Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of:
Roosevelt A. Striggles
Petitioner,
- v. -
The Inspector General.
DATE: January 11, 1991
Docket No. C-301
DECISION
On September 12, 1990, the Inspector General (the I.G.)
notified Petitioner that he was being excluded from
participation in the Medicare program and any State
health care program. 1/ The I.G. told Petitioner that
his exclusion was due to the fact that Petitioner's Ohio
pharmacist license had been revoked. Petitioner was
advised that he could reapply for reinstatement in
Medicare and Medicaid at such time as he obtained a valid
pharmacist license from the State of Ohio.
Petitioner timely requested a hearing, and the case was
assigned to me for a hearing and decision. I scheduled a
hearing in the case. However, prior to the scheduled
hearing date, the I.G. moved for summary disposition.
Petitioner timely filed a reply to the motion. I have
considered the I.G.'s motion, Petitioner's reply, the
undisputed material facts, and applicable law and
regulations. I conclude that the exclusion is authorized
by section 1128(b)(4)(A) of the Social Security Act (the
Act) and is reasonable. Therefore, I conclude that
summary disposition is appropriate and no evidentiary
hearing is necessary.
ISSUES
The issues in this case are whether:
1. Petitioner's pharmacist license was revoked by a
state licensing authority for reasons bearing on
Petitioner's professional competence, professional
performance, or financial integrity;
2. the correctness or fairness of the decision
revoking Petitioner's pharmacist license is a
relevant question of material fact on which I should
receive evidence;
3. summary disposition is appropriate in this case;
4. the exclusion imposed and directed against
Petitioner is reasonable.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
1. Petitioner was licensed as a pharmacist in the State
of Ohio. I.G. Ex. 2/7. 2/
2. On March 8, 1989, the Ohio State Board of Pharmacy
(Pharmacy Board) revoked Petitioner's pharmacist license.
I.G. Ex. 2/20.
3. The Pharmacy Board concluded that Petitioner was
guilty of a felony and gross immorality. I.G. Ex. 2/20.
4. The Pharmacy Board concluded that Petitioner had
committed acts constituting dishonesty and unprofessional
conduct in the practice of pharmacy. I.G. Ex. 2/20.
5. The Pharmacy Board found that Petitioner unlawfully
sold or offered to sell controlled substances. I.G. Ex.
2/7-19.
6. Among the controlled substances which the Pharmacy
Board found that Petitioner unlawfully sold or offered to
sell were Schedule II controlled substances consisting of
Percodan, Demerol, and Percocet. I.G. Ex. 2/7-19.
7. The Pharmacy Board found that Petitioner knowingly
possessed false or fraudulent prescriptions for
controlled substances, including Dexedrine, Preludin,
Demerol, and Percodan, Schedule II controlled substances.
I.G. Ex. 2/13, /17, /18.
8. The Pharmacy Board found that Petitioner knowingly
and unlawfully sold a dangerous drug to a consumer
without a prescription. I.G. Ex. 2/19.
9. The Pharmacy Board found that Petitioner unlawfully
failed to keep records of all controlled substances which
he had received or dispensed. I.G. Ex. 2/14.
10. The Pharmacy Board revoked Petitioner's pharmacist
license for reasons bearing on Petitioner's professional
competence or performance. Findings 2-9.
11. The Secretary of the 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. 48 Fed. Reg. 21662,
May 13, 1983.
12. On September 12, 1990, the I.G. excluded Petitioner
from participating in the Medicare program and directed
that he be excluded from participating in Medicaid,
pursuant to section 1128(b)(4)(A) of the Act. I.G. Ex.
1.
13. Petitioner's exclusion is effective until such time
as his pharmacist license is restored by the State of
Ohio and his participation in Medicare and Medicaid is
reinstated. I.G. Ex. 1.
14. Petitioner's assertion that the Pharmacy Board acted
incorrectly or improperly in revoking his license is not
a relevant ground on which to argue that the I.G. lacked
authority to exclude Petitioner. See Social Security
Act, section 1128(b)(4)(A).
15. There are no disputed material facts in this case
and summary disposition is appropriate.
16. The I.G. had authority to exclude Petitioner from
participating in Medicare and to direct that he be
excluded from participating in Medicaid. Finding 10;
Social Security Act, section 1128(b)(4)(A).
17. The exclusion imposed and directed against
Petitioner by the I.G. is reasonable. Social Security
Act, section 1128(b)(4)(A).
