When you use meds, you just remove the carbon, which is the little black rock looking things. When you are done medicating, you replace the carbon to get rid of the meds, but it has to be new carbon. Carbon is only good for 2 weeks, so if it has been in your tank longer than that, you will need new. Make sure you don't put a bunch of new stuff in the filter though, since that's where your good bacteria lives.
I wouldn't use meds yet though, I would do some water changes for the next few days and see how that goes. What is in the meds that you bought? What does it say it treats?
Do you have hiding places for your BGK? They don't like light too much, so they tend to hide during the day.
My BGK grew from 4-8 inches in about 5 months, and oscars should be kept in tanks with only other oscars.
EDIT: Keep the ceramic rings and black sponge in your filter, you only need to remove the carbon (little black rocks).