Exclusion Case
Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of:
Mark E. Silver, D.P.M.,
Petitioner,
- v. -
The Inspector General.
DATE: July 2, 1991
Docket No. C-336
DECISION
In this case, governed by section 1128 of the Social
Security Act (Act), Petitioner timely filed a request for
a hearing before an Administrative Law Judge (ALJ) to
contest the December 20, 1990 notice of determination
(Notice) issued by the Inspector General (I.G.) of the
United States Department of Health and Human Services
(DHHS). The Notice informed Petitioner that he was
excluded from participating in the Medicare and Medicaid
programs for five years. 1/ The I.G. alleged that
Petitioner was "convicted", as defined in section 1128(i)
of the Act, of a criminal offense "related to the
delivery of an item or service" under the Medicaid
program, within the meaning of section 1128(a)(1) of the
Act.
Based on the entire record before me, I conclude that
summary disposition is appropriate in this case, that
Petitioner is subject to the mandatory exclusion
provisions of section 1128(a)(1) of the Act, and that
Petitioner's exclusion for a minimum period of five years
is mandated by section 1128(c)(3)(B) of the Act.
APPLICABLE STATUTES AND REGULATIONS
1. The Federal Statute.
Section 1128 of the Social Security Act is codified at
42 U.S.C. 1320a-7 (West U.S.C.A., 1990 Supp.). Section
ll28(a)(l) of the Act provides for the exclusion from
Medicare and Medicaid of those individuals or entities
"convicted" of a criminal offense "related to the
delivery of an item or service" under the Medicare or
Medicaid programs. Section ll28(c)(3)(B) provides for a
five year minimum period of exclusion for those excluded
under section 1128(a)(l).
2. The Federal Regulations.
The governing federal regulations (Regulations) are
codified in 42 C.F.R. Parts 498, 1001, and 1002 (l990).
Part 498 governs the procedural aspects of this exclusion
case; Parts 1001 and 1002 govern the substantive aspects.
Section l00l.l23 requires the I.G. to issue an exclusion
notice to an individual whenever the I.G. has conclusive
information that such individual has been "convicted" of
a criminal offense "related to the delivery of an item or
service" under the Medicare or Medicaid programs. The
exclusion begins 20 days from the date on the Notice. 2/
BACKGROUND
On January 7, 1991, Petitioner requested an
administrative hearing before an ALJ to contest the I.G's
determination to exclude him and the case was assigned to
me for a hearing and decision. On February 13, l991, I
held a prehearing conference. I issued a prehearing
Order on February 15, 1991 which established a schedule
for the parties to submit briefs and documentary evidence
in support of motions for summary disposition in this
case. The I.G. filed a motion for summary disposition
and Petitioner submitted an opposing brief. Neither
party requested oral argument.
ADMISSIONS
During the telephone prehearing conference on February
13, 1991, Petitioner admitted that he had been
"convicted", as defined by section 1128(i) of the Act.
In his hearing request, Petitioner admits that he pleaded
guilty to a Medicaid related offense.
ISSUES
The issue in this case is whether the five-year minimum
mandatory exclusion provisions of sections 1128(a)(1) and
1128(c)(3)(B) of the Act apply.
FINDINGS OF FACT AND CONCLUSIONS OF LAW 3/
1. At all times relevant to this case, Petitioner was a
podiatrist. I.G. Ex. 1. 4/
2. On March 28, 1989, Petitioner pleaded guilty in a
New York State court (Court) to grand larceny in the
third degree, a class E felony under New York law. I.G.
Ex. 1.
3. In his guilty plea, Petitioner admitted that he had
improperly billed the New York Medicaid program in that
he had submitted claims for reimbursement indicating that
he had made orthotics for Medicaid patients from casts
and imprints when in fact he made them from tracings and
impressions. I.G. Ex. 1.
4. As an element of his plea, Petitioner agreed to pay
restitution in the amount of $75,000.00. I.G. Ex. 1.
5. Petitioner's plea was accepted by the Court, within
the meaning of section 1128(i) of the Act. I.G. Ex. 1.
6. Petitioner was convicted of a criminal offense
related to the delivery of an item or service under
Medicaid, within the meaning of section 1128(a)(1) of the
Act. FFCL 2 and 3.
7. The Secretary of DHHS delegated to the I.G. the
authority to determine, impose, and direct exclusions
pursuant to section 1128 of the Act. 48 Fed. Reg. 21662,
May 13, 1983.
8. On December 20, 1990, the I.G. excluded Petitioner
from participating in Medicare and directed that he be
excluded from participating in Medicaid, pursuant to
section 1128 of the Act.
9. Because there are no disputed issues of material
fact in this case, there is no need for an in-person
evidentiary hearing and summary disposition is
appropriate. FFCL 1-3, 5, and 6.
10. Petitioner may not collaterally challenge his State
conviction in this proceeding. Act, section 1128(a)(1).
