[Federal Register Volume 62, Number 126 (Tuesday, July 1, 1997)]
[Notices]
[Pages 35527-35529]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-17152]


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DEPARTMENT OF JUSTICE

Drug Enforcement Administration
[Docket No. 96-37]


Joseph M. Piacentile, M.D.; Revocation of Registration

    On June 25, 1996, the Deputy Assistant Administrator, Office of 
Diversion Control, Drug Enforcement Administration (DEA), issued an 
Order to Show Cause to Joseph M. Piacentile, M.D., (Respondent) of 
Yardley, Pennsylvania and Basking Ridge, New Jersey, notifying him of 
an opportunity to show cause as to why DEA should not revoke his DEA 
Certificates of Registration, BP1786853 and BP2526056, pursuant to 21 
U.S.C. 824 (a)(4) and (a)(5), and deny any pending applications for 
renewal of such registrations as a practitioner under 21 U.S.C. 823(f).
    By letter dated July 15, 1996, Respondent, proceeding pro se, filed 
a request for a hearing, and following prehearing procedures, a hearing 
was held in New York, New York on November 20, 1996, before 
Administrative Law Judge Gail A. Randall. At the hearing, the 
Government called a witness to testify and introduced documentary 
evidence. Respondent made a brief opening statement, but did not 
testify under oath nor offer any documentary evidence. After the 
hearing, Government counsel and Respondent submitted proposed findings 
of fact, conclusions of law and argument. On March 26, 1997, Judge 
Randall issued her Opinion and Recommended Ruling, recommending that 
Respondent's DEA Certificates of Registration be revoked. Neither party 
filed exceptions to her decision, and on May 5, 1997, Judge Randall 
transmitted the record of these proceedings to the Acting Deputy 
Administrator.
    The Acting Deputy Administrator has considered the record in its 
entirety, and pursuant to 21 CFR 1316.67, hereby issues his final order 
based upon findings of fact and conclusions of law as hereinafter set 
forth. The Acting Deputy Administrator adopts, in full, the Opinion and 
Recommended Ruling of the Administrative Law Judge, and his adoption is 
in no manner diminished by any recitation of facts, issues and 
conclusions herein, or of any failure to mention a matter of fact or 
law.
    The Acting Deputy Administrator finds that Respondent is currently 
registered with DEA in both Pennsylvania and New Jersey. In January 
1985, the Department of Health and Human Services, Office of the 
Inspector General initiated an investigation of Electro Therapeutics 
(ETI) after receiving hundreds of complaints from Medicare patients 
concerning medical equipment they had received from ETI. Respondent was 
the President of ETI and was responsible for ETI's sales force.
    ETI distributed transcutaneous electrical nerve stimulator units 
(TENS units), TENS accessory kits, and lymphedema pumps. Both the TENS 
unit and the lymphedema pump must be prescribed by a physician in order 
for Medicare to pay for the equipment. Further, Medicare requires that 
a physician assess a patient's use of a TENS unit for 30 days prior to 
authorizing the purchase of the device. In addition, Medicare had very 
specific diagnoses criteria. If a patient did not have a condition 
covered by one of these criteria, Medicare would not authorize the 
purchase of the unit. TENS accessory kits also required a prescription, 
and were only authorized for distribution every three months.
    Between 1984 and September 1987, ETI billed Medicare $49 million 
for this equipment, $22 million of which was actually paid to ETI for 
over 22,000 separate beneficiaries. In an attempt to verify the 
validity of claims submitted by ETI to Medicare, agents interviewed a 
number of the Medicare beneficiaries who had received equipment from 
ETI and physicians whose signatures had served as authorization for the 
distribution of the medical equipment. The investigation revealed that 
ETI distributed these units by either sending out sales representatives 
to ``health fairs'' held at supermarkets, senior citizen centers or 
banks, or through arrangements with specific geriatric physicians 
whereby the sales representatives would demonstrate the use of the 
equipment at the physicians' offices. ETI would then obtain a 
physicians's signature on a prescription, telling the physician that 
the patient wanted the equipment.
    However, the patients were told that the equipment was a free gift 
from Medicare. After learning that Medicare was in fact billed for the 
equipment, the patients complained because they stated that had they 
known there would be a charge for the equipment, they would not have 
accepted it. The investigation

