SUBJECT:

Carlos Noda,

Petitioner,

The Inspector General

DECISION

This case is before me pursuant to a request for hearing filed by Carlos Noda (Petitioner) on November 19, 2002. Social Security Act (Act), section 1128(f); 42 C.F.R. § 1005.2.

By letter dated October 31, 2002, the Inspector General (I.G.) notified Petitioner that he was being excluded from participating in Medicare, Medicaid, and all federal health care programs as defined in section 1128B(f) of the Act. The I.G. further informed Petitioner that the exclusion was based on section 1128(b)(4) of the Act, in view of the revocation, suspension, loss, or surrender of his license to practice medicine or provide health care in the State of Florida for reasons bearing on his professional competence, professional performance, or financial integrity. The exclusion would be in effect as long as his license to practice opticianry in Florida remained revoked, suspended, surrendered, or otherwise lost.

The I.G. is represented in this case by the Office of Counsel. Petitioner appears on his own behalf in spite of being advised of his right to retain counsel. At a telephone conference held on February 5, 2003, the parties agreed that this matter could be decided based on written arguments and documentary evidence, and that an evidentiary hearing was unnecessary. The I.G. submitted a memorandum of law (I.G. Br.) accompanied by seven proposed exhibits on March 7, 2003. These have been identified as I.G. Exhibits 1 - 7 (I.G. Ex.), and admitted into the record without objection. Petitioner submitted a brief in support of his contentions (P. Br.) on March 7, 2003, and offered six exhibits. These have been admitted into the record without objection as Petitioner Exhibits 1 - 6 (P. Ex.). The parties did not file reply briefs.

It is my decision to sustain the determination of the I.G. to exclude Petitioner, Carlos Noda, from participating in Medicare, Medicaid, and all other federal health care programs, for a period coterminous with the loss of his license to practice medicine or provide health care in the State of Florida. 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's license was suspended by the State of Florida Board of Opticianry (Board) for reasons bearing on his professional competence, professional performance, or financial integrity. Additionally, I find that when an exclusion imposed by the I.G. runs concurrent with the remedy imposed by the State licensing authority, such exclusion is mandated by law.

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

2. Whether the length of the exclusion imposed and directed against Petitioner by the I.G. is unreasonable.

Under section 1128(b) of the Act, the Secretary of Health and Human Services (Secretary) may exclude individuals from participation in any federal health care program, as defined in section 1128B(f), any individual whose license to practice has been revoked or suspended or otherwise lost for reasons bearing on his professional competence, performance or financial integrity. Section 1128(b)(4) of the Act.

The Act defines "federal health care program," as any plan or program that provides health care benefits, whether directly, through insurance, or otherwise, which is funded directly, in whole or in part, by the United States Government; or any State health care program, as defined in section 1128(h). Act, section 1128B(f).

Section 1128(b)(4)(B) of the Act authorizes the I.G. to exclude an individual who surrenders a license to provide health care, while a formal disciplinary proceeding is pending before a state licensing authority, and the proceeding concerns the individual's professional competence, professional performance, or financial integrity. According to section 1128(c)(3)(E) of the Act, the minimum term of exclusion of an individual who is excluded pursuant to section 1128(b)(4) must be coterminous with the term of loss, suspension, revocation, or surrender of that individual's license to provide health care.

The regulations promulgated at 42 C.F.R. §§ 1001.501 and 1001.1901(b) mirror the statutory provisions set forth in the Act.

2. On March 14, 2002, the Florida Agency for Health Care Administration (AHCA) notified Petitioner that the Florida Department of Health (Department) had filed an Administrative Complaint (Complaint) against his license. I.G. Ex. 5.

3. The Complaint charged Petitioner with performing eye examinations when he was not authorized to do so, dispensing glasses and contacts by forging or otherwise procuring a prescription from a physician, and billing the Florida Medicaid program for glasses and contacts in violation of Florida statutes. I.G. Ex. 3, at 2, 3.

4. On March 18, 2002, Petitioner submitted to the Board an executed Election of Rights Form indicating that he did not dispute the allegations of fact and conclusions of law in the Complaint and requested a hearing to present mitigating evidence. I.G. Ex. 6.

