SUBJECT:

Raymond Montoya,

Petitioner,

The Inspector General

DECISION

I sustain the determination of the Inspector General (I.G.) to exclude Petitioner, Raymond Montoya, from participating in Medicare, Medicaid, and all federal health care programs for a period of 10 years.

I. Background

By letter dated August 30, 2002, the I.G. notified Petitioner that he was being excluded from participation in the Medicare, Medicaid, and all other federal health care programs (as defined in section 1128B(f) of the Social Security Act (Act)) for a period of 10 years. The I.G. informed Petitioner that his exclusion was imposed pursuant to sections 1128(a)(1) and 1128(a)(3) of the Act, due to his conviction (as defined in section 1128(i) of the Act), in the United States District Court, District of Montana, Great Falls Division, of a criminal offense related to the delivery of a health care item or service under the Medicare and Medicaid programs, and for a felony offense related to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct in connection with the delivery of a health care item or service in a health care program operated or financed by a governmental agency. This case is before me pursuant to a request for hearing filed on October 22, 2002, by Petitioner.

I conducted a telephone conference on January 6, 2003. The I.G. is represented in this case by the Office of Counsel. Although advised of his right to representation, Petitioner elected to appear on his own behalf. Both parties agreed this case could be decided based on written arguments and documentary evidence alone. Based on the parties' agreement and my review of the record in this case, I find that an in-person evidentiary hearing is unnecessary. ⁽¹⁾ On March 3, 2003, the I.G. submitted its initial brief (I.G. Br.) and six proposed exhibits. These have been identified as I.G. Exhibits (I.G. Exs.) 1- 6. On April 4, 2003, Petitioner filed his initial brief (P. Br.). Petitioner submitted no proposed exhibits. On May 7, 2003, the I.G. submitted its response brief (I.G. Resp.). The Petitioner, on May 20, 2003, filed his response brief (P. Resp.). There being no objections made, I admitted the I.G.'s proposed exhibits into the record in this case.

It is my decision to sustain the determination of the I.G. to exclude Petitioner from participating in the Medicare, Medicaid, and all other federal health care programs, for a period of 10 years. I base my decision on the documentary evidence, the applicable law and regulations, and the arguments of the parties. It is my finding that Petitioner was convicted of a criminal offense related to the delivery of a health care item or service under the Medicare program and a felony offense relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct. Additionally, I find that his 10-year exclusion is not unreasonable.

II. Issues

A. Whether the I.G. had a basis upon which to exclude Petitioner from participation in the Medicare, Medicaid, and all other federal health care programs; and

B. Whether the 10-year exclusion imposed by the I.G. is unreasonable.

III. Applicable Law and Regulations

Section 1128(a)(1) of the Act authorizes the Secretary of Health and Human Services (Secretary) to exclude from participation in any federal health care program (as defined in section 1128B(f) of the Act), any individual "convicted of a criminal offense related to the delivery of an item or service under title XVIII or under any State health care program." 42 U.S.C. § 1320a-7(a)(1).

Section 1128(a)(3) of the Act requires the Secretary to exclude any individual who has been convicted for an offense occurring after August 21, 1996, "in connection with the delivery of a health care item or service . . . in a health care program operated by or financed in whole or in part by any Federal, State, or local government agency." 42 U.S.C. § 1320a-7(a)(3). The criminal offense must be "a felony relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct." Id.

An exclusion under section 1128(a) of the Act must be for a minimum period of five years. Act, section 1128(c)(3)(B). Aggravating factors can serve as a basis for lengthening the period of exclusion. 42 C.F.R. § 1001.102(b). If aggravating factors justify an exclusion longer than five years, mitigating factors may be considered as a basis for reducing the period of exclusion to no less than five years. 42 C.F.R. § 1001.102(c).

Pursuant to 42 C.F.R. § 1001.2007, a person excluded under section 1128(a) of the Act may file a request for hearing before an administrative law judge (ALJ).

