DEPARTMENT OF HEALTH AND HUMAN SERVICES
Departmental Appeals Board
Civil Remedies Division
In the Case of:
Mira Tomasevic, M.D.,
Petitioner,
- v. -
The Inspector General.
DATE: January 13, 1989
Docket No. C-46
DECISION
This case is before me on Petitioner's request for a hearing challenging her
suspension from participating in
the Medicare and Medicaid programs. By notice dated August 12, 1986, the Inspector
General (the I.G.)
announced that he had suspended Petitioner from participating in these programs
for three years, pursuant
to section 1128(a) of the Social Security Act, 42 U.S.C.1320a-7. The reason
provided for Petitioner's
suspension was her conviction in federal court of an offense related to her
participation in the Medicaid
program. Petitioner requested a hearing on August 23, 1988, protesting the length
of the suspension and
arguing that it should be reduced to two years. The I.G. moved to dismiss the
hearing request, arguing that
it was not timely filed. He asserted, alternatively, that the three-year suspension
is reasonable. I conducted
a hearing in Chicago, Illinois, on October 4, 1988, at which I received evidence
as to both the issues of
timeliness of the hearing request and the reasonableness of the suspension.
I conclude that the hearing
request was timely filed, and I deny the motion to dismiss. I conclude further
that the three-year
suspension imposed on Petitioner is reasonable.
ISSUES
The issues in this case are whether:
1. Petitioner is entitled to a hearing based on her hearing request, filed August 23, 1988.
2. The length of the suspension imposed on Petitioner is reasonable.
APPLICABLE LAWS AND REGULATIONS
1. Section 1128 of the Social Security Act: As of the date of Petitioner's
suspension, Section
1128(a) of the Social Security Act, 42 U.S.C. 1320a-7(a), required the Secretary
of Health and Human
Services (the Secretary) to suspend from participation in the Medicare and Medicaid
programs any
physician or other individual who had been convicted of a criminal offense related
to that person's
participation in the delivery of medical care or services under titles XVIII
(Medicare), XIX (Medicaid), or
XX (block grants to states) of the Act. The law did not prescribe a minimum
suspension. The law was
revised in August 1987 to require a minimum exclusion from participation in
the Medicare and Medicaid
programs of five years for any individual or entity "convicted of a criminal
offense related to the delivery
of an item or service under title XVIII or under any State health care program,"
Pub. L. 100-93 (August 18,
1987), 42 U.S.C. 1320(a)(1) and (c)(3)(B).
Both the law in effect as of the date of Petitioner's suspension and the current
law provide that a suspended
or excluded individual is entitled to an administrative hearing as to the suspension
or exclusion. The law in
effect as of Petitioner's suspension provided at 42 U.S.C. 1320a-7(e) that a
suspended individual is entitled
to a hearing "to the same extent as is provided in section 205(b) of the
Social Security Act." Virtually
identical language is contained in the 1987 revision at 42 U.S.C. 1320a-7(f)(1).
Section 205(b)(1) of the
Social Security Act, 42 U.S.C. 405(b)(1), provides that a person entitled to
an administrative hearing by
virtue of an adverse decision shall be given reasonable notice and opportunity
to be heard, and provides
further that the hearing decision shall be based "on evidence adduced at
the hearing."
2. Regulations Governing Suspension, Exclusion, or Termination of Practitioners,
Providers,
Suppliers of Services and Other Individuals. Regulations governing suspension
and exclusion of
individuals convicted of program-related offenses are contained in 42 C.F.R.
Part 1001. Section
1001.123(a) provides that when the I.G. has conclusive information that an individual
has been convicted
of a program-related crime he will give that individual written notice that
he is being suspended from
participation beginning 15 days from the date of the notice. Section 1001.125(b)
establishes criteria for the
I.G. to consider in determining the length of a suspension to impose on an individual
convicted of a
program-related crime. These instruct the I.G. to consider: "(1) The number
and nature of the program
violations and other related offenses; (2) The nature and extent of any impact
the violations have had on
beneficiaries; (3) The amount of the damages incurred by the Medicare, Medicaid,
and the social services
programs; (4) Whether there are any mitigating circumstances; (5) The length
of the sentence imposed by
the court; (6) Any other facts bearing on the nature and seriousness of the
program violations; and (7) The
previous sanction record of the suspended party under the Medicare and Medicaid
program."