[[Page 35528]]

further revealed that the patients were not assessed for 30 days by a 
physician before ETI submitted a claim to Medicare for the purchase of 
the equipment, but that ETI personnel were altering the dates on the 
prescriptions. It was also determined that ETI personnel were giving 
patients three to four TENS accessary kits at a time, and altering the 
dates on the prescriptions that accompanied the Medicare claim forms.
    Given the volume of claims, the agents were unable to investigate 
the validity of each and every claim. It was determined however, that 
$3.7 million of the $22 million that was reimbursed by Medicare were 
false claims that had been altered by ETI personnel. It was the case 
agent's opinion that 99% of the $22 million in claims were medically 
unnecessary, as the equipment was provided to patients who did not have 
a condition that would have caused reimbursement by Medicare.
    Following the investigation, Respondent pled guilty in the United 
States District Court for the Southern District of New York to one 
count of conspiracy to make false statements in claims against 
Medicare, in violation of 18 U.S.C. 371, and to one count of income tax 
evasion, in violation of 26 U.S.C. 7201. As a result of his conviction, 
by letter dated December 15, 1994, the Department of Health and Human 
Services, Office of Inspector General, notified Respondent that he was 
excluded from participating in the Medicare, Medicaid, Maternal and 
Child Health Services Block Grant and Block Grants to States for Social 
Services programs for a period of fifteen years pursuant to 42 U.S.C. 
1320a-7(a). Subsequently, on May 28, 1996, Respondent and the Inspector 
General of the Department of Health and Human Services entered into a 
stipulation, whereby Respondent would be excluded, effective January 4, 
1995, from participation in the Medicare and Medicaid programs for a 
period of thirteen years, or until January 4, 2008. In addition, the 
stipulation included a provision whereby Respondent agreed not to 
further contest ``now or in the future'' his exclusion from the 
Medicare and Medicaid programs.
    On October 31, 1995, Respondent entered into a Consent Order with 
the State of New Jersey, Department of Law and Public Safety, Division 
of Consumer Affairs, State Board of Medical Examiners (New Jersey 
Board). The new Jersey Board found that Respondent had engaged in 
conduct which represented ``crimes of moral turpitude,'' and ordered 
that Respondent's license to practice medicine and surgery in New 
Jersey be suspended for 21 months, the first three months to be served 
as an active suspension, and the remaining 18 months to be served as a 
period of probation. On May 11, 1995, the Commonwealth of Pennsylvania, 
Department of State, State Board of Medicine (Pennsylvania Board) and 
Respondent entered into a Consent Agreement. The Pennsylvania Board 
ordered, among other things, that Respondent's license to practice 
medicine and surgery in Pennsylvania be suspended for a period of two 
years, six months of which to be an active suspension, and the 
remaining 18 months suspension to be stayed in favor of probation 
subject to various conditions.
    The Deputy Administrator may revoke or suspend a DEA Certificate of 
Registration under 21 U.S.C. 824(a), upon a finding that the 
registrant:
    (1) Has materially falsified any application filed pursuant to or 
required by this subchapter or subchapter II of this chapter;
    (2) Has been convicted of a felony under this subchapter or 
subchapter II of this chapter or any other law of the United States, or 
of any State relating to any substance defined in this subchapter as a 
controlled substance;
    (3) Has had his State license or registration suspended, revoked, 
or denied by competent State authority and is no longer authorized by 
State law to engage in the manufacturing, distribution, or dispensing 
of controlled substances or has had the suspension, revocation, or 
denial of his registration recommended by competent State authority;
