Last week’s arrest of a DeKalb County obstetrician shows a new area of interest for Attorney General Sam Olens: prosecuting doctors who perform abortions and bill Medicaid for related ultrasound tests.

The AG’s office says charging Medicaid for abortion-related services constitutes fraud, but another DeKalb doctor facing similar charges will take his case to the Georgia Supreme Court next month.

At issue is whether the federal Hyde Amendment and state law, which prohibit tax money from being used for elective abortions, also apply to pregnancy services performed before an abortion. Neither doctor is accused of charging Medicaid for abortions.

In the case before the high court, a Georgia administrative law judge had ruled in favor of Dr. Tyrone Cecil Malloy. The judge said that the state couldn’t withhold Medicaid funding for lab testing of a patient seeking an abortion or confirmation of pregnancy. The attorney general’s office countered in its brief to the Supreme Court that the civil determination of an administrative law judge doesn’t invalidate a criminal prosecution.

Malloy’s attorneys wrote to the court that state prosecutors, whose office is led by the Republican attorney general, are pursuing the case for political reasons.

“The prosecution of this case is a mockery of justice. The State is using its vast police power to harass, persecute, and undermine one of its citizens to further an obvious political agenda,” according to the brief by attorneys Thelma Wyatt Moore, Dwight Thomas and M. Katherine Durant.

The attorney general’s office said in its reply that the indictment wasn’t politically charged, and that Malloy failed “the test of common sense” when he billed Medicaid $132,000 over three years for patient office visits associated with elective abortions and $255,000 for ultrasounds that allegedly weren’t performed.

“It should be apparent to anyone who has signed on as a provider in the Medicaid field that a service provider is not allowed to charge the state for abortion-related services, and by artifice and design, conceal such activity, thereby obtaining amounts greater than he is entitled,” said the brief by Olens, Senior Assistant Attorney General Nancy Allstrom and Assistant Attorney General Henry Hibbert.

Malloy was indicted Dec. 8, 2010, on two counts of Medicaid fraud. He is appealing DeKalb County Superior Court Judge Cynthia Becker’s rulings that denied his claims that the indictment violated his rights against double jeopardy, unconstitutionally vague statutes and prejudicial language. The high court will hear oral arguments Feb. 4. His attorneys didn’t return messages seeking comment.

As Malloy’s appeal was pending, the state brought Medicaid fraud charges against Dr. Andre Damian Williams, who was arrested Jan. 2. A Dec. 20 indictment in DeKalb County accuses Williams of illegally billing the government $205,000 for abortion-related procedures, including detailed ultrasounds, office visits, transvaginal ultrasounds, pregnancy tests and urinalysis. Williams couldn’t be reached, and an attorney couldn’t be located.

These two cases are the first abortion-related Medicaid fraud indictments brought by the attorney general’s office, said Olens spokeswoman Lauren Kane.

“We aggressively prosecute Medicaid fraud regardless of how it is committed,” Kane said.

Doctors across the country may bill Medicaid for ultrasounds and urinalysis separately from abortion procedures, said American College of Obstetricians and Gynecologists spokesman Greg Phillips. Those ultrasound and urinalysis services aren’t considered bundled with abortions by the Medicare Correct Coding Initiative or by the ACOG Coding Manual, he said.

The Hyde Amendment has forbidden federal money from being used for elective abortions since 1976. The state of Georgia administers the federal Medicaid program, which provides health services to people with low incomes, through the Department of Community Health. The department’s policies and procedures call for doctors to be reimbursed for abortions when the life of the mother is endangered and in cases of rape and incest.

Malloy’s attorneys argued in their brief that he had no way of knowing that charging Medicaid for abortion-related services could be considered illegal, especially after Administrative Law Judge Steven Teate found in his favor Aug. 25, 2010.

Teate’s ruling reversed the Department of Community Health’s determination to withhold Medicaid payments from Malloy.

Teate wrote that the department’s procedures don’t clearly enunciate whether abortion expenditures exclude abortion-related expenses, and that an accusation of fraud would have required knowledge of a falsehood.

Malloy continued his medical practice for more than a year after Teate’s decision before he was indicted.

State prosecutors said in their filings that Malloy should have known better.

The state’s Policies and Procedures for Physician Services don’t say that doctors can’t charge Medicaid for abortion-related services. Instead, it outlines that payments will be reimbursed in cases involving rape, incest and endangerment of the life of the mother, and that documentation is required in those cases for reimbursement of associated services such as ultrasounds and lab tests.

The attorney general’s office wrote in its brief that the Georgia Supreme Court should reject Malloy’s appeal because the trial court denied his motion for a certificate of immediate review, which is a requirment for bringing interlocutory appeals.

Prosecutors argued that Malloy can’t justify his actions based on an administrative law judge’s decision. They added that double jeopardy considerations don’t apply, because the judge’s civil actions don’t preclude criminal charges, and that the statutes aren’t unconstitutionally vague.

Malloy wrote in a May 7, 2010, letter to the Department of Community Health that he billed the government for routine pregnancy services, but that he had never charged Medicaid for an abortion, and 25 percent of his patients left his office undecided about whether to have an abortion.

“It would be unfair to separate the facilities that submit the claims for these services that do not perform abortions from those that have the capability to provide that service even though the former had just as much knowledge as to the patients intent at the time the procedures were performed,” Malloy wrote in the letter, which is an exhibit in his criminal case.

Nancy Boothe, executive director for Atlanta’s Feminist Women’s Health Center, which also provides abortions, said Malloy thought he was protected after he won a ruling from the administrative law judge.

“He presumed he had something in writing saying it was OK to do that,” Boothe said. “In the case of Dr. Malloy, I believe it’s harassment. They’ve been after him for a long long time, and they seem not to be willing to give up.”

The Feminist Women’s Health Center doesn’t bill Medicaid for abortion-related services, Boothe said, because it would create a hassle, and she needs to choose her battles.

Suzanne Ward, spokeswoman for Georgia Right to Life, said laws barring government funding for elective abortions should be aggressively enforced.

“Abortion opens that door to the abuse of taxpayer funds,” Ward said. “The law is clear that federal funds are not to be used for elective abortions.”

Medical Association of Georgia Executive Director Donald Palmisano Jr. said he’s not aware of any widespread confusion among physicians about what can or can’t be billed under Medicaid.

“The Medical Association of Georgia doesn’t have a policy that addresses Medicaid billing in any specific way, but physicians should only submit bills for the work they perform,” Palmisano said.

According to the state Department of Public Health, Georgia lawmakers in 2007 changed the law so that in “all cases in which an ultrasound is performed prior to conducting an abortion or a pre-abortion screen, the woman must be offered the opportunity to view the ultrasound and listen to the fetal heart rate.”

The case on appeal to the Georgia Supreme Court is Malloy v. State, No. S13A0188.