SUBJECT:

Joseph S. Scheidler, D.O.

Petitioner,

The Inspector General

DECISION

This case presents the narrow question of whether an individual's plea agreement in Ohio State court "for intervention in lieu of conviction" constitutes a conviction within the meaning of section 1128(a)(4) of the Social Security Act (Act). Joseph S. Scheidler (Petitioner) appeals the decision of the Inspector General (I.G.), made pursuant to section 1128(a)(4) of the 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 uphold the I.G.'s decision.

I. Background

By letter dated July 31, 2003 (I.G. Ex. 1), the I.G. notified Petitioner of her decision to exclude him from program participation for ten years. On August 11, 2003, Petitioner filed a timely request for review, and the matter has been assigned to me for resolution. The parties have waived their rights to an in-person hearing and agreed that the matter could be decided on the written record. ⁽¹⁾ See Summary of Prehearing Conference and Briefing Schedule dated September 25, 2003. On November 7, 2003, the I.G. reduced Petitioner's period of exclusion to 5 years. I.G. Ex. 8.

The critical facts of this case are not in dispute. Petitioner was a licensed physician in the State of Ohio. I.G. Exs. 6, 7. On February 19, 2002, Petitioner was indicted in Butler County, Ohio on 15 counts of deception to obtain a dangerous drug and 15 counts of possession of drugs in violation of sections 2925.22(A) and 2925.11(A) of the Ohio Rev. Code. I.G. Ex. 2. On July 10, 2002, Petitioner entered a guilty plea to all 30 counts. I.G. Ex. 3. ⁽²⁾ The court accepted the plea, stayed further proceedings, and ordered Petitioner to comply with terms and conditions imposed by the court pursuant to Ohio Rev. Code § 2951.041(D), intervention in lieu of conviction. Id. at 2. Petitioner successfully complied with the terms and conditions imposed by the court and, on May 2, 2003, "the Court journalized an entry terminating charges upon completion of intervention in lieu of treatment program." P. Ex. A at 1.

II. Issue ⁽³⁾

The sole issue before me is whether Petitioner was "convicted" of a felony relating to a controlled substance within the meaning of section 1128(a)(4) of the Act.

Petitioner also challenges his exclusion as violative of the Americans with Disabilities Act (ADA), but, as discussed below, I have no authority to review that issue.

III. Discussion

I make findings of fact and conclusions of law (Findings) to support my decision in this case. I set forth each Finding below, in italics, as a separately numbered heading. I discuss each Finding in detail.

1. Petitioner was convicted of a felony relating to a controlled substance within the meaning of section 1128(a)(4) of the Act.

Section 1128(a)(4) of the Act requires that any individual or entity "convicted of a felony criminal offense relating to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance" be excluded from all federal health care programs. ⁽⁴⁾ An individual is considered to have been "convicted" within the meaning of the statute if his plea of guilty or nolo contendere "has been accepted by a Federal, State, or local court" (section 1128(i)(3)), or he has "entered into participation in a first offender, deferred adjudication, or other arrangement or program where judgment of conviction has been withheld." Act § 1128(i)(4).

Under Ohio Rev. Code § 2952.041, if an eligible offender, such as Petitioner, "enters a plea of guilty or no contest," the state criminal court "may stay all criminal proceedings and order the offender to a period of rehabilitation." Ohio Rev. Code § 2952.041(B). Petitioner argues that he was not "convicted" within the meaning of section 1128(a)(4) because the court stayed his criminal proceedings and ultimately dismissed and expunged his guilty plea (I.G. Ex. 3; P. Ex. A), and because the Ohio "intervention in lieu of conviction" program in which he participated is distinguishable from the programs encompassed by the federal definition.

I reject Petitioner's arguments. Congress broadly defined the term "conviction" in order "to ensure that exclusions from federally-funded health programs would not hinge on state criminal justice policies," so the fact that a court's adjudication is not a "conviction" under state law is not controlling. Carolyn Westin, DAB No. 1381, at 3 (1993). In Westin, the petitioner participated in a deferred adjudication program, and her plea of nolo contendere was dismissed nunc pro tunc (now for then). She argued, accurately, that she had not been convicted under the state law. Nevertheless, the Departmental Appeals Board (Board) recognized that the federal statute controls and concluded that her participation in the deferred adjudication program fell within the statutory definition of a conviction. See Travers v. Shalala, 20 F.3d 993, 996 (9^th Cir. 1994). Here, Petitioner signed a document titled "Plea of Guilty," which the court "accepted and ordered filed," exactly the process described in section 1128(i)(3). I.G. Ex. 3. See Victoria Winterhalter, DAB CR1114 (2003); Handel J. Roberts, M.D., DAB CR911 (2002) (both holding that a plea of guilty pursuant to Ohio Rev. Code § 2952.041 constitutes a conviction under section 1128(i)(3)).