5. On May 8, 2002, a hearing was held for consideration of the Complaint. The Department's motion for a Final Order was granted, and a Final Order was filed on July 18, 2002, approving, adopting, and incorporating the allegations of fact and conclusions of law in the Complaint. I.G. Ex. 2, at 2.

6. In its Final Order, the Board found, and Petitioner agreed, that his conduct constituted the unlawful diagnosis and treatment of the human eye, the unlawful dispensing of glasses or contacts without a valid prescription, the exercising of influence on his patients for his own financial gain, and, fraud or deceit, or negligence, incompetence, or misconduct in the authorized practice of opticianry. I.G. Ex. 3.

7. The Board ordered the revocation of Petitioner's license, which was stayed, and suspended Petitioner's license for three years. Petitioner was also ordered to pay a fine and court costs. Furthermore, a Board member was to monitor the Petitioner to ensure his compliance with the Board's Final Order. I.G. Ex. 3.

8. Section 1128(b)(4) of the Act authorizes the I.G. to exclude an individual whose license was suspended by the State's licensing authority due to the individual's professional competence, professional performance, or financial integrity. 42 U.S.C. § 1320a-7(b)(4).

9. The Board is a State licensing authority pursuant to section 1128(b)(4)(A) of the Act.

10. On October 31, 2002, the I.G. notified Petitioner that he was being excluded from participation in Medicare, Medicaid, and all federal health care programs, pursuant to section 1128(b)(4) of the Act.

11. The I.G. notified Petitioner that the program exclusion was effective twenty days from the date of the letter and would remain in effect as long as Petitioner's license was revoked, suspended, or otherwise lost.

12. Petitioner possessed a license to provide health care within the scope of section 1128(b)(4) of the Act.

13. The I.G. was authorized to exclude Petitioner pursuant to section 1128(b)(4) of the Act because the suspension of Petitioner's license was for reasons bearing on his professional competence, professional performance, or financial integrity.

14. Where the exclusion is imposed pursuant to section 1128(b)(4) of the Act, the period of exclusion shall not be less than the period during which the individual's license to provide health care is revoked, suspended, or surrendered. Section 1128(c)(3)(E) of the Act.

15. When an exclusion is imposed pursuant to section 1128(b)(4) of the Act and the period of exclusion is coterminous with the revocation, suspension, or surrender of a State license, no issue of reasonableness with regard to the length of the exclusion exists.

16. Section 1128(b) of the Act authorizes the Secretary to bar excluded individuals from receiving payment for services that would otherwise be reimbursable under Medicare, Medicaid, or other federal health care programs.

Discussion

1. The I.G. had a basis for excluding Petitioner.

Petitioner is an optician licensed to practice in the State of Florida. On March 14, 2002, Petitioner was cited by the Florida Department of Health for reasons bearing on his professional competence, professional performance, or financial integrity. On July 18, 2002, the Department's Board of Opticianry filed an order suspending Petitioner's pharmacy license based on conduct that constituted an unlawful diagnosis and treatment of the human eye, the unlawful dispensing of glasses or contacts without a valid prescription, the exercising of influence over his patients for his own financial gain, and, fraud or deceit, or negligence, incompetence, or misconduct in the authorized practice of opticianry. I.G. Ex. 3.

By letter dated October 31, 2002, the I.G. notified Petitioner that he was being excluded from participating in Medicare, Medicaid, and all federal health care programs pursuant to section 1128(b)(4) of the Act because his license to practice medicine or provide health care in the State of Florida was revoked, suspended, or otherwise lost, or surrendered for reasons bearing on his professional competence, professional performance, or financial integrity.

In his defense, Petitioner offered the following account of the events leading up to the disciplinary action taken against him:

In early 1999, Dr. Pedro A. Cuni visited his place of business, Lucy Optical, and offered his services for the performance of eye examinations. Dr. Cuni showed him evidence of license to practice medicine and other qualifications. Petitioner agreed to provide Dr. Cuni with office space and equipment for examination of his own patients, as well as, patients who arrived at Lucy Optical for eye examinations. In addition to receiving office space, Dr. Cuni, asked for and collected 10% of all Medicaid payments made to Lucy Optical, even though Petitioner never billed Medicaid for eye exams. Later, Petitioner suggested that Dr. Cuni apply for a provider number to the Medicaid program. In spite of assurances that he had done so, Dr. Cuni never provided proof that he had followed through with his application.

