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Tsirelman v. Daines

United States District Court, E.D. New York

May 14, 2014

GARY TSIRELMAN, M.D., Plaintiff, -
v.
- RICHARD F. DAINES, M.D., Commissioner of Health, New York State Department of Health; and New York State Department of Health; and Kendrick A. Sears, M.D., Chairman of the State Board For Professional Medical Conduct, New York State Department of Health, and State Board For Professional Medical Conduct and their employees and agents, Defendants

Decided May 13, 2014.

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For Plaintiff: Adam Francois Watkins, Clifford Y. Chen, Watkins, Bradley & Chen LLP, New York, NY; Julia Paskalova, Esq., Gary Tsirelman P.C., Brooklyn, NY.

For Defendants: Kathryn E. Leone, Erick T. Schneiderman, Attorney General of the State of New York, New York, New York.

OPINION

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MEMORANDUM, ORDER & JUDGMENT

Jack B. Weinstein, Senior United States District Judge.

I. Introduction

II. Background

A. New York State Public Health Law § 230

B. Plaintiff's Disciplinary Hearing

C. Plaintiff's State Court Appeal

D. Plaintiff's Subsequent Applications to Department

III. Standard of Review

A. Rule 12(b)(6) Failure to State Claim

B. Rule 12(b)(1) Lack of Subject Matter Jurisdiction

IV. Law

A. Facial vs. As-Applied Challenges

B. Procedural Due Process

C. Preclusion

V. Application of Law to Fact

A. Claims against Agency Defendants Dismissed

B. Challenge to Preponderance Standard

1. Facial Challenge

2. As-Applied Challenge

C. Challenge to Evidentiary Rules

1. Facial Challenge

2. As-Applied Challenge

D. Challenge to Rules Governing Reconsideration

1. Facial Challenge

2. As-Applied Challenge

VI. Conclusion

I. Introduction

Plaintiff Gary Tsirelman's license to practice medicine was revoked by the State of New York. He alleges due process violations. See 42 U.S.C. § § 1983 and 1988. He claims: (1) the preponderance evidentiary standard required at revocation hearings and the imposition of a fine were unconstitutional; (2) the lack of specific evidentiary rules violates due process; and (3) due process requires an automatic mechanism for reconsideration of changes in the law designed to improve fairness in the administrative process.

Defendants Richard F. Daines, M.D., Commissioner of Health, New York State Department of Health; New York State Department of Health; Kendrick A. Sears, M.D., Chairman of the State Board for Professional Medical Conduct, New York State Department of Health; and State Board for Professional Medical Conduct and their employees and agents (" defendants" ) move for dismissal of the complaint.

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See Fed.R.Civ.P. 12(b)(1) and (6). They maintain tat plaintiff's facial and as-applied challenges are meritless. They argue that federal precedents support a preponderance standard, and that New York courts have consistently upheld the preponderance standard in physician disciplinary proceedings.

There is considerable force to plaintiff's position that a physician, after years of training and developing skills, should not be driven from practice on less than an overwhelming probability that he was guilty of serious misconduct demonstrated with the most meticulous procedural protections. On balance the state's policy, based on the need for the public's protection from cheating physicians who add to the high costs of medical care--even if their curative treatment is effective--requires strict enforcement with procedures that provide only reasonable, rather than the highest, protections. In the instant case, the procedures utilized in revoking plaintiff's medical license resulted in an adequate demonstration that he was cheating regularly in his billings.

The New York physician disciplinary proceedings comports with due process and plaintiff's as-applied challenges are insufficient. The motion to dismiss the complaint is granted.

II. Background

This action arises from a determination by the New York State Department of Health (" Department" ), based on charges of professional misconduct, revoking plaintiff's medical license and imposing a $100,000 fine. The detailed procedural history and factual background of this case is incorporated in the present memorandum. See Tsirelman, M.D., v. Daines, M.D. et al., 10-CV-0903, ECF No. 32, (E.D.N.Y. Oct. 14, 2010).

A. New York State Public Health Law § 230

New York State Public Health Law § 230(10) sets forth the process for determining professional misconduct by physicians in New York. Initial investigations are conducted by the Department of Health Office of Professional Medical Conduct (" OPMC" ). See N.Y. Pub. Health Law § 230(10)(a). In consultation with a physician from the State Board for Professional Medical Conduct, the OPMC Director then determines whether to commence disciplinary proceedings. Id. The licensee is given notice of the charges and an opportunity to contest. Id. § 230(10)(c),(d).

Attorneys from the Bureau of Professional Medical Conduct (" BPMC" ), an office within the Division of Legal Affairs of the Department of Health, prosecute the charges before an Administrative Law Judge (" ALJ" ) and a Hearing Committee of the Board of Professional Medical Conduct (" Committee" ). The Committee is comprised of two licensed physicians and one lay member appointed from the State Board for Professional Medical Conduct. Id. § 230(1)-(7), (10)(e). The ALJ presides over the hearing but has no vote. Id.