IV. The Parties' Arguments

A. The I.G.'s Arguments

The I.G. argues that Petitioner was convicted of a criminal offense related to the delivery of an item or service under the Medicare program and of a felony relating to financial misconduct in connection with the delivery of a health care service in a health care program financed in whole or in part by a governmental entity. Therefore, Petitioner is subject to the statutory minimum mandatory period of exclusion, that is, five years. Act, section 1128(c)(3)(B); 42 U.S.C. § 1320 a-7(c)(3)(B).

The I.G. also asserts that, due to the following aggravating factors and the absence of mitigating factors, Petitioner's period of exclusion was reasonably lengthened to 10 years:

•The acts resulting in the conviction created a financial loss to a government program or to one or more entities of $5000 or more.

•The sentence imposed by the court included incarceration.

•Petitioner was convicted of another offense that was based on the same circumstances that serve as the basis for the imposition of the exclusion.

42 C.F.R. §§ 1001.102(b)(1), (5) and (9).

B. Petitioner's Arguments

Petitioner, Assistant Administrator of the Blackfeet Nursing Home, was convicted of theft of federal and tribal funds from a federally-funded health care facility. In his brief, Petitioner conceded he is subject to at least a five-year exclusion. P. Br. at 2. Petitioner's main argument with respect to his exclusion is that an extension of his exclusion beyond five years is unreasonable and does not account for several mitigating factors. He asks for consideration of the following:

•The restitution ordered by the Court as part of his sentencing overstated the amount of loss resulting from his crime.

•The sentencing Court could have sentenced him to a far longer incarceration and his incarceration was at a transition facility rather than a regular prison.

•The third count for which he was convicted is not a separate crime and, thus, should not be an aggravating factor.

•Petitioner has worked with many health care programs for the Blackfeet Tribe and has not previously had any legal problems or convictions associated with his work.

•Petitioner has won many awards, certificates, letters of acknowledgment and thanks for his prior work with the Tribe.

P. Br. at 4 - 8. Petitioner brings up several arguments he made during the investigation that led to his trial. In particular, Petitioner says that the Tribe was aware of his activities; the theft occurred so long before the trial that his defense was "lost through poor records management;" and the presiding judge would not allow him to have witnesses in his defense and allowed the prosecution to amend the charges against him. Id. at 7. In his response, Petitioner also argued that: (1) his cooperation with the Department of Health and Human Services (DHHS) which led to another individual being convicted should be a mitigating factor; (2) because the I.G. has not shown that the restitution he was required to make represents money taken from Medicare or Medicaid rather than the Tribe, the restitution should not be an aggravating factor; and (3) the law does not prevent consideration being given to the type of incarceration imposed on the excluded individual. P. Resp. at 3 - 4. Petitioner reiterated his argument that he was convicted of "one" theft, not three, and thus, his last conviction on the third count of his indictment should not be considered an aggravating factor. Id. at 4.

V. Findings and Discussion

The findings of fact and conclusions of law noted below, in italics and bold, are followed by a discussion of each finding.

A. Petitioner was convicted of a criminal offense related to the delivery of an item or service under title XVIII (Medicare).

Petitioner, who was the Assistant Administrator of the Blackfeet Nursing Home, was charged by a three-count grand jury indictment on May 21, 2001, in the United States District Court for the District of Montana, Great Falls Division, of embezzling funds from the Blackfeet Nursing Home, in violation of 18 U.S.C. §§ 669, 641, and 1163, from December 1996 until November 12, 1997. I.G. Ex. 3, at 2.

According to the grand jury indictment against Petitioner, he, as an employee of the Blackfeet Nursing Home, created an employee incentive fund using federal and tribal monies and, thereafter, he and another employee withdrew the funds for their own personal use and benefit. I.G. Ex. 3.

After a trial by jury, Petitioner was found guilty of all three counts. I.G. Ex. 4. In December 2001, Petitioner was sentenced to a term of 15 months in prison for each count, with each term to run concurrently. Additionally, upon his release from imprisonment, Petitioner was sentenced to supervised release for three years. I.G. Ex. 5. He was required to pay an assessment of $300 and restitution in the amount of $30,553.54. Id.

