STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES, )

)

Petitioner, )

)

vs. ) CASE NO. 91-3487

) ANDREW R. ALTMAN, M. D., )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to Notice, this cause came on for final hearing on September 19, 1991, in Fort Lauderdale, Florida, before J. Stephen Menton, the assigned Hearing Officer of the Division of Administrative Hearings. After conducting a portion of the final hearing, Hearing Officer Menton recused himself. This cause was thereafter transferred to Linda M. Rigot, also a Hearing Officer of the Division of Administrative Hearings. By agreement of the parties, a transcript of that portion of the proceeding already conducted was furnished to the undersigned, who reconvened and continued the final hearing rather than commencing the final hearing anew. The continued final hearing was conducted on November 21 - 22 and December 27, 1991, in Fort Lauderdale, Florida.

APPEARANCES

For Petitioner: David G. Pius, Senior Attorney

Department of Health and Rehabilitative Services

1317 Winewood Boulevard Building Six, Room 234

Tallahassee, Florida 32399-0700

For Respondent: Salvatore A. Carpino, Esquire

1 North Dale Mabry, Suite 1010 Tampa, Florida 33609

STATEMENT OF THE ISSUE

The issue presented is whether Respondent is guilty of the allegations contained in the Administrative Complaint filed against him, and, if so, what sanctions should be imposed against him, if any.

PRELIMINARY STATEMENT

Petitioner issued an emergency termination order, which terminated Respondent from participation as a medical provider in the Florida Medicaid program, followed by an Administrative Complaint as required by Chapter 120, Florida Statutes. Respondent timely requested a formal hearing on the allegations contained within that Administrative Complaint, and the matter was

subsequently transferred to the Division of Administrative Hearings for the conduct of that formal proceeding.

Petitioner presented the testimony of Respondent; Phyllis C. Stiver; Jeffrey M. Long; Robert Marcus, Jr., M.D.; Armand B. Cognetta, M.D.; and Mark Unis, M.D. The Respondent testified on his own behalf and presented the testimony of Edward K. Edwards, Jr., M.D., and James T. Collins, M.D. Additionally, Petitioner's Exhibits numbered 1, 3 - 11, and 14 and Respondent's Exhibits numbered 1 - 7 were admitted in evidence. Filing of the six-volume transcript was completed on January 15, 1992.

Several extensions of time for filing proposed recommended orders were granted for good cause. Both parties filed proposed findings of fact in the form of proposed recommended orders on March 13, 1992. A specific ruling on each proposed finding of fact can be found in the Appendix to this Recommended Order.

FINDINGS OF FACT

1. Petitioner is the State agency responsible for the administration of Medicaid funds in Florida.

   
   

2. Respondent is a physician licensed in the State of Florida and practicing in Sunrise, Broward County, Florida. He is a Board-certified dermatologist. Until the Department issued its emergency termination order, Respondent participated in the Medicaid program by treating Medicaid recipients and receiving reimbursement from the Department. He was one of only several Broward County dermatologists who accepted Medicaid patients.

   
   

3. As part of his medical practice, Respondent employs a device known as a grenz ray machine to treat certain dermatologic conditions from which his patients, including his Medicaid patients, suffer.

   
   

4. Grenz rays (also known as ultra-soft x-rays and Bucky rays) have been used for more than sixty years for the treatment of benign skin diseases.

   
   

5. Grenz rays are radiations of very low energy. They are closely related to conventional x-rays but possess very limited penetration abilities. Conventional x-rays and grenz rays are part of the electromagnetic spectrum, with grenz rays bordering the very short wavelength ultraviolent light. The word Grenz is derived from a German word meaning "border." As part of the electromagnetic spectrum, grenz rays are a form of ionizing radiation. Further up the electromagnetic spectrum from the very low energy of grenz rays are the higher energy levels of superficial x-rays and then the higher levels of diagnostic x-rays through such intense ionizing radiation equipment as the linear accelerator.

   
   

6. Grenz rays do not penetrate the skin as deeply as even superficial radiation. As grenz rays pass through the outer layer of skin, their energy drops off rapidly. Grenz rays are almost entirely absorbed within the first 1-2 millimeters of skin. Accordingly, grenz rays do not have an energy level capable of penetrating so as to constitute a real risk of biological damage.

   
   

7. Grenz ray therapy is a safe, rapid, and painless procedure for the patient. The risk of malignancy from grenz ray therapy appears to be quite small and then only in a few cases involving massive overdoses. Further, the risk factor of grenz rays in the development of non-melanoma skin tumors is

   small, if any. Any relationship between grenz ray therapy and skin cancer in humans is far from evident as opposed to conventional x-rays further up the electromagnetic spectrum which can be carcinogenic. Long-term studies of substantial numbers of people who have received grenz ray therapy have not documented risk.

   
   

8. Although cautions against unnecessary use of ionizing radiation have been issued, the cautions against indiscriminate use of ionizing radiation relate to the use of superficial x-rays and/or higher levels of radiation. Those same recommendations suggest the use of less penetrating grenz rays which offer a wider margin of safety. Those recommendations, such as those issued by the National Academy of Sciences in 1980, in addition to affirming the safety factor inherent in grenz rays, also strongly endorse the concept that it remains the prerogative of the physician to use any form of therapy in which the benefits accruing to the patient from its use are considered to outweigh the risks inherent in its use.

