Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of: Anthony Accaputo, Jr., Petitioner,
- v. -
The Inspector General.
DATE: January 12, 1993
Docket No. C-92-001
Decision No. CR249
DECISION
On May 10, 1989, the Inspector General (I.G.) of the United States Department
of Health and Human
Services (DHHS) issued a letter (Notice) stating that Petitioner was being excluded
from participation in
the Medicare and State health care programs 1/ for a period of seven years.
The I.G. alleged that Petitioner
had been convicted of a criminal offense related to the delivery of an item
or service under the Medicaid
program. The I.G. contended that exclusions after such a conviction are required
by section 1128(a)(1) of
the Act, and that section 1128(c)(3)(B) of the Act provides that the minimum
period of exclusion for such
an offense is five years. In a letter dated August 21, 1991, which the I.G.
received on September 26, 1991,
Petitioner challenged his exclusion and requested a hearing.
I have considered the evidence of record, the parties' arguments, and the applicable
law. I conclude that
the seven year exclusion imposed by the I.G. is reasonable. Therefore, I sustain
the exclusion imposed and
directed against Petitioner.
BACKGROUND
The case was assigned originally to Administrative Law Judge (ALJ) Joseph K.
Riotto. On October 3,
1992, Judge Riotto issued an Order to Show Cause in which he ordered the parties
to submit briefs and
supporting documentation on the issue of whether he should grant Petitioner's
hearing request, in view of
the length of time which had elapsed between the I.G.'s May 10, 1989 Notice
and Petitioner's August 21,
1991 hearing request. The parties fully briefed this issue, and on January 28,
1992, Judge Riotto issued a
Ruling finding that Petitioner had filed his request in a timely fashion. Judge
Riotto found that Petitioner
did not receive notice of the exclusion until some time in August 1991. He found
also that Petitioner
complied with the requirement to file a hearing request within 60 days from
receipt of the Notice, and that
Petitioner is therefore entitled to a hearing on the merits.
Pursuant to his January 28, 1992 Ruling, Judge Riotto scheduled a prehearing
conference to take place by
telephone on February 11, 1992. Prior to the conference, Petitioner moved to
vacate his exclusion. During
the February 11, 1992 conference, Petitioner argued that his exclusion should
be vacated on the grounds
that he did not have time to seek his remedies under the Act, since the I.G.
did not notify him of the
exclusion in a timely fashion. Judge Riotto issued an oral Ruling at the telephone
conference, denying
Petitioner's motion to vacate the exclusion. Prehearing Order and Schedule for
Filing Motions for
Summary Disposition dated February 14, 1992 at 2.
The I.G. subsequently filed a motion for summary disposition, accompanied by
a supporting brief, and
proposed exhibits. Petitioner filed a responsive brief accompanied by proposed
exhibits. In his responsive
brief, Petitioner requested an in-person hearing. The I.G. filed written objections
to two of Petitioner's
proposed exhibits.
Judge Riotto convened a telephone conference on May 27, 1992. During that conference,
Judge Riotto
issued an oral Ruling granting Petitioner's request for an in-person hearing,
on the grounds that the case
involved contested facts relating to Petitioner's trustworthiness. Order and
Notice of Hearing dated June
15, 1992, at 2. In view of the fact that the case was proceeding to an in-person
hearing, Judge Riotto
deferred ruling on the I.G.'s objections to two of Petitioner's proposed exhibits.
On June 10, 1992, Petitioner filed a motion for discovery and request for documents
from the I.G. The I.G.
subsequently supplied some of the requested documents to Petitioner and filed
a motion for a protective
order in response to Petitioner's other requests for documents. Petitioner filed
a motion to deny the I.G.'s
motion for a protective order.
On July 1, 1992, the case was reassigned to me for hearing and decision. On
July 20, 1992, I convened a
prehearing conference. During that conference, the parties orally presented
their respective positions
regarding discovery. In addition, Petitioner argued that the equities in this
case require that I backdate the
commencement of the exclusion.
On July 23, 1992, I issued a Ruling in which I granted the I.G.'s motion for
a protective order and denied
Petitioner's request for discovery. Also, I ruled that my authority to hear
and decide cases under section
1128 of the Act does not include the authority to change the commencement date
of the exclusion. Samuel
W. Chang, M.D., DAB 1198 (1990).
On August 24, 1992, I held a hearing in Boston, Massachusetts. Petitioner offered
12 exhibits into
evidence. Although the I.G. had previously objected to two of these exhibits
in a written memorandum, at
the hearing the I.G.'s counsel stated that she did not object to any of the
exhibits, and I admitted all 12
exhibits into evidence. Tr. 10-11. 2/ The I.G. offered five exhibits. Petitioner
did not object to any of the
I.G.'s exhibits, and I admitted them into evidence. Tr. 11, 13-14. 3/ Although
Petitioner did not object to
any of the five exhibits offered by the I.G. at the hearing, he did object to
the fact that the I.G. did not offer
all of the exhibits on his list of proposed exhibits. Petitioner stated that
the basis of his objection was that
he wasn't notified that the I.G. would not offer all of the exhibits on his
list. Tr. 12-13. 4/
A party is under no obligation to offer all of the exhibits proposed by that
party, nor is there any obligation
to notify the other party in advance that a particular exhibit will not be offered.
Moreover, Petitioner has
not shown that he has been prejudiced by this lack of notification. Indeed,
the two proposed exhibits which
the I.G. decided not to offer into evidence were copies of exhibits that had
been offered by Petitioner and
admitted into evidence as Petitioner Hearing Exhibit 9 and Petitioner Hearing
Exhibit 10. Had the I.G.
offered these exhibits into evidence, they would have been duplicative. Petitioner
argued at the hearing
that the I.G. should not be allowed to rely on exhibits offered by Petitioner.
Tr. 13. I do not agree. There
is no rule which prohibits a party from relying on evidence offered by the opposing
party. Once an exhibit
has been admitted into evidence, either party may rely on it.