I find that Petitioner's conviction met the definition of a section 1128(a)(1) conviction. He was convicted of three criminal offenses. Section 1128(i)(2) of the Act defines a conviction as inter alia "[w]hen there has been a finding of guilt against the individual or entity by a Federal, State, or local court . . . ." Petitioner was found guilty of violating 18 U.S.C. §§ 669, 641, and 1163 by a federal court. I.G. Ex. 4.

As noted above, Petitioner made several arguments related to the incorrectness of his conviction, specifically asserting that the judge's rulings discouraged his witnesses from testifying and were prejudicial in other respects as well. It is inappropriate for me to inquire into a jury's or judge's decision concerning the evidence that was before them. It is well established that section 1128 of the Act is triggered by a conviction and neither the ALJ nor the Departmental Appeals Board (Board) can collaterally attack the underlying conviction or relitigate the validity of the conviction. 42 C.F.R. § 1001.2007(d) Travers v. Shalala, 20 F.3d 993, 998 (9^th Cir. 1994). Therefore, all of the facts Petitioner sets forth in his brief regarding the judge's prejudicial rulings at his trial are unavailing to him here and are given no evidentiary weight in this decision. P. Br. at 7.

Petitioner's conviction for violating 18 U.S.C. § 669 was for acts related to the provision of nursing home services, which is an item or service under Title XVIII, in that payments are made for nursing home services by Medicare and Medicaid. ⁽²⁾

The Blackfeet Care Center, formerly known as the Blackfeet Nursing Home, received $742,000 from Medicaid in 1996 and $808,000 from Medicaid in 1997. I.G. Ex. 6. This money was to be applied to the care of the patients. I find that the facts and circumstances underlying Petitioner's conviction establish a nexus or common sense connection between the delivery of the nursing home services and the money taken by Petitioner from the nursing home's employee incentive fund. The theft for which Petitioner was convicted clearly constitutes program-related misconduct. Jerry L. Edmonton, DAB CR59 (1989). Petitioner's conviction met the criteria of a section 1128(a)(1) conviction.

B. Petitioner was convicted under federal law of a felony that occurred after August 21, 1996, relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct with respect to an act in a health care program financed in whole, or in part, by any Federal, State or local government agency.

I find that Petitioner's conviction also met the criteria of a section 1128(a)(3) conviction. He was convicted under federal law in that a jury found him guilty, and a federal judge entered judgment against him, for violating 18 U.S.C. § 641, a federal law. ⁽³⁾ His conviction was for acts committed after August of 1996. The indictment for which he was convicted states that the acts were committed between December 1996 and November 1997. As noted above, the acts were committed in a health care program, i.e., the Blackfeet Nursing Home, that was financed in whole or in part by Medicare and Medicaid, which are government agencies. His conviction was for acts occurring in connection with the delivery of a health care item or service, nursing home services. His conviction was for a criminal offense relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct. His conviction was for a felony offense.

A felony is an offense punishable by imprisonment for a term exceeding one year. A violation of 18 U.S.C. § 641 carries a potential sentence of imprisonment of up to 10 years, unless the value of the stolen property is less than $1000.

Two of the counts for which Petitioner was convicted ⁽⁴⁾, theft from a health care facility in violation 18 U.S.C. § 669 and theft of federal government money in violation of § 641, are section 1128(a) convictions and either conviction would support the I.G.'s imposition of Petitioner's mandatory exclusion for five years.

C. Petitioner's exclusion for a period of 10 years is not unreasonable.

On August 30, 2002, the I.G. notified Petitioner that he was being excluded from participation in the Medicare, Medicaid, and all federal health care programs for a minimum period of 10 years. I.G. Ex. 1. That action was taken pursuant to section 1128(a)(1) and 1128(a)(3) of the Act due to his conviction as defined in section 1128(i)(2). An exclusion under section 1128(a)(1) or 1128(a)(3) of the Act must be for a minimum mandatory period of five years as set forth in section 1128(c)(3)(B) of the Act which states:

Subject to subparagraph (G), in the case of an exclusion under subsection (a), the minimum period of exclusion shall not be less than five years . . . .

