SUBJECT:

Felix Ellis, M.D.,

Petitioner,

The Inspector General

DECISION

I. Background

By letter dated September 30, 2002 the I.G. notified Petitioner that he was being excluded from participation in Medicare, Medicaid, and all federal health care programs for a period of 12 years. The I.G. advised Petitioner that he was being excluded pursuant to section 1128(a)(1) of the Act as a result of his conviction in the Criminal Court of the City of New York, County of Kings, State of New York, of a criminal offense related to the delivery of a health care item or service under the Medicaid program. The I.G. also noted that the Act mandates that Petitioner be excluded for a minimum period of five years, but he was excluded for 12 years because of three aggravating circumstances the I.G. had found to exist in his case: 1) the acts resulting in his conviction, or similar acts, resulted in financial loss to a government program or one or more entities of $5,000 or more, in that Petitioner was ordered to pay approximately $150,000 in restitution to the Medicaid program; 2) the acts resulting in his conviction were committed over a period of one year or more, specifically from July 1997 through in or about June 1999; and 3) Petitioner was subject to an adverse action by a State government agency and the action was based on the same set of circumstances serving as the basis for the imposition of the I.G.'s exclusion, in that Petitioner was excluded from the New York Medicaid program.

By letter dated October 8, 2002, Petitioner timely requested a hearing and the case was assigned to me for hearing and a decision. In an August 12, 2002 letter to the I.G., which Petitioner attached to his hearing request, Petitioner admitted that he had been found guilty of Medicaid fraud. He asserted, however, that this was an "aberration" and due to his "inadvertent misuse of a billing code." Petitioner stressed that his conviction had nothing to do with patient care and that his treatment has never been found not to meet the applicable standards of care. Further, Petitioner inferred that no alternative sources of medical care for his patients exists, as he is a psychiatrist serving Spanish speaking Medicare and Medicaid patients and his knowledge of Hispanic customs and tradition allows him to have "greater insight concerning his patients." Petitioner also asserted that he has been unsuccessful in many cases in referring his patients to a Spanish-speaking psychiatrist. From this, Petitioner argued that he should either be given a waiver from exclusion or the shortest possible sanction under law.

On December 3, 2002, I convened a prehearing conference by telephone. During the conference Petitioner stated that he was not contesting the mandatory five-year exclusion, thus conceding that a basis existed for the I.G. to exclude him under section 1128(a)(1) of the Act. Instead, Petitioner argued that mitigating factors exist in his case and that the length of his exclusion should be no longer than the five-year minimum mandatory exclusion. Both parties agreed that the case could be decided based on an exchange of briefs and documentary evidence in lieu of an in-person hearing. Accordingly, with the parties' agreement, I set a briefing schedule for the case.

The I.G. submitted a motion for summary affirmance and brief (I.G. Br.), accompanied by four exhibits (I.G. exhibits (I.G. Exs.) 1 - 4). Petitioner submitted a response brief (P. Br.), unaccompanied by exhibits. The I.G. submitted a reply brief (I.G. R. Br.). In the absence of objection, I receive into evidence I.G. Exs. 1 - 4.

II. Issue

As Petitioner has admitted that the I.G. has a basis to exclude him for the minimum mandatory five-year period, and that he is not contesting that exclusion, the only issue in this case is whether the 12-year period of exclusion imposed against Petitioner by the I.G. is within a reasonable range of possible exclusions and, thus, not unreasonable.

III. Applicable Law

Section 1128(a)(1) of the Act authorizes the Secretary of Health and Human Services (Secretary) to exclude from participation in Medicare, Medicaid, and all federal health care programs (as defined in section 1128B(f) of the Act), any individual convicted of a criminal offense relating to the delivery of a health care item or service under title XVIII (Medicare) or under any State health care program (Medicaid). An exclusion under section 1128(a)(1) must be for a minimum period of five years. Act, section 1128(c)(3)(B).

