Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of: Bhupandra Patel, M.D., Petitioner,
- v. -
The Inspector General.
DATE: August 19, 1992
Docket No. C-92-067
Decision No. CR227
DECISION
In this case, governed by section 1128 of the Social Security Act (Act), the
Inspector General (I.G.) of the
United States Department of Health and Human Services (DHHS) notified Petitioner
by letter dated
December 10, 1991, that he was being excluded from participating in the Medicare
and Medicaid programs
for a period of eight years. 1/ Petitioner was advised that his exclusion resulted
from his conviction 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.
Petitioner timely requested a hearing before an Administrative Law Judge (ALJ),
and the case was assigned
to me for a hearing and decision. During the prehearing conference I conducted
on March 10, 1992,
Petitioner admitted that he was convicted of a criminal offense related to the
delivery of an item or service
under Medicaid. Petitioner indicated that he was not contesting the mandatory
five-year exclusion, he was
merely contesting the I.G.'s imposition of an additional three-year period.
Petitioner contended that there
were mitigating circumstances that made a five-year period of exclusion appropriate,
not eight years.
Petitioner and the I.G. agreed to proceed by way of summary disposition, in
lieu of an in-person hearing,
whereby the I.G. would submit a motion for summary disposition and Petitioner
would submit a response
to the I.G.'s motion.
I admit all of the parties' exhibits into evidence and I have considered the
parties' briefs and exhibits. 2/ I
conclude that the I.G. had authority to exclude Petitioner and that the eight-year
exclusion directed against
Petitioner is appropriate and reasonable under the circumstances.
APPLICABLE STATUTES AND REGULATIONS
I. The Federal Statute.
Section 1128 of the Act is codified at 42 U.S.C. 1320a-7 (1988). Section 1128(a)(1)
of the Act permits
the I.G. to exclude from Medicare, Medicaid and related health care programs:
. . . any individual or entity that has been convicted, under Federal or State
law, of a criminal
offense related to the delivery of a health care item or service under Medicare
II. The Federal Regulations.
The federal regulations governing this proceeding are codified in 42 C.F.R.
Parts 498, 1001, and 1002
(1990). Part 498 governs the procedural aspects of this exclusion case; Parts
1001 and 1002 govern the
substantive aspects.
ADMISSIONS
Petitioner admits that (1) he was convicted of a criminal offense, (2) his
criminal conviction is related to
the delivery of an item or service under the Medicaid program, and (3) he is
subject to a five year
minimum mandatory exclusion. Petitioner contends that an exclusion of eight
years is unreasonable.
ISSUES
1. Whether the regulations published on January 29, 1992, at 57 Fed. Reg. 3298
et seq. are applicable to
this case.
2. Whether the eight year exclusion imposed and directed against Petitioner
by the I.G. is appropriate and
reasonable.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
1. Petitioner is a medical doctor engaged in the practice of internal medicine
and licensed in New York
State and New Jersey. I.G. Ex. 3; P. Br. 1-3.
2. Petitioner is not licensed as a psychiatrist or psychotherapist, nor does
he have the required training to
qualify as a psychiatrist or psychotherapist. P. Br. 1; I.G. Ex. 1/5; I.G. Ex.
2.
3. Petitioner was indicted in a New York State court on two counts of grand
larceny and 31 counts of
offering a false instrument for filing, all 33 counts involving Medicaid fraud.
I.G. Ex. 2.
4. On June 7, 1992, Petitioner pled guilty to one count of grand larceny in
the third degree and two counts
of offering a false instrument for filing. (Counts one, 16 and 17 of indictment
#9337/89). Petitioner was
sentenced to five years probation and to pay restitution in the amount of $123,500.
I.G. Exs. 3; 5; 6.
5. Petitioner pled guilty to third degree grand larceny as a result of his
submitting fraudulent claims to the
New York State Medicaid agency for reimbursement for psychiatric and psychotherapy
services that he
was not qualified or licensed to provide. I.G. Ex. 3.