   
   

9. For many decades, medical schools have taught dermatologists about the beneficial uses of grenz ray therapy in alleviating benign dermatologic conditions. Medical schools have uniformly included lectures and required reading on grenz ray therapy in their curricula. Although not all have provided their students with "hands-on" experience as part of their studies, by the time dermatologists have completed their residencies, however, most of them have been given "hands-on" training. Respondent was taught the use of grenz ray therapy in medical school.

   
   

10. Over the last several decades, the use of grenz ray therapy by dermatologists has declined as antibiotics and topical medications have increased in availability. However, grenz ray therapy has remained an effective weapon in the arsenal of therapeutic modalities available in the treatment of dermatologic conditions.

    
    

11. The American Academy of Dermatology is the national organization for Board-certified dermatologists. Its 1991 annual meeting took place during the course of the final hearing in this cause. At its annual meeting, the Academy offered two lectures and a symposium on the beneficial use of grenz ray therapy for many benign conditions. Respondent attended the symposium and one of the lectures. He did not attend the lecture which was a basic introduction to grenz ray therapy. Whether the emphasis placed on grenz ray therapy during the Academy's last annual meeting indicates a resurgence in the use of grenz ray therapy is unknown; however, it is clear that doctors still use that therapeutic modality and are still teaching it to each other.

    
    

12. The standard dose of grenz ray therapy ranges from 50 rads to 200 or

    300 rads. It is a small dose and requires only a few seconds to administer.

    The dosimetry cannot be scientifically or logically compared to the dosimetry of diagnostic x-rays, such as a chest x-ray, since such diagnostic x-rays require a much higher level of ionizing radiation than grenz rays. Similarly, grenz rays are not used for the purpose of obtaining x-rays of a human body. They are simply used to treat diseases and conditions of the skin.

    
    

13. Some dermatologists use grenz rays to treat benign skin disorders. Respondent is one of them. Some dermatologists do not use grenz rays. Some of the ones who do not use grenz rays refer their patients who would benefit from grenz ray therapy to dermatologists who administer that modality. One of the Department's witnesses does not use grenz ray therapy; one of the Department's witnesses does but for fewer skin disorders than the variety of skin disorders

    which Respondent treats with grenz ray therapy; and the Department's third witness does not use grenz ray therapy but rather uses superficial therapy, a stronger form of ionizing radiation, to treat at least one of the same conditions that Respondent treats with grenz ray therapy.

    
    

14. Until this case arose, Respondent's use of grenz ray therapy had never been questioned by any federal or state regulatory agency. Likewise, no claim for grenz ray services rendered by Respondent had been declined by any third- party payor, and, specifically, all claims for grenz ray therapy which Respondent had submitted to the Department over the years that he had been a Medicaid provider had been paid. There is no statute or rule on the federal or state level prohibiting the use of grenz ray therapy, and the Department has no policy against such use. The Department had been paying Respondent on all claims submitted by him in accordance with the reimbursement schedule utilized by Medicaid, with the current rate being $11 for a grenz ray therapy treatment.

    
    

15. Respondent has four grenz ray machines in the medical office which he shares with another dermatologist. Those machines are calibrated annually by a radiation physicist, and they have been inspected and licensed every year by the Department. Respondent's machines are calibrated to deliver the standard minimum dose of 50 rads per treatment. Respondent's use of the minimum dosimetry for grenz ray therapy is conservative.

    
    

16. The Department's computer does random utilization audits of services by Medicaid providers in the State of Florida. The computer "flagged" Respondent, one of only several dermatologists providing Medicaid services in Broward County, as having been paid for an "excessive" number of grenz ray treatments. The Department's investigator who received that computer file had never heard of grenz ray therapy. She began a search of the literature to learn about grenz ray therapy. She misunderstood the scientific studies, medical textbook chapters, and other medical articles which she obtained. She did not understand that the biological risks of ionizing radiation discussed in the writings she collected related to higher levels of ionizing radiation than the ultra-soft grenz rays. She also misunderstood the conclusions of the scientific studies specifically related to grenz rays. She did not speak to Respondent regarding the medical services he was providing.

    
    

17. Instead, she went to Respondent's office, copied medical records of some of his Medicaid patients, and advised him that his use of grenz ray therapy was an outdated, antiquated modality. She further advised him that grenz ray therapy should never be used on children.

    
    

18. The Department then issued an emergency termination order terminating Respondent's Medicaid provider status due to the danger which his use of grenz ray therapy posed to his patients. No one on behalf of the Department contacted Respondent to discuss those patients or his use of grenz ray therapy prior to the Department entering its emergency termination order. As required by Chapter 120, Florida Statutes, the emergency termination order was followed by this Administrative Complaint.

    
    

19. There are no statutes, rules, policies or guidelines issued by any federal or state regulatory agency specifying the order in which physicians may select a particular treatment modality, and that decision is properly left to each physician. Although some physicians use grenz ray therapy as the treatment of last resort, some use it as a treatment of first choice, and others use it in an adjunctive manner, i.e., in conjunction with other treatment modalities.

    Respondent uses grenz ray therapy with other treatments to expedite those other treatments.