ANALYSIS
The Pharmacy Board revoked Petitioner's Ohio pharmacist
license based on findings that Petitioner had committed
felonies related to the unlawful sale of controlled
substances and that he had engaged in dishonest and
unprofessional conduct. Subsequently, the I.G. imposed
an exclusion against Petitioner pursuant to section
1128(b)(4)(A) of the Social Security Act. This section
permits exclusion of any individual or entity:
(W)hose license to provide health care has been
revoked or suspended by any State licensing
authority, or who otherwise lost such a
license, for reasons bearing on the
individual's or entity's professional
competence, professional performance, or
financial integrity. . . .
The exclusion imposed and directed by the I.G. is
indefinite in duration. Petitioner may request
reinstatement as a provider in Medicare and Medicaid when
his license is restored.
Petitioner does not deny that his pharmacist license was
revoked by the Pharmacy Board. He disputes that it was
revoked for reasons bearing on his professional
competence or performance. Petitioner argues that the
Pharmacy Board's findings in his case are incorrect. He
asserts that the Pharmacy Board is presently being sued
for making false charges against a pharmacy and from this
I infer that Petitioner seeks to challenge the probity
and integrity of the Pharmacy Board.
Petitioner does not contend that he has or seeks a
pharmacist license in any state other than Ohio, and he
does not assert that he wishes to be a participant in
Medicare and Medicaid in any status other than as a
pharmacist.
1. Petitioner's pharmacist license was revoked by a
state licensing authority for reasons bearing on
Petitioner's professional competence, professional
performance, or financial integrity.
The Pharmacy Board decided that Petitioner was guilty of
a felony and of gross immorality. It concluded that
Petitioner had committed acts constituting dishonesty and
unprofessional conduct in the practice of pharmacy.
Findings 3, 4. It based these conclusions on findings
that Petitioner had unlawfully: sold controlled
substances, including Schedule II controlled substances;
possessed prescriptions which he knew to be false or
forged; and failed to keep records of his receipt and
sale of controlled substances. Findings 4-9.
I conclude that the reasons expressed by the Pharmacy
Board for revoking Petitioner's license bear on
Petitioner's professional competence and performance. An
essential part of Petitioner's professional performance
of his pharmacist's duties was to dispense controlled
substances in compliance with law and in a manner which
would not endanger the health and safety of his
customers. The Pharmacy Board unequivocally found that
he had willfully violated this obligation. This finding
falls squarely within that which is covered by section
1128(b)(4)(A).
Petitioner argues that the Board did not revoke his
license for reasons bearing on his professional
competence or performance because it made no finding that
Petitioner violated any federal law. However, the terms
"professional competence" and "professional performance"
in section 1128(b)(4)(A) are not linked to performance of
duties in compliance with federal law. An action by a
state licensing board to revoke a party's license will
fall within section 1128(b)(4)(A) if the reasons
expressed for that action bear on the party's
professional competence or performance. Such reasons
might relate to a violation of federal law, but they
might also relate to violations of other laws, or to
errors or omissions which are not unlawful, but which
bear on competence or performance.
2. The correctness or fairness of the Pharmacy
Board's decision revoking Petitioner's pharmacist license
is not a relevant question of material fact on which I
should receive evidence.
Petitioner argues that the findings made by the Pharmacy
Board are incorrect. In his reply to the I.G.'s motion
for summary disposition, Petitioner asserts that there
exist facts which would substantially refute the Pharmacy
Board's findings. Petitioner also seems to be arguing
that the license revocation proceedings in his case are
tinged with dishonesty by asserting that the Pharmacy
Board has been charged with dishonesty in a lawsuit. I
infer from these contentions that Petitioner is arguing
that the proceedings which resulted in the revocation of
his license were defective, and that the I.G.'s exclusion
determination is invalid because it is based on defective
proceedings.
A petitioner's argument concerning the correctness or
fairness of a state licensing board's license revocation
proceeding is irrelevant to the issue of whether the I.G.
has authority to impose and direct an exclusion based on
the board's order revoking that petitioner's license.
Andy E. Bailey, C.T., DAB App. 1131 (1990); John W.
Foderick, M.D., DAB App. 1125 (1990). The Departmental
Appeals Board held in Foderick that:
The authority given to the I.G. to impose and
direct exclusions . . . is based on actions
taken by state licensing boards. The statute
clearly intended that the I.G. was to rely on
the state board actions, and did not intend
that the I.G. examine the fairness or propriety
of the process which led to the actions of the
state boards.
