Court: Massachusetts Appeals Court; September 12, 2008; Massachusetts; State Appellate Court
Kennard C. Kobrin, a board-certified psychiatrist with a private practice in Fall River, was indicted in 1998 on multiple counts related to Medicaid fraud and illegal prescribing of controlled substances. Specifically, he faced accusations of Medicaid fraud for unnecessary psychological testing and for accepting kickbacks from psychologists to whom he referred patients. Following a month-long jury trial, Kobrin was acquitted of most charges but convicted of one count of illegally prescribing Klonopin and two counts of Medicaid fraud concerning unnecessary psychological tests. The trial judge denied his motions for acquittal but granted a new trial on the Medicaid fraud convictions while denying it for the illegal prescribing charge. Kobrin and the Commonwealth both appealed—Kobrin contesting the denial of acquittal and the new trial related to his illegal prescribing conviction, whereas the Commonwealth appealed the new trial order on the Medicaid fraud counts. The court affirmed the new trial for Medicaid fraud but reversed the conviction for illegal prescribing, citing insufficient evidence. Kobrin's practice, which catered to patients with dual diagnoses eligible for Medicare and Medicaid, faced scrutiny from the Board of Registration in Medicine, leading to a temporary suspension of his medical license, which was later reinstated after a board hearing determined he had not acted unlawfully. His pretrial motion to dismiss charges based on collateral estoppel was denied, and he was not allowed to present evidence from the board's decision during the trial.
Of the eighty-two counts in the indictment against Kobrin, sixty-four proceeded to trial in 2002. These included twenty-five counts of Medicaid fraud under G. L. c. 118E. 40 for ordering unnecessary psychological tests for patients A, B, C, D, G, and three undercover state troopers; twenty-six counts of violating G. L. c. 118E. 41 for accepting kickbacks from tenant psychologists; and thirteen counts under G. L. c. 94C. 32B(a) for illegally prescribing benzodiazepines to patients A, B, C, D, F, and G. The prosecution's case asserted that Kobrin exploited his patients' vulnerabilities for personal profit, focusing on financial gain as the central theme.
Kobrin allegedly created a complex scheme involving kickbacks from tenant psychologists who paid high rents for profitable patient referrals, thus maximizing Medicaid reimbursements. He mandated excessive psychological testing for new patients, regardless of medical necessity, and frequently scheduled retests to align with reimbursement cycles, typically every six months. Additionally, he prescribed low-dosage benzodiazepines to patients with substance abuse issues, ensuring their return for further prescriptions, which Medicaid often covered.
The Commonwealth presented evidence from fourteen witnesses, including two tenant psychologists and one psychiatrist, who testified about the profitability of Kobrin's practice, the high rents charged, and the office policies that enhanced Medicaid reimbursements. Other witnesses provided insights into Medicaid claims, office procedures, and financial aspects of the practice. Two undercover state troopers, posing as patients, reported being subjected to psychological testing before seeing a psychiatrist but did not receive prescriptions for any addictive drugs.
The jury heard testimonies from four experts regarding the standard of care for psychological testing and the prescribing of benzodiazepines. Two experts criticized the psychological tests conducted on patients A, B, C, D, and G as substandard. Additionally, a psychiatrist and an addiction medicine specialist testified that the prescriptions written by Kobrin for patients A, B, C, D, F, and G also fell below the appropriate standard of care. The treatment records of these patients were included as evidence.
Following defense motions, the judge dismissed about one-third of the sixty-four counts, leading to the jury deliberating on forty-three counts. Kobrin was acquitted of all twenty-six counts of Medicaid fraud linked to alleged kickbacks, as well as the Medicaid fraud counts for testing patients A and C and the illegal prescribing counts for patients A, B, and C. However, he was found guilty of illegally prescribing benzodiazepines to Patient D on January 26, 1996, and for ordering psychological tests for Patients D and G on specified dates.