Section 1001.128(a) provides that an individual suspended for conviction of
a program-related crime may
request a hearing before an administrative law judge on the issues of whether:
(1) he or she was in fact,
convicted; (2) the conviction was related to his or her participation in the
delivery of medical care or
services under the Medicare, Medicaid, or social services program; and (3) the
length of the suspension is
reasonable.
3. Regulations Governing Appeals Procedures. Regulations governing the hearings
and appeals
procedures in suspension and exclusion cases are contained in 42 C.F.R. Part
498. Section 498.10 provides
that any affected party may appoint another individual to represent him. Section
498.11(b) provides that a
notice or request may be sent to either a party, his or her representative,
or to both. Section 498.40(a)(2)
states that an affected party or that party's representative must file a written
hearing request "within 60 days
of the receipt of the notice" of an adverse determination in order to be
entitled to a hearing. Section 498.22
provides that the date of receipt of a notice will be presumed to be five days
after the date on the notice,
unless there is a showing that it was, in fact, received earlier or later.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
A. Findings and Conclusions as to Petitioner's Right to aHearing.
1. Beginning in at least 1983, Petitioner owned a condominium at 426 West
Barry Street,
Chicago, Illinois. Tr. 23.
2. Petitioner resided at that address at various times until July, 1986. Id..
3. In July, 1986, Petitioner left the United States to reside in Yugoslavia.
She resided there
continuously until December, 1987. Tr. 33, 51; P. Ex. 11, 21.
4. On June 13, 1986, Petitioner's attorney advised the I.G. in writing that
he represented Petitioner
in connection with the I.G.'s review of her possible suspension from participating
in the Medicare and
Medicaid programs. P. Ex. 4. On July 7, 1986, Petitioner's attorney again wrote
to the I.G. on her behalf.
P. Ex. 5.
5. On August 12, 1986, the I.G. sent written notice to Petitioner, pursuant
to 42 U.S.C. 1320a-
7(c), and 42 C.F.R. 1001.123, advising her that she would be suspended from
participating in the Medicare
and Medicaid programs. P. Ex. 1. The notice was sent to Petitioner's residence
address at 426 West Barry
Street. No copy of the notice was sent to Petitioner's attorney. Id..
6. Petitioner did not reside at 426 West Barry Street on the date the notice
was sent, and did not
receive the notice. Tr. 56.
7. Petitioner first learned that she had been suspended from participating
in the Medicare and
Medicaid programs in July or August 1988, in connection with her application
for employment as a staff
physician at a hospital in Texas. Tr. 56.
8. Petitioner's attorney received a copy of the notice of suspension on August
11 or 12, 1988 and
filed a hearing request on Petitioner's behalf on August 23, 1988.
9. The hearing request was filed within 60 days from Petitioner's receipt
of the notice of
suspension and was timely filed within the requirements of 42 C.F.R. 498.40(b)(2).
10. Petitioner is entitled to a hearing.
B. Findings and Conclusions as to the Whether the Length of the Suspension is
Reasonable.
11. Petitioner is a medical doctor who has been employed in a variety of settings
as a physician
since 1974. Tr. 193; P. Ex. 6/1.
12. Between January and May, 1983, Petitioner was employed as a physician
in Chicago, Illinois,
at clinics operated by Drug Industry Consultants (D.I.C.). Tr. 22-23; P. Ex.
7/5-7.
13. Petitioner's salary while employed by D.I.C. was $200 per day. Tr. 192.
14. Commencing early in her employment with D.I.C., Petitioner began receiving
complaints
from her superiors that she was prescribing inadequate amounts of medications
to clinic patients. Tr. 181;
P. Ex. 5/2; 7/6.
15. Petitioner understood that the additional medications she was pressured
to prescribe were not
medically necessary, but that their sale contributed to the financial success
of D.I.C. Tr. 181-182; P. Ex.
7/6.
16. Petitioner acceded to her superiors' pressure to prescribe additional
medications, and
prescribed medications which she knew were not medically necessary for the patients
she was treating. Tr.
181-182; I.G. Ex. 12/1-2; P. Ex. 7/7.
17. There were some unnecessary medications, such as endocrine drugs, which
Petitioner was
pressured to prescribe, but which she refused to prescribe. Tr. 182.
