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State v. Macko

Superior Court of Connecticut, Judicial District of Hartford

August 1, 2016





          A. SUSAN PECK, Judge Trial Referee.

         In this action, commenced on May 15, 2012, the plaintiff, state of Connecticut, [1] seeks restitution, civil penalties and injunctive relief against the defendants, Douglas Macko, D.M.D. (Dr. Macko) and Douglas Macko, D.M.D., P.C., based on allegations of unfair or deceptive acts and practices, pursuant to the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a, et seq., more particularly, General Statutes § § 42-110m (a) and 42-110o (b). A hearing in damages to the court was held after default[2] on May 20, 2015, June 3, 2015, June 4, 2015, June 5, 2015 and June 9, 2015, October 6, 2015 and February 25, 2016. Thereafter, pursuant to an order of the court issued during closing argument on February 25, 2016, the defendant, Dr. Macko, filed a personal financial affidavit on April 11, 2016.



         The plaintiff alleges that between April 2002, and December 2009, the defendants provided dental services to various individuals, including pediatric patients, and billed the Department of Social Services (DSS) for those services. During that time frame, Dr. Macko was enrolled as a provider of dental services through the Connecticut Medical Assistance Program (CMAP), which includes the Connecticut Medicaid Program. In accordance with the CMAP provider agreement signed by Dr. Macko, Dr. Macko was required to adhere to all program rules, laws, and regulations as a condition of payment and participation. Notably, the statutes governing the practice of dentistry in Connecticut; see General Statues § 20-103a, et seq.; require licensed dentists and licensed dental hygienists to perform the practice of " dental hygiene." See General Statutes § 20-126/ (b).

         During the aforementioned time frame, Dr. Macko employed various individuals at his office who were neither licensed dentists nor licensed dental hygienists. Rather, many of these unlicensed individuals were dental assistants trained by Dr. Macko to perform various procedures, namely, " prophylaxis treatments" and " fluoride applications, " which, pursuant to statute, are " dental hygiene" practices. See General Statues § 20-126/ (a) (3). Between April 2002, and December 2009, these unlicensed employees would perform prophylaxis treatments and fluoride applications on individual patients and, thereafter, the defendants would receive compensation from the plaintiff under the CMAP " fee-for-service" (FSS) and " managed care organization" (MCO) programs. In essence, the plaintiff claims that the defendants engaged in a pattern and practice of billing the plaintiff for dental procedures wrongfully performed by unlicensed individuals. As a result of these activities, the plaintiff further alleges that the defendants were paid approximately $931, 508.30, to which they were not entitled.


         APPLICABLE LAW [3]


         The General Assembly has enacted specific legislation governing the practice of dentistry. See General Statutes § 20-103a, et seq. General Statutes § 20-123 (a) provides in relevant part that " [n]o person shall engage in the practice of dentistry unless he or she is licensed pursuant to the provisions of this chapter. The practice of dentistry or dental medicine is defined as the diagnosis, evaluation, prevention or treatment by surgical or other means, of an injury, deformity, disease or condition of the oral cavity or its contents, or the jaws or the associated structures of the jaws."

         General Statutes § 20-112a, entitled " [cl]ental assistants, " provides in relevant part that " [a] licensed dentist may delegate to dental assistants such dental procedures as the dentist may deem advisable . . . but such procedures shall be performed under the dentist's supervision and control and the dentist shall assume responsibility for such procedures; provided such assistants may not engage in: (1) Diagnosis for dental procedures or dental treatment . . . (5) the taking of any impression of the teeth or jaws or the relationship of the teeth or jaws for the purpose of fabricating any appliance or prosthesis; (6) the placing, finishing and adjustment of temporary or final restorations, capping materials and cement bases; or (7) the practice of dental hygiene as defined in [§ ] 20-126l. (Emphasis added.) Moreover, General Statutes § 20-126 provides in relevant part that " [a]ny person who violates any provision of this chapter shall be guilty of a class D felony. . . . For purposes of this section, each instance of patient contact or consultation which is in violation of any provision of this section shall constitute a separate offense."

