Opinion
No. 1107 C.D. 2011
03-14-2012
Monica L. Cozzone, D.O., Petitioner v. Department of Public Welfare, Respondent
BEFORE: HONORABLE DAN PELLEGRINI, President Judge HONORABLE PATRICIA A. McCULLOUGH, Judge HONORABLE ANNE E. COVEY, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY JUDGE COVEY
Monica L. Cozzone, D.O. (Dr. Cozzone) petitions this Court for review of the May 19, 2011 Order of the Department of Public Welfare (DPW) adopting the recommendation of the Administrative Law Judge (ALJ) denying Dr. Cozzone's appeal of a decision of DPW's Office of Medical Assistance Programs (OMAP) to terminate Dr. Cozzone's provider agreement, to preclude Dr. Cozzone from participation in the medical assistance (MA) program for four years, and to direct Dr. Cozzone to make restitution to DPW. Dr. Cozzone essentially presents four issues for this Court's review: (1) whether the findings of fact and credibility determinations of the ALJ are illegal, arbitrary and capricious; (2) whether DPW erred as a matter of law by disregarding medical necessity evidence; (3) whether DPW erred by disregarding uncontroverted evidence of record; and (4) whether DPW erred as a matter of law by imposing sanctions against Dr. Cozzone. We affirm.
BACKGROUND
The DPW is the state agency that administers Pennsylvania's MA program pursuant to Section 101.1(e) of DPW's regulations, 55 Pa. Code § 101.1(e). Under the MA program, DPW pays for various medical services and items that are provided to, or ordered for MA recipients by medical practitioners, including osteopaths, who are enrolled MA providers. The Bureau of Program Integrity (BPI) is a bureau within DPW that is responsible for monitoring MA providers to ensure that the services they render to MA recipients and the medical records that they keep to document those services comply with MA regulations. In monitoring MA providers, BPI is responsible for reviewing information on claims for services rendered that have been billed to and paid for by DPW, and when reviewing that information, looks for patterns of non-compliance with MA regulations.
In 2001, BPI conducted an MA claims data analysis. During the time period covered by BPI's analysis, Dr. Cozzone was a general practitioner who maintained a family practice in Exeter, Pennsylvania, a small town located north of Wilkes-Barre in northeastern Pennsylvania. BPI learned from its MA claims data analysis in 2001 that, out of the 40,000 physicians who were enrolled MA providers, including 50 to 100 pain management specialists, Dr. Cozzone was the fifth largest prescriber of OxyContin in Pennsylvania. BPI also found that Dr. Cozzone prescribed more OxyContin than every pain management specialist, every orthopedic surgeon, every rheumatologist, and every oncologist who prescribed drugs for MA recipients during the period of review. In 2002, BPI directed two of its physician consultants, including Mark Bates, M.D. (Dr. Bates), to examine Dr. Cozzone's medical records for approximately 15 to 20 patients from September 1999 through April 2001. From the analysis and examination, BPI concluded that Dr. Cozzone violated MA regulations in providing and documenting treatment for 18 MA patients, and that sanctions against her could be appropriate.
FACTS
On November 8, 2002, by Notice of Proposed Sanctions, DPW informed Dr. Cozzone of the results of its review, including the regulations BPI determined Dr. Cozzone had violated. DPW further informed Dr. Cozzone that, based on these regulatory violations, DPW intended to terminate her provider agreement, preclude her participation in the MA Program for a period of four years, and recover restitution in the amount of $86,745.09. On June 18, 2004, by Notice of Sanctions, DPW notified Dr. Cozzone that her provider agreement was, in fact, terminated and her participation in the MA Program was precluded for a period of four years, effective in 30 days. That same letter demanded restitution in the amount of $70,342.14. On December 30, 2004, DPW sent a corrected notice to Dr. Cozzone that limited the basis for its sanctions. As a result of these limitations, DPW reduced its restitution demand to $50,397.31.
Dr. Cozzone timely appealed from the Notice of Sanctions. On January 20, 2011, after a 12-day trial, the ALJ recommended that the appeal be denied. On May 19, 2011, the DPW adopted the recommendation of the ALJ in its entirety. Dr. Cozzone appealed to this Court.
"Our scope of review in an appeal of an adjudication of DPW is limited to determining whether constitutional rights were violated, an error of law was committed, or necessary findings of fact are not supported by substantial evidence." Burroughs v. Dep't of Pub. Welfare, 606 A.2d 606, 607 (Pa. Cmwlth. 1992).
Dr. Cozzone argues that the ALJ's findings of fact and credibility determinations are illegal, arbitrary and capricious. Specifically, she contends: the ALJ who authored the Adjudication, Recommendation and Order was not present at the 12-day trial, thereby rendering invalid and illegal the substituted ALJ's credibility determinations; the decision to find DPW's expert more credible than Dr. Cozzone's expert was an error of law, and arbitrary and capricious; and credibility determinations of Dr. Bates over Dr. Cozzone were arbitrary and capricious. We disagree.
