Stanley H. Guberman, D.C., DAB CR111 (1990)

Department of Health and Human Services

DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

In the Case of:
Stanley H. Guberman, D.C.,

Petitioner,

- v. -

The Inspector General.

DATE: November 20, 1990

Docket No. C-240

DECISION

In this case, governed by section ll28 of the Social Security Act
(Act), Petitioner timely filed a request for a hearing before an
Administrative Law Judge (ALJ) to contest the April l2, l990 notice
of determination (Notice) issued by the Inspector General (I.G.).
The Notice informed Petitioner that he was excluded from
participating in the Medicare and Medicaid programs for five years.
1/

Based on the entire record before me, I conclude that summary
disposition is appropriate in this case, that Petitioner is subject
to the minimum mandatory exclusion provisions of sections ll28(a)(1)
and ll28(c)(3)(B) of the Act, and that Petitioner's exclusion for a
minimum period of five years is mandated by federal law.


APPLICABLE STATUTES AND REGULATIONS

I. The Federal Statute.

Section ll28 of the Social Security Act is codified at 42 U.S.C.
l320a-7 (West U.S.C.A., l989 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
ll28(a)(l).


II. The Federal Regulations.

The governing federal regulations (Regulations) are codified in 42
C.F.R. Parts 498, l00l, and l002 (l989). Part 498 governs the
procedural aspects of this exclusion case; Parts l00l and l002
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

The I.G. based this exclusion on Petitioner's conviction, as defined
in section ll28(i) of the Act, of a criminal offense "related to the
delivery of an item or service" under the Medicare and Medicaid
programs. Such exclusions are mandated by section ll28(a)(l) of the
Act.

On April 23, l990, Petitioner requested an administrative hearing to
contest the I.G's determination and the case was assigned to me for
a hearing and decision. On June 6, l990, I held a prehearing
conference and established a schedule for filing prehearing motions
and briefs. Thereafter, the I.G. filed a motion for summary
disposition on all issues; Petitioner submitted an opposing brief to
which the I.G. replied.


ISSUES

The issues in this case are:

l. Whether Petitioner was "convicted" of a criminal
offense within the meaning of section ll28(i) of the Act.

2. Whether 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 ll28(a)(l) of the Act.

3. Whether Petitioner was subject to the minimum
mandatory five-year exclusion provisions of sections ll28(a)(l) and
ll28(c)(3)(B) of the Act.

4. Whether the effective date of Petitioner's exclusion
should be a date other than the date set out in the I.G.'s Notice.

5. Whether the I.G. is barred from excluding Petitioner
because the exclusion violates the prohibition of double jeopardy,
the ex post facto clause of the United States Constitution, and the
requirements of due process.

6. Whether summary disposition is appropriate in this
case.

FINDINGS OF FACT AND CONCLUSIONS OF LAW 3/

Having considered the entire record, the arguments and the
submissions of the parties, and being advised fully herein, I make
the following Findings of Fact and Conclusions of Law: 4/

1. At all times relevant to this case, Petitioner was a
licensed chiropractor certified as a Medicare provider, maintaining
a practice in the State of Florida. I.G. Ex. 2.

2. By letter dated September 27, 1985, Blue Cross and
Blue Shield of Florida suspended payments to Petitioner for assigned
Medicare claims. I.G. Ex. 10.

3. On March l, l989, Petitioner entered into a plea
agreement with the Office of the United States Attorney for the
Southern District of Florida (U.S. Attorney) wherein he agreed to
plead guilty to five misdemeanors charged in a criminal information
(information) filed by the U.S. Attorney. I.G. Exs. 2 and 3.

4. The five counts of the information charged Petitioner
with submitting five false claims under the Medicare program to the
Department of Health and Human Services for services that were not
eligible for payment in that the services were not provided or did
not meet the requirements for payment. I.G. Ex. 2.

5. On March l3, l989, the United States District Court
for the Southern District of Florida (Court), on Petitioner's plea
of guilty entered a Judgment of Conviction finding Petitioner guilty
of the criminal offenses recited in the information. I.G. Ex. 4.

6. The Court suspended imposition of sentence with
respect to all counts of the information; placed Petitioner on
supervised probation for three years; imposed a $3,000 fine; and
ordered Petitioner to perform 600 hours of community service. I.G.
Ex. 4.

7. The Court also ordered Petitioner to make restitution
to the Medicare program in the total amount of $l69.92. I.G. Ex. 4.