11. The I.G.'s authority to impose and direct exclusions
pursuant to section 1128 of the Act is independent of any
authority to impose exclusions vested in the New York
Medicaid program by State law or regulations. Act,
section 1128.
12. While I am sympathetic to Petitioner's concerns
about the twenty-one month delay between the date of his
conviction and the date of this exclusion, I do not have
authority to change the effective date of the exclusion.
Act, section 1128.
13. This exclusion imposed and directed against
Petitioner by the I.G. for five years is the minimum
period required by section 1128(a)(1) and section
1128(c)(3)(B) of the Act.
14. This exclusion imposed and directed against
Petitioner by the I.G. is required by section 1128 and
may not be reduced. FFCL 7 and 13.
DISCUSSION
The material facts are not in dispute. In March 1989,
Petitioner pleaded guilty in New York to a state felony
charge. At the time of his plea, Petitioner admitted
that he had billed the Medicaid program for orthotics
that were not made from a cast or imprint, but rather
from tracings and impressions of the patient's feet. In
pleading guilty, Petitioner admitted that he had filed
improper claims for a Medicaid item or service.
Petitioner's plea was accepted by the Court and
constitutes a conviction as defined by section 1128(i) of
the Act. In his hearing request, Petitioner asked for a
six months credit towards his exclusion; he asked that
the mandatory five year exclusion begin at the time his
license was suspended, or, in the alternative, that I
should make the effective date of his exclusion
retroactive to the date of his conviction.
I. Petitioner Was Convicted of a Criminal Offense
Related to the Delivery of an Item or Service Under
Medicaid Within the Meaning of Section 1128(a)(1) and
Section 1128(i) of the Act.
Section 1128(a)(1) of the Act requires the I.G. (as
delegate of the Secretary) to exclude from participation
in Medicare, and to direct the exclusion from
participation in Medicaid, of:
any individual or entity that has been
convicted of a criminal offense related to the
delivery of an item or service under . . .
[Medicare] or under . . . [Medicaid].
Petitioner admitted at the prehearing conference that he
was convicted. Additionally, Petitioner's guilty plea
was accepted by the Court, which is all that is required
by section 1128(i) of the Act. Charles W. Wheeler and
Joan K. Todd, DAB App. 1123 (1990); See Gordon Lee Hanks,
DAB Civ. Rem. C-112 at 9-10 (1989). The term "accepted"
in section 1128(i)(3) is defined by Webster's Third New
International Dictionary, 1976 Unabridged Edition, as the
past tense of "to receive consent." A guilty plea is
"accepted" within the meaning of section 1128(i)(3)
whenever a party admits his guilt to a criminal offense
and a court disposes of the case based on that party's
plea. Russell E. Baisley and Patricia Mary Baisley, DAB
Civ. Rem. C-276 (1991). See Marie Chappell, DAB Civ. Rem.
C-225 (1990). In the instant case, the Court "accepted"
Petitioner's plea agreement as statement of his guilt to
the charges, pursuant to section 1128(i)(3). Thus, under
section 1128(i)(3), Petitioner's plea constitutes a
conviction for purposes of this federal law exclusion.
Petitioner admitted in his hearing request that he pled
guilty to a Medicaid related offense. I also
independently find that crimes involving financial
misconduct in the submission of Medicaid claims are
"related to" the "delivery of an item or service."
Wheeler and Todd, supra.
Black's Law dictionary, Fifth Edition (West Pub. Co.
1979) defines "related" as: ". . . standing in relation;
connected; allied; akin." The offense for which
Petitioner was convicted was "connected to" the delivery
of an item or service under Medicaid. There is a simple,
common sense connection, supported by the record, between
the actions associated with Petitioners' conviction and
the Medicaid program. Thus, the criminal offense for
which Petitioner was convicted is "related to the
delivery of an item or service" within the meaning of
section 1128(a)(1) of the Act.
II. Petitioner May Not Collaterally Challenge his State
Conviction in this Proceeding.
In his hearing request, Petitioner indicated that his
plea was made under duress and threat of imprisonment,
that his conduct was the result of being misled by the
lab he used, and that recent New York case law has held
that the conduct for which he was convicted is no longer
considered an offense in all cases. The I.G. argues that
Petitioner may not now collaterally attack his State
court conviction. I.G. Br. 7-9.
Petitioner pled guilty and was convicted of submitting
reimbursement claim forms to Medicaid indicating that he
had made orthotics for Medicaid patients from casts and
imprints when in fact he had made them from tracings and
impressions. Petitioner attached to his hearing request
an article, the gist of which is that he, and other
similarly situated providers, would appear to have been
prosecuted as a result of an ambiguous Medicaid
reimbursement code and policy. Petitioner asserts that
the written guidance and the Medicaid officials were
ambiguous as to whether or not the reimbursement code in
question required that orthotics billed under the code be
made from casts or imprints, not tracings or impressions.