When the I.G. imposes an exclusion for the mandatory five-year period, the issue of the length of such exclusion is not considered. 42 C.F.R. § 1001.2007(a)(2). Aggravating factors which justify extending the exclusion period may be taken into account, but the five-year term will not be shortened.

Petitioner was convicted of a criminal offense related to the delivery of a health care item or service under the Medicare program and for a felony of financial misconduct in the delivery of an item or service financed in part by a governmental agency. The I.G. was required to exclude him, pursuant to section 1128(a)(1) and 1128(a)(3) of the Act for at least five years. Consequently, the only issue in controversy is whether the 10-year exclusion period imposed against Petitioner is unreasonable.

The I.G. has discretion to impose an exclusion of more than five years in appropriate circumstances. In Petitioner's case, the I.G. added five years to the statutory five-year minimum. Petitioner made a general argument in his response brief that the cases seem to render powerless the ALJ in these types of cases, giving the I.G. "ultimate and final authority" in assessing the length of exclusions. P. Resp. at 2. The ALJ must give consideration to the quantity and circumstances of the aggravating and mitigating factors in determining whether a period of exclusion is reasonable. Nonetheless, the Board has previously pointed out that the preamble to the applicable regulations, 42 C.F.R. Part 1001, "indicates that the regulation contemplates broad discretion for the I.G. in setting the length of an exclusion in a particular case, in light of the I.G.'s 'vast experience in implementing exclusions under these authorities'. . . .". And the Board has, thus, held that as long as the length of exclusion is within a reasonable range, neither the ALJ nor the Board has the authority to alter it. Gerald A. Snider, M.D., DAB No. 1637 (1997). My inquiry is limited to whether the I.G.'s determined length of exclusion is within a reasonable range.

The Secretary has published regulations which establish the criteria for determining the length of exclusions imposed pursuant to section 1128 of the Act. The regulation which sets forth the applicable criteria for an exclusion imposed pursuant to section 1128(a) is 42 C.F.R. § 1001.102. The applicable criteria are expressed as either aggravating or mitigating factors. The relevant aggravating factors are stated at 42 C.F.R. § 1001.102(b). The relevant mitigating factors are stated at 42 C.F.R. § 1001.102(c). An exclusion may be imposed for a period of more than five years where there exists an aggravating factor or factors not offset by any mitigating factor or factors.

The aggravating and mitigating factors that are set forth in the regulations function as rules of evidence for deciding the length of exclusions. Evidence which does not pertain to one of the specifically stated aggravating or mitigating factors is not relevant and may not be used to decide whether an exclusion of a particular length is unreasonable.

The regulations do not prescribe the weight that is to be given to evidence that relates to an aggravating or a mitigating factor. While the regulation tells the decision maker what criteria may be used to determine the length of an exclusion, it does not tell the decision maker how to weigh relevant evidence to arrive at an exclusion that is reasonable in a given case.

However, there is an overall statutory purpose to which the regulations must adhere. An exclusion is not intended to be a punishment. The purpose of any exclusion that is imposed under section 1128 of the Act is to protect federally funded health care programs and beneficiaries and recipients of those programs from an individual who has been shown not to be trustworthy. Therefore, in deciding the length of an exclusion that is imposed pursuant to section 1128, the question that must be considered is: what is reasonably necessary to protect the programs and their beneficiaries and recipients from an untrustworthy individual? In a case involving an exclusion that is imposed pursuant to section 1128(a)(1) or 1128(a)(3), the factors that are contained in 42 C.F.R. § 1001.102(b) and (c) state the criteria which may be used to answer this question.

At the outset, however, I point out that Petitioner was convicted of program-related embezzlement, a felony of financial misconduct. He was sentenced to prison, and ordered to make restitution in the amount of $30,553.54. In the face of such a conviction, the I.G. was required by law to exclude him as untrustworthy for five years and to evaluate his future trustworthiness pursuant to the factors set forth at 42 C.F.R. § 1001.102. Joann Fletcher Cash, DAB No. 1725 (2000).