8. Petitioner was "convicted" of a criminal offense
within the meaning of section ll28(a) and ll28(i) of the Act.

9. The offenses of submitting false claims under the
Medicare program were "related to the delivery of an item or
service" under Medicare, within the meaning of section ll28(a)(l) of
the Act.

10. The Secretary of Health and Human Services (the
Secretary) delegated to the I.G. the authority to determine, impose,
and direct exclusions pursuant to section ll28 of the Act. 48 Fed.
Reg. 2l662, May l3, l983.

11. The five year exclusion is the minimum period
required by sections ll28(a)(l) and ll28(c)(3)(B) of the Act.

12. The I.G. acted properly in excluding and directing
the exclusion of Petitioner from participation in the Medicare and
Medicaid programs for the minimum period of five years.

l3. Neither the ALJ nor the I.G. have the authority to
reduce the mandatory minimum period of exclusion.

l4. The ALJ does not have the authority to change the
effective date of the exclusion imposed by the I.G. in this case.

15. The exclusion of Petitioner is not barred by double
jeopardy or the ex post facto and due process clauses of the United
States Constitution.

16. The I.G. is entitled to summary disposition in this
case.

DISCUSSION

I. Petitioner Was "Convicted" of a Criminal Offense as a Matter
of Federal Law.

The I.G. must exclude an individual from the Medicare and Medicaid
programs if he or she is convicted of a criminal offense related to
the delivery of an item or service as defined in sections ll28(a)(l)
and ll28(i) of the Act.

Section ll28(i) of the Act provides that an individual or entity has
been "convicted" of a criminal offense when:

(l) a judgment of conviction has been entered
against the individual or entity by a Federal,
State, or local Court, regardless of whether
there is an appeal pending or whether the
judgment of conviction or other record relating
to criminal conduct has been expunged; or

(3) a plea of guilty or nolo contendere by the
individual or entity has been accepted by a Federal,
State, or local Court.

In this case, I relied on the evidence contained in the following
three documents to decide the issue of whether Petitioner was
"convicted" of a criminal offense as a matter of federal law: (1)
Petitioner's plea agreement signed by Petitioner March l, l989; (2)
the information; and (3) the Court's Judgment of Conviction entered
against Petitioner on March l3, l989.

These documents prove that Petitioner entered into a plea agreement
with the U.S. Attorney and pled guilty to the charges contained in
the information, to submitting false claims under the Medicare
program as charged in the information.

The Court's Judgment of Conviction states that Petitioner entered
pleas of guilty as to the five counts in the information and that
Petitioner was guilty of the counts therein. The Court suspended
sentencing Petitioner and placed him on probation.

The Judgment of Conviction shows that Petitioner's plea of guilty
was "accepted" by the Court within the meaning of section ll28 (i)
of the Act. This plea, together with the Judgment of Conviction
entered against Petitioner by the Court, constitute a "conviction"
within the meaning of sections ll28(a)(l), ll28(i)(l), and
ll28(i)(3) of the Act.


II. Petitioner's Conviction "Related to the Delivery of an Item or
Service" Within the Meaning of Section ll28(a)(l) of the Act.

Having concluded that Petitioner was "convicted" of a criminal
offense, I must determine whether the evidence demonstrates a
relationship between the judgment of conviction and "the delivery of
an item or service" under the Medicare or Medicaid programs as
provided in Section ll28(a)(l) of the Act.

I have relied on the plea agreement, information, and Judgment of
Conviction as the best evidence of the nature of the offense of
which Petitioner was convicted. See, Charles W. Wheeler and Joan K.
Todd, DAB App. ll23 at l0 (l990). These documents, read in their
totality, demonstrate that the criminal offenses to which Petitioner
pled guilty were "related to the delivery of an item or service"
under Medicare.

The evidence shows that Petitioner submitted false claims to the
Medicare program. In the case of Jack W. Greene, DAB App. l078
(l989), the Departmental Appeals Board (DAB) held that "false
Medicaid billing and the delivery of drugs to a Medicaid recipient
are inextricably intertwined and therefore 'related' under any
reasonable reading of that term." Petitioner's conviction for
submitting false claims to Medicare is "inextricably intertwined"
with the Medicare program, and, therefore, "related." Thus,
Petitioner was convicted of criminal offenses "related to the
delivery of an item or service" under the Medicare program within
the meaning of section ll28(a)(l) of the Act.

