SUBJECT:

Thomas A. Oswald, R. Ph.,

Petitioner,

The Inspector General.

DECISION

This matter is before me on the Inspector General's (I.G.'s) Motion for Summary Affirmance of the I.G.'s determination to exclude the Petitioner pro se herein, Thomas A. Oswald, R.Ph., from participation in Medicare, Medicaid, and all other federal health care programs for a period of five years. The I.G.'s Motion and determination to exclude Petitioner are based on the terms of section 1128(a)(3) of the Social Security Act (Act), 42 U.S.C. � 1320a-7(a)(3). I sustain the determination of the I.G. to exclude Petitioner from participating in Medicare, Medicaid, and other federally funded health care programs for a period of five years. I find the I.G. is authorized to exclude Petitioner pursuant to section 1128(a)(3) of the Social Security Act (Act) and that the five-year exclusion is the minimum mandatory period of exclusion under section 1128(c)(3)(B) of the Act.

I. BACKGROUND

By letter dated November 28, 2003, the I.G. notified Petitioner that he was being excluded from participation in Medicare, Medicaid, and all federal health care programs for a period of five years. The I.G. advised Petitioner that he was being excluded pursuant to section 1128(a)(3) of the Act as a result of Petitioner's felony conviction, in the Court of Common Pleas, Summit County, State of Ohio, of a criminal offense relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct in connection with the delivery of a health care item or service or with respect to an act or omission in a health care program operated or financed by any federal, state, or local government agency. By letter dated January 27, 2004, Petitioner timely requested a hearing and the case was assigned to me for a hearing and a decision. In his hearing request Petitioner contested whether he had been convicted for purposes of the Act; whether, if I determined a conviction exists, the conviction falls within the exclusion provisions of the Act; and whether he should be excluded for a period of five years, considering that he had been excluded and then reinstated by the I.G. based on a license suspension for the same conduct underlying his alleged conviction.

On March 15, 2004, I convened a telephone prehearing conference. Petitioner reiterated that his main concern was that he had been excluded twice for the same underlying activity. I told the parties that since there appeared to be no material facts in dispute the case could likely be handled most expeditiously on a motion for summary disposition. The parties did not object and I set out a briefing schedule. In that schedule I requested that the I.G. brief what effect Petitioner's first exclusion should have on his current exclusion, especially as it regards the length of the exclusion. The I.G. submitted the Motion, accompanied by a brief (I.G. Brief), to which were attached nine exhibits. Petitioner submitted a Motion For Summary Denial, accompanied by a brief in response to the I.G.'s submission (P. Brief), to which Petitioner attached nine exhibits. The I.G. submitted a reply (I.G. Reply Brief) and Petitioner a sur-reply (P. Reply Brief). Neither party requested an in-person hearing or oral argument. In the absence of objection, I admit I.G. exhibits (I.G. Exs.) 1 - 9 and Petitioner's exhibits (P. Exs.) 1 - 9 into evidence. I note that the parties have, in part, submitted copies of the same document as exhibits. Where the parties have submitted an identical exhibit, I cite to the I.G.'s exhibit.

II. APPLICABLE LAW AND REGULATIONS

Section 1128(a)(3) of the Act authorizes the Secretary of Health and Human Services (Secretary) to exclude from participation in any federal health care program (as defined in section 1128(b)(f) of the Act), any individual convicted of a criminal offense consisting of a felony relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct in connection with the delivery of a health care item or service or with respect to any act or omission in a health care program operated by or financed in whole or in part by any federal, state, or local government agency.

For convictions pursuant to section 1128(a) of the Act, a "conviction" of a criminal offense is defined as:

(1) when 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;

(2) when there has been a finding of guilt against the individual or entity by a Federal, State, or local court;

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

(4) when the individual or entity has entered into participation in a first offender, deferred adjudication, or other arrangement or program where judgment of conviction has been with-held.

Act, section 1128(i).

An exclusion under section 1128(a)(3) of the Act must be for a minimum period of five years. Act, section 1128(c)(3)(B). Aggravating factors can serve as a basis for lengthening the period of exclusion. 42 C.F.R. � 1001.102(b). If aggravating factors justify an exclusion longer than five years, mitigating factors may be considered as a basis for reducing the period of exclusion to no less than five years. 42 C.F.R. � 1001.102(c).