At the conclusion of the August 24, 1992 hearing, I gave the parties the opportunity
to file simultaneous
posthearing briefs, and to request the opportunity to file reply briefs. The
parties filed posthearing briefs,
but did not request leave to file reply briefs.
ADMISSIONS
Petitioner admits that: (1) he was "convicted" of a criminal offense
within the meaning of section
1128(a)(1) of the Act; and (2) the offense was "related to the delivery
of an item or service" under the
Medicaid program within the meaning of section 1128(a)(1) of the Act. Tr. 6.
ISSUES
The remaining issues are:
1. Whether, under the circumstances of this case, the I.G. is precluded from
exercising his authority to
exclude Petitioner pursuant to section 1128(a)(1) of the Act.
2. Whether the seven year exclusion imposed and directed against Petitioner is reasonable.
FINDINGS OF FACT AND CONCLUSIONS OF LAW 5/
Having considered the entire record, the arguments and submissions of the parties,
and being fully advised
herein, I make the following Findings of Fact and Conclusions of Law (FFCLs):
1. Petitioner has provided health care as the owner and operator of several
different nursing homes. Tr.
24; P. H. Ex. 11.
2. On August 28, 1986, a grand jury of the Commonwealth of Massachusetts returned
Indictment No.
046498 charging Petitioner with seven counts of violating the Massachusetts
Medicaid False Claims Act.
P. H. Exs. 7, 8.
3. Indictment No. 046498 alleged that Petitioner knowingly and willfully made
and caused to be made
false statements on cost reports submitted to the Massachusetts Rate Setting
Commission for use in
determining the rates of payment for services under the Medicaid program. The
indictment alleged also
that the fraudulent cost reports involved five different nursing homes and that
the criminal activity took
place during the period spanning from January 1, 1981 through December 31, 1981.
P. H. Ex. 8.
4. On August 28, 1986, a grand jury of the Commonwealth of Massachusetts returned
Indictment No.
060529 charging Petitioner with four counts of making false entries in the books
of four different nursing
homes at various times during the period from January 1981 to February 1983.
P. H. Exs. 9, 10.
5. On September 17, 1986, Petitioner pled not guilty to all counts in both indictments. P. H. Exs. 7/1, 9/1.
6. Pursuant to plea negotiations, Petitioner entered into an agreement in which
he agreed to change his
plea to count one of Indictment No. 046498 from not guilty to guilty, in exchange
for a predetermined
sentence recommended to the Suffolk County Superior Court by the Massachusetts
Attorney General's
Medicaid Fraud Control Unit. Tr. 23, 24, 43, 50, 51, 61; P. H. Ex. 7/4.
7. On September 7, 1988, Petitioner pled guilty to count one of Indictment No. 046498. P. H. Ex. 7/4.
8. In pleading guilty to count one of Indictment No. 0460498, Petitioner admitted
that he knowingly and
willfully made and caused to be made false statements on a cost report of a
nursing home for the period
from January 1, 1981 through December 31, 1981. P. H. Ex. 8/2.
9. On September 7, 1988, the Suffolk County Superior Court entered a judgment
of guilty, based on its
acceptance of Petitioner's plea. P. H. Ex. 7/4.
10. The Suffolk County Superior Court sentenced Petitioner to the House of
Correction for two years,
sentence suspended, and to probation for three years. In addition, the Suffolk
County Superior Court
ordered Petitioner to pay a fine and surfine totalling $6,125 and to pay restitution
to the Medicaid program
in the amount of $35,205 over the three year probationary period. P. H. Ex.7/4-5.
11. On September 7, 1988, the Suffolk County Superior Court ordered that each
of the remaining six
counts of Indictment No. 046498 and each of the four counts of Indictment No.
060529 be placed on file,
without a change of plea. P. H. Exs. 7/5, 9/4.
12. Petitioner was represented by counsel throughout the criminal proceedings. P. H. Exs. 7, 9.
13. Petitioner was "convicted" of a criminal offense within the meaning
of sections 1128(a)(1) and 1128(i)
of the Act.
14. 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 1128(a)(1) of the Act.
15. The Secretary of DHHS delegated to the I.G. the authority to determine,
impose, and direct exclusions
pursuant to section 1128 of the Act. 48 Fed. Reg. 21661 (May 13, 1983).
16. On May 10, 1989, the I.G. issued a Notice stating that Petitioner was being
excluded from
participation in the Medicare and Medicaid programs for seven years, pursuant
to section 1128(a)(1) of the
Act.
17. Petitioner did not receive notice of the exclusion until some time in August
1991. January 28, 1992
Ruling Denying I.G.'s Motion to Dismiss Request for Hearing at 6.
18. Petitioner's hearing request, dated August 21, 1991, was timely filed.
January 28, 1992 Ruling
Denying I.G.'s Motion to Dismiss Request for Hearing at 1, 6.
19. The Massachusetts Attorney General's Medicaid Fraud Control Unit did not
have the authority to make
a decision on behalf of the Secretary of DHHS that would frustrate the strong
federal interest in protecting
the integrity of the federally-funded health care programs.
20. A defendant in a criminal proceeding does not have to be advised of all
the possible consequences,
such as temporarily being barred from government reimbursement for his professional
services, which may
flow from his plea of guilty.
21. Sections 1128(a)(1) and 1128(i) of the Act, read together, provide adequate
notice of the consequences
which could result from conviction of an offense related to the delivery of
an item or service under the
Medicaid program.
22. The determination of the I.G. to impose and direct a seven year exclusion
in this case does not violate
the prohibition against double jeopardy under the United States Constitution.
23. The I.G. properly excluded Petitioner from participation in the Medicare
and Medicaid programs for a
period of at least five years as required by the minimum mandatory exclusion
provisions of sections
1128(a)(1) and 1128(c)(3)(B) of the Act.
24. While sections 1128(a)(1) and 1128(c)(3)(B) set a minimum mandatory period
of exclusion of five
years in cases of persons convicted of criminal offenses related to the delivery
of a health care item or
service under the Medicaid program, the I.G. may direct and impose an exclusion
of more than the
minimum mandatory period in appropriate circumstances.