Petitioner also claims that his case does not fall within the ambit of section 1128(i)(4). He argues that Ohio Rev. Code § 2952.041 does not create a "first offender" program because an individual's eligibility for intervention in lieu of conviction depends on statutory factors unrelated to whether he/she is a first offender; that it does not create a "deferred adjudication" program because the individual who successfully completes the intervention plan is not adjudicated; and that it is not an "other arrangement or program where judgment of conviction has been withheld" because no judgment of conviction exists to be withheld. P. Br. at 4-5.

But Ohio Rev. Code § 2952.041 plainly creates a "deferred adjudication program" and a "program where judgment of conviction has been withheld." Under the state statute, if an eligible offender enters a plea of guilty or no contest, the court may stay all criminal proceedings. By staying the proceeding after the entry and acceptance of a plea, the court defers the adjudication of the charges and withholds a judgment of conviction. What occurs next turns on whether the offender successfully completes the rehabilitation plan. If the offender fails to comply with the rehabilitation plan, the court "shall enter an adjudication of guilt and shall impose upon the offender a term of imprisonment." Ohio Rev. Code § 2952.041(F). If the person successfully completes his/her period of rehabilitation, the court may dismiss the proceedings against him. Ohio Rev. Code § 2952.041(H). In either case, the requirements of section 1128(i)(4) are met, i.e., an adjudication has been deferred and a judgment of conviction withheld.

In Travers v. Shalala, 20 F.3d at 996-999, the court explained that this is precisely the type of program encompassed by the plain language of section 1128(i)(4). In Travers, the court distinguished between deferred prosecution procedures and deferred adjudication procedures. Under deferred prosecution, the parties agree to defer prosecution and withhold initiation of charges. If the defendant subsequently fails to abide by the terms of the parties' agreement, the defendant may then plead not guilty and proceed to trial. In contrast, Ohio Rev. Code § 2952.041 provides for an adjudication of guilt based on the earlier plea if the defendant fails to comply with the rehabilitation plan. The Ohio program therefore falls within the plain meaning of section 1128(i)(4). See Winterhalter, DAB CR1114; Roberts, DAB CR911 (both holding that a plea of guilty pursuant to Ohio Rev. Code § 2952.041 constitutes a conviction under section 1128(i)(4)).

Petitioner also argues that Congressional intent does not support a finding that Petitioner was convicted within the meaning of section 1128(i)(4). Petitioner cites the following passage from the legislative history.

The principal criminal dispositions to which the exclusion remedy [currently] does not apply are the "first offender" or "deferred adjudication" dispositions. It is the Committee's understanding that States are increasingly opting to dispose of criminal cases through such programs, where judgment of conviction is withheld. The Committee is informed that State first offender or deferred adjudication programs typically consist of a procedure whereby an individual pleads guilty or nolo contendere to criminal charges, but the court withholds the actual entry of a judgment of conviction against them and instead imposes certain conditions of probation, such as community service or a given number of months of good behavior. If the individual successfully complies with these terms, the case is dismissed entirely without a judgment of conviction ever being entered.

These criminal dispositions may well represent rational criminal justice policy. The Committee is concerned, however, that individuals who have entered guilty or nolo [contendere] pleas to criminal charges of defrauding the Medicaid program are not subject to exclusion from either Medicare or Medicaid. These individuals have admitted that they engaged in criminal abuse against a Federal health program and, in the view of the Committee, they should be subject to exclusion. If the financial integrity of Medicare and Medicaid is to be protected, the programs must have the prerogative not to do business with those who have pleaded to charges of criminal abuse against them.

H.R. Rep. No. 727, 99th Cong., 2d Sess. 75 (1986), reprinted in 1986 U.S.C.C.A.N. 3607, 3665.