On appeal, Kobrin argues that the evidence was insufficient to support any of the three convictions, specifically contesting that the Commonwealth did not prove he acted in bad faith or without legitimate medical purpose in prescribing for Patient D. He also claims there was no evidence that the tests for Patients D and G were unnecessary or that Medicaid was billed or reimbursed. The Commonwealth, in its cross-appeal, argues that the trial judge erred in allowing a new trial motion based on evidence that claims were not submitted to Medicaid, asserting this was neither newly discovered nor relevant to the charges.
Kobrin's appeal includes a challenge to his illegal prescribing conviction under the Massachusetts Controlled Substances Act, which requires prescriptions to be issued for legitimate medical purposes. The jury concluded that Kobrin's prescription of Klonopin to Patient D did not meet this standard.
The Act differentiates between the proof required for a physician's criminal liability and that needed for civil malpractice or board disciplinary actions. A prescription issued by a physician without the intent to treat a patient is invalid, as such an act demonstrates bad faith, diverging from accepted medical practice. Establishing criminal liability mandates proof of wrongful intent; mere noncompliance with medical standards does not constitute a crime. The physician's intent must be shown to lack a legitimate medical objective, aligning with the Act's goal of regulating controlled substances. Physicians who write invalid prescriptions effectively act as "pushers."
Determining a physician's bad faith is a factual question for the jury, which may rely on inferences from the trial's facts, provided the evidence is compelling enough to persuade beyond a reasonable doubt. Conjecture or mere speculation is insufficient. The jury evaluates whether the evidence, viewed favorably for the Commonwealth, supports the essential elements of the crime. The physician-patient relationship is crucial in assessing the bona fides of the physician's actions in prescribing controlled substances. In this context, the jury can consider the entire course of the physician's interactions with patients when determining good or bad faith. Specifically, in the case of Patient D, a long-standing doctor-patient relationship existed, with the patient having both a diagnosed mental illness and a history of alcohol abuse.
On January 26, 1996, Patient D, a 37-year-old unemployed individual receiving public benefits, had a complex mental health history. He was diagnosed with schizophrenia, severe anxiety, mania, paranoia, and depression, and exhibited delusions, including beliefs of being pursued by the Mafia and abducted by aliens. Patient D began treatment with Dr. Kobrin in 1986, interrupted by periods in California and time spent with other providers. Upon returning to Massachusetts in December 1995, he was admitted to the John C. Corrigan Mental Health Center and later resumed treatment with Kobrin.
During his nearly ten years of treatment, Kobrin referred Patient D for psychological testing on three occasions, with the most recent on December 22, 1995, the day of D's return after a three-year absence. Testing revealed no history of drug abuse but indicated episodic alcohol use, which D linked to emotional distress. He was not in detox programs and last consumed alcohol three weeks prior to the January 26 appointment.
Kobrin prescribed various medications to manage D's mental health conditions, including antipsychotics like Stelazine and lithium, anticonvulsants like Depakote, and benzodiazepines such as Klonopin. From January 28, 1992, to January 26, 1996, Kobrin issued 28 prescriptions for Klonopin, consistently at a dosage of four milligrams per day, alongside other psychotropic medications. Prescription intervals varied, with some for 14 to 30 days, including two prescriptions written shortly after D's last visit. Throughout D's treatment, regardless of the provider, the medication regimen remained largely consistent, particularly concerning Klonopin.
Patient D was discharged from Corrigan on December 19, 1995, with an outpatient treatment plan that included Klonopin, prescribed by Sousa. When Kobrin met with Patient D on December 22 and 29, he did not issue new prescriptions but resumed prescribing the same medications on January 11, 1996. Experts Dr. Kleber and Dr. Pasanen criticized this practice, labeling it dangerous and below standard care, particularly for patients with a history of alcohol abuse. They argued that benzodiazepines, like Klonopin, should not be prescribed to substance abusers, even at appropriate dosages, due to their potential for addiction and the risk of increased alcohol dependency. Pasanen noted that Kobrin was aware of Patient D’s alcohol consumption habits, yet still prescribed a 28-day supply of Klonopin, which Pasanen deemed unjustifiable and not aligned with accepted medical standards. Kleber emphasized that mixing alcohol with benzodiazepines can lead to relapse and requires careful monitoring. While acknowledging that Kobrin prescribed other medications for Patient D’s conditions, both experts concluded that the January 26, 1996, Klonopin prescription was inappropriate. The Commonwealth argued that the evidence indicated Kobrin acted in bad faith and without legitimate medical purpose when prescribing Klonopin, thus violating the standard of care expected for treating substance abusers.