25. Regulations published on January 29, 1992 do not apply retroactively to
establish a standard for
adjudicating the reasonableness of the exclusion in this case.
26. The remedial purpose of section 1128 of the Act is to protect the integrity
of federally-funded health
care programs and the welfare of beneficiaries and recipients of such programs
from individuals and
entities who have been shown to be untrustworthy.
27. The offense of which Petitioner was convicted is serious.
28. The seriousness of Petitioner's criminal offense is reflected in the sentence
imposed by the Suffolk
County Superior Court. FFCL 10.
29. The Medicaid program suffered substantial financial loss as a result of
Petitioner's criminal activity.
FFCL 10.
30. Throughout this proceeding, Petitioner attempted to minimize his culpability
by characterizing the
false statements as unintentional errors. Tr. 69, 73-75, 87-88.
31. Petitioner's disavowal of criminal intent is not credible.
32. Petitioner engaged in calculated fraud of the Medicaid program motivated
by the desire for personal
gain. Petitioner's unlawful conduct manifests a high level of culpability. FFCL
8, 31.
33. Petitioner's testimony denying that he intentionally defrauded the Medicaid
program is additional
evidence of his untrustworthiness. FFCL 31.
34. Petitioner's attempt to minimize his culpability by characterizing his
wrongdoing as negligence rather
than intentional fraud shows that he still does not fully accept the wrongfulness
of his criminal activity.
35. Petitioner's license to practice pharmacy was suspended because Petitioner
did not comply with a
requirement to report to authorities that a registered pharmacist was working
for him. Tr. 79-81. This
shows that Petitioner has engaged in a pattern of misconduct involving a failure
to comply with reporting
requirements to government authorities, and it is additional evidence of his
untrustworthiness.
36. Petitioner was under treatment for an anxiety disorder at the time he committed
the offense underlying
his conviction. P. Ex. 2.
37. There is no evidence which leads me to conclude that Petitioner's anxiety
disorder reduced his
culpability.
38. There is no evidence that the Suffolk County Superior Court determined
that Petitioner's anxiety
disorder reduced his culpability.
39. The fact that Petitioner responded to stress by engaging in criminal activity
is probative of his
untrustworthiness rather than his trustworthiness.
40. Petitioner's expressions of remorse and Petitioner's probation officer's
assurances that Petitioner is
trustworthy are outweighed by the strong evidence showing that Petitioner is
untrustworthy. P. Ex. 1; Tr.
85, 89.
41. A lengthy exclusion is needed in this case to satisfy the remedial purposes of the Act.
42. The seven year exclusion imposed and directed by the I.G. is reasonable.
DISCUSSION
I. The I.G. was required to exclude Petitioner from participation in the Medicare
program and to direct his
exclusion from the Medicaid program for a minimum of five years pursuant to
the mandatory exclusion
provisions of the Act.
The Act mandates, at section 1128(a)(1), an exclusion of:
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 . . . [Medicaid].
The Act further requires, at subsection 1128(c)(3)(B), that in the case of
an exclusion imposed and directed
pursuant to subsection 1128(a)(1), the minimum term of such exclusion shall
be five years.
The I.G.'s authority to impose and direct an exclusion under section 1128(a)(1)
is based on the fulfillment
of the following statutory criteria: (1) an individual or entity must be "convicted"
of a criminal offense
within the meaning of the Act, and (2) the conviction must be "related
to the delivery of an item or service"
under the Medicare or Medicaid programs.
In this case, the record shows that on August 28, 1986, a grand jury of the
Commonwealth of
Massachusetts returned Indictment No. 046498 charging Petitioner with seven
counts of violating the
Massachusetts Medicaid False Claims Act. FFCL 2. On that same day, a grand jury
of the Commonwealth
of Massachusetts returned Indictment No. 060529, charging Petitioner with four
counts of making false
entries in the books of four nursing homes. FFCL 4. On September 17, 1986, Petitioner
pled not guilty to
all counts in both indictments. FFCL 5. Pursuant to plea negotiations, Petitioner
entered into an agreement
in which he agreed to change his plea to count one of Indictment No. 046498
from not guilty to guilty, in
exchange for a predetermined sentence recommended to the Suffolk County Superior
Court by the
Massachusetts Attorney General's Medicaid Fraud Control Unit. FFCL 6. On September
7, 1988,
Petitioner pled guilty to count one of Indictment No. 046498, and the Suffolk
County Superior Court
accepted that plea. FFCL 7, 9. In addition, the Suffolk County Superior Court
ordered that each of the
remaining six counts of Indictment No. 046498 and each of the four counts of
Indictment No. 060529 be
placed on file, without a change of plea. FFCL 11.
Based on these facts, Petitioner admits that he was "convicted" of
a criminal offense within the meaning of
section 1128(a)(1) of the Act. He admits also that the offense of which he was
convicted was "related to
the delivery of an item or service" under the Medicaid program. Tr. 6.
In addition, he does not dispute that
the mandatory exclusion provisions of the Act require the I.G. to exclude health
care providers, who have
been convicted of program-related offenses, for a minimum period of five years.
Tr. 7. However, he does
not concede that the mandatory exclusion provisions can be properly applied
to this case. Petitioner
contends that, under the circumstances of this case, the I.G. is precluded from
exercising his authority to
exclude him pursuant to section 1128(a)(1) of the Act. Tr. 7; Petitioner's Posthearing
Brief at 2-7. During
the hearing, I issued an oral Ruling in which I held that the minimum mandatory
exclusion provisions of
sections 1128(a)(1) and 1128(c)(3)(B) apply to this case. Tr. 67. Petitioner
addressed this issue in his
posthearing brief, and upon consideration of those arguments, I reaffirm my
ruling, for the reasons
discussed below.