When the State Agency conducted its investigation of Lucy Optical's activities, Dr. Cuni reported to the auditors that Petitioner was performing eye examinations and that he signed the prescriptions. Dr. Cuni added that he was not always on the premises when Petitioner performed eye exams, a fact denied by Petitioner. After the investigation took place, and Petitioner was removing his belongings from his place of business due to eviction, he uncovered a document from the Medicaid Program denying Dr. Cuni his application for a provider number because he did not meet the participation requirements. Petitioner concluded that the denial was the reason Dr. Cuni had lied to the auditors about him and disappeared.

On March 2, 2002, Petitioner received a complaint against him in which he was given an opportunity to exercise certain "Election of Rights." At that time he was too stressed to cope with the situation, and as a result, chose the wrong option, believing that he would be allowed to present evidence in his behalf. At the hearing, the Board did not allow him to withdraw his "Election of Rights.".

Concerning the issue of professional competence and performance, Petitioner alleges that all eyeglasses billed to Medicaid were dispensed and delivered to the beneficiaries of the program. There was never a complaint from any of the patients inasmuch as his services were of the highest quality.

As to the matter of financial integrity, Petitioner asserts that his precarious financial condition is incongruous with the accusation that he engaged in a "medical fraud scheme."

P. Br.

The I.G. contends that she is not required to reestablish the factual or legal basis for an underlying state sanction. Therefore, the basis for the underlying sanction cannot be collaterally attacked or litigated. The I.G. further argues that the exclusion action in this case is grounded exclusively on the suspension of Petitioner's opticianry license. That is the sole evidence the I.G. requires to proceed under this exclusion authority. Charles J. Barranco, M.D., DAB CR187 (1992).

The clear language of the statute is not open to dispute. The Secretary may exclude any individual or entity:

(A) whose license to provide health care has been revoked or suspended by any state licensing authority, or who otherwise lost such a license or the right to apply for or renew such a license, for reasons bearing on the individual's or entity's professional competence, professional performance, or financial integrity, or

(B) who surrendered such a license while a formal disciplinary proceeding was pending before such an authority and the proceeding concerned the individual's or entity's professional competence, professional performance, or financial integrity.

Section 1128(b)(4)(A)(B) of the Act.

There are two aspects to this legal provision. The first requirement, as pertinent here, is that the individual's or entity's license to provide health care be revoked or suspended by any state licensing authority. The evidence in this case shows this to be a fact, and Petitioner does not dispute it. The second requirement is that the suspension or revocation be for reasons bearing on professional competence, professional performance, or financial integrity. Petitioner did not dispute the allegations in the Complaint. I.G. Ex. 6. In doing so, he admitted to having dispensed glasses and contact lenses to clients at Lucy Optical without a valid prescription from a licensed physician or optometrist. Clearly, the actions of Petitioner have a bearing on his professional competence, professional performance, or financial integrity.

Petitioner's argument that he was under stress and distraught when he agreed to the allegations in the Complaint, and that the Board did not permit him to withdraw his election not to dispute the charges, has no merit. In this respect, 42 C.F.R. § 1001.2007(d) provides that when the exclusion is based on the existence of a criminal conviction or a civil judgment imposing liability by federal, State or local court, a determination by another Government agency, or any other prior determination where the facts were adjudicated and a final decision was made, the basis for the underlying conviction, civil judgment or determination is not reviewable, and the individual or entity may not collaterally attack it either on substantive or procedural grounds.

In view of the foregoing, I conclude that Petitioner's license to provide health care in the State of Florida was suspended for reasons bearing on his professional competence, professional performance, or financial integrity.

2. The length of the exclusion is not unreasonable.

Pursuant to section 1128(c)(3)(E) of the Act, "no issue of reasonableness exists" where the length of the exclusion imposed by the I.G. is coterminous with the revocation, suspension, surrender, or loss of a State license. Maurice Labbe, DAB CR488 (1997). That section requires that Petitioner be excluded for a period no less than the period during which his license is revoked, suspended, surrendered, or lost. The coterminous exclusion by the I.G. in this case is the mandated minimum period required by law.

Administrative Law Judge