18. By intentionally prescribing unnecessary medications to patients of D.I.C.-operated
clinics,
Petitioner participated in a scheme to defraud the Illinois Department of Public
Aid (Medicaid). I.G. Ex.
12/1-2. The conspiracy involved numerous individuals and employees of D.I.C.
operating out of several
clinics and pharmacies. See I.G. Ex. 3; I.G. Ex. 4/1. The co-conspirators included
physicians and
pharmacists. I.G. Ex. 4/1. The scheme obtained approximately $20 million from
Medicaid. Id..
19. Petitioner disagreed with the activities she observed and was induced
to engage in. Tr. 183;
I.G. Ex. 4/50. She resigned from D.I.C. after about 70 days' employment. P.
Ex. 5/2.
20. Subsequent to terminating her employment with D.I.C., Petitioner received
reimbursement
checks from the Illinois Department of Public Aid, totalling over $25,000, which
Petitioner surrendered to
her former employer. Tr. 185-186; P. Ex. 16.
21. Petitioner also learned after terminating her employment with D.I.C.,
that an individual was
signing her name to health insurance claim forms. Tr. 183-184; P. Ex. 17-19.
Petitioner reported these
acts to the Illinois Department of Public Aid. Tr. 183-184. However, she did
not report having prescribed
unnecessary medications or the activities she had observed at D.I.C.-run clinics.
Tr. 183.
22. Subsequent to her employment by D.I.C., Petitioner was advised by the
United States
Attorney's office that her activities as a D.I.C. employee were being investigated,
and that she might be the
subject of an indictment. Tr. 190. Petitioner truthfully admitted her activities
to the United States
Attorney; however, the United States Attorney did not use evidence provided
by Petitioner in connection
with its investigation or in prosecutions of other individuals. I.G. Ex. 8.
23. Petitioner was indicted by a federal grand jury in December 1984, and
charged with felonies,
consisting of unlawful conspiracy and mail fraud. I.G. Ex. 3. The indictment
named 36 individuals,
including Petitioner, as co-conspirators. Id..
24. Petitioner pleaded guilty on May 3, 1985, to two felony counts of mail
fraud. I.G. Ex. 12.
The maximum sentence Petitioner could have received for these crimes was ten
years' imprisonment, a
$2,000 fine, and restitution. Id.. On April 7, 1986, Petitioner received a sentence
of three years' probation.
I.G. Ex. 5; P. Ex. 11/10. The sentencing judge noted that Petitioner's involvement
in the conspiracy lasted
only 71 days; that Petitioner initially thought that the terms of her employment
by D.I.C. were legitimate;
that Petitioner became aware that her activities were not legitimate and complained
about them; and that
she expressed contrition for her involvement in the scheme. Id..
25. The criminal offenses to which Petitioner pleaded guilty constitute criminal
offenses related
to her participation in the delivery of medical care or services under the Medicaid
program, as provided by
42 U.S.C. 1320a-7(a). Petitioner's guilty pleas constitute convictions as defined
by 42 U.S.C. 1320a-7(i).
26. The Secretary is required by law to bar Petitioner from participating
in the Medicare program,
and to direct state agencies to bar her from participating in the Medicaid program,
as a consequence of
Petitioner's conviction of crimes related to her participation in the delivery
of medical care or services
under the Medicaid program, 42 U.S.C. 1320a-7(a)(1).
27. The law in effect as of Petitioner's conviction did not specify a minimum
exclusion length;
however, the law was amended in August, 1987, to require a minimum five-year
exclusion of persons
convicted of a criminal offense related to the delivery of an item or service
under the Medicare or Medicaid
programs. Pub. L. 100-93 (August 18, 1987), 42 U.S.C. 1320a-7(a)(1) and (c)(3)(B).
28. The Secretary has delegated to the I.G. the responsibility for suspending
from participation in
Medicare and Medicaid persons convicted of program-related offenses. 42 C.F.R.
Part 1001.
29. The Secretary has adopted internal guidelines to facilitate processing
of suspensions pursuant
to the law and regulations. I.G. Ex. 10, 11.
30. The internal guidelines in effect as of the date Petitioner was sentenced
for her crimes
provided for a minimum suspension of three years for persons suspended for program-related
offenses.
I.G. Ex. 11/15.
