Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of:
Oscar Klein, M.D., Petitioner,
- v. -
The Inspector General.
DATE: March 4, 1993
Docket No. C-92-142
Decision No. CR253
DECISION
By letter dated June 17, 1992, Oscar Klein, M.D., the Petitioner herein, was
notified by the Inspector
General (I.G.), U.S. Department of Health & Human Services (HHS), that it
had been decided to exclude
him for a period of five years from participation in the Medicare program and
from participation in the
State health care programs mentioned in section 1128(h) of the Social Security
Act (Act). (I use the term
"Medicaid" in this Decision when referring to the State programs.)
The I.G. explained that the five-year
exclusion was mandatory under sections 1128(a)(1) and 1128(c)(3)(B) of the Act
because Petitioner had
been convicted of a criminal offense related to the delivery of an item or service
under Medicare or
Medicaid.
Petitioner filed a timely request for review of the I.G.'s action, and the
I.G. moved for summary
disposition.
I have determined that there are no material and relevant factual issues in
dispute (i.e., the only matter to be
decided is the legal significance of the undisputed facts). Accordingly, I have
decided the case on the basis
of written submissions in lieu of an in-person hearing.
I affirm the I.G.'s determination to exclude Petitioner from participation
in the Medicare and Medicaid
programs for a period of five years.
LAW
Sections 1128(a)(1) and 1128(c)(3)(B) of the Act make it mandatory for an individual
who has been
convicted of a criminal offense related to the delivery of an item or service
under Medicare or Medicaid to
be excluded from participation in such programs, for a period of at least five
years.
Section 1128B(a) of the Act (codified as 42 U.S.C. 1320a-7b) makes it a criminal
offense, inter alia, for a
person to willfully make false representations in order to fraudulently secure
Medicare/Medicaid benefits,
or to knowingly and willfully conceal knowledge relevant to a person's entitlement
to such benefits and/or
unlawful attempts to secure them.
FINDINGS OF FACT AND CONCLUSIONS OF LAW 1/
1. During the period relevant to this case, Petitioner was a licensed physician
in the State of Florida.
His practice was known as the Westbay Medical Walk-In Clinic (Westbay). I.G.
Exhibit (Ex.) 2; P. Ex. 1.
2. In 1988, Petitioner arranged with Healthlift, Inc., for "free"
medical tests to be offered to the
public at Westbay. Petitioner claimed that he hoped thereby to attract new patients
to his clinic. I.G. Ex. 2;
P. Ex. 1.
3. Healthlift, through its executive director, Wesley Blevins, submitted claims
to Medicare seeking
payment for performing these tests. I.G. Ex. 2.
4. Inasmuch as Medicare requires that diagnostic tests be ordered by a treating
physician, Blevins
fraudulently entered physicians' names -- including Petitioner's name -- on
the claim forms, even though
these doctors had not ordered the tests in question. I.G. Ex. 2; P. Ex. 1.
5. Petitioner knew of this unlawful billing, but failed to report it and assisted
in concealing the truth.
I.G. Ex. 2; P. Ex. 1.
6. By means of an information, Petitioner was charged with Medicare Fraud under
42 U.S.C.
1320a-7b for having concealed and failed to disclose that false representations
were being made to
Medicare, namely that tests which were performed at Westbay had been duly ordered
by a referring
physician who had actually examined the patients, when in fact that had not
been done. I.G. Ex. 1; P. Ex.
2.
7. Pursuant to a plea bargain in which he agreed to cooperate with the government,
Petitioner
entered a plea of guilty to the information in the United States District Court,
Middle District of Florida.
I.G. Ex. 2.
8. The district court entered a judgment against Petitioner, fined him, placed
him on probation, and
required him to perform community service. I.G. Ex. 3.
9. The Secretary of HHS has delegated to the I.G. the authority to impose exclusions
pursuant to
section 1128 of the Act. 48 Fed. Reg. 21662 (1983).
10. Petitioner's voluntary guilty plea and subsequent criminal conviction of
an offense clearly
described as "Medicare Fraud," which consisted of his having knowingly
concealed misrepresentations
made on Medicare/Medicaid claims, constitutes an offense related to the delivery
of items or services under
Medicare or Medicaid, within the meaning of section 1128(a)(1) of the Act.
11. HHS is not authorized to look beyond the fact of conviction and Petitioner
may not utilize its
administrative proceedings to collaterally attack his criminal conviction by
seeking to show that he did not
do the act charged, or that there was no criminal intent.
12. It is no defense that Petitioner did not physically deliver an item or
service, inasmuch as there is a
commonsense connection between his criminal conduct and the Medicare reimbursement
process and
Medicare was the intended victim of the crime.
PETITIONER'S ARGUMENT
Petitioner asserts that he cooperated in initiating a health screening program
at his clinic because he wished
to attract new patients, but that he was unaware that Healthlift -- which actually
performed the tests --
planned to bill the government for them. Petitioner contends also that he did
not know that Healthlift
would sign his name to documents making it appear that he ordered tests to be
performed. Petitioner
declares that when he learned of this, he returned from an overseas vacation
and ordered Healthlift to
desist. P. Ex. 1.