Kobrin's prescription of a twenty-eight-day supply of low-dose Klonopin for Patient D, who has a history of alcohol abuse, raises concerns regarding his adherence to medical guidelines. The PDR for Klonopin mandates close monitoring for patients with substance abuse issues. The Commonwealth argues that the jury could reasonably infer bad faith and a lack of legitimate medical purpose from Kobrin's actions, contrasting with the expected practice of prescribing a short supply with follow-up. Additionally, evidence suggests Kobrin may have engaged in financially motivated practices, such as ordering unnecessary psychological testing for personal profit.
The Commonwealth draws parallels to the case of Commonwealth v. Pike, where a psychiatrist was convicted for illegally prescribing controlled substances, including Klonopin. In Pike's case, expert testimonies indicated that his prescribing practices, including extremely high dosages and refilling prescriptions prematurely, lacked legitimate medical purpose and fell below the standard of care. Pike also continued prescribing to patients with suspicious claims regarding lost prescriptions.
While the experts in Kobrin’s case acknowledged Patient D's significant mental illness and did not dispute his treatment of her other conditions, they criticized the Klonopin prescription as "extraordinarily wrong" for an active alcohol abuser. They agreed that Klonopin should not be abruptly stopped and should instead be tapered. Although the experts established that Kobrin deviated from accepted medical practices, the evidence presented lacks sufficient support for the crucial intent elements of bad faith and lack of legitimate medical purpose, which were more clearly established in the Pike case.
No evidence indicates that Kobrin prescribed to Patient D or any other patient with overlapping intervals of prior prescriptions, replaced lost or stolen prescriptions, or prescribed dosages exceeding recommended ranges, all of which would suggest illegitimate medical practices. There is also no record of Patient D requesting benzodiazepines or of Kobrin inquiring about medication preferences. Furthermore, there is no evidence that Kobrin directed Patient D to fill prescriptions at different pharmacies to evade detection or that Patient D abused Klonopin, misused it, or traded it with others. Additionally, Kobrin did not make any incriminating statements regarding his prescribing, nor did he provide unmarked or illicit drugs. The evidence presented indicates that Kobrin prescribed a twenty-eight-day supply of Klonopin to a patient with a history of alcohol abuse without a monitoring plan. To conclude that Kobrin acted in bad faith, the jury would need to infer from a lack of evidence about any follow-up appointments for Patient D after January 26, 1996, and the absence of explanations for his failure to return for further care.
The prescribing history indicates that Patient D had regular office visits aligned with medication renewal dates, but the jury cannot conclusively determine whether appointments were missed due to a lack of evidence. The critical issue is whether prescribing a twenty-eight-day supply of medication indicates a disregard for Patient D’s welfare, suggesting bad faith without a legitimate medical purpose. This requires significant conjecture from the jury. Kobrin's past prescriptions for Patient D included multiple instances of Klonopin being prescribed at similar intervals, and there was no evidence of misuse by Patient D that correlated with the supply duration. Expert testimony suggested that prescribing shorter supplies does not equate to effective monitoring. This aligns with the Commonwealth's argument that shorter prescriptions were aimed at ensuring return visits rather than monitoring. Therefore, prescribing a longer supply does not indicate a lack of monitoring, nor does it support the notion of bad faith. The evidence does not sufficiently prove that Kobrin prescribed without intending to fulfill a legitimate medical goal; a profit motive alone does not negate medical intent, even if decisions are deemed negligent. No precedent in Massachusetts exists for criminal liability under such circumstances. Regarding Medicaid fraud, the defendant was convicted for ordering unnecessary psychological tests. He contends that the trial judge erred by denying his motion for acquittal, asserting insufficient evidence to prove the tests were unnecessary or that claims were submitted to Medicaid. The sufficiency of evidence is assessed based on what was available at trial, favoring the Commonwealth's perspective.