1. The I.G. has proven the existence of aggravating factors.

The aggravating factors that the I.G. may consider in lengthening a period of exclusion are found at 42 C.F.R. § 1001.102(b). In the instant case, the I.G. contends that a basis exists for increasing the period of exclusion in view of these three factors:

•The acts resulting in the conviction created a financial loss to a government program or to one or more entities of $5000 or more (42 C.F.R. § 1001.18702(b)(1)).

•The sentence imposed by the court included incarceration (42 C.F.R. § 1001.102(b)(5)).

•The Petitioner was convicted of another offense based on the same set of circumstances that served as the basis for his exclusion (42 C.F.R. § 1001.102(b)(9)).

a. Petitioner's criminal offense involved the loss of $5000 to a federal health care program or other entity.

With regard to the first factor, I find that the Petitioner's criminal offense involved the loss to a federal health care program or other entity of over $5000. The I.G. presented no other evidence but the amount of restitution, i.e., $30,553.54, to prove this aggravating factor. The Court ordered the restitution to be remitted to the Blackfeet Nursing Home. It is appropriate to consider the amount ordered for restitution to correspond to the amount of the loss to an entity. Steven Alonso Henry, M.D., DAB CR638 (2000). Thus I find the I.G. has made a prima facie case that the loss to an entity occasioned by Petitioner's criminal acts was over $5000.

With respect to this aggravating factor, Petitioner provided insufficient evidence to contradict the sentencing court's establishment of the amount of loss engendered by Petitioner's criminal activity to be $30,553.54. Petitioner argues that only about $18,300 of the total restitution ordered represented funds from Medicare, Medicaid or other U.S. Treasury checks. He further stated that some $2000 went to employees of the nursing home, some $5000 went for awards for groceries. Of the remainder, a considerable amount of the funds were used to provide emergency loans to meet employees' emergency needs.

In calculating whether the loss exceeded $5000, it does not matter whether the loss was from a government agency or another type of entity. Therefore, it does not matter whether the stolen funds belonged to the Blackfeet tribe or the federal government in considering whether this aggravating factor is established. Moreover, the regulations specifically require the entire amount of the financial loss to the program or entities to be considered regardless of who received the stolen funds or whether full or partial restitution has been made. 42 C.F.R. § 1001.102(b)(1); Dan Anderson, DAB CR855 (2002). Accordingly, I find the I.G. has proven this aggravating factor.

b. The sentence imposed by the Court after Petitioner's conviction included incarceration.

With respect to the second alleged aggravating factor, 42 C.F.R. § 1001.102(b)(5) provides for lengthening the period of exclusion if "the sentence imposed by the court included incarceration." On December 10, 2001, subsequent to a trial by jury and a finding of guilt, a judge of the United States District Court sentenced Petitioner to 15 months in prison. Petitioner argues that he was sentenced to a half-way house and home detention only. The regulations, however, explicitly define "incarceration" to mean imprisonment or any type of confinement with or without supervised release, including, but not limited to, community confinement, house arrest and home detention." 42 C.F.R. § 1001.2. Home detention constitutes incarceration for purposes of these regulations and ALJs are bound by the regulations. Farhad Mohebban, DAB CR686 (2000). I am also not persuaded that consideration must be given to the fact that Petitioner could have been incarcerated for far longer than he actually was. The applicable criterion for this aggravating factor is whether the sentence included any "incarceration." Therefore, I find the I.G. has proven this aggravating factor.

c. The Petitioner was convicted of another offense besides those that formed the basis for the exclusion, based on the same circumstances that serve as the basis for the imposition of his exclusion.