A. The Massachusetts Attorney General's Medicaid Fraud Control Unit does not
have the authority to act
on behalf of the Secretary of DHHS in a way that would frustrate the strong
federal interest in protecting
the integrity of the federally-funded health care programs.
In support of his position, Petitioner argues that he should not be excluded
from participation in the
Medicare and Medicaid programs because at the time he entered into his plea
agreement, the Massachusetts
Attorney General's Medicaid Fraud Control Unit (Medicaid Fraud Control Unit)
did not recommend to the
Suffolk County Superior Court that an exclusion should be part of his sentence.
Petitioner contends that
the Medicaid Fraud Control Unit receives funds from DHHS and is subject to federal
laws and regulations.
Based on this, Petitioner argues that the Medicaid Fraud Control Unit is an
agent of DHHS and that it has
the authority to act on behalf of DHHS in negotiating plea agreements in criminal
proceedings prosecuted
by the Commonwealth of Massachusetts.
Petitioner contends that he changed his plea from not guilty to guilty in exchange
for a predetermined
sentence that was recommended to the Suffolk County Superior Court by the Medicaid
Fraud Control Unit.
The Medicaid Fraud Control Unit did not recommend that exclusion from Medicare
and Medicaid be part
of Petitioner's sentence. Petitioner reasons that at the time he entered into
his plea bargain with an
Assistant Attorney General from the Medicaid Fraud Control Unit, he was in effect
entering into an
agreement with an agent of DHHS. According to Petitioner, DHHS is now precluded
from excluding him
from the Medicare and Medicaid programs because its agent, the Medicaid Fraud
Control Unit, did not
recommend that an exclusion should be part of his sentence at the time that
the plea agreement was
reached. Petitioner's Posthearing Brief at 2-7; Tr. 42-50, 62-66.
Petitioner's argument is premised on his assertion that at the time he entered
into his plea bargain with an
Assistant Attorney General from the Medicaid Fraud Control Unit, the Assistant
Attorney General acted as
an agent for DHHS in reaching a plea agreement. Even if I were to accept Petitioner's
assertions that the
Medicaid Fraud Control Unit receives some federal funding and is subject to
some federal regulation for
the sake of argument, I do not accept that this leads to the conclusion that
the Medicaid Fraud Control Unit
acts as an agent of DHHS in prosecuting criminal offenses, as Petitioner contends.
Section 1128 of the Act is a federal statute which Congress enacted to provide
civil remedies independent
from punishments which might be applied to a party under State criminal law.
There is nothing in section
1128 which suggests that Congress intended that the authority to impose and
direct exclusions be subject to
limitations imposed by State prosecutors. Petitioner's program-related conviction
triggered a mandatory
exclusion under a federal law which was designed to protect a federal interest
in protecting federally-
funded health care programs from health care providers who cannot be trusted
to handle program funds. I
conclude that the State prosecutor did not have the authority to make a decision
on behalf of the Secretary
of DHHS that would frustrate the strong federal interest in protecting the integrity
of federally-funded
health care programs.
B. The I.G. is not barred from excluding Petitioner in this case because Petitioner
did not know that his
criminal conviction would result in an exclusion.
Petitioner argues also that he should not be subject to an exclusion under
section 1128(a)(1) because the
State prosecutor did not inform him that he would be excluded from the Medicare
and Medicaid programs
as a result of his conviction at the time he agreed to change his plea from
not guilty to guilty. Petitioner
asserts that he was prejudiced because he did not have full knowledge of the
consequences of entering a
guilty plea. Petitioner states that had he known that he would have been excluded
as a result of his
conviction, he might not have agreed to plead guilty to violating the Medicaid
False Claims Act.
Petitioner's Posthearing Brief at 3, 6; Tr. 23-24, 46, 50-52.
This argument is essentially the same as an argument made by a petitioner in
the case of Douglas Schram,
R.Ph., DAB CR215 (1992), aff'd DAB 1372 (1992). In that case, the petitioner
argued that his due process
rights were violated because he was deprived of the notice necessary to understand
the possible
consequences of his guilty plea. The petitioner asserted that had he known of
the consequences of his plea,
he would have pled differently. The ALJ rejected this argument. In rejecting
this argument, the ALJ cited
U.S. v. Suter, 755 F.2d 523, 525 (7th Cir. 1985) for the proposition that a
defendant in a criminal
proceeding does not have to be advised of all the possible consequences, such
as temporarily being barred
from government reimbursement for his professional services, which may flow
from his plea of guilty.
DAB CR215, at 6. An appellate panel of the DAB reviewed the ALJ's decision,
and found that the "ALJ
correctly held that, as a defendant, Petitioner did not have to be advised of
all the possible consequences of
his plea". DAB 1372, at 11. The appellate panel also went on to say:
More importantly, Petitioner was on notice that his guilty plea could lead
to a mandatory exclusion.
Sections 1128(a)(1) and 1128(i), read together, provide adequate notice of the
consequences which could
result from conviction of a program-related offense. If Petitioner's complaint
is with the actions of the
[State] prosecutor . . . the proper forum for this complaint is . . . [the]
State court.
DAB 1372, at 12. The DAB has held in other cases that arguments about the process
leading to a
Petitioner's criminal conviction are completely irrelevant to an exclusion proceeding.
Charles W. Wheeler,
DAB 1123 (1990); David S. Muransky, D.C., DAB 1227 (1991). In view of the foregoing,
Petitioner's
argument that the I.G. is precluded from imposing an exclusion in this case
because Petitioner did not
know that his conviction would result in an exclusion is without merit.
C. The exclusion in this case does not violate the constitutional prohibition against double jeopardy.
In addition, Petitioner argues that application of the mandatory exclusion
provisions to this case violates
the Double Jeopardy Clause of the United States Constitution because he has
already been punished in the
criminal case, and the effect of the exclusion is so extreme as to constitute
a second punishment.
Petitioner's Posthearing Brief at 7; Tr. 44.