Kobrin argues that the Commonwealth did not provide evidence demonstrating that Patient D and Patient G lacked medical necessity for the two tests ordered. He highlights that neither of the Commonwealth’s expert witnesses stated that these tests were unnecessary. The Commonwealth maintains that, based on a broader examination of the evidence, the jury could reasonably infer the tests were medically unnecessary. Their theory posits that Kobrin violated G. L. c. 118E. 40 by facilitating false claims regarding the medical necessity of the tests for Medicaid reimbursement purposes. He allegedly charged excessive rent to Greene in exchange for referring his Medicaid patients for psychological testing, regardless of their actual needs. Kobrin implemented office policies that led to automatic scheduling of tests without assessing individual patient conditions. He assured another psychologist, Dr. Katz, that Medicaid was profitable and incentivized referrals by promising substantial financial returns. Expert opinions criticized the quality of testing conducted, indicating it was substandard and not beneficial. Additionally, Kobrin's lack of individualized referrals and failure to address conflicting test results in his treatment notes further suggested negligence. The judge concluded that the jury could reasonably infer Kobrin's awareness of the tests' lack of medical necessity.
Regarding the submission of claims to Medicaid, Kobrin contends that the evidence was insufficient to prove that claims for the two tests were actually submitted. The trial judge instructed the jury that, for conviction under G. L. c. 118E. 40, they must find beyond a reasonable doubt that a claim was filed for each patient, that it falsely represented the tests as medically necessary, and that Kobrin knew the representation was false. While the Commonwealth presented MA-9 Medicaid applications for other tests, no such documentation existed for the two tests Kobrin was convicted for.
Kobrin's posttrial motion for a required finding of not guilty was denied by the judge, who determined that the Commonwealth had established the actual claim submitted element through circumstantial evidence. While circumstantial evidence is acceptable, it must not rely on conjecture. The judge found sufficient evidence at trial, despite the close nature of the question. Testimonies indicated that Patients D and G were receiving Medicaid and Medicare assistance, and a psychologist testified he was a Medicaid provider and had administered the tests in question but did not confirm that claims had been submitted for those tests. Evidence from Kobrin's office indicated that reimbursement claims were regularly filed with Medicaid. The judge concluded that the jury could rationally infer that claims had been submitted to Medicaid, thus denying the motion regarding Medicaid fraud counts.
Regarding the Commonwealth’s cross appeal, it argued that the trial judge incorrectly ordered a new trial for Kobrin’s Medicaid fraud convictions. A judge can grant a new trial if justice may not have been served, and appellate courts review such decisions for significant errors of law or abuse of discretion. The judge, who was also the trial judge, is given special deference in these matters. A new trial was warranted based on posttrial evidence showing that no claims for the disputed tests had been submitted to Medicaid; rather, the claims were filed with Medicare and not processed by Medicaid. The Commonwealth’s position that claim submission to Medicaid is not an element of the crime emerged only after the trial, despite having previously accepted the judge's instruction on this requirement and utilizing circumstantial evidence to meet its burden. Each of the Commonwealth's arguments is addressed in light of this context.
The trial judge granted a new trial based on newly discovered evidence that raised significant doubt regarding the justice of the two convictions. The Commonwealth argued that this evidence should not have been considered, asserting it was not newly discovered as it could have been available to the defense at trial. However, a defendant must demonstrate that the evidence is truly newly discovered and that it casts doubt on the conviction's justice. The standard requires that the evidence was unknown and unavailable despite diligent efforts by the moving party.
The judge emphasized that appellate counsel had undertaken extensive discovery efforts, uncovering significant new evidence from billing specialists that surpassed what was known at the time of trial. This new evidence provided superior insights into the reimbursement process and potentially significant defenses for the defendant. The judge concluded that reasonable diligence would not have led trial counsel to this evidence, which was crucial for the defendant's case.