Dr. Cozzone's first issue has been decided by this Court in Siemon's Lakeview Manor Estate v. Department of Public Welfare, 703 A.2d 551 (Pa. Cmwlth. 1997), wherein the petitioner argued that the Secretary of DPW does not have the authority to reverse the Director of the Office of Hearings and Appeals on factual issues. The petitioner in that case specifically argued that the attorney examiner is in the best position to judge the credibility and demeanor of witnesses and to review the evidence. However, in that case, as here, the attorney examiner was not present at the hearings. The Court held that:
Although the Director and the Secretary are not in a position to assess the behavior and demeanor of the witnesses who testify before the attorney examiner, we recognized in G.S. [v. Department of Public Welfare, 521 A.2d 87 (Pa. Cmwlth. 1987)] that a statutory scheme where the Secretary or his designee is vested with final fact-finding authority is not unusual in Pennsylvania. Also, DPW asserts that neither the Director, the Secretary or the attorney examiner who made the recommendation in this case was in any better position to function as the fact finder here because the evidence was heard by another attorney examiner. None of the three individuals who reviewed the facts in the instant case saw or heard the testimony of the witnesses. Therefore, [Petitioner's] attempt to maintain a distinction between the fact-finding authority of the Secretary, who appoints the Director to act on her behalf, and the Director in provider appeals is a distinction that we must reject in light of the administrative scheme established by our General Assembly.Id., 703 A.2d at 555 (footnote omitted). Clearly, attendance at the hearings is not a requirement for fact-finding or making credibility determinations. Thus, Dr. Cozzone's argument that the determinations of the ALJ are invalid because the ALJ did not attend the hearings is meritless.
Dr. Cozzone next argues that DPW erred as a matter of law by capriciously disregarding medical necessity evidence. Specifically, she contends that because Dr. Bates' admissions on cross-examination eviscerated his statements on direct examination, and Dr. Cozzone's uncontroverted testimony was ignored, the decision lacks substantial evidence and must be reversed. We disagree.
Initially, we recognize that "where the party with the burden of proof is the only party to present evidence before the administrative tribunal and fails to prevail, our standard of review is whether the tribunal capriciously disregarded competent evidence." Siemon's, 703 A.2d at 555-56. However, because both parties presented evidence in the instant case, the issue is not whether DPW disregarded evidence, but whether the DPW's findings are supported by substantial evidence. Lehigh Cnty. Office of Children & Youth Servs. v. Dep't of Pub. Welfare, 550 A.2d 269 (Pa. Cmwlth. 1988). "'Substantial evidence' is evidence which outweighs inconsistent evidence and which a reasonable person would accept as adequate to support a conclusion. In addition, it is within the discretion of the fact-finder to make credibility determinations and these determinations will not be disturbed on appeal." Mazzitti & Sullivan Counseling Servs., Inc. v. Dep't of Pub. Welfare, 7 A.3d 875, 882 n.5 (Pa. Cmwlth. 2010) (citation omitted).
Section 1101.51 (e)(1)(x) of DPW's regulation, 55 Pa. Code § 1101.51 (e)(1)(x), requires a provider to keep patient records that "contain documentation of the medical necessity of a rendered, ordered or prescribed service." (Emphasis added).
The term 'medically necessary' means: A service, item, procedure or level of care that is: (i) Compensable under the Medical Assistance Program. (ii) Necessary to the proper treatment or management of an illness, injury or disability. (iii) Prescribed, provided or ordered by an appropriate licensed practitioner in accordance with accepted standards of practice.Devereux Hosp. Texas Treatment Network (Timbers) v. Dep't of Pub. Welfare, 878 A.2d 967, 970-71 (Pa. Cmwlth. 2005).
Here, Dr. Bates, DPW's expert witness, testified that he reviewed the medical records for Dr. Cozzone's patient, J.K., for whom she prescribed OxyContin and duragesic. J.K. saw Dr. Cozzone 16 times between September 13, 1999 and January 8, 2001. Dr. Bates concluded that Dr. Cozzone's records did not contain documentation of medical necessity to prescribe OxyContin and duragesic for any of those visits. Notes of Testimony (N.T.), March 26, 2008 at 193, 196, 198-99, 201, 204, 206-7, 209, 211, 213, 215, 216-17, 219, 220-21, 224-25, 231, 240. Dr. Bates further described his reasons for each specific conclusion.
J.K. subsequently died of a drug overdose although it is contested which drug caused his death.