31. A principal purpose of legislation requiring suspension of persons convicted
of program-
related offenses is to deter other individuals from committing such offenses.
See S. Rep. No. 100-109,
1987 U.S. Code Cong. & Ad. News 682, 686.
32. The objective in establishing a minimum suspension period was to create
a deterrent against
the commission of program-related offenses. I.G. Ex. 11/15.
33. In evaluating Petitioner's case, the I.G. considered the number and nature
of the program
violations committed by Petitioner, pursuant to 42 C.F.R. 1001.125(b)(1), and
concluded that Petitioner
had been convicted of two felony charges involving potentially severe penalties.
These were determined to
be in the mid-range of offenses encountered by the I.G. in suspension cases.
Tr. 132.
34. The I.G. concluded, pursuant to 42 C.F.R. 1001.125(b)(2), that he could
not determine
whether Petitioner's crimes had an adverse impact on program beneficiaries.
Tr. 133.
35. The I.G. determined, pursuant to 42 C.F.R. 1001.125(b)(3), that Petitioner's
unlawful acts had
diverted funds from legitimate program purposes and had defrauded the program.
Tr. 134. Although the
precise amount of damages could not be calculated, they were concluded to be
in the mid-range of
damages encountered by the I.G. in suspension cases. Tr. 137.
36. The I.G. concluded, pursuant to 42 C.F.R. 1001.125(b)(4), that there did
not exist mitigating
factors in Petitioner's case which would justify a reduced suspension. Tr. 140-141.
Specifically, the I.G.
concluded that Petitioner's truthful statements to the United States Attorney
did not constitute a mitigating
factor. Tr. 142, 145. The I.G. also concluded that the facts that: Petitioner
did not profit from her crimes,
apart from her salary, her involvement with D.I.C. lasted only about 70 days,
and she expressed contrition
over her involvement did not constitute mitigating factors. Tr. 162. The I.G.
also concluded that
Petitioner's compliance with the terms of her sentence was not a mitigating
factor. Tr. 163.
37. The I.G. considered Petitioner's sentence, pursuant to 42 C.F.R. 1001.125(b)(5),
and
concluded that the three-year probation imposed on Petitioner fell within the
mid-range of sentences
encountered in suspension cases. Tr. 139.
38. Based on the facts of the case, the regulations, and guidelines, the I.G.
imposed a three-year
suspension on Petitioner from participating in the Medicare and Medicaid programs.
Tr. 143-144. The
suspension was for the minimum length specified by the guidelines. Tr. 174.
39. In determining the length of the suspension, the I.G. considered the regulatory
criteria in 42
C.F.R. 1001.125(b).
40. The suspension imposed on Petitioner by the I.G. advances the statutory
purpose of deterring
individuals from committing crimes related to the delivery of services under
the Medicare and Medicaid
programs.
41. Based on the law, regulations, and evidence, a three-year suspension of
Petitioner from
participating in the Medicare and Medicaid programs is reasonable.
ANALYSIS
A. Petitioner's Entitlement to a Hearing.
The threshold issue in this case is whether Petitioner is entitled to a hearing.
The I.G. contends that
Petitioner's hearing request, filed more than two years after she was sent the
notice of suspension, was not
timely filed. He argues that, consequently, Petitioner is not entitled to a
hearing and that I should dismiss
her hearing request. Petitioner asserts that her hearing request was timely
filed and that she is therefore
entitled to a hearing on the merits. Based on the evidence and on applicable
regulations, I conclude that
the request was timely filed and that Petitioner is entitled to a hearing.
Certain relevant facts are not in dispute. The parties agree that for several
years, Petitioner maintained a
residence at 426 West Barry Street, Chicago, Illinois. At the time the I.G.
suspended Petitioner, he
understood the West Barry Street address to be Petitioner's residence, and so
he sent the suspension notice
to that address.
The parties disagree as to when Petitioner received the suspension notice.
Petitioner testified that several
weeks prior to the date the notice was sent, she moved from West Barry Street
to her family's home in
Yugoslavia. She averred that she remained in Yugoslavia until December 1987;
that mail sent to her
Chicago residence was not forwarded to her, and that she did not receive the
suspension notice until her
attorney obtained a copy from the I.G. in August, 1988. The I.G. argues that
these assertions are not
credible. He asserts that Petitioner either actually received the notice in
August 1986, or at any rate, long
before she now says she did.