         General Statutes § 20-126l (a) provides in relevant part that " [a]s used in this section: (1) 'General supervision of a licensed dentist' means supervision that authorizes dental hygiene procedures to be performed with knowledge of said licensed dentist, whether or not the dentist is on the premises when such procedures are being performed . . . (3) The ' practice of dental hygiene ' means the performance of educational, preventive and therapeutic services including: Complete prophylaxis; the removal of calcerous deposits, accretions and stains from the supragingival and subgingival surfaces of the teeth by scaling, root planing and polishing; the application of pit and fissure sealants and topical solutions to exposed portions of the teeth; dental hygiene examinations and the charting of oral conditions; dental hygiene assessment, treatment planning and evaluation. . . ." (Emphasis added.) Finally, General Statutes § 20-126l (b) provides that " [n]o person shall engage in the practice of dental hygiene unless such person (1) has a dental hygiene license issued by the Department of Public Health and (A) is under the general supervision of a licensed dentist . . . or (2) has a dental license."


         The DSS administers the CMAP, which includes the Connecticut Medicaid Program. General Statutes § 17b-2 (6). The Commissioner of the Department of Social Services has promulgated the following regulations that are necessary to administer the CMAP. General Statutes § 17b-262; see also Regs., Conn. State Agencies § 17b-262-522, et seq.

         Section 17b-262-526 of the Regulations of Connecticut State Agencies provides that " [t]o maintain enrollment in the Connecticut Medical Assistance Program, a provider shall abide by all federal and state statutes regulations and operational procedures promulgated by the department which govern the Medical Assistance Program and shall . . . (5) meet and adhere to all applicable licensing, accreditation, and certification requirements and all applicable state and local zoning and safety requirements pertaining to the provider's assigned type and specialty in the jurisdiction where the Medical Assistance Program goods or services are furnished; [and] (6) meet and adhere to any additional department requirements, after enrollment, promulgated in conformance with federal and state statutes, regulations and operational procedures which govern the provider's assigned provider type and specialty. . . ." Accordingly, pursuant to § 17b-262-526 of the Regulations of Connecticut State Agencies, providers must practice in accordance with all applicable licensing requirements.

         Section 17b-262-523 (22) of the Regulations of Connecticut State Agencies defines a " provider" as " any individual or entity that furnishes Medical Assistance Program goods or services pursuant to a provider agreement with the department and is duly enrolled and in good standing or, as the context may require, an individual or entity applying for enrollment in the Medical Assistance Program."



         As previously noted, a default entered against the defendants on August 29, 2012, based on a failure to plead. " A default admits the material facts that constitute a cause of action . . . and entry of default, when appropriately made, conclusively determines the liability of the defendant . . . . If the allegations of the plaintiff's complaint are sufficient on their face to make out a valid claim for the relief requested, the plaintiff, on the entry of a default against the defendant, need not offer evidence to support those allegations. . . . Therefore, the only issue before the court following a default is the determination of damages . . .

         " [T]he rule is that the entry of default operates as a confession by the defaulted defendant of the truth of the material facts alleged in the complaint which are essential to entitle the plaintiff to some of the relief prayed. It is not the equivalent of an admission of all of the facts pleaded. The limit of its effect is to preclude the defaulted defendant from making any further defense and to permit the entry of a judgment against him on the theory that he has admitted such of the facts alleged in the complaint as are essential to such a judgment. It does not follow that the plaintiff is entitled to a judgment for the full amount of the relief claimed. The plaintiff must still prove how much of the judgment prayed for in the complaint he is entitled to receive." (Emphasis in original; internal quotation marks omitted.) Bank of New York v. National Funding, 97 Conn.App. 133, 138-39, 902 A.2d 1073, cert. denied, 280 Conn. 925, 908 A.2d 1087 (2006), cert. denied, 549 U.S. 1265, 127 S.Ct. 1493, 167 L.Ed.2d 229 (2007); cf. State v. Ritz Realty Corp., 63 Conn.App. 544, 548, 776 A.2d 1195 (2001) (entry of default in action brought by Attorney General based on CUTPA violations).

         " When a default for failure to plead has been entered, there are two paths. Under Practice Book § 17-32, a defaulting party may file a motion to set aside the default within fifteen days, or anytime prior to the filing of a claim for a hearing in damages, and the clerk may set aside the default. If the defaulting party fails to file a motion to set aside before a claim to a hearing in damages is filed and thereafter files a motion to set aside, only the judicial authority may set aside the default. The opening of a default when a claim for a hearing in damages has been filed is controlled by Practice Book § 17-42. Significantly, Practice Book § 17-42 refers to Practice Book § 17-32, noting that certain defaults may be set aside by the clerk. The distinction between whether Practice Book § 17-32 applies or Practice Book § 17-42 applies is whether a claim for a hearing in damages is filed before, or after, a motion to set aside the default is filed." Snowdon v. Grillo, 114 Conn.App. 131, 138, 968 A.2d 984 (2009).