I find that Petitioner's offenses were "related to the delivery of
an item or service" under the Medicare program, within the meaning
of section ll28(a)(l) of the Act.


III. A Minimum Mandatory Five Year Exclusion is Required in This
Case.

Petitioner contends that the period of l3 months between his
conviction of March l3, l989 and his exclusion by the I.G.
(effective 20 days from the April 12, 1990 Notice) constitutes an
unreasonable delay which violates section ll28(c) of the Act.
Sections ll28(c) and ll28(f)(l) of the Act and section l00l.l23 of
the Regulations require reasonable notice and an opportunity for a
hearing. Petitioner argues that such a delay requires the period of
his exclusion to be reduced or the effective date adjusted. P. Br.
1.

Petitioner was convicted on March l3, l989. I.G. Ex. 4. The date
that the I.G. learned of the conviction of Petitioner does not
appear in the record. However, three months after the date of the
conviction, on June l3, l989, the I.G. sent a letter to Petitioner
advising him of the I.G.'s intent to exclude him and his
chiropractic clinic from participation in federal and state health
care programs pursuant to section ll28(a)(l) of the Act. Although
the letter solicited a reply from Petitioner within 30 days, the
I.G. received no response. I.G. Rep. Br. 1 and 2.

On January 5, l990, the I.G. again sent the same letter of intent to
Petitioner, at a different address, to which Petitioner responded on
February 6, l990. I.G. Exs. 6 and 7. Subsequently, the I.G.
excluded Petitioner. I.G. Ex. 8.

The I.G. contends that at least six months of the l3 months period
is attributable to Petitioner. The I.G. alleges in his Reply Brief
that for six months the I.G. waited for a response from Petitioner
to the June l3, l989 letter because the I.G. desired to have
Petitioner's input prior to exclusion. Petitioner was afforded the
opportunity by telephone to submit any information in response to
the I.G.'s Reply Brief, but did not do so.

The I.G. offered no evidence to show that Petitioner received the
June l3, l989 letter. The fact that a second letter of intent was
sent by the I.G. in January l990 (to a different address) leads to
the conclusion that the I.G. could not show that Petitioner had
received the first letter and had failed to respond. Therefore, I
find that the evidence does not support this contention by the I.G.

Section ll28(c)(3)(B) of the Act requires the I.G. to exclude
individuals and entities from the Medicare and Medicaid programs for
a minimum period of five years when such individuals and entities
have been "convicted" of a criminal offense "related to the delivery
of an item or service" under the Medicare or Medicaid programs
within the meaning of section ll28(a)(l) of the Act.

Congressional intent on this matter is clear:

Moreover, a mandatory five-year exclusion should
provide a clear and strong deterrent against the
commission of criminal acts.

S. Rep. No. l09, l00th Cong., lst Sess. 2, reprinted in l987 U.S.
Code Cong. & Admin. News 682, 686.

Since Petitioner was "convicted" of a criminal offense and it was
"related to the delivery of an item or service" under the Medicare
program within the meaning of section ll28(a)(l) and (i) of the Act,
the I.G. was required to exclude Petitioner for the mandatory
minimum of five years. See, Greene v. Sullivan, 73l F. Supp. 835
(E.D. Tenn. l990). In Samuel W. Chang, M.D, DAB 1198 at 9 (1990),
the Departmental Appeals Board found that, in a mandatory five year
minimum exclusion case, the ALJ cannot decrease the time, nor can he
decide when the exclusion is to begin. Therefore, I am without
authority to reduce Petitioner's period of exclusion or to adjust
the effective date of the exclusion.


IV. The Effective Date of Petitioner's Mandatory Minimum Exclusion
Cannot be Changed.

Petitioner contends that on September 27, l985, he was formally
suspended from the Medicare program. Petitioner argues that this
suspension effectively excluded him from participation in the
Medicare program since that time. Petitioner argues that the
effective date of the I.G.'s exclusion extends the exclusion beyond
the mandatory five year period. For this reason, Petitioner asserts
his mandatory exclusion by the I.G. should become effective either
as of September 27, l985, the date of his suspension, or as of March
13, 1989, the date of his conviction. P. Br. l.

The I.G. contends that in l985 only payments to Petitioner for
assigned Medicare claims were suspended pending the outcome of an
investigation. The I.G. further contends that Petitioner was not
excluded at that time because he could have continued to submit
Medicare assigned claims which would have been processed but on
which payments would have been withheld. Medicare beneficiaries
could have continued to submit unassigned claims. The I.G. argues
that had Petitioner not been convicted, he would have ultimately
been reimbursed for covered services properly rendered. I.G. Br. 5
and 6.