Because the passage refers to individuals who "admitted that they engaged in criminal abuse against a Federal health program," Petitioner argues that section 1128(i)(4) should only apply to those excluded pursuant to section 1128(a)(1). P. Br. at 7. Of course, the plain language of the statute is the best expression of Congressional intent. When the language is clear, there is no need to resort to legislative history to attempt to discern a different meaning. Florence Peters, DAB No. 1706 (1999). The plain language of section 1128(i) could not be clearer - it applies to all exclusions under section 1128(a). Further, the I.G.'s construction of section 1128(i)(4) is consistent with the cited legislative history. The passage cited by Petitioner is part of a 1986 discussion about improving the I.G.'s ability to protect Medicare and Medicaid. Those improvements included adding a federal definition of the term "convicted." Congress later expanded the I.G.'s exclusion authority and continued to apply the definition of "convicted" to these new authorities. Section 1128(a)(4) was enacted in 1996 (Health Insurance Portability and Accountability Act of 1996, Pub. L. No. 104-191, § 211(b)(1)), ten years after the adoption of the federal definition. If Congress had not wanted the definition to apply to section 1128(a)(4), it would have said so.

Finally, Petitioner dismisses concerns about individuals' using deferred adjudication to avoid exclusion, pointing out that, because the Ohio statute requires automatic license suspension of any physician found eligible for intervention in lieu of conviction (Ohio Rev. Code § 3719.121), the I.G. could still exclude a physician under section 1128(b)(4) of the Act, which authorizes exclusion based on loss of license. P. Br. at 7. This argument is not persuasive. Congress has given the I.G. multiple grounds for excluding individuals and some offensive conduct may fall within more than one of these grounds. See Lorna Fay Gardner, DAB No. 1733, at 6 (2000); Jack W. Greene, DAB No. 1078 (1989), aff'd sub nom. Greene v. Sullivan, 731 F. Supp. 835 (E.D. Tenn. 1990). Congress enacted these multiple grounds to strengthen the I.G.'s ability to protect health care programs and the fact that another basis exists for exclusion does not justify ignoring the plain language of section 1128(i)(4).

2. I do not have authority to review Petitioner's argument that his exclusion violates the Americans with Disabilities Act (ADA).

Petitioner argues that his exclusion violates the ADA. Section 1001.2007(a)(1) of 42 C.F.R. grants me the authority to review exclusions of individuals from participation in Medicare and all other federal health care programs. However, that regulation provides I may only review whether a basis for the exclusion exists and whether the length of the exclusion is unreasonable. My review is further limited by § 1005.4(c)(1) which provides that, in reviewing exclusions, civil money penalties, and assessments, an ALJ "does not have the authority to . . . find invalid or refuse to follow Federal statutes or regulations or secretarial delegations of authority." Therefore, under this express limitation, I lack authority to review Petitioner's assertion that his exclusion violates the ADA since that would require me to find section 1128 invalid or otherwise refuse to follow its requirements. Tracey Gates, DAB No. 1768 (2001) (ALJ did not err in rejecting argument under ADA on the grounds that he did not have the authority to decide it.)

IV. Conclusion

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

Carolyn Cozad Hughes

Administrative Law Judge

1. Attached to the I.G.'s brief (I.G. Br.) are I.G. Exhibits (I.G. Exs.) 1-8. Petitioner submitted a brief (P. Br.) and Petitioner Exhibits (P. Exs.) A and B. The I.G. submitted a response brief (I.G. Response). There being no objections, I.G. Exs. 1-8 and P. Exs. A and B are admitted into evidence.

2. On July 1, 2002, Petitioner pled guilty to 14 counts of drug related felonies in the Court of Common Pleas, Hamilton County, Ohio. I.G. Exs. 4, 5. However, the I.G. based this exclusion on the Butler County convictions. I.G. Ex. 8; I.G. Br. at 5 n.3.

3. Petitioner does not challenge the length of his exclusion, which, under the statute, must be for a minimum period of five years. Act § 1128(c)(3)(B); see also 42 C.F.R. § 1001.102(a). When the I.G. imposes the minimum mandatory exclusion, the reasonableness of the length of the exclusion is not at issue. 42 C.F.R. § 1001.2007(a)(2).

4. "Federal health care program" is defined in section 1128B(f) of the Act as any plan or program that provides health 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. "State health care program" is defined in section 1128(h) of the Act and includes the Medicaid program (Title XIX).