I am satisfied that Petitioner did not receive the suspension notice until
her attorney obtained a copy of it in
August 1988. Petitioner's testimony as to her move to Yugoslavia is credible
and is corroborated by visa
stamps on her passport. Her assertion that she remained in Yugoslavia until
December 1987 is also
credible and is substantiated by a stream of correspondence between Petitioner
in Yugoslavia and her
attorney in Chicago. Her testimony that mail sent to her Chicago residence was
not forwarded to her is
likewise credible. The I.G. has offered little to rebut this evidence, other
than producing a certified mail
receipt for the suspension notice, signed with Petitioner's name. Petitioner
has testified that she did not
sign the receipt, and there is no probative evidence to establish that the signature
on the receipt is
Petitioner's.
The regulations provide, at 42 C.F.R. 498.40(a)(2), that a party must file
a hearing request within sixty
days from "receipt of the notice" in order to be entitled to a hearing.
Petitioner complied with this
regulation by filing her hearing request on August 23, 1988, within sixty days
from the date her attorney
obtained a copy of the suspension notice from the I.G.
The I.G. argues that the regulations should not be construed to require actual
receipt of the suspension
notice as a trigger date for the limitations period within which a party must
file a hearing request. He
contends that notwithstanding the plain language of 42 C.F.R. 498.40(a)(2),
regulations which permit
service of notices by mail would be meaningless if the I.G. had to ascertain
in each case whether the
affected party actually received the notice. He asserts that if, as in this
case, he sends the notice of
suspension to an address which he reasonably believes is the affected party's
address, then he has
discharged his duty to provide notice to that party. Furthermore, according
to the I.G., the Petitioner was
obliged to notify the I.G. of any change in her mailing address. Having failed
to do so, the Petitioner
should not be "allowed to seek refuge" behind non-receipt of the notice.
I.G.'s Brief at 9. Petitioner's
failure to notify the I.G. of a change in her address was a "gross indifference
regarding receipt" of the
notice, according to the I.G. Id. Therefore, the I.G. asserts that Petitioner's
hearing request should be
dismissed as untimely even if she never received the notice which was sent to
her Chicago residence.
The I.G. has confused the process requirements of law and regulations for effectuating
a suspension with
the regulatory notice criteria which trigger the time period within which a
party may file a hearing request.
Actions which satisfy the former requirement may not be sufficient to satisfy
the latter requirement.
The law provides that a suspension shall be effective at such time and upon
such reasonable notice to the
public and to the suspended party as may be specified in regulations. 42 U.S.C.
1320a-7(c). Regulations
provide that a suspension for a person convicted of a program-related crime
will become effective
beginning fifteen days from the date of written notice of suspension given by
the I.G. to the suspended
party. 42 C.F.R. 1001.123. The regulations do not specify how the notice must
be transmitted, other than
that it be in writing. However, it is reasonable to infer that the regulations
permit service by mail.
It may be, as the I.G. contends, that actual receipt of the notice by the suspended
party is unnecessary to
initiate a suspension provided that the I.G. makes a good faith effort to transmit
the notice by mail to the
party's last known address. But it is clear that actual receipt of the notice
is required to trigger the sixty day
limitations period within which a hearing request must be filed. 42 C.F.R. 498.40(a)(2).
Contrary to the
I.G.'s assertion, the limitations regulation does not impose an affirmative
duty on a party to advise the I.G.
of a change in address, nor does it permit constructive notice to substitute
for actual notice of suspension.
It should be noted that the record does not support the I.G.'s claim that Petitioner
was indifferent to receipt
of the suspension notice. As of the date of Petitioner's suspension, her attorney
was communicating with
the I.G. on her behalf, and was forcefully advocating reasons to reduce the
suspension. Had the I.G. sent a
copy of the suspension notice to Petitioner's attorney, as was his option pursuant
to 42 C.F.R. 498.11, the
question of receipt would never have arisen.
The I.G.'s arguments are not supported by the case it cites, National Labor
Relations Board v. Clark, 468
F.2d 459 (5th Cir. 1972), vacated on other grounds, 411 U.S. 912 (1972). The
Clark case stands for the
principle that a party need not actually receive notice of an action to be validly
served, where the serving
party mails the notice in good faith to the receiving party's last known address.