With respect to the third alleged aggravating factor; that is, being convicted of another offense if the adverse action is based on the same circumstances that served as the basis for the imposition of the exclusion, the I.G. relied on Petitioner's conviction for the third count of the indictment. In the third count, Petitioner was charged with violating 18 U.S.C. § 1163. This particular statute makes it illegal to embezzle, steal or knowingly convert to one's own use any of the moneys, funds, credits, goods, assets, or other property belonging to any Indian tribal organization or intrusted to the custody or care of any officer, employee, or agent of an Indian tribal organization. Count III of the indictment charged Petitioner with willfully embezzling, stealing, purloining or knowingly converting to his use property belonging to the Blackfeet Nursing Home of the Blackfeet Tribe of Indians, an Indian tribal organization. I.G. Ex. 3, at 2-3.

Petitioner makes two arguments with respect to this aggravating factor. First, he posits that this count is part of the same indictment or crime and should not form the basis for a further period of exclusion. He argues that the counts were grouped for purposes of sentencing and, thus, the third alleged aggravating factor is not applicable. Second, Petitioner argues that the Blackfeet Nursing Home is a "tribal program" and not an "Indian Tribal Organization," and there are distinct differences between a tribal program and a tribal organization.

With respect to Petitioner's first argument, that his conviction for all three counts of the indictment constituted one crime, I find that his conviction on all three counts represented three separate crimes. Both the violations of 18 U.S.C. §§ 669 and 641 are specifically subject to the five year minimum exclusion because section 669 is likely to be a "program-related" crime and section 641 refers to a felony of financial misconduct in connection with a health care item or service or governmental funds. Petitioner's conviction for the violation of these two statutes is separate and apart from the violation of section 1163, which is for financial crimes against an Indian tribal organization. Count III is a separate offense based on the same facts and circumstances of the prior two counts and, thus, fits squarely within the regulatory language of 42 C.F.R. § 1001.102(b)(9) which provides that it is an aggravating factor if:

. . . the individual or entity was convicted of other offenses besides those which formed the basis for the exclusion . . . if the adverse action is based on the same set of circumstances that serve as the basis for imposition of the exclusion.

Other excluded individuals have argued that the adverse action referred to by the I.G. in applying this aggravating factor were based on the same circumstance and, therefore, constitute the same offense. As is evident from the language of 42 C.F.R. § 1001.102(b)(9) (quoted above), however, this is precisely the situation described in the aggravating factor. Joseph Piciotti, D.P.M, DAB CR769 (2001).

With respect to Petitioner's second argument, that the Blackfeet Nursing Home is a tribal program and not a tribal organization, I find that to so find would require me to determine that the jury was incorrect in finding Petitioner guilty of violating 18 U.S.C. § 1163. An "Indian tribal organization" has been defined in case law, and I must assume the court properly instructed the jury regarding that definition. See, e.g., U.S. v. Brame, 657 F.2d 1090 (9^th Cir. 1981); U.S. v. Zephier, 916 F.2d 1368 (8^th Cir. 1990). Because I cannot go back and relitigate the jury's finding, i.e., collaterally attack the conviction, I must accept that the jury found the Blackfeet Nursing Home to be a tribal organization as defined in the law.

Therefore, I find the I.G. has proven the existence of the third aggravating factor.

2. Petitioner has failed to demonstrate the existence of any mitigating factors.

As noted above, in his briefing, Petitioner mentions several "mitigating" factors. But ,as also noted above, for determining the reasonableness of the length of exclusion, the ALJ can only consider the existence of mitigating factors if aggravating factors exist and the ALJ can only consider the mitigating factors specifically listed in the regulations. 42 C.F.R. § 1001.102(c). The allowable mitigating factors are: (1) the individual was convicted of three or fewer misdemeanor offenses, and the financial loss to Medicare was less than $1500; (2) the court determined the individual had a mental, emotional or physical condition before or during the commission of the offense that reduced the individual's culpability; or (3) the individual's cooperation with federal or state officials resulted in others being convicted or excluded from Medicare, Medicaid and all other federal health care programs, additional cases being investigated or reports being issued by the appropriate law enforcement agency identifying program vulnerabilities or weaknesses, or the imposition against someone else of a civil money penalty or assessment.

