returning to medical
practice in South
Dakota or Wisconsin. 3/ The I.G. contended that this
was an impossible
standard to meet, and that it defeated the
Congressional purpose, cited by
the ALJ in FFCL 38, to prevent
individuals or entities from evading sanctions
by moving from their home
jurisdiction to avoid sanctions imposed
there. The I.G. also contended
that although the ALJ had found that
Petitioner had a propensity to harm
patients, the ALJ's standard did not
address this finding. The I.G.
pointed out that South Dakota's and
Virginia's licensing boards had
conditioned Petitioner's further practice on
a requirement that he
obtain evaluation and counseling (FFCLs 8, 29), but
that the I.G. had no
authority to impose such a condition on Petitioner for
reinstatement
once the five-year term set by the ALJ expired.
Analysis
The Board has previously stated that exclusions set for an
indefinite
period coterminous with a period of license revocation or
suspension are
not per se unreasonable. Behrooz Bassim, M.D., DAB 1333
(1992); Sheldon
Stein, M.D., DAB 1301 (1992); John W. Foderick, M.D., DAB
1125 (1990).
In those cases, the Board concluded that by enacting
section
1128(b)(4)(A) Congress had provided that practitioners who lost
their
license to practice for reasons bearing on their professional
ability
could be deemed to be untrustworthy to serve Medicare and
Medicaid
beneficiaries. The ALJ cited these cases with approval, but
went on to
infer (from the discussion in those cases about how state
licensing
boards had an interest in assuring quality care for citizens of
the
state) that a coterminous exclusion was reasonable only if the
provider
wanted to continue a relationship with the state that had revoked
or
suspended his license.
We see several problems with this approach.
o The ALJ's assumption that South Dakota and Wisconsin had
no
further interest in Petitioner because he does not practice
in
either of those States and does not treat their citizens
is
insupportable. The ALJ recognized in FFCL 38 that one
purpose
of section 1128(b)(4) is to protect the integrity of
State
regulation of medical professional standards. There is
no
evidence that Petitioner's avowed intention to stay away
from
South Dakota and Wisconsin meant that those states had
no
interest in preserving the integrity of their
licensing
procedures. In fact, Wisconsin had already shown itself
willing
to provide a thorough review of Petitioner's license even
though
Petitioner was not practicing in the state. See FFCLs
15-18.
Moreover, if Petitioner were to be obliged to seek
an
unrestricted license in either South Dakota or Wisconsin,
that
state would have an interest in ensuring he met
licensing
standards in the state before authorizing him to practice
there,
even if he represented that he did not intend to do so, since
he
could possibly change his mind. While it might have
been
inconvenient for Petitioner to seek reinstatement in
South
Dakota or Wisconsin, Petitioner's convenience is not
paramount
here.
o The ALJ was incorrect in his characterization of
Petitioner's
term of exclusion as being totally dependent on
Petitioner's
return to Wisconsin or South Dakota. The I.G. had
specifically
noted in briefing before the ALJ that Petitioner could
seek
early reinstatement if, for example, Virginia decided to
grant
Petitioner an unrestricted license. I.G.'s Brief in Support
of
Motion for Summary Disposition at 11, n. 2. Even if the ALJ
did
not accept the I.G.'s interpretation that this regulation,
which
was adopted after the I.G. had proposed his exclusion,
would
apply here, the ALJ could have interpreted this argument to be
a
further I.G. modification of the exclusion (see n. 3 above),
or
could have modified the exclusion to include this provision,
as
we do below.
o The ALJ's requirement that the I.G. provide evidence
that
there is little or no possibility that Petitioner would
become
trustworthy unless and until he changed his mind and chose
to
return to one of the states that revoked his license sets
an
impossible standard. One would expect that many physicians
who
lost their license in one state would leave that state
to
practice somewhere else where they hold a license, rather
than
remaining in a state where they could no longer practice
their
profession. Thus, many excluded physicians would more
likely
than not be able to say that they have left the
sanctioning
state for good, and it is difficult to imagine how the
I.G.
would disprove such a statement.
o More importantly, the ALJ's standard contravenes one of
the
remedial purposes of the Act expressly acknowledged by the
ALJ
in FFCL 38 -- preventing individuals and entities from
evading
sanctions by moving from their home jurisdiction to
avoid
sanctions imposed there. The ALJ found that Petitioner used
his
move to Virginia to avoid the obligations to which
he
voluntarily bound himself in his Stipulation with the
South
Dakota Medical Board. FFCL 43. It appears that
Petitioner's
move was just the kind of evasion of sanctions that
Congress was
attempting to protect against.
For all these reasons, we conclude that the ALJ applied an erroneous
legal
standard in determining that the exclusion period set by the I.G.
was
unreasonable.