Thus, Petitioner's assertions about the correctness or
fairness of the Pharmacy Board's decision are irrelevant
to the hearing and deciding of this case. 3/
3. Summary disposition is appropriate in this case.
Summary disposition is appropriate in an exclusion case
where there are no disputed issues of material fact and
where the undisputed facts demonstrate that one party is
entitled to judgment as a matter of law. Foderick, at
5-12. There are potential questions of fact which may
arise in an exclusion hearing brought to challenge
exclusions imposed and directed pursuant to section
1128(b)(4)(A). I have carefully considered this case in
terms of those potential fact questions, and I conclude
that there exist no disputed issues of material fact with
respect to any of them.
The first potential issue of fact is whether Petitioner's
license was revoked for reasons bearing on his
professional competence or professional performance.
There are no disputed material facts as to the reason the
Pharmacy Board revoked Petitioner's license because
Petitioner has not disputed those facts offered by the
I.G. which establish that the Pharmacy Board's decision
bears on Petitioner's professional competence or
performance. Petitioner made collateral arguments
concerning the fairness of the Pharmacy Board's action
which I have concluded are not relevant to this case.
Petitioner has not asserted that the license revocation
order (I.G. Ex. 2), which establishes the Pharmacy
Board's decision and the basis for it, is inaccurate or
incomplete.
The next potential issue of fact is whether it is
reasonable to exclude Petitioner until his Ohio
pharmacist license is restored. The exclusion imposed
and directed by the I.G. is indefinite. Petitioner may
not apply for reinstatement as a Medicare or Medicaid
provider until such time as his license is restored;
there is nothing in the Pharmacy Board's decision which
suggests how long it may take for Petitioner to be
relicensed or what criteria would be employed to evaluate
a request by Petitioner to have his license restored.
Furthermore, the exclusion applies in all jurisdictions
where Medicare and Medicaid items or services are
reimbursed and it applies to all types of items or
services (not limited to pharmacy items or services) for
which Petitioner might seek reimbursement. Walter J.
Mikolinski, Jr., DAB App. 1156 (1990).
The Departmental Appeals Board (the Appeals Board) has
decided that in some circumstances where a license has
been revoked Congress intended section 1128(b)(4) to
authorize the I.G. to impose and direct exclusions until
such time as the license is restored. Foderick at 11.
The petitioner in Foderick surrendered his license to
practice medicine to a state licensing board rather than
participate in a state license revocation hearing. As in
this case, the I.G. excluded Petitioner until such time
as Petitioner succeeded in having his license reinstated.
I concluded that, under the facts of the case, the
exclusion was per se reasonable. I entered summary
disposition in favor of the I.G. sustaining the
exclusion. The Appeals Board affirmed this decision. It
held that the Act was:
designed to ensure that health care providers
who lose their licenses for reasons related to
their professional competence be prohibited
from participating in Medicare and Medicaid in
all states until they reacquire their licenses
and demonstrate their trustworthiness.
Foderick at 11 (Emphasis added). The Appeals Board
therefore concluded that an indefinite exclusion under
section 1128(b)(4) -- that is to say, an exclusion whose
duration is tied to restoration of a license by the state
board which revoked that license -- is within the intent
of Congress and is ordinarily per se reasonable.
Subsequently, the Appeals Board identified an exception
to this general principle. In Mikolinski, the Board held
that an exclusion imposed pursuant to section 1128
applied to all forms of reimbursement that a provider
might claim under Medicare or Medicaid. The petitioner
in Mikolinski was a pharmacist whose license had been
suspended by a state licensing authority for reasons
bearing on his professional competence or performance.
The I.G. imposed an exclusion whose duration was
conditioned on restoration of the petitioner's pharmacist
license. Mikolinski was also a nursing home operator.
He contended that an exclusion as to his nursing home
operation conditioned on restoration of his pharmacist
license was not reasonable.
The Appeals Board held that an exclusion could not
differentiate among the various items or services for
which the petitioner claimed reimbursement. Mikolinski
at 5-16. It held, however, that the petitioner's
assertions as to the items or services he provided raised
the issue of whether an indefinite exclusion whose
duration was tied to restoration of petitioner's
pharmacist license was reasonable. The Appeals Board
held that the petitioner's assertions raised an issue of
fact which would not justify a finding that the
indefinite exclusion was per se reasonable. The Board
found that:
Subsection 1128(g)(2) of the Act does not
require that an exclusion based on license
suspension under subsection 1128(b)(4)(A) be
effective until the excluded individual regains
a valid license.
Id. at 22. It remanded the case to the administrative
law judge with directions to take additional evidence as
to the reasonableness of the length of the exclusion.