The Supreme Court has held that, under some circumstances, the imposition of
civil penalties could
constitute double jeopardy where:
. . . [A] civil sanction that cannot fairly be said solely to serve a remedial
purpose, but rather can be
explained only as also serving either retributive or deterrent purposes, is
punishment, as we have come to
understand the term.
United States v. Halper, 490 U.S. 435 (1989). In this case, the primary purpose
of this exclusion is not to
punish the Petitioner, but to protect the Medicare and Medicaid programs from
future misconduct by a
provider who has shown himself to be untrustworthy. Federal district courts
have specifically found that
exclusions under section 1128 are remedial in nature, rather than punitive,
and do not violate the double
jeopardy provisions of the constitution. Manocchio v. Sullivan, 768 F. Supp.
814 (S.D. Fla. 1991); Greene
v. Sullivan, 731 F. Supp. 838 (E.D. Tenn. 1990).
Petitioner has not established that his seven year exclusion is the type of
government action contemplated
by the Halper doctrine where the civil penalty is so extreme that it bears no
rational relation to the
government's remedial goals. As I discuss more fully below, the evidence in
this case establishes that a
seven year exclusion is proportionate to the harm done by Petitioner to the
Medicaid program and the need
to preclude repetition of his behavior. In view of the remedial nature of the
exclusion, I find no merit to
Petitioner's double jeopardy argument. See John N. Crawford, M.D., DAB 1324,
at 6-8 (1992) (where an
appellate panel of the DAB found that a six year exclusion imposed pursuant
to section 1128(a)(1) of the
Act did not violate the constitutional prohibition against double jeopardy.)
D. The I.G. properly classified Petitioner's exclusion as falling under the mandatory exclusion authority.
Petitioner contends also that the I.G. should have treated his criminal conviction
as the basis for a
permissive exclusion action. Petitioner's Motion for Oral Arguments and Summary
Disposition at 5. I do
not agree. Where, as here, an individual has been convicted of a program-related
criminal offense, the law
directs the I.G. to impose an exclusion of not less than five years. Even where
the same conviction could
give rise to mandatory as well as permissive exclusions, it is well settled
that the I.G. must impose the
mandatory exclusion when the conviction falls within the meaning of section
1128(a)(1). Schram, DAB
1372, at 12-13, citing Travers v. Sullivan, 791 F. Supp. 1471 (E.D. Wash. 1992).
In this case, there is no dispute that Petitioner was convicted of a criminal
offense which is related to the
delivery of an item or service under the Medicaid program. I conclude that the
I.G. properly classified
Petitioner's conviction as falling under the mandatory exclusion authority.
Under these circumstances, the
I.G. had no choice but to apply sections 1128(a)(1) and 1128(c)(3)(B) of the
Act and to exclude Petitioner
from participation in the Medicare and Medicaid programs for at least five years.
II. A seven year exclusion is appropriate and reasonable in this case.
The I.G. excluded Petitioner for a period of seven years. The exclusion provisions
of sections 1128(a)(1)
and 1128(c)(3)(B) of the Act require that a health care provider that has been
convicted of a program-
related offense be excluded for a minimum period of five years. The remaining
issue in this case is
whether a seven year exclusion is reasonable. The parties disagree as to the
reasonableness of the length of
the seven year exclusion imposed and directed by the I.G.
A. Regulations published on January 29, 1992 do not establish criteria which
govern my decision on the
reasonableness of the length of the exclusion.
On January 29, 1992, the Secretary of DHHS published regulations which, among
other things, establish
criteria to be employed by the I.G. to determine the length of exclusions imposed
pursuant to sections
1128(a) and (b) of the Act. 42 C.F.R. Part 1001; 57 Fed. Reg. 3298, 3330-43.
These regulations include a
section which establishes criteria to be employed by the I.G. to determine the
length of exclusions to be
imposed pursuant to section 1128(a)(1). 42 C.F.R. 1001.102; 57 Fed. Reg. 3331.
In considering the reasonableness of the length of the seven year exclusion,
a threshold issue is whether the
regulations published by the Secretary of DHHS on January 29, 1992 establish
criteria by which I must
adjudicate the reasonableness of the exclusion which the I.G. imposed and directed
against Petitioner.
The I.G. asserts that, as the new regulations were effective when they were
published on January 29, 1992,
they apply to any exercise of ALJ authority on or after that date. It is the
I.G.'s position that the new
regulations require me to uphold the seven year exclusion imposed on Petitioner
in this case. I.G. Motion
for Summary Disposition at 7-10. Petitioner did not address the issue of whether
the regulations can be
applied retroactively to I.G. determinations made prior to the regulations'
date. He did, however, cite the
new regulations to support his position that the I.G. should have treated his
conviction as the basis for a
permissive exclusion action. Petitioner's Motion for Oral Arguments and Summary
Disposition at 5.
An appellate panel of the DAB addressed this issue in the decision Behrooz
Bassim, M.D., DAB 1333
(1992). In that case, the appellate panel held that, as interpreted by the I.G.,
the new regulations effected a
substantive change in the right of a petitioner to a de novo hearing to challenge
an exclusion pursuant to
section 1128(b)(4) of the Act. For that reason, the panel held that retroactive
application of the new
regulations would deprive petitioner of due process. Notwithstanding the fact
that it arises under section
1128(a)(1) rather than under section 1128(b)(4) of the Act, I conclude that
application of the new
regulations to the present case would similarly materially alter Petitioner's
substantive rights. The
exclusion determination in this case was made on May 10, 1989. Therefore, under
Bassim, the Part 1001
regulations published on January 29, 1992, do not apply retroactively to establish
a standard for
adjudicating the reasonableness of the exclusion in this case. 6/
B. The remedial purpose of section 1128 of the Act is to protect federally-funded
health care programs and
their beneficiaries and recipients.
In deciding whether an exclusion under section 1128(a)(2) is reasonable, I
must analyze the evidence of
record in light of the exclusion law's remedial purpose. Lakshmi N. Murty Achalla,
M.D., DAB 1231
(1991).