Pursuant to 42 C.F.R. � 1001.2007, an individual or entity excluded under section 1128(a)(3) of the Act may file a request for a hearing before an administrative law judge. The only issues an administrative law judge is authorized to hear are whether: 1) a basis exists for the imposition of the remedy; and 2) the length of the exclusion is unreasonable.

III. ISSUES

The legal issues before me are those enumerated at 42 C.F.R. � 1001.2007(a)(1). In the specific context of this record they are:

1. Whether the I.G. had a basis upon which to exclude Petitioner from participating in Medicare, Medicaid, and all other federal health care programs pursuant to section 1128(a)(3) of the Act; and

2. Whether the five-year term of the exclusion is unreasonable.

If I determine that the I.G. had a basis upon which to exclude Petitioner under section 1128(a)(3) of the Act, a five-year term of exclusion is the irreducible minimum established by section 1128(c)(3)(B) of the Act, 42 U.S.C. � 1320a-7(c)(3)(B), and is therefore ipso jure reasonable.

IV. FINDINGS AND DISCUSSION

The findings of fact and conclusions of law noted below, in italics and bold face, are followed by a discussion of each.

1. Petitioner was convicted of a criminal offense consisting of a felony relating to theft in connection with the delivery of a health care item or service.

On November 8, 2000, the Ohio State Board of Pharmacy (Ohio Board) summarily suspended Petitioner's license to practice pharmacy and, on February 12, 2001, the Ohio Board indefinitely suspended Petitioner's license to practice pharmacy based on a finding that Petitioner was unfit to practice pharmacy because he had stolen a Schedule III controlled substance, Marinol, from Healthrays Pharmacy, and had abused controlled substances. I.G. Ex. 7. As a result of the suspension of Petitioner's license, the I.G. excluded Petitioner from participating in Medicare, Medicaid and all federal health care programs pursuant to section 1128(b)(4) of the Act. I.G. Ex. 6. Petitioner's exclusion was effective May 20, 2002, and was to remain in effect as long as his license was suspended. On January 9, 2003, the Ohio Board reinstated Petitioner's license to practice pharmacy. I.G. Ex. 4. On February 5, 2003, Petitioner was reinstated by the I.G. and was again eligible to participate as a provider of services in the programs. I.G. Ex. 8.

On March 26, 2001, in the Court of Common Pleas, Summit County, Ohio, Petitioner was charged by Information with four counts of theft of drugs from Healthrays Pharmacy, which offenses allegedly occurred on or about February 25, 2000, June 1, 2000, July 26, 2000, and December, 1999, and involved his theft of Marinol, defined as a dangerous drug under the Ohio Revised Code. Each of the charged offenses was defined as a felony of the fourth degree, in violation of section 2913.02 of the Ohio Revised Code. I.G. Ex. 2. Petitioner pleaded guilty to all four counts of the Information on May 15, 2001. I.G. Ex. 3. The court accepted Petitioner's pleas, and then granted Petitioner intervention in lieu of conviction. Id. On November 28, 2003, the I.G. notified Petitioner that as a result of this conviction he would be excluded from participation in Medicare, Medicaid, and all federal health care programs, pursuant to section 1128(a)(3) of the Act, for the minimum mandatory period of five years.

Based on these facts, the I.G. had a legal basis to exclude Petitioner under section 1128(a)(3). Section 1128(a)(3) is written in the disjunctive to cover two different categories of felonies relating to "fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct." Each category has its own distinct requirements for an exclusion. The first category covers an individual convicted of one of the listed felonies "in connection with the delivery of a health care item or service" (see 42 C.F.R. � 1001.101(c)(1)), and it covers as a second category any individual convicted of a listed felony with respect to any act or omission in a health care program operated by or financed in whole or in part by any federal, state, or local government agency. 42 C.F.R. � 1001.101(c)(2). Petitioner's offense falls into the first category, and consists of theft of a health care item or service in connection with the delivery of a health care item or service. See Erik D. DeSimone, R.Ph., DAB No. 1932 (2004).

To prove that Petitioner is subject to mandatory exclusion under section 1128(a)(3), the I.G. must prove four things: (1) that Petitioner was convicted of a felony offense; (2) that the offense took place after August 21, 1996; (3) that the offense was related to fraud, theft, embezzlement, breach of fiduciary responsibility or other financial misconduct; and (4) that the offense was in connection with the delivery of a health care item or service. See Katherine Marie Nielson, DAB CR1181 (2004). The I.G. has done so here.

