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BBH employed doctor convicted of Medicaid fraud

State health officials say Roman Ostrovsky's 2006 conviction prohibited BBH from hiring him

By Scott Calvert | scott.calvert@baltsun.com

10:16 PM EST, November 22, 2010

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Baltimore Behavioral Health Inc. is under investigation by the state's health inspector general for employing a psychiatrist who had been convicted several years earlier of Medicaid fraud.

The doctor, Roman Ostrovsky, 53, is one of eight physicians employed by the nonprofit mental health clinic over the past decade who have been disciplined by the Maryland Board of Physicians, with sanctions ranging from reprimand to license revocation, public records show.

One doctor became intoxicated while on call at BBH, board records show, and another groped a 22-year-old patient in an exam room.

Providers like BBH that receive Medicaid payments are barred from employing anyone on the federal government's "exclusions" list of people who have defrauded Medicaid, which is jointly funded by the state and federal governments, state health department spokesman David Paulson said. BBH faces a possible fine for the violation, he said.

BBH has informed state officials that Ostrovsky, who no longer works for the Southwest Baltimore clinic, held a "non-clinical" job. The Board of Physicians revoked his license in June 2007, a year after he pleaded guilty to Medicaid fraud by billing the taxpayer-funded system $200,000 for thousands of therapy sessions he did not perform. He did not work for BBH at the time.

Paulson said providers are obligated to ensure that they have no staff members on the federal exclusions list. "He never should have been hired in the first place," he said of Ostrovsky. "This isn't an obscure regulation, this isn't a minor detail. This is a major issue when it comes to hiring employees."

Staff from the state Mental Hygiene Administration discovered in June that Ostrovsky was "on the grounds of BBH" and notified the state Office of Health Care Quality, Paulson said. Subsequently, he said, BBH dismissed Ostrovsky and notified the health department's inspector general.

William "Kris" Hathaway, BBH's chief executive, sent The Baltimore Sun an e-mail in response to questions. "BBH reported the problem to the authorities, is now in compliance, has taken measures to ensure it does not recur, and has no further comment," he wrote.

Hathaway declined to answer questions about Ostrovsky's employment dates, job duties or whether the clinic checked his background before hiring him. Former employees say Ostrovsky managed the psychiatrist suite starting in early 2009.

Ostrovsky declined to comment when reached by telephone at his Baltimore home.

Baltimore Behavioral Health was the subject of a recent Baltimore Sun investigation that revealed high Medicaid billings at the clinic. According to the investigation, some former BBH patients and employees and outside doctors say the clinic has been diagnosing mental illness — and collecting public funds to treat it — in some patients whose main affliction is drug addiction.

The Sun also found that BBH offers many patients a bed in unregulated rental homes in Southwest Baltimore. More than a dozen former patients and staff described illicit drug use by patients at some of the houses and BBH facilities.

The Mental Hygiene Administration began an investigation in May, after The Sun started its examination. The administration's probe is continuing. Over the past three fiscal years, BBH has received about $46 million in payments from the state's public mental health system, largely through Medicaid.

The Sun used tax filings, audit reports and interviews to identify 18 doctors who have worked at BBH. Eight have disciplinary records at the Board of Physicians. Unlike Ostrovsky, most worked at BBH in a medical rather than administrative capacity, board records indicate.

Dr. Priscilla W. Sheldon, who is among the eight and has struggled with substance abuse, said it's no surprise BBH has hired several doctors with drug or alcohol problems.

"The fact that more of them happen to be working here is simply because [BBH] has made the effort to give people a chance, which is important," she said.

Asked about the board's finding that two other physicians repeated past behaviors while on duty at BBH — one by groping a patient and one by drinking while on call — Sheldon said it was a "reasonable concern."

"When you have that many people who have been given an opportunity, there is a percentage you would expect might have difficulty," she said. "That doesn't excuse anything."

Robert Oshel, who retired as associate director for research and disputes at the federal National Practitioner Data Bank, said he is not familiar with BBH but said the number of doctors with disciplinary records could be problematic.

"Even if you have as one of your goals to hire problem physicians and rehabilitate them," Oshel said, "at some point enough is enough."

The Maryland physicians board rarely metes out serious punishment. Last fiscal year, it imposed 118 sanctions such as fines, probation orders, reprimands, suspensions and revocations, board Deputy Director John Papavasiliou said. Maryland has 27,664 licensed physicians, about 17,000 of whom treat patients, he said.

Among the eight sanctioned BBH doctors, five have struggled with drug or alcohol abuse, according to physicians board records. In the substance abuse treatment field, it is not uncommon to find employees who are recovering addicts. BBH specializes in treating those with co-occurring drug addition and mental illness.

Two other doctors were disciplined for having inappropriate relationships with patients.

Hathaway of BBH said in an earlier e-mail that his center "works closely" with a rehabilitation program in Maryland for troubled doctors but declined to comment on specific doctors.

One of those with a history of drug problems is Dr. Nicholas G. Scotto, the center's chief physician and Hathaway's brother-in-law. According to the Board of Physicians, Scotto's last recorded substance abuse predates his hiring at BBH in 2002.