At the hearing, physicians are entitled to: counsel; examination of all evidence; production of their own expert and fact witnesses; other evidence on their behalf; issuance of subpoenas for the production of witnesses and evidence; and cross-examination of opposing witnesses. See id. § 230(10)(c).

A decision containing findings of fact, the action to be taken, and supporting reasons must be rendered within 60 days of the hearing's conclusion. The Committee is not bound by the rules of evidence, but a decision to sustain charges must be

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based on a preponderance of the evidence. Id. § 230(10)(f). If any charges are sustained, the Committee imposes a penalty. Id. § 230(10)(i).

Either party may seek administrative review of the Committee's decision, or commence litigation challenging the administrative decision. See C.P.L.R. article 78; N.Y. Pub. Health Law § 230-c.

At any time subsequent to the conclusion of the professional misconduct proceeding, the physician may petition the OPMC Director for limited post-final administrative review. Id. § 230(10)(q). Specifically, section 230(10)(q) of the Public Health Law provides:

At any time subsequent to the final conclusion of a professional misconduct proceeding against a licensee, whether upon the determination and order of a hearing committee . . . the licensee may file a petition with the director, requesting vacatur or modification of the determination and order. The director shall, after reviewing the matter and after consulting with department counsel, determine in the reasonable exercise of his or her discretion whether there is new and material evidence that was not previously available which, had it been available, would likely have led to a different result, or whether circumstances have occurred subsequent to the original determination that warrant a reconsideration of the measure of discipline. Upon determining that such evidence or circumstances exist, the director shall have the authority to join the licensee in an application to the chairperson of the state board for professional medical conduct to vacate or modify the determination and order, as the director may deem appropriate. Upon the joint application of the licensee and the director, the chairperson shall have the authority to grant or deny such application.

Id. (emphasis added).

B. Plaintiff's Disciplinary Hearing

In 2007 the OPMC initiated professional misconduct proceedings against plaintiff. He was charged with: engaging in the fraudulent practice of medicine by billing an insurance company for medical procedures that he did not perform; submitting false reports that he had performed these procedures; ordering tests and treatments that were excessive or inappropriate in light of a patient's condition; and moral unfitness to practice medicine. Compl. ¶ ¶ 17, 18, 32.

In accordance with New York Public Health Law § 230, the Committee conducted an evidentiary hearing on the charges. A pre-hearing conference was held on March 20, 2013. In the Matter of Gary Tsirelman, M.D., Determination & Order, BPMC 07-269 (Dep't of Health Dec. 5, 2007), Spiegelman Decl. Ex. 1 at 2, ECF No. 49. The hearing commenced on March 27, 2007, and was continued on April 27, May 25, June 1, June 22 and August 14, 2007. Id. Plaintiff contends uncertified and incomplete patient records were admitted into evidence during the hearing and the Department's medical expert, Dr. Carfi, relied upon those records in his testimony. Compl. ¶ 26.

In March 2007, plaintiff requested that OPMC produce a complaint made by Allstate Insurance Company to OPMC regarding plaintiff's billing practices and the " exculpatory" materials attached. The OPMC prosecutor supplied these materials, but disputed their characterization as exculpatory. Nemerson Decl., ECF No. 49, Ex. 4. In June 2007, plaintiff contended that the production was untimely and moved to: (1) strike the Allstate insurance investigator's testimony or allow additional

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cross-examination; and (2) order OPMC to turn over its entire investigatory /prosecution file. Id. The presiding ALJ denied the motion. Id.

On December 5, 2007, the Committee issued a Determination and Order holding that plaintiff had engaged in the fraudulent practice of medicine. The preponderance of the evidence standard, prescribed by New York Public Health Law § 230(10)(f), was applied. The Committee's conclusion was based, in part, on plaintiff's own testimony that he did not perform 'nerve destruction procedures' (NDP), the work for which he billed an insurance company. Compl. ¶ ¶ 18, 21, 32. Acknowledging that it may not have had the complete medical records before it, the Committee found:

Even though we found [Plaintiff's] testimony completely lacked credibility, we gave [him] the benefit of the doubt where there was even a slight possibility that the 'missing information' (if it ever existed) would have helped [his] position. As an example, we did not conclude that if it was not documented, it was not done, which is normally a rational and accepted conclusion to make.

Spiegelman Decl., ECF No. 49, Ex. 1 at 46. Accordingly, the Committee dismissed charges that plaintiff billed for certain unperformed services. Id.

The Committee revoked plaintiff's medical license and fined him $100,000. In the Matter of Gary Tsirelman, M.D., Determination & Order, BPMC 07-269 (Dep't of Health Dec. 5, 2007), Spiegelman Decl. Ex. 1 at 52-23.

C. Plaintiff's State Court Appeal

Plaintiff challenged the defendants' action in an Article 78 proceeding in the Appellate Division, Third Department. See N.Y. PHL § 230-c(5). He contended that he was deprived of a fair hearing by the introduction of incomplete and uncertified medical records. Compl. ¶ 35.

On April 9, 2009, the Appellate Division rejected plaintiff's due process claim. It affirmed the revocation and fine. Compl. ...


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