Furthermore, the Commonwealth contended that even if the new evidence was permissible, the judge erred in granting a new trial. The appellate review indicated that the new evidence likely would have influenced the jury's deliberations regarding whether the defendant had submitted fraudulent claims to Medicaid. The judge's conclusion that there was a substantial risk the jury might have reached a different decision with the new evidence is upheld, and his decision to grant a new trial is supported by a lack of grounds for disturbance. The matter of proof regarding actual claim submission remains.
The Commonwealth argues that the judge erred in granting a new trial based on newly discovered evidence, claiming it is irrelevant. The Commonwealth contends it was required to prove more than necessary at trial, asserting that it did not need to show that claims for Medicaid reimbursement were submitted regarding the psychological tests of Patients D and G. However, the Commonwealth's interpretation is incorrect. General Laws c. 118E governs the Medicaid program and its Section 40 addresses fraud by service providers, prohibiting knowingly making false statements in applications for benefits or in determining rights to benefits. The Commonwealth did not pursue charges against Kobrin under the first clause since the tenant psychologists, not Kobrin, submitted claims for reimbursement. Instead, Kobrin was charged under the second clause, based on allegations that he signed forms for patient referrals that falsely indicated the tests were medically necessary. The Commonwealth argues that proof of actual claim submission is unnecessary for a violation of the second clause. This question has not been previously resolved. The statute's interpretation relies on legislative intent, which indicates that false statements must pertain to determining rights to benefits or payments. The Executive Office of Health and Human Services oversees Medicaid, determining eligibility and disbursing funds. Providers must submit bills to receive reimbursement, highlighting that false statements must be submitted to the division to affect benefit determinations. Furthermore, G. L. c. 118E. 46A clarifies that certain protections exist for providers against criminal liability, reinforcing the necessity of claim submission for liability under both clauses of Section 40.
Providers submitting claims for Medicaid payment that do not adhere to billing policies will not face prosecution if such submissions result from clerical or administrative errors. The Commonwealth contests this interpretation, emphasizing the focus of G. L. c. 118E, § 40 on falsity and misrepresentation rather than financial harm to Medicaid. They argue that a narrow reading of the statute could limit the liability of referring physicians, making it contingent upon whether providers submit claims rather than their own actions. The Commonwealth overlooks the interrelation of the statute's clauses; the first allows prosecution of fraudulent billing providers, while the second enables prosecution of fraudulent referring providers, thereby protecting innocent billing providers who acted in good faith based on misleading referrals. The judge's decision to grant a new trial is upheld, with an expectation that the Commonwealth will present additional evidence of actual claims submission in any future proceedings regarding Medicaid fraud related to psychological testing. The judgment for illegal prescribing is reversed, and the motion for a new trial on Medicaid fraud convictions is affirmed. Additionally, charges were brought against PSE Corp. and PSE-COR Provider, Inc. for Medicaid fraud involving kickbacks, with PSE being acquitted and PSE-COR's charges subsequently dropped. Kobrin, the sole stockholder of PSE, was also individually indicted.
The judge found the defendant not guilty of several illegal prescribing counts: five out of six related to Patient A, three out of six for Patient C, one out of two for Patient D, and all counts for Patients F and G. Additionally, the judge acquitted the defendant of seven counts of Medicaid fraud, five concerning psychological tests for Patient B and two involving tests for Troopers Wilder and Cuoco. Although certain counts related to Patients B and F, and illegal prescribing counts for Patient G, did not go to the jury, all evidence was presented to the jury during deliberation, despite defense objections.
The defendant raised claims of erroneous jury instructions, exoneration by a board before the trial barring further prosecution, prosecutorial misconduct, and ineffective assistance of counsel; however, these issues were deemed unnecessary to address based on the outcome reached. The Uniform Controlled Substances Act (CSA) was cited, emphasizing its purpose to prevent drug diversion and control substance trafficking. Klonopin, a benzodiazepine prescribed for anxiety and seizures, has a recommended maximum daily dose and contraindications related to liver disease and addiction risk. The behavior of negligent physicians is monitored through civil tort actions and administrative oversight by a regulatory board, which has the primary responsibility for medical practice regulation, with judicial review of board decisions permitted under specific statutes. The CSA's interpretation parallels that of state law regarding the regulation of controlled substances.