Section 1128 is a civil statute and Congress intended it to be remedial in
application. The remedial purpose
of the exclusion law is to enable the Secretary of DHHS to protect federally-funded
health care programs
from misconduct. Such misconduct includes fraud or theft against federally-funded
health care programs.
See S. Rep. No. 109, 100th Cong., 1st Sess. 1, reprinted in 1987 U.S.C.C.A.N.
682.
When considering the remedial purpose of section 1128, the key term to keep
in mind is "protection," the
prevention of harm. Through exclusion, individuals who have caused harm, or
who have demonstrated
that they may cause harm, to the federally-funded health care programs or their
beneficiaries or recipients
are no longer permitted to receive reimbursement for items or services which
they provide to program
beneficiaries and recipients. Thus, untrustworthy providers are removed from
positions which provide a
potential avenue for causing future harm to the programs or to their beneficiaries
or recipients.
The determination of when an individual should be trusted and allowed to reapply
to the I.G. for
reinstatement as a provider in the Medicare and Medicaid programs is a difficult
issue. It involves
consideration of multiple factual circumstances. An appellate panel provided
a listing of some of these
factors, which include:
the nature of the offenses committed by the provider, the circumstances surrounding
the offense,
whether and when the provider sought help to correct the behavior which led
to the offense, how far the
provider has come toward rehabilitation, and any other factors relating to the
provider's character and
trustworthiness.
Robert M. Matesic, R.Ph., d/b/a Northway Pharmacy, DAB 1327, at 12 (1992).
It is evident that, in evaluating these factors, I must balance the seriousness
and impact of the offense with
existing factors which may demonstrate trustworthiness. The totality of the
circumstances of each case
must be evaluated in order to reach a determination regarding the appropriate
length of an exclusion.
In weighing these factors, I conclude that a lengthy exclusion is needed in
this case to satisfy the remedial
purposes of the Act, and the seven year exclusion imposed and directed by the
I.G. is reasonable. In
reaching this determination, I recognize that Petitioner has already suffered
financial losses as a result of
the related criminal proceeding and that a seven year exclusion may have a severe
financial impact on
Petitioner. Tr. 24-25, 27. However, the remedial considerations of the Act must
take precedence over the
financial consequences that an exclusion may have on Petitioner. Willeta J.
Duffield, DAB CR225 (1992).
C. The offense which formed the basis of Petitioner's criminal conviction is serious.
The evidence of record shows that on August 28, 1986, a grand jury of the Commonwealth
of
Massachusetts returned an indictment charging Petitioner with seven counts of
knowingly and willfully
making and causing to make false statements on cost reports submitted to the
Massachusetts Rate Setting
Commission for use in determining the rates of payment for services under the
Medicaid program. The
indictment alleged that the fraudulent cost reports involved five different
nursing homes and that the
criminal activity took place during the period spanning from January 1, 1981
through December 31, 1981.
FFCL 2, 3. Also, Petitioner was charged on that same day in a separate indictment
with four counts of
making false entries in the books of four nursing homes at various times during
the period from January
1981 to February 1983. FFCL 4. Pursuant to a plea agreement, Petitioner pled
guilty to one count of
knowingly and willfully making and causing to make false statements on the cost
report of a nursing home
for the period from January 1, 1981 through December 31, 1981. FFCL 6, 7, 8.
7/
Citing the I.G.'s May 10, 1989 Notice, Petitioner stated that the I.G.'s determination
to exclude him for
seven years was based on the fact that he was charged with seven counts of making
false statements on cost
reports of five nursing homes and four counts of making false entries in the
books of four nursing homes.
Petitioner points out that while it was true that he was charged with these
offenses, he pled guilty to and
was convicted of only one count of making false statements on the cost report
of one nursing home. He
contends that the I.G. improperly based his determination to exclude him for
seven years on allegations to
which he did not plead guilty and which did not form the basis of his conviction.
Petitioner's Posthearing
Brief at 7-8.
Petitioner argues that the I.G.'s exclusion determination is improper for the
additional reason that he was
not afforded the opportunity to submit information on mitigating circumstances
prior to the time that the
I.G. reached his exclusion determination. The I.G. sent a preliminary exclusion
notice letter to Petitioner
on January 18, 1989 which invited Petitioner to provide information on mitigating
circumstances. Since
this letter was sent to an incorrect address, Petitioner did not receive it.
January 28, 1992 Ruling Denying
I.G.'s Motion to Dismiss Request for Hearing at 4. Petitioner now argues that
the I.G. improperly excluded
him for seven years without giving him the opportunity to provide information
on mitigating circumstances
prior to the time that he was excluded. Petitioner's Motion for Oral Arguments
and Summary Disposition
at 1-2; Tr. 22.
I disagree with Petitioner's arguments. Under section 205(b) of the Act, Petitioner
is entitled to a de novo
hearing. I am required to make an independent evaluation of the question of
whether the exclusion, as
measured against the evidence adduced by both parties and the Act's remedial
purpose, is reasonable. The
purpose of this hearing is not to decide whether the I.G. correctly determined
to impose the exclusion.
Therefore, the thought processes of the I.G. or members of the I.G.'s staff
in reaching the determination to
exclude Petitioner for a particular length of time are not relevant to my decision.
I must independently
judge the exclusion on its merits, not in terms of whether the I.G. properly
considered the evidence or
properly followed its own internal procedures in imposing an exclusion. See
Arthur V. Brown, DAB
CR252, at 14 (1992).
In evaluating the evidence, I find that the offense of which Petitioner was
convicted, the one count
violation of the Massachusetts Medicaid False Claims Act, is serious. In pleading
guilty to this offense,
Petitioner admitted that he knowingly and willfully made false statements on
a cost report of a nursing
home for the period January 1, 1981 through December 31, 1981. FFCL 8. In committing
this offense,
Petitioner attacked the nerve center of the Medicaid program.