    
    

20. During the final hearing, the Department was given leave to strike the allegations in the Administrative Complaint as to many of Respondent's patients. What remained were allegations as to improper treatment of 39 children and 4 adults. Although the use of ionizing radiation on children is generally discouraged because of the potential biological effect, such restrictions do not apply to the use of grenz ray therapy. There are no apparent clinical limitations on the use of grenz ray therapy based upon age or sex. The physiological process and the way tissue reacts to grenz rays are the same for adults as for children, including infants. Because the quantity of grenz rays capable of penetrating below the top 1 to 2 millimeters of skin is small and no risk therefrom has been documented, children can benefit from the use of grenz ray therapy as much as adults can.

    
    

21. Respondent's use of grenz ray therapy on the 39 children and 4 adults involved herein was appropriate, was medically necessary, was neither excessive nor inferior, and was not harmful to those patients; rather, Respondent's use of grenz ray therapy benefited the patients in question.

    
    

22. All of the dermatologic conditions for which Respondent administered grenz ray therapy to the patients involved herein are among the conditions likely to benefit from grenz ray therapy. They are also among the conditions identified during the Academy's 1991 annual meeting as being appropriate for grenz ray therapy.

    
    

23. When utilizing ionizing radiation therapy, it is important to note in the patient's record the number of rads administered, the treatment site, and the skin target distance for two reasons. First, there is a cumulative lifetime dose above which ionizing radiation would not normally be administered. Second, the use of ionizing radiation in a particular treatment area may prohibit subsequent use of ionizing radiation in that same treatment area.

    
    

24. The same restrictions regarding repeated doses of ultra-soft grenz rays do not appear to apply. There is no certainty that there is a maximum lifetime dose. Although researchers in Denmark have recommended a maximum of less than 2,000 rads per year and 10,000 rads per lifetime and although American literature recommends 5,000 rads as the total lifetime cumulative dose per location, Swedish researchers, who conducted the landmark long-term study of over 14,000 patients who had received ultra-soft grenz ray treatment, have indicated that a schedule of weekly treatments for a total of 800 - 1,000 rads followed by a 6-month rest before additional treatment is given can be followed ad infinitum. Further, due to the meager penetration beyond the surface by grenz rays, research has not established that the administration of grenz ray therapy would be a barrier to subsequent use of additional grenz rays or the stronger forms of ionizing radiation.

    
    

25. Grenz ray therapy has a standard minimum protocol attendant to its use. Grenz rays appear to be ineffective at less than 50 rads or with a skin target distance of more than approximately 20 centimeters. Respondent's grenz ray machines are calibrated to deliver the minimum effective dose of 50 rads at the effective skin target distance of 20 centimeters.

    
    

26. Respondent noted in the medical records each grenz ray treatment given to each of the patients in question herein. Although Respondent's medical records for the patients involved herein rarely specified that the dose

    administered was 50 rads, did not recite the skin target distance, and rarely contained a drawing of the area affected, some dermatologists include such information in their medical records, and some do not. In the absence of such detail, subsequent treating physicians would likely assume the standard protocol. In any event, the failure to specify such details does not fall below the acceptable standard of care.

    
    

27. Respondent's records do not contain an written informed consent form for any of the patients involved herein to whom he administered grenz ray therapy. There is no federal or state statute or rule or Department policy requiring that a dermatologist obtain a written informed consent form before administering grenz ray therapy. The evidence is uncontroverted that Respondent did explain to the patient or to the patient's parent or guardian grenz ray therapy together with its benefits and risks. The evidence is uncontroverted that he obtained consent in advance of such treatments. Although some dermatologists notate in their records that the explanation was given, some do not, and some do some of the time. Respondent's failure to notate those discussions in the medical records of the patients involved herein does not fall below the acceptable standard of care.

    
    

28. The thyroid, the eyes (particularly the cornea), and the testicles are sensitive to even low doses of radiation. Therefore, using cones to collimate the beam and/or shielding the patient are devices normally used to protect patients from receiving ionizing radiation outside the field of treatment. However, the necessity for shielding those organs from the administration of the ultra-soft grenz rays is not so clear. It is not established that there is a risk to the thyroid from grenz ray therapy to the neck or to the testicles from grenz ray therapy to the scrotum due to the lack of penetration abilities of grenz rays. It is also believed that closing the eyelids offers the cornea sufficient protection to avoid risk from grenz ray therapy. It is clear that Respondent did not always use cones or other shielding devices, but there is no evidence that Respondent wanted to limit the field of treatment during those applications of grenz ray therapy. Further, it is Respondent's practice to place his hand over the eyes of any patient receiving grenz ray therapy to the face area who is unable to close his or her eyelids. While such a practice may not be in Respondent's own best interest, there is no evidence that Respondent's use of his hand as a shielding device reduced the benefits or increased the risks of grenz ray therapy for his patients. It has not been shown that Respondent fell below acceptable standards in his use of shielding devices.

    
    

29. Although it is well known that exposure to ionizing radiation carries a risk, no safe threshold dose has been established. A safe threshold dose for grenz rays is even more elusive since the existing literature does not document biological harm from the administration of grenz ray therapy in accordance with standard dosimetry. Although grenz rays are incapable of being used to diagnose conditions due to their inability to penetrate beyond the outer layer of skin, grenz rays and the stronger levels of ionizing radiation are used to treat conditions based on a risk/benefit ratio. Stated differently, the use of any form of ionizing radiation is acceptable when the benefit to the patient outweighs the risk. In using grenz ray therapy for the patients involved herein, Respondent determined that in his best medical judgment the benefit to the patients outweighed the risk.