The Secretary has also given the I.G. discretion to lengthen an individual's period of exclusion if specific aggravating factors are present. 42 C.F.R. § 1001.102(b). Among those aggravating factors are: 1) where the acts by an individual which resulted in the individual's conviction, or similar acts, caused, or were intended to cause, a financial loss to a Government program or to one or more entities of $5,000 or more ⁽¹⁾; 2) the acts that resulted in the conviction, or similar acts, were committed over a period of one year or more; and 3) whether the individual was convicted of other offenses besides those which formed the basis for the exclusion, or whether the individual has been the subject of any other adverse action by any federal, State or local government agency or board, if the adverse action is based on the same set of circumstances that serves as the basis for the imposition of the exclusion. 42 C.F.R. § 1001.102(b)(1), (2), and (9). If the presence of one or more aggravating factors justifies an exclusion longer than five years, specific mitigating factors contained in the regulations at 42 C.F.R. § 1001.102(c) may be considered as a basis for reducing an exclusion to no less than five years.

The aggravating and mitigating factors set forth in the regulations comprise the exclusive factors that may be considered in determining the length of an exclusion to be imposed pursuant to section 1128(a)(1). Evidence which does not relate to these factors is not relevant to determining the length of an exclusion. The regulations governing the length of exclusions do not prescribe the weight to be given to these factors. However, so long as the amount of time chosen for the exclusion imposed on a petitioner by the I.G. is within a reasonable range, based on demonstrated criteria, an administrative law judge has no authority to change the length of the exclusion. JoAnn Fletcher Cash, DAB No. 1725, at 18 - 19 (2000), citing 57 Fed. Reg. 3298, 3321 (1992); see Stacy Ann Battle, D.D.S., DAB No. 1843 (2002); see also Gary Alan Katz, R.Ph., DAB No. 1842 (2002).

IV. Findings of Fact and Conclusions of Law

I make findings of fact and conclusions of law to support my decision in this case. I set forth each finding below, in italics and bold, as a separate heading.

1. The I.G. had a basis upon which to exclude Petitioner from participation in Medicare, Medicaid, and all federal health care programs.

Petitioner has admitted that the I.G. had a basis upon which to exclude him under section 1128(a)(1) (see my Order and Schedule for Filing Briefs and Documentary Evidence dated December 4, 2002). Moreover, he stated specifically in his letter to the I.G. which was attached to his hearing request that he "did plead guilty to Medicaid Fraud." Finally, in his brief, Petitioner asserts that he "does not dispute the imposition of the five-year mandatory exclusion pursuant to Section 1128 (a)(1) of the Social Security Act." P. Br. at 1.

My review of the evidence submitted by the I.G. confirms that Petitioner was indeed convicted of a criminal offense within the ambit of section 1128(a)(1) of the Act. Petitioner plead guilty (a conviction as defined under section 1128(i)(3) of the Act), in the Criminal Court of the City of New York, County of Kings, State of New York, to the criminal offense of "Grand Larceny in the Fourth Degree." I.G. Ex. 2, at 2, 14. Petitioner stated in front of the judge hearing his plea of guilty that "[he] submitted invoices that constituted claims under the Medicaid Program, knowing that the claims that were stated at the length of time that [he] spent with the patients in Brooklyn, as a result of the claims the State of New York paid [him] more than $1,000 that [he] was not entitled to" and agreed that "[t]hose claims were submitted falsely, and over stated the length of time that [he] spent with patients." I.G. Ex. 2, at 5. Petitioner's guilty plea and its acceptance by the court, on the face of transcripts of his plea and sentencing hearings, constitutes a conviction of a criminal offense related to the delivery of a health care service (here his psychiatric services) under the Medicaid program. I.G. Exs. 2, 4.

2. The length of the exclusion imposed by the I.G. is within a reasonable range of possible exclusions and is not unreasonable.

The purpose of an I.G. exclusion is to protect the federally-funded health care programs, as well as those served by the programs, from an individual who has demonstrated by his or her conduct that he or she is untrustworthy. The I.G. has been vested with the discretion to increase the minimum period of exclusion. The use of the I.G.'s discretion has been found to be reasonable where a longer period of exclusion is necessary to accomplish this statutory purpose. The aggravating and mitigating factors listed in the regulations are the only factors the I.G. and an administrative law judge can consider when evaluating an individual's potential future threat to the programs and those they serve, which is the central concern of the exclusion provisions. Narendra M. Patel, M.D., DAB No. 1736 (2000); Joann Fletcher Cash, DAB No. 1725.