6. Petitioner pled guilty to count 16 of the indictment, which charges him
with submitting fraudulent
claims for reimbursement to the New York State Medicaid Agency. In pleading
guilty to count 16,
Petitioner admitted that he claimed to have provided psychiatric and psychotherapy
services to Medicaid
patients when he was not qualified or licensed to do so. I.G. Ex. 3.
7. Petitioner pled guilty to count 17 of the indictment, which charges him
with submitting fraudulent
claims for reimbursement to the New York State Medicaid Agency. In pleading
guilty to count 17,
Petitioner admitted that he claimed to have provided medical tests to Medicaid
patients, when in fact no
such tests were performed. I.G. Ex. 3.
8. Petitioner was convicted of a criminal offense, within the meaning of section
1128(a)(1) and 1128(i) of
the Act. FFCL's 3 -7.
9. 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) of the Act. FFCL
8.
10. The Secretary of the United States Department of Health and Human Services
(the Secretary)
delegated to the I.G. the authority to determine, impose, and direct exclusions
pursuant to section 1128 of
the Act.
11. The I.G. properly excluded Petitioner from participation in the Medicare
and Medicaid programs for a
period of at least five years as required by the minimum mandatory exclusion
provisions of sections
1128(a)(1) and 1128(c)(3)(B) of the Act.
12. The remedial purpose of section 1128 of the Act is to protect federally-funded
health care programs
and their beneficiaries and recipients from providers who have demonstrated
by their conduct that they
cannot be trusted to handle program funds or treat beneficiaries and recipients.
13. Petitioner has demonstrated a pattern of defrauding the Medicaid program
by claiming to provide
services that he did not provide and by billing Medicaid for psychotherapist
and psychiatric services that he
was not qualified to provide. FFCL's 4 - 7.
14. The financial loss to the Medicaid program resulting from Petitioner's
criminal misconduct amounted
to at least $123,500, and significant amount of money. FFCL 4.
15. Petitioner's criminal activities occurred over the period between February
1, 1984, and June 23, 1986,
more than two years, a lengthy period of time. I.G. Exs. 2/2; 3/16; P. Br. 3.
16. Petitioner has demonstrated a pattern of initiating and submitting false,
fraudulent and inaccurate
claims. Such actions are harmful to the Medicaid program and show a high degree
of culpability. FFCL
15.
17. A lengthy exclusion is needed in this case to satisfy the remedial purposes of the Act.
18. The eight year exclusion imposed and directed by the I.G. is reasonable.
DISCUSSION
I. The regulations published on January 29, 1992, are not applicable to this case.
On January 29, 1992, new federal regulations applicable to exclusion cases
were published at 57 Fed. Reg.
3298 et seq. The I.G. argues that the new regulations have merely codified the
existing statutory and case
law as applicable to a mandatory minimum five year exclusion under section 1128(a)(1).
I.G. Br. at 18.
While the new regulations do not seem to change the factors for me to consider
in an 1128(a)(1) exclusion
-- i.e., whether Petitioner's conviction was program related and whether an
eight year exclusion is
reasonable -- I nonetheless find that the new regulations are not applicable
to this case.
For me to apply the new regulations to this case in midstream, absent specific
and uncontroverted guidance
to do so, would constitute a violation of Petitioner's due process rights. Also,
because application of the
new regulations to this case would result in derogation of section 205(b) of
the Act, which guarantees
Petitioner a de novo hearing, and would conflict with relevant DAB precedent,
I find that the January 29,
1992, regulations do not apply to my review of the reasonableness of the exclusion
imposed and directed
against Petitioner. The regulations contained in Part 1001 of the new regulations,
and 42 C.F.R. 1001.102
in particular, were not intended by the Secretary to govern hearings as to the
reasonableness of exclusion
determinations. Bruce G. Livingston, D.O., DAB CR202 (1992); Charles J. Barranco,
M.D., DAB CR187
(1992); Syed Hussaini, DAB CR193 (1992); Steven Herlich, DAB CR197 (1992); Stephen
J. Willig, DAB
CR192 (1992); Sukumar Roy, M.D., DAB CR205 (1992); Aloysius Murcko, M.D., DAB
CR189 (1992);
Narinder Saini, M.D., DAB CR217 (1992). Even if the Part 1001 regulations do
govern such hearings, an
appellate panel of the DAB recently held they do not apply in cases involving
exclusion determinations
made prior to the regulations' publication date. Behrooz Bassim, M.D., DAB 1333
at 5 - 9 (1992).