    
    

30. In sum, Respondent's treatment of the patients named in the Administrative Complaint was within acceptable standards of care. Further, his records of those treatments are within acceptable standards of care.

    CONCLUSIONS OF LAW

    
    

31. The Division of Administrative Hearings has jurisdiction over this matter. Section 120.57(1), Florida Statutes.

    
    

32. It is undisputed by the parties that the Department bears the burden of proving the allegations contained in the Administrative Complaint filed against Respondent. It is also undisputed between the parties that if this action were in the nature of a licensure disciplinary proceeding, the burden imposed on the Department would be to prove its allegations by clear and convincing evidence. The Department contends that its burden is merely a preponderance of the evidence, citing several cases. The Department relies on the case of Southpointe Pharmacy v. Department of Health and Rehabilitative Services, decided by the First District Court of Appeal for the State of Florida on March 11, 1992. That case holds only, as to the burden of proof, that when the Department seeks reimbursement for overpayments to a Medicaid provider, its burden of proof is a preponderance of the evidence. The Department also relies on the case of Manocchio v. Sullivan, 768 F. Supp. 814 (S.D. Fla. 1991). In that case a physician had been convicted of Medicare fraud. He subsequently brought an action challenging the constitutionality of his exclusion from participation in the Medicare program based upon his criminal conviction. The court considered the question of whether the action excluding him from participating in the Medicare program was remedial or punitive in nature, thereby violating the ex post facto or double jeopardy clauses. The court determined that such action was remedial in nature.

    
    

33. In the case at bar, the Department wishes to terminate Respondent's status as a Florida Medicaid provider for a period of five years. The Department also seeks to impose an administrative fine of $20,000. None of the cases relied upon by the Department specifically involves the question of the burden of proof imposed on the Department when it wishes to fine a medical provider. The reimbursement of overpayments considered in the Southpointe case and the constitutional implications of being excluded from participation in the program considered in the Manocchio case are not present in this case.

    
    

34. The Medicaid Provider Agreement entered into between the Department and Respondent on May 16, 1988, is a contract voluntarily entered into between the parties. That contract provides that it may be terminated upon 30 days' written notice by either party. Accordingly, the Department had the option of simply terminating its agreement with Respondent without instituting either its emergency order or the administrative complaint which is the subject of this proceeding. However, that contract further provides that the Department can terminate the contract in accordance with Chapter 120, Florida Statutes.

    
    

35. Section 120.52(9) defines a license as a franchise, permit, certification, registration, charter, or similar form of authorization required by law. Respondent could not achieve the status of being a Medicaid provider, authorized to treat Medicaid patients and to be reimbursed for such treatment, without being authorized by the Department to do so. Although the emergency order issued by the Department was not made part of the record in this cause, the references made by the parties to it indicate that that order terminated Respondent's status as a Medicaid provider due to the Department's determination that the public health, safety, or welfare was threatened by Respondent's Medicaid provider status. Such an emergency order is authorized by Chapter 120 only in Section 120.60(8) which requires that such an emergency suspension or revocation order be promptly followed by the issuance of an administrative

    complaint. The Department has complied with that requirement by issuing the Administrative Complaint which is the subject matter of this proceeding.

    
    

36. Since the Department has by virtue of its form contract elected to require that its termination of such a contract be in accordance with Chapter 120, then the burden of proof, in such situations, has been well settled to be clear and convincing evidence. It is apparent that the Department determined when it issued its emergency order followed by its Administrative Complaint that it was bound by all of the due process and stringent burden of proof requirements inherent in that kind of a proceeding brought pursuant to Section 120.60, Florida Statutes.

    
    

37. In the case at bar, the Department is alleging that Respondent failed to meet the acceptable standard of care in treating patients whom the Department had previously determined had been given appropriate services when the Department paid Respondent's claims for reimbursement of the services rendered to each and every patient alleged in the Administrative Complaint filed herein. When the Department changed its mind, it did not simply restrict Respondent in rendering future grenz ray therapy when appropriate in his medical judgment but, rather, terminated Respondent's provider status so that he is not eligible to render any medical services to Medicaid patients and be reimbursed therefor. Further, the Department does not allege that Respondent has received overpayments for services but rather seeks to punish him by fining him the sum of $20,000.

    
    

38. The Administrative Complaint filed herein contains four counts. Although the pleading form utilized by Petitioner makes it difficult to ascertain the exact nature of the charges brought by virtue of the successive incorporation of all matters before alleged, the essence of the complaint can be summarized as follows. Count I alleges that Respondent's use of grenz ray therapy in children, without extraordinary justification, which justification is not documented in the children's medical records, is a departure from established safe medical practice; that the treatments on children were not medically necessary and thus were in excess of the recipients' needs or harmful to the recipients; that Respondent has violated Section 409.266(11)(i), Florida Statutes, in that he has furnished, or ordered the furnishing, to Medicaid recipients of goods or services which are in excess of the recipients' needs or harmful to the recipients; and that such determination has been made based on competent peer judgment and evaluations. Count II in its concluding paragraphs makes these same allegations as to Respondent's use of grenz ray therapy for adults. Count III alleges that Respondent's failure to properly document treatment variables is a departure from established safe medical practice; that the treatments which Respondent performed on adult and children Medicaid recipients were not in keeping with the prevailing standard of care and thus were harmful to the recipients or of inferior quality; and that Respondent has violated Section 409.266(11)(i), Florida Statutes, in that he has furnished, or ordered the furnishing, to Medicaid recipients of goods or services which are harmful to the recipients or of inferior quality, such determination having been made based on competent peer judgment and evaluations. Count IV alleges that Respondent had no signed consent forms in those Medicaid patient records and had no indication in the records that the potential negative effects of ionizing radiation were discussed with the minors' parents or guardians or that the possible harmful effects were discussed with the adult patients; that Respondent's failure to obtain informed consent from patients or the patient's parent or guardian is a departure from established safe medical practice; that such treatments, therefore, were not in keeping with the prevailing standard of care and thus were harmful to the recipients or of inferior quality; and that