In his response brief, Petitioner mentioned that he provided cooperation with DHHS. This may be relevant, but Petitioner provided no further evidence, such as a sentencing report or transcript or letter from the investigators, to confirm he provided the type of cooperation required to apply this mitigating factor; that is, that his cooperation led to the conviction or investigation of others or the imposition of a monetary penalty against others. The mere fact of cooperation does not automatically reduce the period of exclusion. Steven Alonso Henry, M.D., DAB CR638 (2000); David E. Sternberg, M.D., DAB CR617 (1999). Petitioner bears the burden of proving any of the mitigating factors. Steven Alonso Henry, DAB CR638.

The exclusive list of mitigating factors in the regulations does not provide for mitigation based on an individual's generally good career. P. Br. at 7. Therefore, I cannot consider Petitioner's career history in association with a determination of whether the I.G.'s imposed length of exclusion is unreasonable. In another recent case, the petitioner also argued that he had provided valuable services to Medicare and that the monetary benefit of these services outweighed any loss to the Medicare program. The ALJ in that case found that the regulation did not allow him to consider evidence of the benefits provided as a mitigating factor. Dan Anderson, DAB CR855 (2002).

In sum, I find the Petitioner has not shown the presence of any mitigating factors.

3. Protection of the beneficiaries of Medicare and other federal health care programs is required.

Obviously, Petitioner's conduct is the type that Congress sought to deter for the protection of the beneficiaries of the federal and state health care programs. It follows that, since Petitioner poses a risk to the welfare of Medicare and Medicaid recipients, his untrustworthiness makes him unfit to participate in any of these programs. I must determine whether the length of exclusion is unreasonable based on the facts as found by me. In order to make that determination, I must consider whether the length of the exclusion imposed by the I.G. is within a reasonable range. Thus, to determine if the I.G.'s length of exclusion is unreasonable, I must consider the parties' evidence as it pertains to the aggravating factors delineated at 42 C.F.R. § 1001.102 and, based upon my findings, determine if the I.G.'s decision is within a reasonable range.

The aggravating factors established by the I.G. in this case prove Petitioner is an untrustworthy individual due to his participation in a crime resulting in a loss to an entity of over $30,000. The actions for which he was convicted were recurrent and deliberate, not random and impulsive. Petitioner was sentenced to 15 months of incarceration followed by three years of probation after a full jury trial, suggesting that the sentencing judge found him to be a culpable individual.

For the reasons previously stated above, and in light of my consideration of the regulatory criteria, I find that the 10-year exclusion imposed by the I.G. is within a reasonable range of possible exclusion periods given the circumstances of this case, in which three aggravating factors were present and no mitigating factors. I find that the five-year additional exclusion imposed by the I.G. is not excessive. The 10-year exclusion is a legitimate remedial remedy, which is consistent with the purpose of section 1128 of the Act. In essence, the purpose of section 1128 of the Act is to protect federally funded health care programs and their beneficiaries and recipients from untrustworthy individuals.

VI. Conclusion

Sections 1128(a) 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 of his criminal conviction for an offense relating to delivery of a health care item or service under the Medicare program, and his felony offense of financial misconduct in connection with the delivery of a health care item or service in a health care program operated by or financed in whole or in part by a government agency. The I.G. was also justified in lengthening the period of exclusion due to the existence of aggravating factors. The 10-year exclusion is, therefore, sustained.

Anne E. Blair

Administrative Law Judge

1. Petitioner has had an opportunity to fully present his position in this case. He has not suggested he has witnesses to give oral testimony or that he has any testimony to present himself that he has failed to report in the briefs he filed.

2. Section 669 of 18 U.S.C. makes it illegal to knowingly and willfully embezzle , steal, or otherwise without authority convert to the use of any person other than the rightful owner, or intentionally misapply any of the moneys, funds, property or other assets of a health care benefit program.

3. Section 641 of 18 U.S.C. makes it illegal to embezzle, steal, or knowingly convert to one's own use or the use of another anything of value of the United States or any department or agency thereof.

4. Petitioner was convicted of a third count, theft from an Indian tribal organization in violation of 18 U.S.C. § 1163. I.G. Exs. 4 and 5.