II. Petitioner is subjected to a minimum five year exclusion because he was
convicted of a criminal offense
related to the delivery of a item or service under Medicare, within the meaning
of section 1128(a)(1) of the
Act.
A. Petitioner was "convicted" of an offense within the meaning of section 1128(i).
An individual or entity is considered to have been "convicted" of
a criminal offense when a plea of guilty
or nolo contendere by the individual or entity has been accepted by a Federal,
State, or local court. Section
1128(i)(3). Petitioner has admitted, and the evidence verifies, that he pled
guilty to three separate offenses.
FFCL 4. Petitioner pled guilty to grand larceny in the third degree and to two
separate counts of offering a
false instrument for filing. The court accepted Petitioner's guilty plea and
judgment was entered.
Petitioner was therefore "convicted" of a criminal offense within
the meaning of section 1128(i). 3/
B. Petitioner's conviction is "related to" the Medicaid program within
the meaning of section 1128(a)(1) of
the Act.
Petitioner has admitted, and evidence verifies, that he 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) of the
Act. Under section 1128(a)(1), it makes no difference that the criminal offenses
for which Petitioner was
convicted were against Medicaid rather than Medicare. Section 1128(a)(1) applies
equally to criminal
offenses related to the delivery of an item or service under either program.
David D. DeFries, DAB CR156
(1991). 4/
C. Petitioner is subject to the provisions of section 1128(c)(3)(B) of the Act.
Petitioner's conviction falls within the provisions of section 1128(a)(1) of
the Act. Section 1128(c)(3)(B)
of the Act provides that, in the case of individuals against whom a mandatory
exclusion is imposed, the
minimum length of such an exclusion shall be five years. Petitioner was properly
excluded by the I.G. for
the minimum mandatory five year period. Neither the I.G. nor the ALJ has discretion
to reduce the
mandatory minimum five year period of exclusion. Charles W. Wheeler and Joan
K. Todd, DAB 1123
(1990); John Strausbaugh, DAB CR186 (1992).
III. Eight years is a reasonable period of exclusion to be imposed and directed against Petitioner.
There is no dispute that Petitioner is subject to the mandatory minimum exclusion
of five years. Petitioner
pled guilty to three separate criminal counts. Count one was third degree larceny,
as to which Petitioner
admitted that, from February 1984 through June of 1986, he submitted bills in
excess of $118,600 to the
New York State Medicaid program for psychiatric and psychotherapy services he
claimed to have
provided, and did so with the knowledge that he was not eligible to be reimbursed
as a psychiatrist or
psychologist. I.G. Ex. 3/15-17. In pleading guilty to count 16, Petitioner admitted
that he submitted a
claim for reimbursement to the Medicaid program in which he claimed to have
provided psychotherapy to
a Medicaid recipient when he provided no such services to the recipient. I.G.
Ex. 3/14-18. In pleading
guilty to count 17, Petitioner admitted to submitting a claim for reimbursement
to Medicaid for a breathing
test and examination in the amount of $4,900 when, in fact, he performed no
such test or exam. I.G. Ex.
3/17-18.
Since the minimum mandatory exclusion of five years is applicable to Petitioner,
the issue before me is
whether the I.G. is justified in excluding Petitioner for eight years. Resolution
of this issue depends on
analysis of the evidence of record in light of the remedial purposes of the
Act. Lakshmi N. Murty Achalla,
M.D., DAB 1231 (1991); Joel Davids, DAB 1283 (1991); Robert Matesic, R.Ph.,
d/b/a Northway
Pharmacy, DAB 1327 (1992).