    Respondent has violated Section 409.266(11)(i), Florida Statutes, by furnishing, or ordering the furnishing, to Medicaid recipients of goods or services which are harmful to the recipients or of inferior quality, such determination having been made based on competent peer judgment and evaluations. As paraphrased by the Department during the final hearing, Count I alleges the treatments were harmful to children, Count II alleges the treatments were harmful to adults, Count III alleges that the records were inferior and therefore the treatments were inferior, and Count IV alleges that there was either no or there was insufficient informed consent and that, therefore, the treatments were inferior.

    
    

39. All four counts rely on Section 409.266(11)(i), Florida Statutes, which provides that the Department may impose administrative sanctions on a Medicaid provider when:

    
    

    1. The provider has furnished or ordered the furnishing to a recipient of goods or services which are in excess of his needs, harmful to the recipient, or of inferior quality. Such determinations shall be based on competent peer judgment and evaluations.

       
       

       The Department has failed to meet its burden of proof, whether that burden is clear and convincing evidence or merely a preponderance of the evidence.

       
       

40. The weight of the competent evidence is that grenz ray therapy is a safe treatment modality which is properly used for both adults and children in the treatment of a variety of benign dermatologic conditions. It is an acceptable treatment modality, it was administered to Medicaid recipients for appropriate conditions, it was not harmful to the recipients, and it was not of inferior quality. Respondent's provision of the treatments in question was within acceptable standards of medical care. Respondent's medical records of such treatments were not of inferior quality; rather, they were within acceptable standards of medical care. Respondent's recordkeeping did not make the grenz ray therapy treatments inferior. Lastly, there is no requirement that Respondent obtain written informed consent for the provision of grenz ray therapy. The evidence is uncontroverted that Respondent discussed with the patient or the patient's parent or guardian the modality of grenz ray therapy, Respondent obtained verbal informed consent, and Respondent's failure to notate the obtaining of informed consent in his records was within acceptable standards of medical care and did not render his provision of grenz ray therapy inferior. These conclusions are based upon competent peer judgment and evaluations as disclosed by the weight of the competent evidence in this cause, including the judgments expressed in the scientific literature admitted in evidence.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding Respondent not guilty of

the allegations contained within the Administrative Complaint and dismissing the

Administrative Complaint filed against him in this cause.

DONE and ENTERED this 20th day of April, 1992, at Tallahassee, Florida.

LINDA M. RIGOT

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 20th day of April, 1992.

APPENDIX TO RECOMMENDED ORDER DOAH CASE NO. 91-3487

1. Petitioner's proposed findings of fact numbered 1, 3-6, 8-15, 25, 27, 28, 31, 37, and 40 have been adopted either verbatim or in substance in this Recommended Order.

2. Petitioner's proposed findings of fact numbered 2, 17, 20, 21, 39, 41 and 52 have been rejected as being unnecessary for determination of the issues involved herein.

3. Petitioner's proposed findings of fact numbered 7, 16, 18, 19, 24, 26, 29, 30, 32-36, 38, 42-47 and 53 have been rejected as not being supported by the weight of the evidence in this cause.

4. Petitioner's proposed findings of fact numbered 22, 23 and 48-51 have been rejected as not constituting findings of fact but rather as constituting recitation of testimony, argument of counsel, or conclusions of law.

5. Respondent's proposed findings of fact numbered 1, 2, 4-6, 10-15 and 17-28 have been adopted either verbatim or in substance in this Recommended Order.

6. Respondent's proposed findings of fact numbered 3, 7-9, and 16 have been rejected as being unnecessary for determination of the issues involved herein.

COPIES FURNISHED:

David G. Pius, Senior Attorney Department of Health and

Rehabilitative Services Building Six, Room 234 1317 Winewood Boulevard

Tallahassee, FL 32399-0700

Salvatore A. Carpino, Esquire

1 North Dale Mabry, Suite 1010 Tampa, FL 33609

Sam Power, Agency Clerk Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, FL 32399-0700

John Slye, General Counsel Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, FL 32399-0700

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.

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AGENCY FINAL ORDER

=================================================================

STATE OF FLORIDA

DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES

DEPARTMENT OF HEALTH AND REHABILITATIVE SERVICES,

Petitioner, CASE NO.: 91-3487

RENDITION NO.: HRS-92-149-FOF-MDC

vs.

ANDREW R. ALTMAN, M. D.,

Respondent.