The letter of suspension advised Petitioner that his future assigned
Medicare claims would be processed but that payments would be
withheld pursuant to 42 C.F.R. 405.37l(b). Petitioner's argument is
premised on his incorrect assumption that his suspension of payments
in l985 is the same as the present exclusion. As a matter of law, a
suspension of payment under 42 C.F.R. 405.37l(b) is not the
equivalent of an exclusion under section ll28 of the Act.

An exclusion under section ll28 of the Act bars:
(1) a provider;
(2) any entity in which the provider serves as an
employee, operator, or in any other capacity; and
(3) suppliers wholly owned by the provider
from claiming or obtaining reimbursement for items and services
furnished to Medicare beneficiaries and Medicaid recipients. State
and local licensing and certification authorities as well as the
public are notified of the exclusion. In addition, an excluded
provider can be subject to further penalties if he submits or causes
claims to be submitted after the effective date of the exclusion.
An exclusion seeks, among other goals, to protect beneficiaries,
maintain program integrity, and foster public confidence in the
programs.

The purpose of a suspension of payments under 42 C.F.R. 405.37l(b)
is to withhold payments to a provider and protect the program
against financial loss when there is minimal likelihood of recovery
of overpayments or of amounts paid for fraudulent claims. The
primary purpose of a suspension of payment is preserving the
financial integrity of the program. Thus, the effect of a
suspension of payments is more limited than the effect of an
exclusion.

The I.G. argues that despite the suspension, the Petitioner could
have continued "business as usual." The Petitioner argues that the
practical effect of a suspension of payments on a provider whose
practice


depends to a large degree on Medicare or Medicaid reimbursement is
to force the provider to discontinue such a practice. 5/

Suspension of payments to Petitioner in l985 may involve due process
considerations. 6/ However, this is a matter of program
administration which is not within my authority to address. The
issue that is of concern here is whether the suspension of payments
to Petitioner and the present exclusion are, as a matter of law,
equivalent. The issue is not whether the practical result of the
suspension and the exclusion is the same, as argued by Petitioner.

I conclude that the suspension of payments to Petitioner in l985
under regulations directing such in instances of possible fraud or
misrepresentation is not equivalent to the exclusion imposed by the
I.G. in this case. However impractical, Petitioner could have
continued his practice of seeing and accepting assignment for
Medicare patients. Ultimately, Petitioner would have been paid for
legitimate and valid claims. Consequently, I conclude that
suspension of payments to Petitioner under 42 C.F.R. 405.371(b) is
not equivalent, as a matter of law, to an exclusion under section
ll28 of the Act. Accordingly, the suspension of payments does not
lengthen Petitioner's exclusion. Petitioner's suspension of
payments in l985 was a process separate and different from the
present exclusion.

As indicated earlier in this decision, an ALJ in a mandatory minimum
exclusion case cannot decide when the exclusion is to begin. Chang,
supra. Therefore, Petitioner's mandatory period of exclusion cannot
become effective on any date other than the date established by the
I.G.'s Notice.

V. The I.G. is not Precluded From Excluding Petitioner in This
Case.

Petitioner contends that the I.G. is barred from excluding him
because of the prohibition against double jeopardy. Petitioner
cites the recent Supreme Court case of United States v. Halper, 109
S. Ct. 1892 (1989), in support of his argument. P. Br. 2.

The I.G. contends that this case is distinguishable from Halper in
that here the I.G. is not seeking a monetary recovery and the
economic impact on Petitioner is not the primary intent of the
exclusion. I.G. Rep. Br. 6.

In Halper, the Supreme Court held that, under some circumstances,
the imposition of civil penalties could constitute double jeopardy
in the narrow circumstances where there existed a prior criminal
conviction for the false claims for which the civil penalty was
imposed and where there was not even a rough relationship between
the amount of the penalty and the cost to the government resulting
from the false claims.