First, Petitioner was convicted of a felony criminal offense. The Information upon which Petitioner was convicted consists of four felony counts. I.G. Ex. 2. Petitioner pleaded guilty to those counts and then entered a deferred adjudication program. I.G. Ex. 3, at 1. Specifically, Petitioner was granted intervention in lieu of conviction pursuant to section 2951.041 of the Ohio Revised Code. This section states that:

If the court grants an offender's request for intervention in lieu of conviction and the court finds that the offender has successfully completed the intervention plan for the offender . . . and all other terms and conditions ordered by the court, the court shall dismiss the proceedings against the offender. Successful completion of the intervention plan . . . shall be without adjudication of guilt . . . .

Ohio Rev. Code � 2951.041(E). This Ohio program has been reviewed frequently and recently in this forum, and has uniformly been held to lie within the definition of "conviction" at section 1128(i)(4) which covers an arrangement or other program where judgment of conviction has been withheld. Michael J. O'Brien, D.O., DAB CR1150 (2004); Joseph S. Scheidler, D.O., DAB CR1143 (2004); Victoria L. Winterhalter, DAB CR1114 (2003); Handel J. Roberts, DAB CR911 (2002). Appellate approval of the analyses on which these decisions are based can be found in Travers v. Shalala, 20 F.3d. 993 (9th Cir. 1994). Furthermore, since the court accepted Petitioner's guilty plea, I also find Petitioner's guilty plea constitutes a conviction under section 1128(i)(3). Second, Petitioner's offenses occurred after August 21, 1996, specifically Petitioner's criminal offenses occurred from on or about December, 1999, to on or about July, 2000. I.G. Exs. 2, 3, 7. Third, Petitioner's offenses were related to theft of drugs. Petitioner stole Marinol, a controlled substance, from Healthrays Pharmacy, for his own use. Id. Fourth, Petitioner's offense was in connection with the delivery of a health care item or service, as it involved stealing Marinol from Healthrays Pharmacy during the course of his employment as a pharmacist. I.G. Exs. 2, 3, 7, 9; P. Brief at 4; P. Reply Brief at 2. See Erik D. DeSimone, R.Ph., DAB No. 1932.

Petitioner does not dispute that he was convicted of a criminal offense which falls under section 1128(a)(3) of the Act. Petitioner states in his brief that he "acknowledges the fact that based on the I.G.'s definition of conviction, by entering a plea of guilty in order to be granted intervention in lieu, it counts as a conviction . . . ." P. Brief at 2. Petitioner disputes, however, that he should be subject to the five-year minimum period of exclusion given the unusual circumstances of his case, although he concedes that "under normal circumstances" he would be subject to the five-year exclusion. Id.

2. The five-year exclusion imposed by the I.G. is the minimum mandatory period of exclusion under the Act, and it is therefore ipso jure reasonable.

In a case where an individual has been convicted of a criminal offense which falls under section 1128(a)(3), that individual must be excluded for a minimum period of five years. It is a recognized rule of this forum that once an individual's conviction is found to lie within the terms of section 1128(a)(1), 1128(a)(2), 1128(a)(3), or 1128(a)(4), the imposition of the five-year minimum exclusion established by section 1128(c)(3)(B) of the Act is mandatory and beyond the authority of the I.G. or an Administrative Law Judge to reduce, modify, or suspend. The Departmental Appeals Board has used very clear language to make this point: "Petitioner's exclusion was mandatory under the Act once the nexus was established between her offense and the delivery of an item or service under the Medicare program. The ALJ had no discretion to impose a lesser remedy." Salvacion Lee, M.D., DAB No. 1850, at 4 (2002). This link between conviction in any of the circumstances identified in the four subsections of section 1128(a) and a mandatory five-year exclusion is for most practical purposes absolute. See Lorna Fay Gardner, DAB No. 1733 (2000); Douglas Schram, R.Ph., DAB No. 1372 (1992); Napoleon S. Maminta, M.D., DAB No. 1135 (1990); Juanita Brown, R.N., DAB CR579 (1999); Ann M. MacDonald, DAB CR519 (1998); Aida Cantu, DAB CR462 (1997); Anthony A. Tommasiello, DAB CR282 (1993). The unarticulated assumption behind the rule, however, would appear to be the expectation that the mandatory five-year minimum term is in effect, and is in reality a term of five years, and not a term enhanced or reduced sub silentio into something entirely different.

