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