Petitioner notes that the only crime attributed to him is failing to report
and assisting in concealing false
billing by another. He contends that, inasmuch as he himself did not provide
the services in question or
submit false bills, his offense was not related to the delivery of a health
care item or service under
Medicare or Medicaid. Petitioner contends that "such passive, after-the-fact
activity" is insufficient to
invoke the mandatory exclusion law. He suggests also that his acts were not
directly related to, or integral
parts of, the delivery of goods or services and that he had no "guilty
knowledge of the purpose or methods
of the Healthlift screenings at the time . . .." Petitioner's letter of
August 6, 1992; Petitioner's
Memorandum, pp. 9 - 10.
DISCUSSION
The first statutory requirement for mandatory exclusion pursuant to section
1128(a)(1) of the Act is that the
individual or entity in question must have been convicted of a criminal offense
under federal or State law.
In the case at hand, Petitioner pled guilty and a judgment of conviction was
entered against him by the
court. Section 1128(i) of the Act indicates that these facts are doubly sufficient
to constitute a conviction.
Next, it is required by section 1128(a)(1) that the crime at issue be related
to the delivery of an item or
service under Medicare or Medicaid. This criterion is met where there is a commonsense
connection
between the criminal offense and the Medicare or Medicaid programs. Clarence
H. Olson, DAB CR46
(1989). It is also well-established in decisions of the Departmental Appeals
Board (DAB) that filing false
Medicare or Medicaid claims constitutes program-related misconduct. Jack W.
Greene, DAB CR19, aff'd,
DAB 1078 (1989), aff'd sub nom. Greene v. Sullivan, 731 F. Supp. 835, 838 (E.D.
Tenn. 1990).
HHS is not authorized to look beyond the fact of conviction and Petitioner
may not utilize its
administrative proceedings to collaterally attack his criminal conviction by
seeking to show that he did not
do the act charged, or that there was no criminal intent, or that the criminal
conviction was tainted by legal
error. Petitioner may have recourse in the courts to rectify such matters, but
not here. Richard G. Philips,
D.P.M., DAB CR133 (1991); Peter J. Edmonson, DAB 1330 (1992). In particular,
it has been emphasized
on many occasions that proof of criminal intent is not required to bring a conviction
within the ambit of
section 1128(a)(1); e.g., " . . . the level of intent of the individual
in committing the offense is not relevant
under section 1128(a)." Janet Wallace, L.P.N., DAB 1326, at 5 n.5 (1992);
see also DeWayne Franzen,
DAB 1165 (1990).
It is also no defense that an individual did not physically deliver the
item or service, particularly where there is a commonsense connection between
his criminal conduct and
the standard treatment-reimbursement cycle under Medicare/Medicaid and the program
was the intended
victim of the crime. Niranjana B. Parikh, M.D., et al., DAB 1334, at 5 (1992);
Napoleon S. Maminta,
M.D., DAB 1135 (1990).
Applying these principles to the case at hand, I note that Petitioner voluntarily
pled guilty to an offense
clearly described as "Medicare Fraud," which consisted of his having
knowingly concealed
misrepresentations made on Medicare claims. Congress thought such activity to
be so inherently inimical
to these programs that it enacted section 1128B of the Act [42 U.S.C. 1320a-7b]
to specifically outlaw it.
I, similarly, find this crime to be clearly program related in that it facilitates
the filing of false claims and
the collection of unjustified payments, which burden the programs and impede
the delivery of items and
services. (In the present case, of course, substantial false claims were, in
fact, filed, and their existence was
-- at least initially -- concealed by Petitioner.)
As to Petitioner's assertions that he did not himself deliver items or services
or file claims, the precedent
previously cited shows such argument to be unavailing. Neither of these elements
is indispensable to a
finding that Petitioner has violated section 1128(a)(1), there is a commonsense
connection between his
criminal conduct and the Medicare reimbursement process, and Medicare was the
intended victim of the
crime.
Next, his theory that his criminal conduct was so "passive" as to
exempt him from the terms of the
mandatory exclusion law is not supported by any authority Petitioner cited.
With regard to Petitioner's
alleged lack of "guilty knowledge," I have already noted that the
case law indicates that the I.G. need not
prove that Petitioner had criminal motivation and that Petitioner cannot now
argue that he did not intend to
commit a crime or that he was otherwise innocent.
CONCLUSION
Section 1128(a)(1) of the Act requires that Petitioner be excluded from the
Medicare and Medicaid
programs for a period of at least five years because of his conviction of a
program-related criminal offense.
The I.G.'s five-year exclusion is, therefore, sustained.
______________________________
Joseph K. Riotto
Administrative Law Judge
1. Petitioner and the I.G. submitted written argument and documentary exhibits.
I admitted all of the
exhibits into evidence.