The board found that another physician, Dr. Bannister L. Raines Jr., used alcohol while on duty at BBH.

One night in November 2004, Raines drank three glasses of bourbon, each containing four to six ounces, and then drove his car over the speed limit "in an erratic manner," according to a 2005 board order revoking his medical license. Raines, hired by BBH in 2003, was on call, the order said, and "he in fact received a call and made medical decisions for a patient during this drinking episode."

The board gave no details about those medical decisions.

Raines had four drunken-driving arrests dating to 1981, the board noted, and his blood-alcohol content that November night was found to be 0.10, over the legal limit. He was arrested by Baltimore County police, who charged him with driving under the influence. A phone number listed for Raines was not in service. He is no longer employed by BBH.

Dr. Benigno P. Lazaro Jr. was hired by BBH in March 2009, less than two months after the Maryland board reinstated his license. It had been revoked in 2005 after he was found to have engaged in sexual misconduct with two patients in Ohio.

In November last year, according to the board, Lazaro "made sexual advances" toward a 22-year-old relapsed heroin addict in an exam room at BBH. She reported that he lifted her shirt and kissed her breast. "And then I pushed my shirt down," she told board investigators. "I got up, and he grabbed me and kissed me on the mouth twice, and I walked out."

BBH promptly suspended Lazaro, who later admitted some of the accusations to physicians board staff. The board revoked his license last month, and he no longer works at BBH.

In an interview, Lazaro declined to discuss the incident. But he said Scotto "gave me a chance" by hiring him, adding, "I have discussed it personally with him and I've apologized."

This year, BBH hired Dr. Steven Corvilla after the board put him on probation for substance abuse. The board acted in January, after Corvilla admitted writing himself prescriptions under a false name for medication used to treat attention deficit hyperactivity disorder.

Corvilla, a current BBH staff physician, told the board he had been prescribed the medication but developed a tolerance. "From time to time," he said, "I self-medicated myself under a pseudonym." A suspicious pharmacist reported him to the board in 2006. Corvilla did not return messages left at BBH.

The other three current or former BBH doctors with sanctions are Dr. Arthur Charles Marsh, Dr. Joseph C. Boschulte and Sheldon. Only Sheldon still works there, on a contract basis.

Boschulte did not return messages left at the Eastern Shore treatment facility where he works. Marsh did not return messages left with a stepson in Salisbury and his lawyers on a case unrelated to BBH.

Boschulte, a psychiatrist who worked at BBH from 1999 to 2002, had his medical license suspended for six months in 2002, after the board found that during the mid-1990s he had a sexual relationship with a patient and failed to meet standards of care in prescribing her medication.

Today, the board's website lists Boschulte's license as "active."

Marsh was BBH's program director in early 2006, according to a letter to state health officials. In 2001 Georgia's medical board suspended his license, then put him on probation, after his sixth drunken-driving episode, according to the Maryland board. In 2004 he moved to Maryland and began rehabilitation under a program for addicted physicians.

In July 2006, Marsh received a medical license in Maryland with a probationary period of at least five years, board records show. One condition required him to be drug-tested. In spring 2009, while working on the Eastern Shore, he tested positive for alcohol, board documents say. In June of this year the board revoked his license.

Sheldon, a psychiatrist, resigned from a geriatric center in 2002, according to board records, amid concerns about her "physical and mental condition." In an interview Monday with The Sun, she said she had been using opiates at the time. She had agreed to a five-year "advocacy contract" with a rehab program and in 2004 signed a pact with the physicians board that required drug screens.

Sheldon began volunteering at BBH in 2005 and months later began working part-time. In July 2007, three months after leaving BBH to care for her ailing mother, she tested positive for an unauthorized pain medication — which board records say she reported taking for an ankle injury. She rejoined BBH as a part-time physician in September 2007.

In late 2008, she tested positive for alcohol, and board records say she admitted drinking wine on two nights. She told the board that she realized the episode was "an emergency in my recovery." The board reprimanded her and put her on five-year probation, which requires that she attend outpatient treatment and Alcoholics Anonymous meetings.

"Since then, my recovery has been so much better than it ever was," Sheldon said Monday. But she said she felt the board unfairly imposed the five-year probation, which will keep her from becoming board-certified in psychiatry, thus limiting her career options.

The Sun recently learned about Ostrovsky's employment at BBH from former employees.

He admitted billing for thousands of bogus 45-minute therapy sessions. His scheme was discovered because of suspicious billing patterns. He billed for more than eight hours of daily therapy on 293 occasions, according to then-state Attorney General J. Joseph Curran Jr., and once for 19 hours of therapy in a single day.

Baltimore County Circuit Judge John G. Turnbull II sentenced him in 2006 to five years in jail, with all but a year suspended. He ordered Ostrovsky to a year of home confinement. Ostrovsky paid a $250,000 fine at sentencing and was ordered to pay $150,000 over the next two years.

In revoking his license, the Board of Physicians cited his guilty plea to a crime of moral turpitude.

The inspector general is wrapping up its investigation into Ostrovsky's employment, Paulson said.

scott.calvert@baltsun.com

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