This case is distinguishable from Halper. First, the I.G. is
seeking to impose an exclusion, not additional monetary sanctions.
Second, unlike the factual situation in Halper where the government
was attempting to impose a civil penalty which the Supreme Court
found to be a punishment, the purpose of the exclusion is to protect
the Medicare and Medicaid programs, not to be any sort of
punishment. Dewayne Franzen, DAB App. ll65 at l0 (l990). Moreover,
the Board found in Franzen that the exclusion process is a
collateral consequence of the underlying criminal conviction,
similar to the ones whereby a professional license is revoked based
upon a criminal conviction. Id. at 11 and 12. The Board found that
such situations did not constitute double jeopardy.
Further, exclusions by the I.G. in similar circumstances to the ones
in this case have received judicial approval. In Greene v.
Sullivan, 731 F.Supp. 838, 840 (E.D. Tenn. 1990) the court noted
that the goals of the I.G.'s exclusion "are clearly remedial and
include protecting beneficiaries, maintaining program integrity,
fostering public confidence in the program, etc."

Petitioner also contends that the ex post facto and due process
clauses of the United States Constitution bar application of the
five year mandatory minimum exclusion to this case.

Petitioner contends that application of the mandatory minimum period
of exclusion to this case would violate the ex post facto clause of
the United States Constitution, which prohibits Congress from
enacting any law "which imposes a punishment for an act which was
not punishable at the time it was committed; or imposes additional
punishment to that then prescribed." 7/ The foundation of the
argument of Petitioner is that the conduct giving rise to his
conviction took place during the period l982 through l984, prior to
the effective date of the August 18, 1987 amendments. Petitioner
further argues that it was the delay in bringing his case to trial
that caused his conviction to have occurred in l989, after the
effective date of the l987 amendments. But for this delay in
convicting him, Petitioner would not have been subject to the
mandatory exclusion period of five years required under the l987
amendments. P. Br. 2.

Petitioner then argues that application of the 1987 amendments to
this case "imposes additional punishment." After the enactment of
the 1987 amendments, the I.G. no longer had the authority to impose
an exclusion of less than five years, thereby depriving Petitioner
of any possibility of being excluded for a shorter time than the
mandatory minimum five years. Petitioner supports this contention
by submitting that other providers whose offenses occurred on or
about the same time as that of the Petitioner, but who were
convicted prior to the effective date of the l987 amendments, were
given different periods of exclusion. In the alternative,
Petitioner argues that the I.G. is imposing the exclusion sanction
in an inconsistent fashion. P. Br. 2 and attachments.

The I. G. contends that the ex post facto clause applies only to
criminal statutes. The I.G. argues that using the two-step approach
set forth by the Supreme Court in United States v. One Assortment of
89 firearms, 465 U.S. 354, 362-63 (1984), (1) the statute was not
designated criminal by Congress, and (2) the statutory scheme is
not so punitive in purpose or effect as to negate the Congressional
intent. The primary purpose and effect of the exclusion sanction is
to protect the integrity of and foster public confidence in the
Medicare and Medicaid programs. The I.G. further argues that for
the same reasons as in the discussion of double jeopardy, neither
the purpose nor primary effect of the five-year exclusion is
punitive, and the ex post facto clause is not implicated in this
case. I.G. Rep. Br. l0.

Petitioner also contends that application of the 1987 amendments to
this case would violate his rights to due process guaranteed by the
Fifth Amendment of the United States Constitution. P. Br. 2.

The implied basis of Petitioner's argument must be that application
of the 1987 amendments to this case would have an improper
retroactive effect. Since the purpose of the ex post facto clause
is to "assure that legislative acts give fair warning of their
effect," Petitioner concludes that the due process clause requires
notice of the legislation's effect. Retroactive applicability would
deny notice to Petitioner and therefore due process, forbidding
application of the 1987 amendments to his case. P. Br. 2

The Regulations at 45 C.F.R. 1001.128(a) provide some guidance
concerning the scope of review by an ALJ in hearing federal
exclusion cases. That section provides that an ALJ has the
authority to hear and decide issues of whether: (1) a Petitioner was
in fact, convicted; (2) the conviction was related to his or her
participa-tion in the delivery of medical care or services under the
Medicare, Medicaid, or social services program; and (3) the length
of the suspension (exclusion) is reasonable. There is no language
in section 1001.128 of the Regulations, or in other federal
regulations, which states that an ALJ has the authority to consider
collateral challenges to the validity of the underlying federal
statutory provisions that the issues were designed to address.
However, the jurisdiction conferred upon an ALJ by section 1001.128
of the Regulations does permit inquiry into the propriety of the
imposition of an exclusion in particular cases. In order to
consider the three issues set forth in section 1001.128 of the
Regulations, an ALJ must therefore interpret, construe, and apply
the underlying statutory provisions to individual cases. As stated
by the Departmental Appeals Board in Jack W. Greene, DAB App. 1078
at 17 (1989):

The ALJ must consider the meaning of the pertinent
statutory provision as well as regulations and policy
issuances. It would literally be impossible to apply
the issue identified by [42 C.F.R. 1001.128] in a
legally correct manner without considering these
factors, as appropriate.