Regarding Dr. Cozzone's patient, J.H., Dr. Bates testified that he reviewed J.H.'s medical records from February 24, 2000 through March 28, 2001, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin for any of those visits. N.T., March 26, 2008 at 279-90, 281, 283, 286, 288-89, 289-90, 291, 293, 305. Dr. Bates further described his reasons for each specific conclusion.
With respect to Dr. Cozzone's patient, H.M., Dr. Bates testified that he reviewed H.M's medical records from April 11, 2000 through February 27, 2001, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 27, 2008 at 19-20, 23-24, 26, 27, 28, 31, 32-33, 33-34, 35, 36, 39. Dr. Bates further explained his reasons for each specific conclusion.
Concerning Dr. Cozzone's patient, C.R., Dr. Bates testified that he reviewed C.R.'s medical records from March 1, 2000 through April 2, 2001, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 27, 2008 at 42, 46-47, 49-50, 56, 58, 62-63, 66, 73, 83. Dr. Bates further explained his reasons for each specific conclusion.
Concerning Dr. Cozzone's patient, H.K., Dr. Bates testified that he reviewed H.K.'s medical records from September 13, 1999 through December 13, 2000, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 27, 2008 at 104, 107-8, 112-13, 117, 124, 127-28, 129, 133. Dr. Bates further explained his reasons for each specific conclusion.
Dr. Bates further testified that he reviewed the medical records of Dr. Cozzone's patient, P.W., from November 17, 1999 through November 29, 2000, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 27, 2008 at 160, 163, 165-66, 168, 170, 172, 174-75, 176-77, 179, 180, 182, 186, 188, 189, 191-92. Dr. Bates explained his reasons for each specific conclusion.
Regarding Dr. Cozzone's patient, M.H., Dr. Bates testified that he reviewed M.H.'s medical records from September 14, 2000 through March 15, 2001, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 27, 2008 at 207, 223, 225, 227, 228-29, 230. Dr. Bates explained his reasons for each specific conclusion.
With respect to Dr. Cozzone's patient, L.W., Dr. Bates testified that he reviewed L.W.'s medical records from November 8, 2000 through March 14, 2001, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 27, 2008 at 237-38, 239, 240-41, 242. Dr. Bates explained his reasons for each specific conclusion.
Concerning Dr. Cozzone's patient, G.L., Dr. Bates testified that he reviewed G.L.'s medical records from August 17, 2000 through March 19, 2001, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 27, 2008 at 253-54, 261, 263, 263-64, 264-65, 266. Dr. Bates explained his reasons for each specific conclusion.
Concerning Dr. Cozzone's patient, M.D., Dr. Bates testified that he reviewed M.D.'s medical records from January 10, 2001 through March 2, 2001, and concluded that the records did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 27, 2008 at 270, 273, 274, 277. Dr. Bates explained his reasons for each specific conclusion.
Lastly, Dr. Bates testified that he reviewed the medical records of Dr. Cozzone's patient, M.P., from July 7, 2000 through March 14, 2001, and concluded that they did not contain documentation of medical necessity to prescribe OxyContin. N.T., March 28, 2008 at 13, 14-15, 17, 25-26, 30, 32, 34, 37, 39, 40. Dr. Bates explained his reasons for each specific conclusion.
The ALJ specifically found Dr. Bates more credible than both Dr. Cozzone and Dr. Cozzone's expert, Dr. Wilson. ALJ op. at 42-43. The ALJ enumerated specific findings supporting these credibility determinations. See ALJ op. at 20-22. As the ALJ found Dr. Bates most credible, and the above-cited testimony of Dr. Bates clearly supports the ALJ's conclusion that Dr. Cozzone's medical records did not contain documentation of medical necessity for prescribing OxyContin to those patients, the ALJ's decision is supported by substantial evidence. Accordingly, the DPW did not err by adopting the decision of the ALJ in its entirety.
This Court notes that although Dr. Bates withstood vigorous cross-examination by Dr. Cozzone, he never recanted his testimony or changed his opinion that Dr. Cozzone's medical records lacked documentation to substantiate medical necessity for prescribing OxyContin to her patients.
Dr. Cozzone also argues that the DPW erred as a matter of law by disregarding uncontroverted record evidence establishing Dr. Cozzone's prescriptions were not of an inferior quality, that her documentation taken as a whole demonstrated the prescriptions were medically necessary, that the services were not contraindicated, thus Dr. Cozzone materially complied with Sections 1101.77(a)(10) and 1101.51(d)(3) of DPW's regulations, 55 Pa. Code §§ 1101.77(a)(10), 1101.51(d)(3). We disagree.