There are two approaches in this forum to the unreasonableness of the duration of the minimum five-year term, but both reach the same conclusion. The more frequently-applied approach analyzes 42 C.F.R. � 1001.2007(a)(1) and (a)(2) and concludes that the issue of unreasonableness simply cannot arise when nothing more than the minimum mandatory period is imposed. This "no-issue" approach is exemplified by Rose Mary Maye, DAB CR1028 (2003); Norman Imperial, DAB CR833 (2001); Kathleen E. Talbot, M.D., DAB CR772 (2001); Dr. David Vainio, DAB CR762 (2001); and Rosemary Oteri, DAB CR755 (2001). The second approach allows the question of unreasonableness to be asked but answers it empirically: if the I.G. imposes the minimum exclusionary period, as a matter of law it cannot be unreasonable. It may be seen at work in Mary Jo Izzo, DAB CR1136 (2004) and John L. Grant, M.D., DAB CR737 (2001). Both analytical paths arrive at the same result: there is simply no challenge available in this forum to the reasonableness of Petitioner's five-year exclusion.

However, there are unusual circumstances in this case. They could be understood to fairly raise the question of whether the proposed term of exclusion was in reality and effect the minimum mandatory term for which the I.G. has offered legal support, or whether it was for substantially longer than five years. The uncontested facts and chronology of this case show that Petitioner was: (1) first excluded under section 1128(b)(4) on April 30, 2002, effective May 20, 2002; (2) then reinstated on February 5, 2003; and (3) next excluded again under section 1128(a)(3) on November 28, 2003, for the full five-year minimum mandatory term, effective December 18, 2003, based on a May 15, 2001 conviction, in essence for the same acts and conduct for which he was excluded under section 1128(b)(4) for 261 days, or approximately eight and one-half months. Given these uncontested facts and that chronology, I asked the I.G. to brief the issue of whether the length of Petitioner's exclusion is unreasonable.

The I.G. responded that because of the unusual circumstances in this case the I.G. would credit the time period Petitioner had already been excluded towards the minimum mandatory period of exclusion. The I.G. explained that because Petitioner had already been convicted of theft of drugs at the time his section 1128(b)(4) exclusion was imposed, and because the I.G. should have imposed a five-year mandatory exclusion at that time, in essence Petitioner had already been excluded for 261 days for the conduct underlying the basis of Petitioners's exclusion under section 1128(a)(3). Accordingly, the I.G. revised Petitioner's exclusion such that Petitioner is eligible for reinstatement on April 3, 2008, 261 days prior to the conclusion of the section 1128(a)(3) exclusion the I.G. imposed originally.

Petitioner continues to argue, however, that he should not be excluded on two different occasions as the result of a single action. Petitioner asserts that there is a constitutional principle against the I.G. having imposed the second exclusion knowing that Petitioner had previously been excluded and reinstated as a consequence of the same offense. Petitioner argues that in his case imposition of the five-year exclusion constitutes a punishment, not a remedial action. Moreover, Petitioner argues that the amount of time between his conviction and his exclusion is unreasonable (from May 21, 2001 until December 18, 2003, over two and a half years). Finally, Petitioner asserts that the amount of time the I.G. has offered to credit is too short. Specifically, Petitioner argues that he was summarily suspended from practicing pharmacy by the Ohio Board on November 8, 2000, and he did not become eligible to participate in federal health care programs until February 5, 2003, a period of 820 days. He asserts that there is a common-sense connection between his suspension and the ability to participate in Medicare, Medicaid, and all federal health care programs. Thus, he should be credited with 820 days of exclusion, rather than 261, which would make him eligible for reinstatement on September 29, 2006. Petitioner notes that the intent of the Act is to protect the programs from fraud and the beneficiaries and recipients of the programs from harm, and that his contract with the Pharmacists Rehabilitation Organization protects the programs and their beneficiaries and recipients from any risk. P. Brief at 4 - 8; P. Reply Brief. ⁽¹⁾

