Kathleen Baydala Joyner, Daily Report

March 24, 2014

Nine months after losing a challenge against a new tactic of the state attorney general DeKalb County abortion provider Dr. Tyrone Cecil Malloy was convicted of Medicaid fraud and received a four-year prison sentence Friday, the AG's office announced.

A jury convicted Malloy, owner of Old National Gynecology, of two fraud counts on March 10, following a two-week trial. His sentence, handed down by Judge Cynthia Becker, also includes six years of probation.

Malloy was accused of illegally billing Georgia Medicaid for more than $386,000 for office visits related to abortions and for ultrasound procedures that were never performed. Becker will hold a restitution hearing later to determine how much Malloy owes the state Department of Community Health.

Last year, Malloy challenged his prosecution, arguing that the law on what abortion-related services can be charged to Medicaid is unconstitutionally vague. The federal Hyde

Amendment and state law prohibit tax money from being used for abortions except in cases of rape or incest or to save the patient's life. Malloy was not accused of charging Medicaid for abortions. Instead, in a new enforcement tack, Attorney General Sam Olens contended that charging Medicaid for abortion-related services such as ultrasounds constituted fraud

The Georgia Supreme Court ruled unanimously last year that his case could go to trial. The justices determined that the Medicaid manual, which lists what procedures may not be charged to the service, put the doctor on notice of what was prohibited by law. The high court also rejected Malloy's argument that his prosecution was precluded by an administrative law judge's ruling that said he could bill for abortion-related services.

Senior Assistant Attorney General Nancy Allstrom and Assistant Attorney General James Mooney represented the state in Malloy's criminal case and appeal.

                   Fought                              Abortion

Malloy's defense counsel, former Fulton County Superior Court Judge Thelma Wyatt Cummings Moore, was not available for comment on Friday afternoon. Defense co-counsel Dwight Thomas and M. Katherine Durant also couldn't be reached for comment.

An excerpt from a June 18, 2013, article in the Daily Report explains the arguments surrounding the ALJ's ruling:

In a May 2010 letter to the state Department of Community Health, Malloy said he billed the government for routine pregnancy services but never for an abortion, noting that 25 percent of his patients leave his office undecided about whether to have an abortion. Malloy went to Administrative Law Judge Steven Teate to challenge the Department of Community Health's decision to withhold Medicaid payments on the ground that he had billed for services related to abortions.

Teate ruled that the department's procedures didn't say clearly whether prohibitions on billing for abortions also excluded related procedures. Teate also said the department hadn't proven its accusation of fraud because the record didn't show Malloy knew his billings were false.

Teate reversed the department's decision to withhold Medicaid payments from Malloy, and the depanment didn't challenge that ruling. Malloy continued his medical practice for more than a year before he was indicted in December 2011.

The indictment accused Malloy of billing Medicaid $132, 000 over three years for patient office visits associated with "elective" abortions and $255, 000 for ultrasounds that allegedly were not performed. Malloy's lawyers have said Malloy performed the ultrasounds but made a one-digit coding error when submitting the bills.

DeKalb Superior Coutt Judge Cynthia Becker rejected Malloy's arguments that the indictment should be tossed because the law was too vague and his right to be free from double jeopardy was violated by virtue of the earlier administrative ruling. He appealed before any trial took place, with the Supreme Court on Monday rejecting the state's argument that the court was withoutjurisdiction to hear the matter at this juncture.

At oral argumentsjn February, Justice Harold Melton said he was "troubled by the idea that a doctor litigates an administrative case and prevails, and that's not enough to find out whether that doctor is in good standing or not. "

On Monday, Presiding Justice Hugh Thompson wrote for the court that Malloy's double jeopardy arguments, which both the court and Malloy framed as a question of collateral estoppel, were "persuasive in many respects. " But Thompson added that Malloy couldn't prevail on that point because the state hadn't had a full opportunity in the administrative proceeding to litigate the issues germane to Malloy's criminal case.

"To allow the decision of an administrative lawjudge to subvert the constitutional authority of the district attorneys and attorney general of this state would be in derogation of our Constitution, " wrote Thompson. "At the same time, the practical effect of holding that a finding in an administrative hearing could have a determinative effect in a subsequent criminal trial would impose upon the State a virtually insurmountable burden of investigating

                     fro                                    Abortion

and preparing for administrative matters in the same manner in which it prepares a criminal prosecution.

"Here, the only purpose of the administrative hearing was to determine whether the DCH withhold on appellant's Medicaid reimbursements would continue during the pendency of the State Medicaid Fraud Control Unit's investigation. To require the State to treat the administrative hearing as an integral part of the criminal trial rather than merely as an administrative device allowing the defendant to halt the temporary suspension of reimbursements to his Medicaid provider number during the course of the investigation would frustrate the purpose of the administrative hearing. "

As for the vagueness argument, Thompson wrote that the justices agreed with Becker that although the Medicaid fraud statute didn't explicitly say all the ways in which someone could violate the law, that combined with the Medicaid manual and the facts alleged in the indictment were enough to put Malloy on notice of what was prohibited. The law's requirement that the state must prove at trial that Malloy acted knowingly or willfully offsets any problems with the manual's vagueness, Thompson explained.

"An ordinary person can easily understand that knowingly taking money from Medicaid to which one is not entitled is prohibited conduct, " Thompson wrote. "Further, appellant's contention that the statute is unconstitutionally vague with respect to expenditures related to abortions because the manual is too vague on this subject is relevant to the issue of whether appellant knowingly made false claims, a question of fact which does not overcome the presumption that the statute is constitutional. "