On its face, this finding would appear to be inconsistent
with the Appeals Board's decision in Foderick. 4/
However, the apparent inconsistency of the two holdings
vanishes when Mikolinski is considered in the context of
its unique facts. The facts which distinguish Mikolinski
from Foderick are that in Mikolinski, the petitioner
asserted that he provided items or services other that
those which were within the scope of his suspended
license. No such assertion was made by the petitioner in
Foderick. The Mikolinski decision stands for the rule
that where such assertion is made, it may raise a
disputed issue of material fact concerning the
reasonableness of the exclusion.
That issue arises by virtue of the overall remedial
purpose ofsection 1128. The exclusion provisions are not
intended to punish providers who lose their professional
licenses. They are intended to protect the integrity of
federally-financed health care programs and the welfare
and safety of beneficiaries and recipients of those
programs from parties who have demonstrated that they are
untrustworthy. An exclusion is reasonable if it fairly
addresses that remedial purpose. It is not reasonable if
it bears no rational relationship to the remedial purpose
of the Act.
The Foderick decision holds that Congress made a
legislative finding that parties who lose their licenses
to provide health care should under most circumstances be
deemed untrustworthy until they regain such licenses.
The Mikolinski decision addresses the exception to this
rule, that being the circumstance where the criteria for
relicensure bear no rational relationship to the
provider's trustworthiness to furnish items or services
which are not related to those items or services that are
within the scope of the license. Under that unique
circumstance, an exclusion as to all programs may not be
reasonable, if its duration is tied to relicensure for
one class of items or services. 5/ The Mikolinski
decision therefore constitutes an exception to the
general rule legislated by Congress and affirmed by the
Appeals Board in Foderick. 6/
Petitioner has not contended that he provides items or
services other than those which were within the scope of
his pharmacist license. 7/ Therefore, Petitioner has
not raised the fact issue which distinguishes Mikolinski
from Foderick. I conclude that the material fact as to
the reasonableness of the length of the exclusion in this
case is that Petitioner's Ohio pharmacist license has
been revoked. This is uncontested. Therefore, summary
disposition is appropriate in this case.
4. The exclusions imposed and directed against
Petitioner are reasonable.
The facts of this case are on all fours with the facts in
Foderick. Petitioner's Ohio pharmacist license was
revoked by the Pharmacy Board. The exclusion imposed and
directed by the I.G. is effective until such time as the
license is restored. This exclusion complies with
Congressional intent. Therefore, it is reasonable.
CONCLUSION
Based on the undisputed material facts and the law, I
conclude that the I.G.'s determination to exclude
Petitioner from the Medicare program, and to direct that
Petitioner be excluded from participating in Medicaid,
was authorized pursuant to section 1128(b)(4)(A) of the
Act and is reasonable. Therefore, I enter summary
disposition in favor of the I.G. in this case.
_________________________
Steven T. Kessel
Administrative Law Judge
* * * Footnotes * * *
1. "State health care program" is defined by
section 1128(h) of the Social Security 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 I.G.'s exhibits will be cited as "I.G.
Ex. (number/page)."
3. I make no findings as to whether Petitioner
has any rights to appeal the Pharmacy Board's decision to
revoke his license.
4. The Appeals Board did not discuss the
Foderick case in its Mikolinski decision.
5. The Mikolinski decision does not hold as a
matter of law that such exclusions are unreasonable.
Rather, it identifies a fact question which may arise in
those cases where a party asserts that is providing items
or services which are beyond the scope of those covered
by his health care license. In that circumstance, an
exclusion as to all programs whose duration is tied to
restoration of the license may be unreasonable, but it
may also be reasonable, depending on the facts.
6. The facts within the Mikolinski holding may
not be the only exception to the general rule. There may
exist other circumstances where an exclusion whose
duration is tied to restoration of a professional license
is not per se reasonable. For example, a provider of
health care may have his or her license revoked by a
state for reasons bearing on his or her professional
competence or performance. That provider may relocate to
another state and apply for a health care license in that
state. That state's licensing authority may grant a
license after a rigorous scrutiny of the provider's
qualifications to provide health care, including the
circumstances which resulted in loss of license in the
first state. In that situation, it may not be per se
reasonable to conclude that the exclusion must continue
in effect until such time as the provider returns to the
state which revoked his or her license, reapplies for
licensure in that state, and reacquires the license.
7. Nor has Petitioner contended that he has a
pharmacist license in any jurisdiction other than Ohio.