The Medicaid program is vulnerable to unscrupulous providers. Since the Medicaid
program is responsible
for processing numerous claims, it is impossible for it to audit every claim
as it is filed. It depends on the
honesty and good faith of the providers of services who submit claims to uphold
the integrity of the
program. Petitioner's unlawful conduct directly relates to program fiscal integrity
and, therefore, is the
type of misconduct Congress sought to prevent when it enacted section 1128 of
the Act.
The seriousness of Petitioner's criminal offense is reflected in the sentence
imposed by the Suffolk County
Superior Court pursuant to a plea agreement between Petitioner and the prosecutor.
The Suffolk County
Superior Court sentenced Petitioner to the House of Correction for two years,
sentence suspended, and to
probation for three years. In addition, the Suffolk County Superior Court ordered
Petitioner to pay a fine
and surfine totalling $6,125 and to pay restitution to the Medicaid program
in the amount of $35,205 over
the three year probationary period. FFCL 10.
In his April 23, 1992 response to the I.G.'s statement of facts and conclusions
of law, Petitioner denied that
there was a total of $35,000 damage to the Medicaid program resulting from the
false statements referred
to in the count to which he pled guilty. However, he testified at the hearing
that he did not know the
amount of the monetary damage to the Medicaid program resulting from his criminal
activity, but that he
"was willing to accept" the amount of restitution ordered by the court.
Tr. 89. I conclude that the fact that
the Suffolk County Superior Court ordered Petitioner to pay restitution in the
amount of $35,205 to
compensate the Medicaid program for its monetary loss gives rise to an inference
that the financial damage
to the program resulting from Petitioner's criminal activities was at least
that amount. Petitioner has not
presented any evidence to overcome this inference.
The demand for Medicaid's scarce resources is great. Payments by Medicaid for
any claim which is not
properly reimbursable under Medicaid regulations results in financial damage
to the program. In this case,
Petitioner illegally diverted a substantial amount of program funds and this
resulted in a serious financial
loss to the Medicaid program. Certainly, the fact that Petitioner was convicted
of a criminal offense
involving approximately $35,000 of Medicaid funds, raises serious questions
about his ability to be trusted
to handle Medicare and Medicaid funds.
D. Petitioner's refusal to admit that he intentionally defrauded the Medicaid
program is additional evidence
of his untrustworthiness.
Petitioner argues that he is trustworthy because he has accepted full responsibility
for his actions and he
has shown remorse for his misconduct. Petitioner's Posthearing Brief at 8. I
do not agree that the record
supports these assertions.
In his testimony at the hearing, Petitioner consistently attempted to minimize
his culpability by
characterizing the false statements as unintentional errors which were the product
of time pressures he was
under to file the cost report by the required deadline. Petitioner testified
that an outside accounting firm
prepared the cost report and that individuals in the accounting firm actually
made the false statements. Tr.
69, 73. Petitioner acknowledged that it was his responsibility to review the
cost report for accuracy before
it was submitted to the Rate Setting Commission, but he claimed that he did
not do so because he was
under a filing deadline. Tr. 74. Thus, although Petitioner admits that he was
negligent in his failure to
check the cost report before it was submitted, he consistently refused to admit
that he intentionally
defrauded the Medicaid program. Tr. 75, 87-88.
I find that Petitioner's attempt to minimize his culpability by characterizing
his misconduct as merely
failure to supervise the shoddy work of other individuals is unpersuasive. In
1988, Petitioner, of his own
free will and with the advice of counsel, chose to plead guilty to a charge
that he "knowingly and wilfully"
violated the Massachusetts Medicaid False Claims Act. This amounts to an admission
that he intentionally
engaged in criminal activity. Petitioner was not forced to enter into a plea
agreement with the
Commonwealth of Massachusetts. He voluntarily gave up the right to have the
facts underlying the
allegations contained in the indictments examined in court when he thought that
it was in his interest to do
so. Now, insulated from the repercussions of the criminal justice system, Petitioner
attempts to achieve the
best of both worlds by denying that he had criminal intent at the time he engaged
in the criminal activity.
This attempt to excuse his criminal conduct is highly suspect.
In addition, Petitioner's disavowal of criminal intent is belied by other statements
made by Petitioner at the
hearing. When he was asked at the hearing who received the overpayment resulting
from the false
statements on the cost report, Petitioner admitted that he received the overpayment.
He testified that he
received that overpayment as part of his salary and admitted that his salary
should not have been included
in the cost report. Tr. 89-90. Additionally, Petitioner testified that he was
going through a difficult divorce
at the time the false statements were made, stating that, ". . . what I
did was I tried to make it so that my ex-
wife couldn't get as much money as she wanted from me". Tr. 70. These statements
suggest that
Petitioner's divorce dispute created a motive to improperly include his salary
in the cost report. Petitioner's
assertions that the false statements were merely a mistake is not credible,
particularly when viewed in
context with these other statements made by Petitioner.
I find that the weight of the evidence establishes that Petitioner engaged
in calculated fraud of the Medicaid
program motivated by the desire for personal monetary gain. His unlawful conduct
establishes a
propensity to engage in harmful conduct when it suits his ends, manifesting
a high level of culpability. 8/
Petitioner asserts that he was not the owner or an officer of the particular
nursing home named in the count
to which he pled guilty, and that his ex-partner, Walter Mikolinski, actually
signed the cost report.
Petitioner's Hearing Request dated August 21, 1991; Tr. 34, 73. Under the circumstances
of this case, the
fact that Petitioner did not actually sign the cost report containing the false
statements and the fact that he
was not an owner or a corporate officer of the nursing home named in the count
to which he pled guilty
does not reduce Petitioner's level of culpability. It was Petitioner's responsibility
to ensure that the cost
report contained accurate information. Tr. 74. He deliberately submitted a cost
report containing false
information in order to defraud the Medicaid program.