Although Petitioner has not articulated his argument, he
appears to be asserting that the conduct for which he was
convicted is no longer considered illegal in all
instances. He apparently contends that his conviction is
for conduct which was or should no longer be considered
illegal under the New York Medicaid program. Therefore,
Petitioner seems to argue that his conviction is not a
valid conviction and the I.G. is without authority to
exclude him.
Even assuming that all of Petitioner's assertions of fact
are true, they are not relevant to the issue of whether
the I.G. was required to impose and direct an exclusion
against Petitioner. The I.G.'s authority to exclude a
party under section 1128(a)(1) arises by virtue of that
party's conviction of a criminal offense, as described in
the Act. The underlying conduct behind the conviction,
except for the limited purpose of establishing the
"related to" requirement of the statute, is not relevant
in considering whether the I.G. had authority to impose
and direct a mandatory exclusion pursuant to section
1128(a)(1). The conviction, and not the underlying
conduct, is the triggering event which requires the I.G.
to impose and direct an exclusion. It is not relevant to
the issue of the I.G.'s authority that the criminal
conviction may have been defective or that the conduct
which resulted in the conviction may no longer be
unlawful. See Andy E. Bailey, C.T., DAB Civ. Rem. C-110
(1989), aff'd DAB App. 1131 (1990); John W. Foderick,
M.D., DAB App. 1125 (1990). A party who believes his
conviction was defective is not without recourse. That
party may appeal the conviction in a court which has
jurisdiction over the matter. If the conviction is
overturned on appeal, then the I.G. would reinstate the
excluded party. See 42 C.F.R. 1001.136(a).
III. A Minimum Mandatory Exclusion of Five Years is
Required in This Case.
Petitioner argues that the minimum mandatory exclusion of
five years is not applicable to him or should be adjusted
because of the delay from the date of his conviction to
the date of this exclusion. He further argues that this
twenty-one months delay places him in a position of
double jeopardy. He also argues, in effect, that equity
requires that the five year exclusion be reduced by six
months to give him credit for the time his license was
suspended or, in the alternative, that the effective date
of this exclusion be moved back twenty-one months to the
date of his conviction.
Petitioner's arguments are misplaced. The Supreme Court
has held that, under some circumstances, the imposition
of civil penalties could constitute double jeopardy
where:
. . . [A] civil sanction that cannot fairly be said
solely to serve a remedial purpose, but rather can
be explained only as also serving either retributive
or deterrent purposes, is punishment, as we have
come to understand the term.
United States v. Halper, 490 U.S. 435 (1989). However,
the primary goal of the exclusion here is not punishment,
but remedial. The remedial purpose of the Act is to
protect the trust funds of the Medicare and Medicaid
programs and the beneficiaries and recipients of those
funds. The Board has found that double jeopardy does not
apply in situations like the instant case. Dewayne
Franzen, DAB App. 1165 (1990). See Greene v. Sullivan,
731 F.Supp. 835 and 838 (E.D. Tenn. 1990).
While I am sympathetic to Petitioner's concerns about the
fairness of the long delay between the time he was
convicted and the time of this exclusion, I am without
authority to reduce Petitioner's period of exclusion or
to adjust the effective date of the exclusion. See
Samuel W. Chang, M.D., DAB App. 1198 (1990) Petitioner
was "convicted" of a criminal offense "related to the
delivery of an item or service" under the Medicaid
program within the meaning of section 1128(a)(1) and
1128(i) of the Act. The I.G. was required to exclude
Petitioner for a minimum of five years and an ALJ has no
discretion to reduce the minimum mandatory five-year
period of exclusion or to decide when an exclusion is to
begin. Chang, supra. See Wheeler and Todd, DAB App.
1123 at 9; Jack W. Greene, DAB App. 1078 (1989), aff'd,
731 F. Supp. 835 and 838 (E.D. Tenn 1990).
CONCLUSION
Based on the law and the undisputed material facts in the
record of this case, I conclude that the I.G. properly
excluded Petitioner from the Medicare and Medicaid
programs pursuant to section 1128(a)(1) of the Act, that
the minimum period of exclusion for five years is
required by section 1128(c)(3)(B) of the Act, and that
summary disposition in favor of the I.G. is appropriate.
________________________
Charles E. Stratton
Administrative Law Judge
1. The Medicaid program is one of three types of
federally-financed State health care programs from which
Petitioner is excluded. I use the term "Medicaid" to
represent all three of these programs which are defined
in section 1128(h) of the Act.
2. The I.G.'s Notice adds five days to the 15 days
prescribed in section 1001.l23, to allow for receipt by
mail.
3. Some of my statements in the sections preceding
these formal findings and conclusions are also findings
of fact and conclusions of law. To the extent that they
are not repeated here, they were not in controversy.
4. References to the record and to Board cases in
this decision will be cited as follows:
I.G.'s Exhibits I.G. Ex. (number)
I.G.'s Brief I.G. Br. (page)
Findings of Fact and
Conclusions of Law FFCL (number)
Departmental Appeals Board DAB Civ. Rem. (docket
decisions no./date)
Departmental Appeals Board DAB App. (decision no./
Appellate decisions date)