SUBJECT:

Valerie Baker,

Petitioner,

The Inspector General

DECISION

I grant the Inspector General's (I.G.) Motion for partial summary judgment, and sustain the determination of the I.G. to exclude Valerie Baker (Petitioner) from participating in Medicare, Medicaid, and all federal health care programs for a minimum period of five years.⁽¹⁾ I find that a basis exists for the I.G. to exclude Petitioner pursuant to section 1128(a)(1) of the Social Security Act (Act). Further, I find that the I.G.'s exclusion for a minimum period of five years is mandatory.

I. Background

On August 31, 2000, the I.G. notified Petitioner that she was being excluded from participation in Medicare, Medicaid, and all federal health care programs for a period of 10 years. I decide the threshold issue of whether the I.G. had a basis for Petitioner's exclusion. The secondary issue: of whether it was reasonable for the I.G. to exclude Petitioner for an additional five years more than the mandatory five-year exclusion, will be determined in a subsequent decision. The I.G. imposed its exclusion pursuant to section 1128(a)(1) of the Act, based on Petitioner's conviction in the United States District Court for the Eastern District of New York, of a criminal offense related to the delivery of an item or service under the Medicaid program.

On September 7, 2000, Petitioner appealed the exclusion. This case was originally assigned to Administrative Law Judge Jill S. Clifton. On April 23, 2001, this case was reassigned to me for the hearing and decision.

On October 26, 2000, Judge Clifton convened a prehearing conference. During the conference, the parties agreed that an in-person hearing might be necessary. Subsequently, the I.G. filed a motion for summary judgment (I.G. Br.) accompanied by exhibits one through six. Petitioner responded with her brief (P. Br.) accompanied by nine exhibits labeled A though I. I have redesignated Petitioner's exhibits as P. Exs. 1 - 9. On April 10, 2001, Petitioner submitted a reply brief (P. R. Br.) accompanied by a new exhibit list (numbered 1 - 10), and Petitioner's exhibit 10 as an additional exhibit. The I.G. did not object to Petitioner's exhibits. On July 10, 2001, the I.G. provided a certified copy of I.G. Ex. 2 to be substituted for the uncertified version. In her reply brief, Petitioner objected to unspecified I.G. exhibits which she argued contained indictment counts which were not included in her plea agreement. See I.G. Ex. 3. I note Petitioner's concerns, but I nevertheless receive into evidence I.G. Exs. 1- 6 and P. Exs. 1-10 and give the exhibits such weight as I deem appropriate to decide the single issue for this phase of the case.

Upon cursory review of the briefs filed by the parties, it became clear that the I.G.'s basis for the exclusion of Petitioner is adequately supported by the documents submitted by the parties. Therefore I determined to make a decision on this issue and hold in abeyance the issue of the reasonableness of the length of the exclusion beyond the mandatory five-year minimum term. I base my decision in this case on the parties' arguments, the exhibits, and the applicable law.

II. Issues, findings of fact and conclusions of law

A. Issue

The issue in this case is whether:

The I.G. is authorized to exclude Petitioner from participating in Medicare, Medicaid, and all federal health care programs pursuant to section 1128(a)(1) of the Act.

B. Findings of fact and conclusions of law

I make the following findings of fact and conclusions of law to support my decision set forth in bold below. I then discuss my findings in detail.

1. Petitioner was convicted of a criminal offense.

Petitioner was the owner of a medical supply company in the State of New York. P. Ex. 9 at 1; P. Br. On February 14, 2000, Petitioner plead guilty to count one of a ten-count indictment which was filed in the United States District Court of the Eastern District of New York (Court) against Petitioner and others. The indictment charged Petitioner with conspiracy to defraud the Department of the United States Department of Health and Human Services, a class C felony. 18 U.S.C. § 286, I.G. Ex. 2 at 1; P. Ex. 10 at 1. Petitioner does not challenge that she plead guilty to count one as described in P. Ex. 10.

As a result of her conviction, Petitioner was sentenced to serve six months of home detention, placed on probation for a period of two years, and was ordered to pay restitution in the amount of $120,000 to the New York City Human Resources Administration. Id. at 2.

Petitioner's plea of "guilty" and the Court's acceptance of Petitioner's plea satisfy the definition of conviction under section 1128(i)(3) of the Act which states in pertinent part -

CONVICTED DEFINED.- For purposes of [Section 1128 of the Act] subsections (a) and (b), an individual or entity is considered to have been "convicted" of a criminal offense -

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

In her Brief and Reply Brief, Petitioner argues that the conviction is incorrect because her financial records demonstrate legitimacy of her business operations. It is the fact of the conviction of a criminal offense which causes the exclusion. The law does not permit me to look behind the conviction. Thus, Petitioner's assertion that her conviction is invalid is irrelevant because I am not permitted to consider the validity of convictions. Moreover, Petitioner cannot challenge the facts relating to her criminal conviction. See Paul R. Scollo, D.P.M., DAB No. 1498 (1994); Ernest Valle, DAB CR309 (1994); Peter Edmondson, DAB No. 1330 (1992).

2. Petitioner was convicted, within the meaning of section 1128(a)(1) of the Act, of criminal offenses related to the delivery of items or services under the Medicaid program.

Petitioner does not challenge that she is subject to an exclusion under section 1128(a)(1) of the Act, and I so find. P. R. Br. at 2. Section 1128(a)(1) of the Act applies to "Any individual or entity that has been convicted of a criminal offense related to the delivery of an item or service under [Medicare] or under any State health care program."⁽²⁾

Count one of the indictment which supports Petitioner's guilty plea describes the offense as a class C felony where,

[Petitioner] did knowingly and intentionally enter into an agreement, combination and conspiracy to defraud a department and agency of the United States, to wit: the United States Department of Health and Human Services, by obtaining and aiding to obtain the payment of false, fictitious and fraudulent claims for Medicaid reimbursement.

I.G. Ex. 4 at 1.

Therefore, the guilty plea of Petitioner to these acts clearly constitutes program-related misconduct. I find that Petitioner's conviction, as described above at Finding 1, is of a crime that is program-related within the meaning of section 1128(a)(1) of the Act.

3. The I.G. is required to exclude Petitioner, inasmuch as Petitioner has been convicted of a criminal offense related to the delivery of items or services under Medicare or any State health care program.

Section 1128(a)(1) of the Act mandates that the I.G. exclude any individual or entity who is convicted of any offense which is related to the delivery of an item or service under Medicare or any State health care program. The I.G. must exclude Petitioner, inasmuch as Petitioner was convicted of such an offense.

4. A five-year exclusion of Petitioner is mandatory, and there is no element of reasonableness involved.

An exclusion of at least five years is mandatory for any individual or entity that has been convicted of a criminal offense that is related to the delivery of an item or service under Medicare or under any State health care program. Act, sections 1128(a)(1) and 1128(c)(3)(B).

III. Conclusion

I find that the I.G. was authorized to exclude Petitioner pursuant to section 1128(a)(1) of the Act. I find that a minimum five-year exclusion is mandatory.

Richard J. Smith

Administrative Law Judge

1. "Federal health care program" is defined in section 1128B(f) of the Social Security Act and includes any State health care program, as defined in section 1128(h) of the Act.

2. The term "State health care program" includes a State Medicaid program. Act, section 1128(h)(1); 42 U.S.C. § 1320a-7(h)(1).