/

FINAL ORDER

This cause came on before me for the purpose of issuing a final agency order. The Hearing Officer assigned by the Division of Administrative Hearings (DOAH) in the above-styled case submitted a Recommended Order to the Department of Health and Rehabilitative Services (HRS). The Recommended Order entered April 20, 1992, by Hearing Officer Linda Rigot is incorporated by reference.

For good cause shown by oral motion, the department was given leave to file exceptions to the Recommended Order one (1) day late and did so. The Respondent did not file exceptions.

RULING ON EXCEPTIONS

Although the Department stated its disagreement with the Findings of Fact determined by the Hearing Officer, it did not file exceptions to them and conceded that the Hearing Officer's Findings may not be rejected unless they are not supported by any competent substantial evidence.

The Department did, however, take exception with the Hearing Officer's conclusions of law as to the issue of the proper burden of proof, and a hearing officer's conclusions may be rejected so long as the substituted conclusions of law are not inconsistent with the facts found by the hearing officer.

In its first exception the Department takes exception to the Hearing Officer concluding that the Department's reliance on Southpointe Pharmacy v. Department of Health and Rehabilitative Services, No. 91-451, slip op. (Fla. 1st DCA March 11, 1992) (Wigginton, J.) was misplaced.

The Hearing Officer's Conclusion is erroneous in that the Hearing Officer inexplicably failed to note that Southpointe involved the imposition of a sanction that included termination from participation in the Medicaid program and a fine as well as recovery of overpayment. Nevertheless, the appellate court still found that the proper burden of proof was preponderance of the evidence. Similarly, in the instant case the proper burden of proof is by the preponderance of the evidence. I therefore accept the Department's first exception and reject the Hearing Officer's erroneous Conclusion of Law.

In its second exception the Department takes exception to the Hearing Officer concluding that neither of the two cases relied upon by the Department, Southpointe, supra, and Manocchio v. Sullivan, 768 F.Supp 814 (S.D. Fla. 1981), involve the question of the burden of proof imposed on the Department when it wishes to fine a medical provider.

The Hearing Officer's Conclusion is erroneous in that while the Southpointe case did not turn on the burden of proof issue, the court's opinion did, in fact, address that issue in that the Southpointe court said the Department's burden of proof (even though the Department imposed a fine and exclusion from the program) was the preponderance of evidence standard. While Manocchio may not have specifically addressed the burden of proof issue in the context of a fine, the Manocchio court said exclusion is not punitive but remedial. If exclusion was punitive then the correct burden of proof would be clear and convincing evidence. Based on the two cited cases therefore, the proper standard is preponderance of the evidence.

In its third and final exception the Department takes exception to the Hearing Officer concluding that since the Department has by virtue of its Provider Agreement elected to require that provider termination be in accordance with Chapter 120 Florida Statutes, then the burden of proof must be clear and convincing evidence.

The Hearing Officer's Conclusion is erroneous in that although the Department has proceeded under Chapter 120, Florida Statutes, the clear and convincing standard only applies in cases where there is a property right at stake such as in licensing actions. Such a property right is not present here.

It is true that in actions against an individual'S license to practice a profession allegations must be proved by more than a preponderance, i.e. by clear and convincing evidence. See, e.g., Ferris v. Turlington, 510 So.2d 292.,

(Fla. 1987), and Bowling v. Department of Insurance, 394 So.2d 165 (Fla. 1st DCA 1981). Both cases dealt with action taken by the State against a license to practice a profession. The Supreme court of Florida, citing with approval to Bowling, held that a standard of proof "greater than a mere preponderance of the evidence" was required in such cases. Ferris, supra, at 294. The Court noted "[t]he correct standard for the revocation of a professional license such as that of a lawyer, real estate broker, or ... teacher is that the evidence must be clear and convincing." Id. (emphasis supplied.)

Further, in Bowling, the court discussed proceedings under a penal statute for suspension or revocation of a valuable business or professional license.

Bowling at 171. (emphasis supplied). The court noted that the charges against Bowling were based on section 626.611, Fla. stat., which drew essential elements from section 626.561, Fla. stat., a criminal statute, thus making the issue a violation of a penal statute. The court referred to the allegations of "fraudulent practices" as well as "conversion and unlawful holding". Bowling at

167. In the instant case there is no allegation of fraud or other criminal wrongdoing.

While the Hearing Officer likened this action to the revocation of a professional license, and thus implicitly characterized the proceedings as a taking of a property right under the Fourteenth Amendment to the United States constitution, no such property right exists in an agreement, such as the Medicaid Provider Agreement., to provide Medicaid services and be reimbursed for the provision of those services.

It is well settled that the right to practice a profession is a property right protected by the due process clause of the United states Constitution. Florida Medical Association v. Department of Professional Regulation, 426 So.2d 1112 (Fla. 1st DCA 1983). It is also true that lost profits and business damages are not property in the constitutional sense. Florida Power and Light Co. v. First National Bank and Trust Co., 448 So.2d 1141 (Fla. 4th DCA 1984).

Thus for it to properly be claimed that this proceeding is a licensure action it would have to be shown that a property right attaches to the Medicaid Provider Agreement. No such showing can be made.