Even if the ALJ were correct in concluding that a coterminous
exclusion
was unreasonable in this case, the five-year term he substituted
does
not meet the remedial purposes of the Act because it does not
assure
that Petitioner will ever provide any evidence whatsoever that he
is
trustworthy. In his Decision, the ALJ properly identified the
factors
the Board had stated should be considered in determining
the
reasonableness of the length of an exclusion proposed by the I.G. in
a
particular case:
the nature of the offense committed by the provider,
the
circumstances surrounding the offense, whether and when
the
provider sought help to correct the behavior which led to
the
offense, how far the provider has come toward
rehabilitation, and any other factors relating to the
provider's
character and trustworthiness.
ALJ Decision at 15, citing Robert Matesic, R.Ph., d/b/a Northway
Pharmacy,
DAB 1327 (1992). The ALJ did not find any of Petitioner's
evidence on
these factors convincing. As the ALJ noted, although the
offense here
is extremely serious, Petitioner here persisted in
referring to his initial
misconduct as "an unfortunate incident." ALJ
Decision at 16. In
addition, Petitioner did not show that he had sought
the psychiatric
treatment that two state medical boards have recommended
as necessary to
assure that he poses no danger of repeating this
conduct. Petitioner
had four years to seek the treatment that he agreed
to seek in his
stipulation with South Dakota; there is no guarantee that
he will seek it
during the five-year exclusion period imposed by the
ALJ. Moreover,
Petitioner's subsequent conduct in Virginia and his
failure to comply with
conditions set by the Virginia Board raise
additional concerns about his
character and trustworthiness. See FFCLs
23-30, 44.
While we have upheld time-limited exclusions in other licensure
revocation
cases, those cases did not involve a continuing danger to
patients because
the provider had admitted wrongdoing, was seeking
treatment, and/or had had a
review of his license by another state.
See, e.g., Bernardo G. Bilang, M.D.,
DAB 1295 (1992); Eric Kranz, M.D.,
DAB 1286 (1991). Petitioner still
apparently holds a license to
practice medicine in West Virginia (FFCL 1), so
that, if the ALJ's term
of exclusion were to stand, Petitioner could resume
treatment of
Medicare and Medicaid patients without ever being evaluated by
his peers
as qualified to provide quality care. As the I.G. pointed
out, in
considering whether to reinstate a provider, the I.G. lacks both
the
authority to require Petitioner to undergo psychological evaluation
and
the ability to evaluate Petitioner's competency as a provider
of
physician services.
Conclusion
We therefore overturn the ALJ's determination that a five-year
period
would serve the remedial purposes of the Act. Under the
circumstances
here, we find that the I.G.'s term of exclusion, which
conditions
Petitioner's reinstatement upon an evaluation by a state
medical
licensing board, provides the protection for Medicare and
Medicaid
beneficiaries envisioned by the Act. Since the applicability
of 42
C.F.R. . 1005.501(c)(2) is unclear, we will incorporate the language
of
that provision as a modification to the I.G.'s exclusion. 4/
We
therefore reverse FFCLs 35, 47 and 48. We adopt the following
FFCLs:
49. The exclusion proposed and directed against Petitioner by the
I.G.
is modified as follows: Petitioner is to be excluded until he
obtains a
valid license to practice medicine in Wisconsin or South Dakota,
or
until another state licensing authority, after Petitioner has fully
and
accurately disclosed to it the circumstances surrounding the
exclusion,
grants Petitioner a new license or takes no significant adverse
action
as to a currently held license.
50. The exclusion imposed and directed against Petitioner by the
I.G.,
as modified above, satisfies the remedial purposes of section 1128
of
the Act.
______________________________
Judith
A. Ballard
______________________________
Cecilia
Sparks Ford
______________________________
M.
Terry Johnson Presiding Board
Member
1. "State health care program" is defined in section
1128(h) of the
Act and includes the Medicaid program under Title XIX of the
Act.
Unless the context indicates otherwise, we use the term "Medicaid"
here
to refer to all programs listed in section 1128(h).
2. Petitioner had the right to respond to the I.G.'s
exceptions (see
42 C.F.R. . 1005.21), but did not do so. See April 20,
1993 Letter from
Appellate Division to Petitioner. We have retained the
original
numbering scheme, and thus FFCLs 35, 47, and 48, which were objected
to,
are reproduced later in the decision.
3. While the I.G. originally proposed that the
exclusion continue
until Petitioner obtained a valid license to practice
medicine in
Wisconsin (see FFCL 20), the I.G. modified the exclusion at
the
in-person hearing before the ALJ to provide that Petitioner's
exclusion
could end if he received a valid license to practice medicine in
either
Wisconsin or South Dakota.
4. The Board has previously held that, to the extent
that certain
provisions change substantive law, the regulations which include
section
1001.501 do not apply to exclusions proposed by the I.G. prior to
their
final adoption. Bassim at 5-9. It is unclear whether, by
stating that
section 1001.501(c)(2) would apply in this case, the I.G. is
taking the
position that this provision is procedural or that,
although
substantive, this provision may be applied to Petitioner because
its
terms are favorable to