Clark does not address the
question of whether such service would trigger the limitations period to answer
the notice.
B. Reasonableness of the Length of the Suspension.
The I.G. suspended Petitioner from participating in the Medicare and Medicaid
programs for three years,
pursuant to section 1128(a) of the Social Security Act, 42 U.S.C. 1320a-7. The
suspension results from
Petitioner's conviction in federal court of offenses related to her participation
in the Medicaid program.
Regulations provide that in cases such as this, substantive issues which may
be considered at a hearing
consist of whether: (1) Petitioner was in fact, convicted of an offense; (2)
the conviction was related to
Petitioner's participation in the Medicare, Medicaid, or social services program;
and (3) the length of the
suspension is reasonable. 42 C.F.R. 1001.128(a)(1)-(3). Petitioner does not
dispute that she was convicted
of an offense related to her participation in the delivery of services under
the Medicaid program. The issue
remaining to be resolved is whether the length of the suspension is reasonable.
Subsumed in this issue is the question of the standard of review I am to employ
to decide whether the
length of the suspension is reasonable. Petitioner argues that my role is to
independently weigh the
evidence in light of the criteria for determining suspensions established by
42 C.F.R. 1001.125(b), and to
impose a "reasonable" suspension without regard to the I.G.'s suspension
determination. P.'s Brief at 7.
This formulation misstates my statutory and regulatory authority. My role is
limited to evaluating the
reasonableness of the I.G.'s determination. My function is not to substitute
my judgment for his, so long as
I conclude that his determination is reasonable.
The law and regulations plainly state that it is the Secretary (and his delegate,
the I.G.) who bear the
responsibility to determine an appropriate suspension. The law in effect as
of the date that Petitioner was
suspended, and the 1987 revision to that law, clearly repose in the Secretary
the obligation to suspend, and
to determine the appropriate length of a suspension. See Pub. L. 100-93 (August
18, 1987), 42 U.S.C.
1320a-7a. The regulations establishing criteria for determining length of suspensions
provide that they are
to be employed by the I.G. in evaluating particular cases and imposing suspensions.
The regulations
provide that the standard for review of suspensions at administrative hearings
includes the issue of whether
the length of the suspension imposed by the I.G. is reasonable. 42 C.F.R. 1001.128(a)(3).
In adopting this
regulatory language, the Secretary made it clear that the administrative law
judge's role was to decide
whether the I.G.'s suspension determination was reasonable. "(T)he word
`reasonable' conveys the
meaning that (the I.G.) is required at the hearing only to show that the length
of suspension determined on
the basis of these criteria was not extreme or excessive" (emphasis added).
48 Fed. Reg. 3744 (Jan. 27
1983).
In arguing that I should independently determine and assess a "reasonable"
suspension, Petitioner has
emphasized that the administrative hearing is de novo. 42 U.S.C. 1320a-7(f);
42 U.S.C. 405(b)(1). It is
true that my statutory duty is to conduct a de novo hearing--rather than to
conduct a paper review of the
record generated by the I.G. in making his suspension determination. There is
nothing inconsistent
between this duty and a standard of review which requires a decision as to the
reasonableness of the I.G.'s
determination, based on evidence adduced at the hearing.
The evidence establishes that the I.G. scrupulously considered the merits of
the case, including facts and
arguments raised by Petitioner's attorney, in light of the criteria established
by 42 C.F.R. 1001.125(b).
The I.G. concluded, and the record amply substantiates, that Petitioner committed
serious criminal
offenses. Petitioner was a knowing participant in a massive criminal conspiracy
which defrauded the
Illinois Department of Public Aid of millions of dollars in Medicaid funds.
See 42 C.F.R.
1001.125(b)(1),(3),(6).The offenses to which Petitioner pleaded guilty, two
felony counts of mail fraud, are
serious crimes which may result in substantial prison terms, fines, and court-ordered
restitution. See 42
C.F.R. 1001.125(b)(1). As the I.G.'s agent noted in his testimony, the degree
of severity of the offenses
committed by Petitioner and their impact on the Medicaid program fall within
the mid-range of offenses
for which suspensions are imposed.