It has been held in other jurisdictions that Medicaid providers have no property right in their continued participation in the Medicaid program. See, e.g., Oberlander v. Perales, 740 F.2d 116, 120 (2d Cir. 1984) (wherein the court found that in order to prevail the plaintiff would have to establish the existence of a valid property interest and that such interests are created not by the Constitution but by an independent source such as state law. The court went on to hold that Medicaid providers clearly have no property interest in future reimbursements under New York law.); and Holder v. Perales, Sup. Ct. N.Y. County, October 24, 1988 (cited from CCH Medicare and Medicaid Guide, New Developments April 1989 to Oct. 1989, para. 37,818) (wherein the court stated the relationship is "contractual in nature, and terminable when in the best interest of the [Medicaid] program. No law or regulation gives petitioner any right or entitlement to participate in Medicaid.").

Petitioner's Agreement with the Department is to provide a service, i.e. providing medical care to Medicaid recipients, in exchange for a fee. This agreement is voluntary and, as in Holder, supra, is a contract rather than a license.

Section 120.52(8), Fla.-Stat. notes that a license is an "authorization required by law". (emphasis supplied). Professions in Florida are generally

licensed to protect the public from incompetent practitioners. (See, e.g., section 458.301, Fla. Stat., "[t]he primary purpose in enacting this [Medical Practice] chapter is to ensure that every physician in this state meet minimum requirements for safe practice; and section 465.002, Fla. Stat., "[t]he sole legislative purpose for enacting this [Pharmacy] chapter is to ensure that every pharmacist practicing in this state and every pharmacy meet minimum requirements for safe practice." Further, unauthorized operation can result in criminal sanctions. (See, e.g., section 458.327, Fla. Stat., making it a third degree felony to practice medicine without a license; and section 465.015, Fla. Stat. making it a first degree misdemeanor to operate a pharmacy without a license).

Unlike professional licenses issued by the State, Medicaid Agreements, such as the one Petitioner has with the Department, are entered into not to protect the public from incompetent practitioners, but to ensure that certain state and federal procedural rules are followed to protect the fiscal interest of the government. Similarly, criminal sanctions such as those noted above for operating without the required license do not apply to an individual or entity who provides services to Medicaid recipients (assuming, of course the practitioner has the proper underlying license to practice). If a physician, properly licensed under the Medical Practice Act, treats Medicaid recipients without having a Provider Agreement he will merely not be reimbursed by the state. While this may not be a sensible business practice, it certainly doesn't subject the physician to criminal penalties. If the Department had ultimately prevailed and Dr. Altman was terminated from his voluntary participation in the Medicaid program he would still have been able to operate as a licensed physician.

The Hearing Officer ignored the fact that Dr. Altman applied for a stay of the original Emergency Termination Order from the Fourth District Court of Appeal. The stay would have to have been granted as a matter of right pursuant to section 120.68(3), Florida Statutes, if the matter was truly a licensure action. The court, however, denied the stay as did the Department. It is thus clear that this matter cannot be considered as a licensure proceeding.

While the imposition of a fine may be seen as penal in nature, it is a mere regulatory function and does not change the burden of proof. This is demonstrated by the decision of the First District Court of Appeal in Southpointe Pharmacy V Department of Health and Rehabilitative Services, supra.

As noted above, the Hearing Officer ignored the appellate court's opinion which stated that the Department had not only determined overpayments had been made to the Pharmacy and repayment was due, but also imposed an administrative fine of $2,000 and termination from the Medicaid program for a period of two years. Slip op. at 4.

The court ultimately determined that the Department had improperly rejected the administrative hearing officer's findings of fact and reversed the final order of the Department. The court, however, noted that the Department had the burden of proving its allegations by a preponderance of the evidence, and cited as authority for that pronouncement Florida Department of Transportation v.

J.W.C. Co.1 Inc., 396 So. 2d 778 (Fla. 1st DCA 1981). Slip op. at 7. Given that the Department had intended to impose a fine against the pharmacy and terminate its participations and given that the appellate court was aware of that fact, the proper standard in cases such as this, involving the administrative imposition of termination and fines, must be preponderance of the evidence.

For the above reasons the Department's exceptions are granted and the Hearing Officer's Conclusions of Law as to the issue of the burden of proof are rejected. The Conclusions of Law set forth below are substituted in their place.

FINDINGS OF FACT

I note that I have serious misgivings and doubts as to some of the Hearing Officer's findings. I particularly question her finding that Dr. Altman's use of Grenz Ray therapy on the 39 children and 4 adults herein was appropriate, medically necessary, and neither excessive, inferior, nor harmful. I also have serious reservations as to the findings that Dr. Altman's records were adequate, that he properly informed his patients and that he properly safeguarded his patients. I believe such findings are contrary to the testimony of the Department's witnesses who had much more experience with ionizing radiation than those of the Respondent, and contrary to the weight of scientific knowledge.

Nevertheless, I am bound by the Hearing Officer's Findings of Fact unless, after a full inspection of the record, I conclude that the findings are not supported in the record by any competent substantial evidence. Sections 120.57(1) (b) (10) and 120.68(10), Florida Statutes (1991); Heifitz v.

Department of Business Regulation, 475 So. 2d 1277 (Fla. 1st DCA 1985).

The findings of fact in the recommended order are based on the Hearing Officer's interpretation of the testimony and the weight to be given to the testimony of any particular witness. As the finder of fact the Hearing Officer has the sole authority to choose between which conflicting testimony is found to be more credible. I am, therefore, reluctantly bound by the Findings of Fact in the Recommended Order and they are hereby adopted and incorporated herein by reference.