Section 1101.77(a)(10) of DPW's regulations, 55 Pa. Code § 1101.77(a)(10), provides that the DPW may terminate a provider's enrollment and direct and indirect participation in the MA Program, and seek restitution, if it determines that a provider has: "Rendered or ordered services or items which the Department's medical professionals have determined to be harmful to the recipient, of inferior quality or medically unnecessary." Section 1101.51(d)(3) of DPW's regulations, 55 Pa. Code § 1101.51(d)(3), provides: "Treatment, including prescribed drugs, shall be appropriate to the diagnosis."
Dr. Bates specifically testified to each and every entry in Dr. Cozzone's medical records concerning the specific patients to whom Dr. Cozzone prescribed OxyContin between September 1999 and April 2001. None of the evidence presented in the 12 days of hearings was uncontested. To the contrary, all of the evidence was greatly disputed. The ALJ, however, found Dr. Bates more credible than Dr. Cozzone or her expert and, therefore, accepted his testimony. Dr. Bates' testimony provided substantial evidence to support the findings that Dr. Cozzone's prescriptions were of an inferior quality, that she did not demonstrate through documentation that the prescriptions were medically necessary, that the services were contraindicated, and that Dr. Cozzone did not comply with Sections 1101.77(a)(10) and 1101.51(d)(3) of DPW's regulations. Accordingly, DPW did not err by adopting the decision of the ALJ in its entirety.
Dr. Cozzone next argues that DPW erred as a matter of law by imposing sanctions against her. Specifically, Dr. Cozzone contends that DPW's recoupment regulation is beyond the scope of the Public Welfare Code (PWC), is an unreasonable exercise of bureaucratic authority, and is plainly and palpably unconstitutional in violation of Article I, §1 of the Pennsylvania Constitution. We disagree.
Act of June 13, 1967, P.L. 31, as amended, 62 P.S. §§ 101-1503.
Section 1101.83 of DPW's regulation, 55 Pa. Code § 1101.83, provides, in pertinent part:
(b) The Department may seek reimbursement from the ordering or prescribing provider for payments to another provider, if the Department determines that the ordering or prescribing provider has done either of the following:(Emphasis added). Section 1410 of the PWC, 62 P.S. § 1410, provides: "The [DPW] shall have the power and its duty shall be to adopt rules and regulations to carry out the provisions of this article [Article XIV (Fraud and Abuse Control)]." Moreover, Section 1407 of the PWC, 62 P.S. § 1407, provides in pertinent part:
(1) Prescribed excessive diagnostic services; or
(2) Ordered diagnostic services or treatment or both, without documenting the medical necessity for the service or treatment in the medical record of the MA recipient.
(a) It shall be unlawful for any person to:(Emphasis added).
(1) Knowingly or intentionally present for allowance or payment any false or fraudulent claim or cost report for furnishing services or merchandise under medical assistance, or to knowingly present for allowance or payment any claim or cost report for medically unnecessary services or merchandise under medical assistance, or to knowingly submit false information, for the purpose of obtaining greater compensation than that to which he is legally entitled for furnishing services or merchandise under medical assistance, or to knowingly submit false information for the purpose of obtaining authorization for furnishing services or merchandise under medical assistance.
Because Article XIV of the PWC provides that it is unlawful to present a claim for medically unnecessary services, and Section 1410 of the PWC gives the DPW authority to adopt regulations to carry out this provision, we cannot see how 55 Pa. Code § 1101.83 is in any way at variance with the PWC. Northern Area Personal Care Home Adm'rs Ass'n v. Dept. of Pub. Welfare, 899 A.2d 1182 (Pa. Cmwlth. 2006).
Article 1, Section 1, of the Pennsylvania Constitution provides: "All men are born equally free and independent, and have certain inherent and indefeasible rights, among which are those of enjoying and defending life and liberty, of acquiring, possessing and protecting property and reputation, and of pursuing their own happiness." Pa. Const. art. I, § 1. Requiring reimbursement for failure to perform a prescribed act for the protection of others, i.e., documenting the medical necessity of prescribing OxyContin, does not in any way infringe on any of the above-stated inherent and indefeasible rights. "[A] statute is presumed to be constitutional and a party challenging the constitutionality of a statute has a heavy burden of persuasion." Allied Mechanical and Electrical, Inc. v. Pa. Prevailing Wage Appeals Bd., 923 A.2d 1220, 1229 (Pa. Cmwlth. 2007). Dr. Cozzone presented no evidence to meet that burden. Accordingly, the DPW did not err in ordering sanctions against Dr. Cozzone pursuant to Section 1101.83 of DPW's regulations.
For all of the above reasons, the DPW's order is affirmed.
/s/_________
ANNE E. COVEY, Judge
ORDER
AND NOW, this 14th day of March, 2012, the May 19, 2011 Order of the Department of Public Welfare is affirmed.
/s/_________
ANNE E. COVEY, Judge