Congress enacted the exclusion law to protect the integrity of federally funded
health care programs.
Among other things, the law is designed to protect program beneficiaries and
recipients from individuals
who have demonstrated by their behavior that they threaten the integrity of
federally funded health care
programs or that they could not be entrusted with the well-being and safety
of beneficiaries and recipients.
S. Rep. No. 109, 100th Cong., 1st Sess., reprinted in 1987 U.S.C.C.A.N. 682.
An exclusion imposed and directed pursuant to section 1128 of the Act advances
this remedial purpose.
The principal purpose is to protect programs and their beneficiaries and recipients
from untrustworthy
providers until the providers demonstrate they can be trusted to deal with program
funds and to properly
serve beneficiaries and recipients. As an ancillary benefit, the exclusion deters
other providers of items or
services from engaging in conduct which threatens the integrity of the programs
or the will-being and
safety of beneficiaries and recipients. H. R. Rep. No. 393, Part II, 95th Cong.
1st Sess., reprinted in 1977
U.S.C.C.A.N. 3072.
My purpose in hearing and deciding the issue of whether an exclusion is reasonable
is not to second guess
the I.G., but to decide whether the length of the exclusion imposed by the I.G.
was extreme or excessive.
48 Fed. Reg. 3744 (1983); Abelard A. Pelaez, M.D., DAB CR157 at 14 - 15 (1991);
Barranco at 29 - 30.
An appellate panel in The Hanlester Network, et al., DAB 1347 (1992) set forth
with approval criteria
previously developed by DAB ALJ's in their determinations of evaluating trustworthiness:
- the circumstances of the misconduct and the seriousness of the offense,
in particular the commission
of misconduct in the nature of a program-related crime, see [The Hanlester Network,
et al,] DAB 1275, at
52 [(1991)];
- "the degree to which a [Petitioner] is willing to place the programs
in jeopardy," even if no actual
harm is accomplished, id. at 52; [footnote omitted]
- the failure to admit misconduct, or express remorse, or evidence rehabilitations,
see e.g., Olufemi
Okonuren, M.D., DAB 1319, at 13 (1992); Robert Matesic R.Ph. d/b/a Northway
Pharmacy, DAB 1327, at
12 (1992); and
- the "likelihood that the offense or some similar abuse will occur again," see e.g., Matesic, at 8.
Hanlester DAB 1347 at 46 - 47.
In applying these factors to determine when a provider should be trusted and
allowed to reapply for
participation in the federally-funded health care programs, the totality of
the circumstances of each case
must be evaluated in order to reach a determination regarding the appropriate
length of an exclusion. I
have evaluated and applied the totality of the circumstances with regard to
Petitioner and have reached the
following conclusions regarding his trustworthiness to be a program provider.
Despite the fact that he was not a licensed psychotherapist or psychiatrist,
Petitioner submitted claims for
reimbursement in excess of $118,600 in which he claimed to have provided psychotherapy
to a Medicaid
recipient. Petitioner also submitted a claim for reimbursement in the amount
of $4,900 to Medicaid for a
breathing test and examination that he did not, in fact, perform. Petitioner's
criminal conduct in willfully
and knowingly submitting fraudulent claims for services that he did not and
could not provide is serious,
involved a substantial amount of money, and occurred over a significant period
of time.
Petitioner contends that the I.G. has mischaracterized his criminal convictions
in stating that the sum of
$123,500 is the result of false and fictitious billing. P. Br. 3. Petitioner
contends that the billing was
improper because he was not properly qualified to render or bill for the treatment
administered. P. Br. 3.
However, Petitioner's argument misses the point. Petitioner has admitted that
he was not qualified to bill
for psychotherapy services and that, knowing this, he submitted bills to the
Medicaid program for such
services. FFCL's 2, 5, 6; I.G. Ex. 3. Petitioner has also admitted that he submitted
a claim for
reimbursement for a breathing test that he did not administer. FFCL 7; I.G.