CONCLUSIONS OF LAW

The Conclusions of Law recommended by the Hearing Officer are rejected and the following is substituted in its place.

The Division of Administrative Hearings has jurisdiction over this matter.

Section 120.57(1), Florida Statutes.

It is undisputed by the parties that the Department bears the burden of proving the allegations contained in the Administrative Complaint filed against Respondent. It is also undisputed between the parties that if this action were in the nature of a licensure disciplinary proceeding, the burden imposed on the Department would be to prove its allegations by clear and convincing evidence. As stated in the Rulings on Exceptions, this is not a licensure disciplinary proceeding, thus no property right attaches to the Respondent's participation in the Medicaid program.

The Administrative Complaint filed herein contains four counts:

Count I alleges that Respondent's use of grenz ray therapy in children without extraordinary justification, which justification is not documented in the children's medical records, is a departure from established safe medical practice; that the treatments on children were not medically necessary and thus were in excess of the recipients' needs or harmful to the recipients; that Respondent has violated Section 409.266(11)(i), Florida Statutes, in that he has furnished, or ordered the furnishing, to Medicaid recipients of goods or

services which are in excess of the recipients' needs or harmful to the recipients; and that such determination has been made based on competent peer judgment and evaluations.

Count II makes these same allegations as to Respondent's use of grenz ray therapy for adults.

Count III alleges that Respondent's failure to properly document treatment variables is a departure from established safe medical practice; that the treatments which Respondent performed on adult and children Medicaid recipients were not in keeping with the prevailing standard of care and thus were harmful to the recipients or of inferior quality; and that Respondent has violated Section 409.266(11)(i), Florida Statutes, in that he has furnished, or ordered the furnishing, to Medicaid recipients of goods or services which are harmful to the recipients or of inferior quality, such determination having been made based on competent peer judgment and evaluations.

Count IV alleges that Respondent had no signed consent forms in those Medicaid patient records and had no indication in the records that the potential negative effects of ionizing radiation were discussed with the minors' parents or guardians or that the possible harmful effects were discussed with the adult patients; that Respondent's failure to obtain informed consent from patients or the patient's parent or guardian is a departure from established safe medical practice; that such treatments, therefore, were not in keeping with the prevailing standard of care and thus were harmful to the recipients or of inferior quality; and that Respondent has violated Section 409.266(11)(1), Florida Statutes, by furnishing, or ordering the furnishing, to Medicaid recipients of goods or services which are harmful to the recipients or of inferior quality, such determination having been made based on competent peer judgment and evaluations.

As paraphrased by the Department during the final hearing, Count I alleges the treatments were harmful to children; Count II alleges the treatments were harmful to adults; Count III alleges that the records were inferior and therefore the treatments were inferior; and Count IV alleges that there was either no, or there was insufficient, informed consent and that, therefore, the treatments were inferior.

All four counts rely on Section 409.266(11)(i), Florida Statutes, which provides that the Department may impose administrative sanction on a Medicaid provider when:

1. The provider has furnished or ordered the furnishing to a recipient of goods or services which are in excess of his needs, harmful to the recipient, or of inferior quality. Such determinations shall be based on competent peer judgment and evaluations.

Based on the alleged violations the Department sought to impose the administrative sanctions of termination from participation in the Medicaid program and the imposition of fines. The Department had the burden of proving its allegations, and thus establishing a valid basis for the imposition of administrative sanctions, by a preponderance of the evidence. Florida Department of Transportation v. J.W.C. Co., Inc., 396 So. 2d 778 (Fla. 1st DCA 1981).

Although it is my preference to reject the Hearing Officer's conclusion that the evidence failed to establish the Respondent violated the cited portions of the Florida Statutes and Administrative Code, I cannot do so because my conclusion would then be inconsistent with the Hearing Officer's Findings of Fact. I must, therefore, reluctantly accept the Hearing Officer's conclusion that the department failed to meet its burden of proof.

Based upon the foregoing, it is ADJUDGED, that

1. The department has failed to prove that Respondent, Andrew R. Altman, M. D., is in violation of Section 409.266(11)(i), Florida Statutes, as was alleged in Counts I through IV of the Administrative Complaint. Respondent is found not guilty of the alleged violations.

   
   

2. The Administrative Complaint is, therefore, DISMISSED.

DONE and ORDERED this 13th day of May, 1992, in Tallahassee, Florida.

Robert B. Williams, Secretary Department of Health and

Rehabilitative Services

by Deputy Secretary for Human

Services

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF HRS, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.

Copies furnished to:

David G. Pius, Esquire Medicaid Counsel

1317 Winewood Boulevard

Building 6, Room 233

Tallahassee, FL 32399-0700

Linda M. Rigot Hearing Officer

DOAH, The DeSoto Building 1230 Apalachee Parkway

Tallahassee, FL 32399-1550

Salvatore A. Carpino, Esquire

1 North Dale Mabry, Suite 1010 Tampa, FL 33609

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a copy of the foregoing was sent to the above named people by U. S. Mail this 19th day of May, 1992.

R. S. Power, Agency Clerk Assistant General Counsel Department of Health and

Rehabilitative Services 1323 Winewood Boulevard Building One, Room 407 Tallahassee, FL 32399-0700

(904)488-2381

Docket for Case No: 91-003487

Orders for Case No: 91-003487