Petitioner argues that the I.G. either failed to consider or improperly disregarded
aspects of her case which
should compel a shorter suspension than that imposed by the I.G. These include
Petitioner's reluctant
participation in the conspiracy, the fact that she played only a small role
in the scheme, the fact that her
participation totalled only about seventy days, her willingness to cooperate
with federal authorities once
she knew she was the target of a criminal investigation, and her contrition
for her unlawful acts. Petitioner
also notes that other authorities, including the district court judge who sentenced
her for her crimes, have
expressed compassion in view of the equities of her case.
The regulations require the I.G. to consider potentially mitigating evidence
and weigh that in determining
the length of the suspension. 42 C.F.R. 1001.125(b)(4). The regulations do not
define what constitutes
mitigating circumstances, nor do they direct that particular weight be attached
to specific circumstances. In
this case, the I.G. was aware of and evaluated all of the facts alleged to be
mitigating by Petitioner. The
I.G. concluded that these facts did not constitute extraordinary circumstances
which compelled reducing
the suspension from the three year period he determined to be minimally necessary.
Prior to enactment of the 1987 revisions to the law governing suspensions,
the Secretary implemented a
suspension policy which focused on the prophylactic and deterrent effect of
suspensions, as opposed to the
equities advanced by suspended individuals in their particular cases. The Secretary
concluded that a
relatively stringent suspension policy was necessary in order to protect the
integrity of the Medicare and
Medicaid programs and to strongly warn providers participating in these programs
against committing
program-related offenses. The Secretary determined that, absent extraordinary
circumstances, a policy of
deterrence would best be served by requiring a minimum suspension of three years
for those individuals
convicted of program-related crimes.
This policy comports with Congressional intent. Congress intended legislation
mandating suspensions for
those convicted of program-related offenses to be remedial in application. When
Congress revised the law
in 1987 to mandate a minimum five-year suspension for those convicted of program-related
offenses, it
clarified and strengthened an existing deterrence policy. The efficacy and reasonableness
of suspensions
was intended to be weighed by their deterrent effect, as opposed to the extent
to which they punished
offenders in individual cases. S. Rep. No. 100-109, 1987 U.S. Code Cong. &
Ad. News 682, 686.
Application of a deterrence policy to specific cases may sometimes produce
consequences that seem harsh
in light of individual equities. Obviously, a statutory policy which requires
a minimum suspension of five
years for program-related offenses will produce suspensions in some cases that
appear to be more extreme
than that at issue in this case. But it is clear that prior to the enactment
of the 1987 legislation, a policy
which mandated exclusions of at least three years in all but extraordinary cases
was supported by sound
policy considerations and legislative intent. Application of that policy to
the facts of this case does not
produce an extreme or excessive suspension. I am satisfied that in this case,
the character of Petitioner's
crimes, coupled with the need for an effective deterrent against the commission
of program- related
offenses, outweighs any equitable circumstances that may exist, and militates
in favor of a relatively stiff
suspension. The conspiracy in which Petitioner participated produced enormous
damage to the Medicaid
program, and yet was composed of many individuals operating at Petitioner's
level, whose individual
participation would not, if treated in isolation, appear to be all that serious.
If relatively stringent
suspensions were reserved only for those offenders who committed crimes involving
large sums, or for
which lengthy sentences were imposed, then no effective deterrent would exist
for those individuals
inclined to engage in the type of misconduct Petitioner engaged in.
CONCLUSION
Based on the law and record of this proceeding I conclude that Petitioner's
hearing request was timely filed
within the requirements of 42 C.F.R.498.40(a)(2), and Petitioner is entitled
to a hearing on the merits. The
I.G.'s motion to dismiss this proceeding is denied. I conclude that the suspension
imposed on Petitioner by
the I.G. is reasonable.
__________________________________
Steven T. Kessel
Administrative Law Judg
Addressees:
RETURN RECEIPT REQUESTED
Raymon A. Grossman, Esq.
Grossman, Solomon & Fielkow, P.C.
4433 West Tuohy Avenue, Suite 600
Lincolnwood, Illinois 60646
and
Ted Yasuda, Assistant Regional Counsel
DHHS -- Region V
105 West Adams, 19th Floor
Chicago, Illinois 60603
cc: Office of Inspector General
Office of Investigations
Room 3-C-1, Meadows East Building
6325 Security Boulevard
Baltimore, Maryland 21207
Regional Inspector General
Office of Investigations
Attn: Michael Dyer
P.O. Box 7967
Chicago, Illinois 60680