Ex. 3. Whether Petitioner
chooses to call these acts false, fraudulent, or improper is irrelevant. The
facts indicate that he deliberately
submitted claims to the Medicaid program for reimbursement, while knowing that
he was not entitled to
reimbursement for those claims.
In submitting claims for reimbursement to the Medicaid program, Petitioner
implicitly represented that he
had provided the services for which he sought reimbursement and that he was
properly qualified to provide
such services. That Petitioner represented that he was a qualified and licensed
psychotherapist is a
deliberate, willful, and knowing fraud perpetrated upon the Medicaid program.
It is of particular
significance that Petitioner repeated this type of calculated, willful misrepresentation
when he submitted a
claim for reimbursement in the amount of $4,900 for a breathing test which he
did not provide.
Deliberate misconduct, the ultimate goal of which is to unlawfully take money
from the Medicaid program,
is indicative of a lack of trustworthiness. Petitioner's convictions show that
he perpetrated willful and
deliberate fraud and misconduct upon the Medicaid program. Such actions are
indicative of a lack of
trustworthiness. Petitioner has also shown his lack of trustworthiness by his
willingness to place the
integrity and efficient operation of the Medicaid program in jeopardy for an
extended period of time for his
own personal gain. Specifically, Petitioner's deliberate and willful infliction
of damage to the Medicaid
program occurred over a period of more than two years -- from February 1, 1984,
to June 23, 1986 -- and
is another indication of a lack of trustworthiness. 5/
The failure to admit misconduct, or express remorse, or evidence rehabilitation,
has a bearing on the
trustworthiness of a petitioner. Petitioner has admitted that he wrongfully
billed his services to the
Medicaid program. P. Br. 1. Petitioner has also offered as an exhibit, a certificate
of relief from civil
disabilities. P. Ex. 1. Petitioner argues that the fact that the State court
saw fit to grant such a certificate is
evidence of his trustworthiness and rehabilitation.
However, my reading of this certificate is that it is of little probative value
in determining the
trustworthiness of Petitioner, because the certificate is merely a device used
by the State court to allow
Petitioner to continue to practice medicine in order to meet the restitution
payments imposed by the court.
The State court saw fit to grant such a certificate as being consistent with
Petitioner's rehabilitation and the
public interest. However, it is not probative for my purposes because, in granting
the certificate, the State
court made no specific findings regarding Petitioner's trustworthiness or rehabilitation.
I have no basis from which I can conclude that Petitioner is not sincerely
remorseful for his actions.
However, I also have not had the opportunity to view Petitioner in an in-person
hearing. Additionally,
there is no evidence before me from which I can conclude that Petitioner has
rehabilitated himself, or
sought the appropriate help to do so. In the absence of such evidence and in
the face of evidence showing
that Petitioner committed deliberate fraudulent acts against the Medicare program
for over a two year
period, I conclude that Petitioner is not trustworthy.
The likelihood that the offense or similar abuse will occur again is a factor
having a bearing on
trustworthiness. On this issue the record is again sparse. Petitioner persisted
in his criminal behavior for
over two years. Petitioner has not made any proffer that these offenses will
not happen again. Petitioner
has indicated that he is currently a licensed doctor practicing medicine in
New Jersey. P. Br. 2. Petitioner
has pointed to no safeguards in his current practice which would protect the
program from the type of
deliberate fraud perpetrated by him in the past. In view of Petitioner's continued
ability to practice
medicine, and his past record of persistent and egregious fraud, I conclude
there is some potential
likelihood that the offense or a similar abuse will recur. I find that this
is further evidence that Petitioner is
not trustworthy.
Petitioner's unlawful actions show that he is an individual who is capable of
engaging in false and
fraudulent actions. Petitioner's actions also show his disregard for the financial
integrity of the Medicaid
program and his willingness to subject the program to financial loss for his
personal financial gain.
Petitioner has shown a propensity to perpetrate his schemes over a substantial
period of time and has not
shown that he has been rehabilitated in such a way as to not be a program risk.