In Commonwealth v. Comins, the Massachusetts court established an illegal prescribing standard partly based on federal case law, referencing cases such as United States v. Moore and United States v. Collier. Patient D had the longest relationship with the physician Kobrin, spanning a decade, while other patients, including Patients A, B, C, F, and G, had varied histories of mental health issues and substance abuse. Patient A suffered from major depression and anxiety, Patient B was diagnosed with bipolar disorder and antisocial personality disorder, Patient C had anxiety and a seizure disorder alongside a history of abuse, Patient F had a schizoid personality disorder, and Patient G, who was HIV positive, dealt with anxiety and alcohol dependency. All patients received low dosages of benzodiazepines from Kobrin between office visits.
The facility Corrigan, run by the Massachusetts Department of Mental Health, caters to patients unable to pay for services. Patient D had a significant history of mental illness and numerous hospitalizations. His autopsy revealed he died from a morphine overdose, occurring two months after his last visit with Kobrin, who did not prescribe morphine. While alcohol was found in Patient D’s system, there were no detected benzodiazepines. Except for Patient A, who underwent testing, the other patients were not regularly re-tested as purported by witnesses. Records showed that Kobrin prescribed for Patient D starting in 1992, despite having treated him since 1986 with consistent drug types and dosages. Kobrin justified prescribing Klonopin to Patient D for anxiety and akathisia, a condition marked by agitation, arguing that no expert contested the medical necessity of this treatment, despite noting in 1986 that Patient D had resolved his akathisia.
On May 2, 1988, akathisia was referenced in a treatment plan for Patient D; however, Kobrin's subsequent treatment notes did not mention this condition. The document does not explore this further. According to the PDR, the maximum daily dosage for seizure control is twenty milligrams, while Commonwealth experts suggest a four to six milligram range for anxiety treatment. In Commonwealth v. Miller, the defendant physician unlawfully provided an undercover officer with controlled substances, highlighting a significant deviation from acceptable medical practices. Commonwealth v. Comins examined federal case law to determine the evidence needed for illegal prescribing, citing multiple relevant cases that illustrated similar circumstances, such as prescribing medications requested by patients without symptoms, excessive dosages, and maintaining separate records for prescriptions. Patient D underwent testing on the same day as his first appointment with Kobrin in nearly three years, indicating a practice of testing new patients on their initial visit. Patient G's records indicated a similar pattern, with drug screens ordered after a psychological evaluation yielding negative results. Despite this, Kobrin was found not guilty of illegally prescribing benzodiazepines to Patient G. Posttrial discovery revealed that Medicare and Medicaid can function independently or together; providers typically file claims with Medicare first before submitting crossover claims to Medicaid. For Patient D's testing, Dr. Greene failed to provide necessary information on the HCFA-1500 form for a crossover claim to Medicaid, and if Medicare covered the claim entirely, no crossover would be submitted.
The psychological testing in question was fully covered by Medicare, with no costs transferred to Medicaid. The relevant billing code, 90830, was exclusively a Medicare code and not applicable to Medicaid. There were no records indicating that Medicaid received an MA-2 form for the claims related to Patients D and G. An exhaustive search revealed no transaction control numbers (TCNs) for the subject testing, although TCNs were found for other services provided to the same patients. Kobrin contends that the judge’s extensive reading of Medicaid regulations during the trial misled the jury into believing compliance with these regulations was mandatory for reimbursement claims, which he argues contributed to his conviction for the two psychological tests billed to Medicare. While Kobrin did not object to the instruction at trial, the judge may have considered this factor in his decision regarding a new trial based on newly discovered evidence that raised doubts about the conviction's justice. The Commonwealth failed to clarify the distinction between Medicare and Medicaid claims and did not adequately explain the crossover process. Additionally, prior law allowed for exceptions to violations due to clerical errors, and the changes in the 2000 amendment do not affect the analysis. The Commonwealth’s reliance on case law and statutes to support its position was deemed misplaced, as they did not meaningfully relate to the claims in question.