         The plaintiff made a claim for a hearing in damages on August 13, 2013, nearly one year after the entry of default (# 105). On that same day, the defendants filed an answer to the plaintiff's complaint (# 106). On September 27, 2013, the defendant filed a motion to open default, which was denied by the court, Robaina, J., on October 16, 2013. Because the plaintiff made its claim for a hearing in damages before an answer was filed by the defendants, [4] the opening of the default is governed by Practice Book § 17-42. In this instance, the court, Robaina, J., denied the defendants' motion to open the entry of default, the legal effect of which established the defendants' liability as to the CUTPA violations.



         Practice Book § 17-34 provides in relevant part that " [i]n any hearing in damages upon default, the defendant shall not be permitted to offer evidence to contradict any allegations in the plaintiff's complaint, except such as relate to the amount of damages, unless notice has been given to the plaintiff of the intention to contradict such allegations and of the subject matter which the defendant intends to contradict. . . ." No such notice was filed by the defendants in this case. Accordingly, the only issue before this court is a determination of the appropriate remedy in the context of a hearing in damages.

         At the hearing in damages, the plaintiff presented the testimony of several former employees of the defendants including: Maria Gonzalez, a former dental assistant employed by the defendants from 2003-2006; Linda Malone, a former dental assistant employed by the defendants from 1983-2009; Admar Idlibbi, D.M.D., a dentist, who worked for the defendants as an independent contractor from 2004-2007; Pamela Szymanoski, a former clerical office employee and office manager from 1992-2007, when she was fired for fraudulent practices; Lawrence Marini, a forensic fraud examiner who works for the Attorney General's Office; Patricia Cronin, a lead planning analyst for DSS who oversees the Medicaid program; and Douglas Shannon, a principal of Mercer, a global consulting firm that provides actuarial services for government medicaid agencies including DSS. Mercer assisted Cronin in the retrieval of data concerning Dr. Macko. The plaintiff also presented a transcript of the testimony of Leslie Perrotti before the state of Connecticut Dental Commission (Dental Commission). Perrotti, now deceased, was a former dental assistant employed by the defendants from 2002-2003. The defendants presented the testimony of Dr. Macko and Nancy Simone, a former employee of the defendants from 1998-2015, who did billing and insurance and was the office manager at the time the defendants closed the office. Notably, the plaintiff introduced exhibits 23 and 24 through Cronin, the DSS employee who compiled the information contained therein. Exhibits 23 and 24 are " ad hoc" reports reflecting records of FSS payments by DSS to the defendants, and records of payments by MCOs, to the defendants, for the dental procedure codes for " child prophylaxis" (D1120) and " fluoride applications" (D1203) by year, commencing in April 1, 2002 through December 31, 2009.[5]

         Plaintiff's exhibits 23 and 24 reflect that the average amount paid to the defendants by MCOs for procedure code D1120 from 2002 to 2008, when the program was discontinued, was $24.60, and the average amount paid for procedure code D1203, during the same period, was $18.92. The FSS payments to the defendants for the time period 2002 to 2009 averaged $44.62 for procedure code D1120 and $28.75 for procedure code D1203.

         By way of remedy, the plaintiff seeks restitution, civil penalties and injunctive relief against the defendants. The plaintiff contends that the defendants' pattern and practice of billing for dental procedures performed by unlicensed individuals violated Connecticut law and, pursuant to General Statutes § 42-110m (a), the plaintiff is entitled to an " order for restitution that disgorges [the defendants'] ill-gotten gains, " in the amount of $791, 668.60, plus civil penalties of $580, 024, and a permanent injunction " prohibiting Dr. Macko from engaging in future violations of CUTPA, violations of federal and state laws relating to the practice of dentistry and provider participation in the CMAP, and illegally submitting claims for reimbursement for dental services." [6] The defendants counter that the plaintiff has failed to prove by a preponderance of the evidence that Dr. Macko, or other licensed ...

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