A lengthy exclusion is
necessary in this case to provide Petitioner with the opportunity to prove that
he is once again worthy to be
trusted as a program provider. Based on Petitioner's past criminal activities
and the dearth of evidence
showing that he is no longer a risk to the program, I conclude that the eight
year exclusion directed and
imposed against Petitioner is neither "extreme nor excessive" and
therefore should not be reduced.
CONCLUSION
The I.G. properly excluded Petitioner. In this case, an exclusion of eight
years is reasonable to protect the
integrity of the Medicare and Medicaid programs.
________________________
Charles E. Stratton
Administrative Law Judge
1. "State health care program" is defined by section 1128(h) of the
Act to cover three types of federally
financed health care programs, including Medicaid. I use the term "Medicaid"
hereafter to represent all
State health care programs from which Petitioner was excluded.
2. The parties' exhibits, briefs, and my findings of fact and conclusions of
law will be referred to as
follows:
I.G.'s Exhibits I.G. Ex. (number/page)
Petitioner's Exhibits P. Ex. (number/page)
I.G.'s Post Hearing Brief I.G. Br. at (page)
Petitioner's Post Hearing P. Br. at (page)
Brief
I.G.'s Post Hearing Reply I.G. R. Br. at (page)
Brief
My Findings of Fact and FFCL (number)
Conclusions of Law
3. There is a discrepancy in the documents submitted by the I.G. I.G. Ex. 3/13
- 21 indicates that
Petitioner pled guilty to count one of the indictment (grand larceny in the
third degree in the amount of
$118,600) and also pled guilty to counts 16 and 17. At the plea proceedings,
the court specifically stated
that Petitioner was to make $123,500 in restitution based on the sum total of
his wrongful billings from
counts one and two of the indictment -- the two grand larceny counts of $118,600
and $4,900, respectively.
I.G. Ex. 3/5, 17. (The court misspoke when it indicated at I.G. Ex. 3/17 that
the amount for count one was
$118,000, because the indictment says $118,600, and the restitution amounts
would not add up correctly
otherwise. I.G. Ex. 2/2.) The sentencing document is at odds with I.G. Ex. 3,
because it states that
Petitioner pled guilty to count two of the indictment (grand larceny in the
third degree in the amount of
$4,900) and to counts 16 and 17. I.G. Ex. 6/1.
However, the discrepancy does not affect my analysis of this case, because
while the exhibits are unclear as
to which grand larceny count Petitioner actually pled guilty to, it is apparent
that Petitioner did plead guilty
to one count of grand larceny in the third degree. While Petitioner was convicted
on only one of the grand
larceny counts, it is apparent that the court ordered restitution based on the
amount of the wrongful billings
submitted by Petitioner to the Medicaid program. The court found that amount
to be $123,500, which is
the sum of both of the grand larceny counts. I.G. Exs. 3/19; 5; 6.
4. Specifically, Petitioner pled guilty to counts 1, 16, and 17 of the Indictment.
Count one was the third
degree larceny count, in which Petitioner was charged with submitting New York
State Medical Assistance
(Title XIX) Program Practitioner Claim forms to the State of New York, when
Petitioner knew these forms
contained false representations that psychiatric treatment had been rendered
to Medicaid recipients by him
as a specialist in psychiatry. In submitting these forms, Petitioner intentionally
caused the State of New
York to pay him approximately $118,600 to which he was not entitled. Count 16
(offering a false
instrument for filing) alleges that Petitioner submitted a New York State Medical
Assistance (Title XIX)
Program form, knowing that form contained false representations that psychiatric
treatment had been
rendered to a Medicaid recipient by him as a specialist in psychiatry. Count
17 (offering a false instrument
for filing) alleges that Petitioner submitted Medicaid claim forms which falsely
stated that he provided
medical treatment to a certain Medicaid patient, when in truth and in fact,
as the Petitioner well knew, no
such medical treatment had been provided.
5. In determining that Petitioner's unlawful conduct occurred over a period
of more than two years, I use
the more conservative estimate of the time Petitioner engaged in culpable conduct.
P. Br. 4.