Thus, although I do not have the authority to declare the 1987
amendments unconstitutional, I do have the authority to interpret
and apply the amendments. See Hai Nhu Bui, DAB Civ. Rem. C-103
(1990), citing Jack W. Greene, supra.

Petitioner raises the issue of whether the 1987 amendments to
section 1128 of the Act mandating a minimum five year exclusion
apply to him. I am empowered to decide how Congress intended the
1987 amendments to apply. In addition, where there is room to
decide how to apply the statute, I have a duty to apply it in a
manner that is constitutional and valid. See generally, Dickerson,
The Interpretation and Application of Statutes, Ch. 3 (Little, Brown
and Co. 1975). 8/

I disagree with Petitioners' assertion that the constitutional
prohibition against ex post facto laws bars the I.G. from imposing
the mandatory minimum exclusion in this case.

Petitioners' objections to application of the mandatory exclusion
provision to this case on ex post facto grounds are necessarily
premised on the assertion that Congress intended the imposition of
the five year mandatory minimum exclusion to be a punishment. For
the reasons discussed above on double jeopardy, I conclude that the
exclusion provision of the 1987 amendments is a civil law that
imposes a protective or remedial sanction, and it is not a
punishment within the meaning of that term in the United States
Constitution. Therefore, this civil remedy does not trigger the
protections afforded by the Constitution to defendants in criminal
cases.

I also disagree with Petitioner's assertion that the due process
clause bars the I.G. from imposing the five year mandatory minimum
exclusion in this case.

The 1987 amendments were enacted by Public Law 100-93. Section
15(b) of Public Law 100-93 specifically states:

Mandatory minimum exclusions apply prospectively.
Section 1128(c)(3)(B) of the Social Security Act (subsec
(c)(3)(B) of this section) (as amended by this Act [Pub.
L. 100-93, section 2]) which requires an exclusion of
not less than 5 years in the case of certain exclusions,
shall not apply to exclusions based on convictions
occurring before the date of the enactment of this Act
[August 18, 1987].

Regarding this provision, the legislative history states: "The
provision establishing mandatory five year minimum exclusion periods
for conviction of certain crimes would apply to convictions
occurring on or after the date of enactment." S. Rep. No. 109,
100th Cong., 1st Sess. 27, reprinted in 1987 U.S. Code Cong & Admin.
News 682, 708.

It is clear from both the language of the statute itself and its
legislative history that Congress intended the mandatory minimum
exclusion provisions to apply prospectively from the date of the
statute's enactment to all convictions occurring on or after August
18, 1987. See, Betsy Chua, M.D., et al, DAB Civ. Rem. C-139 (1990),
aff'd, DAB App. 1204 (1990). Obviously, if a conviction occurred on
August 18, 1987 or shortly thereafter, the misconduct giving rise to
the conviction would necessarily have occurred prior to August 18,
1987. Accordingly, in enacting this provision, Congress must have
been aware that there would be many convictions that would be
entered after the effective date of the amendments and that these
convictions would be based on acts that were committed prior to that
date. Thus, by logical inference, Congress intended the 1987
amendments to apply even in those cases where the misconduct
occurred prior to August 18, 1987, as long as the conviction
resulting from the misconduct occurred on or after August 18, 1987.
This logical inference is inescapable, and the only way it could be
overcome would be by specific language in the text of the statute
itself or in its legislative history indicating Congressional intent
not to apply the mandatory exclusion to convictions based on
misconduct occurring prior to August 18, 1987.