    (4) Has committed such acts as would render his registration under 
section 823 of this title inconsistent with the public interest as 
determined under such section; or
    (5) Has been excluded (or directed to be excluded) from 
participation in a program pursuant to section 1320a-7(a) of Title 42.
    As noted by Judge Randall, the Order to Show Cause and the 
statement of the issue agreed to by the parties both alleged that 
subsections (4) and (5) of 21 U.S.C. 824(a) provide the basis for the 
revocation of Respondent's DEA Certificates of Registration. However, 
the Government did not present any evidence nor argue in its post-
hearing filing that Respondent's continued registration would be 
inconsistent with public interest pursuant to 21 U.S.C. 824(a)(4). 
Therefore, the Acting Deputy Administrator agrees with Judge Randall's 
conclusion ``that the Government has waived the position that a basis 
for revocation exists under 21 U.S.C. Sec. 824(a)(4) in this matter.'' 
Consequently, subsection (5) of 21 U.S.C. 824(a) provides the sole 
basis for the revocation of Respondent's DEA Certificates of 
Registration.
    Pursuant to 42 U.S.C. 1320a-7(a), Respondent has been excluded from 
the Medicare and Medicaid programs for 13 years, or until January 4, 
2008. The Government argues that based upon this exclusion, 
Respondent's registrations should be revoked. Respondent did not 
dispute that he has been excluded from the Medicare and Medicaid 
programs. He did not offer any evidence into the record regarding why 
his registration should not be revoked. Instead, Respondent argued that 
the Government had failed to meet its burden of proof that Respondent's 
continued registration would be inconsistent with the public interest.
    As discussed above, the issue of whether Respondent's continued 
registration would be inconsistent with the public interest was not 
pursued by the Government as a basis for revocation. Instead, the 
Government has presented evidence that Respondent has been excluded 
from the Medicaid and Medicare programs pursuant to 42 U.S.C. 1320a-
7(a). Therefore, the Government has met its burden of proving that 
grounds exist under 21 U.S.C. 824(a)(5) for revoking Respondent's DEA 
Certificates of Registration. Respondent did not present any evidence 
as to why his registrations should not be revoked based upon his 
exclusion from such programs. Respondent did argue that ``DEA had 
effectually suspended his prescribing privileges, by withholding his 
renewal, without the benefit of a Court ruling, to the detriment of his 
patients and their well-being. This constitutes punishment without due 
process and should be considered by the Court.'' However, as Judge 
Randall noted, ``the record contains no evidence, such as a denied 
application for renewal, to support this factual assertion.''
    Judge Randall stated that ``given the lack of rehabilitation 
evidence, I conclude that circumstances do not exist to deviate from 
the statutory purpose in this case,'' and recommended that Respondent's 
DEA Certificates of Registration be revoked. The Acting Deputy 
Administrator concludes that given the serious nature of the offenses 
which led to Respondent's convictions, and ultimately to his exclusion 
from the Medicare and Medicaid programs, and the lack of any evidence 
of Respondent's rehabilitation or remorse,

[[Page 35529]]

Respondent's registrations should be revoked.
    Accordingly, the Acting Deputy Administrator of the Drug 
Enforcement Administration, pursuant to the authority vested in him by 
21 U.S.C. 823 and 824 and 28 CFR 0.100(b) and 0.104, hereby orders that 
DEA Certificates of Registration BP1786853 and BP2526056, issued to 
Joseph M. Piacentile, M.D., be, and they hereby are, revoked. The 
Acting Deputy Administrator further orders that any pending 
applications for renewal of such registrations, be, and they hereby 
are, denied. This order is effective July 31, 1997.

    Dated: June 24, 1997.
James S. Milford,
Acting Deputy Administrator.
[FR Doc. 97-17152 Filed 6-30-97; 8:45 am]
BILLING CODE 4410-09-M