I find the I.G. has proved that three aggravating factors exist in this case. First, the I.G. asserts that Petitioner's actions caused a financial loss to a government program of $5,000 or more. 42 C.F.R. § 1001.102(b)(1). That this aggravating factor has been met is evident from the court's order that Petitioner make restitution in the amount of $150,000. I.G. Exs. 2, 4. Second, the I.G. asserts that Petitioner's criminal offenses occurred over a period of one year or more. 42 C.F.R. § 1001.102(b)(2). That this aggravating factor has been met is evident from Petitioner's admission to the court that his criminal offences took place between July 21, 1997 and June 28, 1999, a period of more than one year. I.G. Ex. 2, at 6. Finally, the I.G. asserts that Petitioner was the subject of an adverse action by a State government agency which was based on the same set of circumstances that serve as the basis for the imposition of the exclusion. 42 C.F.R. § 1001.102(b)(9). That this aggravating factor has been met is evident from the State Medicaid agency's two-year exclusion of Petitioner based on this conviction for improper billing. I.G. Ex. 3.

Petitioner does not dispute that these aggravating factors exist. P. Br. at 2. Further, Petitioner does not assert that any mitigating factors under the regulations exist. ⁽²⁾ Petitioner does argue, however, that a 12-year exclusion in his case based on the aggravating factors enumerated by the I.G. is "unreasonable, has no relation to Petitioner's offense and is excessive" and asserts that I have the discretion "not to apply these factors to increase the period of exclusion." P. Br. at 2. In this regard, Petitioner asserts that he is a highly qualified physician who provides his patients with care meeting the "highest professional standards." P. Br. at 3. Petitioner argues that his behavior was an aberration due, in part, to the inadvertent misuse of a billing code, not intentional improper billing. Petitioner asserts that he has paid complete restitution to Medicaid. Petitioner asserts that the judge in his criminal case did not impose a period of incarceration or a fine, but a one-year conditional discharge. Petitioner asserts also that his license was not revoked, but suspended for five years with four years and nine months stayed and a $5,000 fine. Petitioner also compares the facts in his case with several other cases in an effort to show that his exclusion should not be for as long as 12 years, although he recognizes that I am not mandated to follow this precedent in determining whether his exclusion falls within a reasonable range. P. Br. at 2 - 5. Petitioner's arguments are unavailing.

When I evaluate the aggravating factors in this case, I find that the 12-year exclusion imposed by the I.G. is within a reasonable range of possible exclusions and, thus, is not unreasonable. The I.G. has established three aggravating factors and no mitigating factors to exist. I find Petitioner's suggestion that his conduct was an "aberration" and his use of an incorrect billing code "inadvertent" to be not credible given his admission at his plea hearing that he submitted invoices for claims to Medicaid overstating the amount of time he spent with patients and that this conduct went on for almost two years. I.G. Ex. 2, at 5 - 6. The aggravating factors in this case illuminate the seriousness of Petitioner's deliberate conduct in billing for more time than he actually spent with patients, which conduct involved (based on his court ordered restitution) a large amount of money, which conduct occurred over an extended period of time, and which conduct the State Medicaid agency also found serious enough to impose an exclusion (albeit for a shorter length of time). Petitioner's conduct is clear evidence of his untrustworthiness. His conduct impairs the fiscal soundness of federal health care programs and potentially impacts public confidence in these programs. Accordingly, Petitioner's 12-year exclusion is a legitimate remedy consistent with the purposes of section 1128 of the Act; to protect federally-funded health care programs and their beneficiaries and recipients from untrustworthy individuals and entities. See Joann Fletcher Cash, DAB No. 1725.

V. Conclusion

Sections 1128(a)(1) and 1128(c)(3)(B) of the Act mandate that Petitioner be excluded from Medicare, Medicaid, and all other federal health care programs for a period of at least five years because he was convicted of a criminal offense related to the delivery of an item or service under Medicare or any State health care program. The I.G. is also justified in lengthening the period of exclusion due to the existence of three aggravating factors. I sustain this 12-year exclusion because it is within a reasonable range of possible exclusions and, thus, is not unreasonable.

Jose A. Anglada
Administrative Law Judge

1. This section of the regulation was revised, effective April 17, 2002, to increase the financial loss the I.G. considers as an aggravating factor from $1,500 to $5,000. 67 Fed. Reg. 11,928 (March 18, 2002).

2. In his letter to the I.G. accompanying his hearing request, Petitioner implied that alternative sources of medical care are not readily available to his patients and that his exclusion should be waived because of it. Although a mitigating factor for some exclusions under the regulations (see 42 C.F.R. § 1001.201(b)(3)(iv)), this is not a mitigating factor for exclusions pursuant to section 1128(a)(1) of the Act.