In this case, Petitioner's guilty plea and subsequent conviction
were entered nearly a year and a half after the enactment of the
amendments to the Act. Accordingly, I conclude there is no
retroactive application here, and that the due process arguments of
Petitioner are therefore misplaced. Since Petitioner in this case
was convicted of a program-related offense after August 18, 1987,
the I.G. had no choice but to apply the 1987 amendments and exclude
Petitioner from participation in the Medicare and Medicaid programs
for at least five years. Greene, supra, at 840


VI. Summary Disposition Is Appropriate In This Case.

The issue of whether the I.G. had the authority to exclude
Petitioner under Section 1128(a)(1) is a legal issue. I have
concluded as a matter of law that Petitioner was properly excluded
and that the length of his exclusion is mandated by law. There are
no genuine issues of material fact which would require the
submission of additional evidence, and there is no need for an
evidentiary hearing in this case. Accordingly, the I.G. is entitled
to summary disposition as a matter of law. See Charles W. Wheeler
and Joan K. Todd, DAB App. 1123 at 10 (1990), and Rule 56 F.R.C.P.


CONCLUSION

Based on the law and 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 ll28(a)(l) of the
Act, and that the minimum period of exclusion for five years is
mandated by federal law.


Charles E. Stratton
Administrative Law Judge


* * * Footnotes * * *

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 ll28(h) of the Act.
2. The I.G.'s Notice adds five days to the l5 days
prescribed in section l00l.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. The citations to the record in this Decision are
designated as follows:
I.G.'s Brief I.G. Br. (page)
I.G.'s Exhibits I.G. Ex. (letter)/(page)
Petitioner's Brief P. Br. (page)
I.G.'s Reply Brief I.G. Rep. Br. (page)
Findings of Fact and FFCL (number)
Conclusion of Law
5. Petitioner was suspended under the Regulations for
possible fraud or misrepresentation. In such cases the intermediary
or carrier of the program is not required to first notify the
provider of the intent to suspend payments. The provider is not
permitted to submit a statement or pertinent evidence on his behalf
to prevent the suspension. Providers have argued that such
procedures violate their due process because they do not afford them
some kind of notice or hearing. This issue has not been reached by
a court but has been discussed in actions requesting temporary
injunction relief against the suspension of payments.

In Plaza Health Laboratories, Inc. v. Perales, et al., 702 F.Supp.
86 (l989), the plaintiff's payments were suspended by the New York
Medicaid program for program misconduct occurring in New Jersey. In
seeking a temporary injunction against such a suspension, the
plaintiff argued, inter alia, that such a suspension was a denial of
due process because the plaintiff had a substantial interest in the
Medicaid payments that were being suspended. The plaintiff
submitted evidence that 25% of its business was Medicaid business;
that it employed 20 persons prior to the suspension and had been
forced to lay off 10 of them in the wake of the suspension; and that
plaintiff could not remain in business without Medicaid payments as
a source of income. Further, the plaintiff directed the court to
decisions that had found a property interest in program
reimbursements that triggered due process considerations. The court
in Plaza rejected those findings as having been made without
analysis and proceeded to conclude that a health-care provider's
"interest" does not rise to the level of a constitutionally
protected property interest. Id. at 90 (emphasis in original).
Contra, Patchogue v. Bowen, 797 F.2d ll37, ll44-45 (2d Cir. l986)
where the court stated that "health care providers have a
constitutionally protected property interest in continued
participation in the Medicare and Medicaid programs, and thus are
entitled to some form of hearing before being deprived of that
interest"; and Case v. Weinberger, 523 F.2d 602, 606 (2d Cir. l975)
where the court said that "it is clear that [plaintiff] has a
property interest in her expectations of continued participation in
the Medicaid program". In both these cases the court did not reach
the due process issue in denying the temporary injunction.

In S & D Maintenance Co., Inc. v. Goldin, 844 F.2d 962 (2d Cir.
l988), the court indicated that a provider's desire to continue the
relationship [with the programs] did not rise to the level of a
legitimate entitlement, and, therefore, there is no constitutionally
protected property interest in future Medicaid payments. See ADL,
Inc. v. Perales, [1988-2 Transfer Binder] Medicare & Medicaid Guide
(CCH) Para. 37,237 (S.D.N.Y. Aug. 2, l988); and Hillside Medical
Laboratory, Inc. v. Perales, [1989-1 Transfer Binder] Medicare &
Medicaid Guide (CCH) Para. 37,459 (S.D.N.Y. Sept. 20, l988)(the
court found there is a property interest in reimbursement for
services already rendered).

6. Although this is not the forum to discuss the due
process issues presented by a suspension of payments, I recognize
Petitioner's concerns and the practical effect of the suspension on
him.
7. Article 1, Section 10 of the United States
Constitution.
8. See also Scott v. Bowen, 845 F.2d 856 (9th Cir. 1988)
(an ALJ also has authority to decide constitutional questions
involving evidence, procedure, and due process).