While Petitioner now asserts that he is not contesting the constitutionality of his exclusion or the I.G.'s right to impose exclusions (P. Reply Brief at 1 - 2), it is important that Petitioner understand that as an Administrative Law Judge I lack the authority to rule on the constitutionality or validity of the exclusion provisions of the Act. See Susan Malady, R.N., DAB CR835 (2001), aff'd, DAB No. 1816 (2002); 42 C.F.R. � 1005.4(c)(1). Moreover, courts have held that the purpose and effect of exclusion is civil and remedial, intended to protect the Medicare and Medicaid programs from fraud and abuse and to protect the beneficiaries and recipients who rely on the programs; and that neither the remedy of exclusion nor its purpose is punitive and criminal, and therefore subject to scrutiny under the double jeopardy clause or the prohibition against cruel and unusual punishment. Susan Malady, R.N., DAB No. 1816; Mannochio v. Kusserow, 961 F.2d 1539 (11th. Cir. 1992). Courts have also found that exclusion is more analogous to the revocation of a professional license than to a punishment and thus does not constitute double jeopardy. Greene v. Sullivan, 731 F. Supp. 838 (E.D. Tenn. 1990). Petitioner does believe that there is a constitutional principle against excluding an individual on two separate occasions for a single "violation," (P. Reply Brief at 1 - 2), but there is more than a single basis for exclusion here. Petitioner both lost his license to practice pharmacy, making him subject to section 1128(b)(4), and was convicted of a criminal offense, making him subject to section 1128(a)(3). Either action is a separate predicate for the I.G.'s determination to exclude him; the conviction-based exclusion is, moreover, mandatory. The I.G. enjoyed the discretionary authority to enhance Petitioner's term of exclusion under section 1128(a)(3) pursuant to 42 C.F.R. � 1001.102, based on his loss of license, that is, to "stack" the license-loss onto the term of exclusion as an aggravating factor, but declined to do so here. In fact, given that Petitioner was convicted of a felony criminal offense related to theft of a controlled substance, occurring after August 21, 1996, in connection with the delivery of a health care item or service, the I.G. was required by law to exclude him from the Medicare, Medicaid, and all federal health care programs for five years. Congress, not the I.G., by enacting section 1128(a)(3) determined that excluding an individual for five years for such criminal offenses serves a necessary remedial purpose.

Moreover, as an Administrative Law Judge I am utterly without the authority to change the length of a minimum mandatory exclusion, nor have I the authority to alter the effective date of that exclusion. Samuel W. Chang, M.D., DAB No. 1198 (1990). Thus, even if I agreed that Petitioner's calculations entitle him to a credit of 820 days against his exclusion, I could not grant Petitioner the relief he seeks. That I do not agree with his calculations and argument may moot the point, but the point may deserve repeating nonetheless: I cannot credit him with 820 days of exclusion.

A final point should be made before this discussion closes. Petitioner has conducted his appeal in an articulate and informed manner, but he has also conducted it pro se. The Board has made clear that "some extra measure of consideration" is due pro se litigants in developing their records and, at least to some extent, their positions. Louis Mathews, DAB No. 1574 (1996); see George Iturralde, M.D., DAB No. 1374 (1992); Timothy L. Stern, M.D., DAB No. 1314 (1992); Edward J. Petrus, Jr., M.D., DAB No. 1264 (1991). I have reviewed the record in this case with that admonition in mind, but have found nothing in it that would alter the findings, conclusions, and result I announce here.

V. CONCLUSION

Petitioner's conviction of a criminal offense pursuant to sections 1128(a)(3) and 1128(c)(3)(B) of the Act mandates that he be excluded from Medicare, Medicaid, and all federal health care programs for a period of at least five years. As Petitioner has been excluded for a period of only five years, I cannot find that the period of exclusion is unreasonable. For the reasons set out above, the I.G.'s Motion for Summary Affirmance should be, and it is, GRANTED. The I.G.'s exclusion of Petitioner, Thomas A. Oswald, R.Ph., from participation in Medicare, Medicaid, and all federal health care programs for a period of five years, pursuant to the terms of section 1128(a)(3) of the Act, 42 U.S.C. � 1320a-7(a)(3), is thereby sustained.

Richard J. Smith

Administrative Law Judge

1. Petitioner has also admitted his actions were wrong, asserted responsibility for his actions, asserted that he has maintained sobriety, and stated how he and his family have been financially harmed by his exclusion. He also points out that the fear of exclusion may keep an impaired pharmacist from coming forward and getting help for his or her addiction. P. Reply Brief. However, the Act and the regulations preclude me from considering Petitioner's assertions in mitigation of his mandatory period of exclusion.