CASE | DECISION |JUDGE | FOOTNOTES

Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
IN THE CASE OF  


SUBJECT:

Erik D. DeSimone, R. Ph,

Petitioner,

DATE: April 02, 2004
                                          
             - v -

 

The Inspector General

 

Docket No.C-03-711
Decision No. CR1163
DECISION
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DECISION

Erik D. DeSimone, R.Ph. (Petitioner) appeals the decision of the Inspector General (I.G.), made pursuant to section 1128(a)(3) of the Social Security Act (Act), to exclude him from participation in Medicare, Medicaid, and all federal health care programs for a period of five years. For the reasons discussed below, I find that the I.G. is authorized to exclude Petitioner. The five-year exclusion is the mandatory minimum period as a matter of law.

I. Background

By letter dated July 31, 2003, the I.G. notified Petitioner of her decision to exclude him from program participation for five years. On September 30, 2003, Petitioner filed a timely request for review, and the matter has been assigned to me for resolution. The parties agree that this matter should proceed on their written submissions and that an in-person hearing is not necessary. Petitioner's Brief in Opposition to I.G.'s Motion for Summary Affirmance (P. Br.) at 1; I.G. Brief (I.G. Br.) at 4.

The parties have submitted their briefs. Attached to the I.G.'s brief are I.G. Exhibits (I.G. Exs.) 1 - 7. Attached to Petitioner's opposition brief are Petitioner Exhibits (P. Exs.) 1 and 2. The I.G. submitted a reply brief (I.G. Reply). There being no objections, I.G. Exs. 1 - 7 and P. Exs. 1 and 2 are admitted into evidence.

II.Issue

The sole issue before me is whether the I.G. had a basis upon which to exclude Petitioner from participation in the Medicare, Medicaid, and all federal health care programs. This depends on whether the offenses for which he was convicted were "in connection with the delivery of a health care item or service."

The length of the period of exclusion is not an issue because the I.G. imposed the statutory minimum.

III. Discussion

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

A. Petitioner was convicted of a felony relating to theft in connection with the delivery of a health care item, within the meaning of section 1128(a)(3) of the Act.

The parties agree that Petitioner was a pharmacist licensed to practice in the State of Georgia. I.G. Exs. 3, 4, 5; P. Br. at 2. On August 13, 1998, he pled guilty to one felony count of theft by taking, and one felony count of obtaining a controlled substance by theft, admitting that he stole drugs from Eckerd Drugs for his personal use. I.G. Exs. 1, 2; See I.G. Ex. 3.

He was sentenced under Georgia's First Offender Treatment program to three years probation, a $1,000 fine, and $2,500 in restitution. I.G. Exs. 1, 4. At the same time, his pharmacy license was suspended, and he underwent drug treatment. I.G. Ex. 4. On February 17, 1999, he entered into a "Public Consent Order" with the Georgia State Board of Pharmacy. By its terms, his license was reinstated, but he agreed to five years probation, with conditions attached, including that he agree to random drug screening. Id. During his period of probation, he admitted to having relapsed. His license was again suspended, and additional conditions were placed on his probation. I.G. Ex. 5. His relapse appears not to have affected his criminal case, however, and on August 17, 2001, the State court determined that he was eligible for discharge. He was discharged "without court adjudication of guilt." I.G. Ex. 6; P. Ex. 1. By order dated January 17, 2003, the State Board reinstated his pharmacy license, again with some conditions attached. I.G. Ex. 7. Shortly thereafter, the I.G. imposed her exclusion under section 1128(a)(3) of the Act. Section 1128(a)(3) of the Act authorizes the Secretary of Health & Human Services (Secretary) to exclude from participation in any federal health care program (as defined in section 1128B(f) of the Act):

[a]ny individual or entity that has been convicted for an offense which occurred after the date of the enactment of the Health Insurance Portability and Accountability Act of 1996 (1), under Federal or State law, in connection with the delivery of a health care item or service or with respect to any act or omission in a health care program . . . operated by or financed in whole or in part by any Federal, State, or local government agency, of a criminal offense consisting of a felony relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct.

(emphasis added). Regulations implementing this statutory provision are found at 42 C.F.R. § 1001.101 et seq. The delivery of a health care item or service includes the provision of any item or service to an individual to meet his or her physical, mental, or emotional needs or well-being, without regard to the source of reimbursement, so I need not find any connection to a government program in order to sustain an exclusion under section 1128(a)(3) of the Act. See 42 C.F.R. § 1001.101(b); Narendra M. Patel, M.D., DAB No. 1736, at 8 n.2. (2000). Further, the statute does not require a direct connection between the offense and the delivery of a health care item or service, but it requires some nexus or "common sense connection." See Berton Siegel, D.O., DAB No. 1467 (1994).

The parties agree that Petitioner was convicted of a felony after August 21, 1996, HIPAA's enactment date. (2) Petitioner acknowledges the theft of drugs "from his place of employment," but, without providing any additional specifics, denies that his conviction was "in connection with the delivery of a health care item or service." P. Br. at 2. (3)

I disagree. Eckerd is a retail drug store that obtains controlled substances for the purpose of delivering them to individuals in order to meet those individuals' physical, mental, or emotional needs. Petitioner interfered with that delivery by taking those controlled substances for his own use. I find these limited facts sufficient to establish a "common sense connection" between Petitioner's crime of stealing controlled substances from Eckerd Drugs and the delivery of a health care item.

B. The statute mandates a five-year mandatory minimum exclusion, and mitigating factors may not be considered to reduce that period of exclusion.

Petitioner also urges me to consider certain mitigating factors. However, the regulations allow consideration of mitigating factors only if the existence of aggravating factors justifies an exclusion period longer than five years. 42 C.F.R. § 1001.102(c). Section 128(c)(3)(B) of the Act sets the minimum exclusion period at five years. See 42 C.F.R. § 1001.102(a).

IV. Conclusion

For these reasons, I conclude that the I.G. properly excluded Petitioner from participation in Medicare, Medicaid, and all other federal health care programs, and I sustain the five-year exclusion.

JUDGE
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Carolyn Cozad Hughes

Administrative Law Judge

FOOTNOTES
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1. The Health Insurance Portability and Accountability Act (HIPAA) of 1996 was enacted on August 21, 1996.

2. Because Petitioner entered his plea under Georgia's First Offender Treatment Program, the Court ultimately discharged him "without court adjudication of guilt." However, Petitioner does not dispute that he was "convicted" within the meaning of

section 1128(a)(3) of the Act. See Act, section 1128(i)(4) (An individual is considered to have been "convicted" if he has "entered into participation in a first offender, deferred adjudication, or other arrangement or program where judgment of conviction has been withheld.")

3. Petitioner nevertheless "acknowledges the Department's authority to make such an exclusion," a position that seems incongruous with the assertion that a necessary statutory element has not been met. P. Br. at 1. If Petitioner's offenses were not found to be "in connection with the delivery of a health care item or service," then the I.G. would have no basis for excluding him under section 1128(a)(3) of the Act.

CASE | DECISION | JUDGE | FOOTNOTES