I find also that Petitioner's testimony denying that he intentionally defrauded
the Medicaid program is
additional evidence of his untrustworthiness. Petitioner may have thought that
claiming that the false
statements were unintentional mistakes would minimize his culpability in my
eyes. However, this
testimony has the opposite effect. I find troubling Petitioner's testimony disavowing
criminal intent
because it demonstrates a willingness to dissemble and misrepresent facts under
oath. This testimony
shows that Petitioner is willing to say whatever he believes will impress a
fact-finder, regardless of its
truthfulness. Petitioner's present mischaracterization of the facts underlying
his 1988 conviction is
evidence that Petitioner continues to be untrustworthy, and that he therefore
still poses a threat to the
Medicare and Medicaid programs.
In addition, while Petitioner gives lip service to acknowledging responsibility
for his misconduct, the
nature and tenor of his testimony reveals that he has not done so. Petitioner
is still attempting to minimize
his past wrongdoing by claiming that it was the result of negligence rather
than intentional fraud.
Petitioner has offered me no meaningful assurance that he will not engage in
wrongdoing in the future. I
recognize that Petitioner has expressed remorse and that he testified that he
is sorry for his wrongdoing.
Tr. 85, 89. However, in view of the fact that Petitioner still does not admit
that he intended to defraud the
program, these expressions of remorse, proclaimed at a time when it plainly
suited his self-interest, ring
hollow.
E. The suspension of Petitioner's license to practice pharmacy is additional
evidence of his
untrustworthiness.
I find that there is sufficient evidence to justify a lengthy exclusion based
on Petitioner's criminal activity
and his refusal to admit that he intended to defraud the Medicaid program. However,
the record contains
additional evidence which is damaging to Petitioner. Petitioner testified that
he had been a registered
pharmacist in the past, but that his license to practice pharmacy was suspended
in 1982. Petitioner stated
that the reason for the suspension was that he did not comply with a requirement
to report to authorities
that a registered pharmacist was working for him. According to Petitioner, his
license to practice pharmacy
has not been reinstated since it was suspended in 1982. Tr. 79-81. The misconduct
which led to the
suspension of Petitioner's pharmacy license is troubling because it shows that
Petitioner has engaged in a
pattern of misconduct involving a failure to comply with reporting requirements
to government authorities.
F. Petitioner's treatment for an anxiety disorder does not reduce his culpability.
Petitioner states that he was under stress in his personal life at the time
he engaged in the criminal activity
underlying his conviction and that he was under the care of a psychiatrist at
that time. He claims that the
trial judge took this into consideration when he accepted the sentence recommended
by the prosecutor.
Petitioner asserts also that he has worked through his emotional problems and
that he has changed his
ways. Tr. 72; Petitioner's Motion for Oral Arguments and Summary Disposition
at 5-6.
In support of these assertions, Petitioner submitted a document dated February
27, 1984 written by S.D.
Zigelbaum, M.D. This document indicates that Petitioner was treated for an anxiety
disorder by Dr.
Zigelbaum during the period from 1978 to 1982. According to Dr. Zigelbaum, Petitioner's
anxiety disorder
was precipitated by family problems, legal problems, and the closing of his
pharmacy business. Dr.
Zigelbaum stated also that termination of therapy "was a mutually agreed
upon experience and represented
the successful 'working through' of [Petitioner's] emotional distress".
P. H. Ex. 2.
While I accept that Petitioner was under treatment for an anxiety disorder
at the time he engaged in the
criminal activity, there is no evidence which leads me to conclude that Petitioner's
anxiety disorder reduced
his culpability. There is no evidence that this condition caused Petitioner
to engage in fraud. Nor is there
evidence that, as a result his anxiety disorder, Petitioner was unable to comprehend
the nature of his acts.
On the contrary, Dr. Zigelbaum stated that Petitioner "at no time, displayed
a significant or disabling
emotional illness". P. H. Ex. 2. In addition, although Petitioner claims
that the judge presiding over his
criminal proceeding in the Suffolk County Superior Court considered his anxiety
disorder in determining
his sentence, he did not submit any evidence substantiating that the judge determined
that Petitioner had a
mental or emotional condition before or during the commission of his offense
that reduced his culpability.
I accept that Petitioner may have been under stress at the time that he defrauded
the Medicaid program.
However, I find that the fact that he responded to this stress by engaging in
criminal activity is probative of
his untrustworthiness rather than his trustworthiness.
G. The favorable statements made by Petitioner's probation officer do not derogate
from my conclusion
that a seven year exclusion is reasonable in this case.
I conclude that the seven year exclusion imposed and directed by the I.G. in
this case is reasonable. In
reaching this conclusion, I am cognizant that the record contains a letter from
Petitioner's probation officer,
dated February 24, 1992, stating that Petitioner has conformed to all terms
and conditions of probation, that
he has been cooperative, and that he understands his prior mistakes. P. H. Ex.
1. 9/ By saying that I do not
find him to be a trustworthy provider of care, I am not belittling any efforts
Petitioner has made to comply
with the terms of his sentence. Although I do not doubt the good faith of Petitioner's
probation officer, his
assurances as to trustworthiness are outweighed by the strong evidence showing
that Petitioner has further
to go before he can be considered completely trustworthy. The evidence in this
case establishes that
Petitioner was convicted of Medicaid fraud for making false statements on a
cost report required by the
Medicaid program. These misstatements were deliberately made by Petitioner in
a calculated effort to
obtain money to which he was not entitled. Petitioner continues to attempt to
misrepresent the facts
underlying his conviction and he continues to attempt to minimize his culpability.
In addition, Petitioner
has shown a pattern of running afoul of the law, as demonstrated by the suspension
of his pharmacy license
for failure to meet reporting requirements. I am unwilling to gamble that my
assessment of Petitioner is
incorrect based on Petitioner's representations that he is a changed person
or on his probation officer's
assertions that Petitioner understands his prior mistakes. I conclude that as
a safeguard and protection
against future fraud, a seven year exclusion is reasonable.
CONCLUSION
Based on the evidence in this case and the law, I conclude that the I.G. had
the authority to exclude
Petitioner pursuant to section 1128(a)(1) of the Act, and that a minimum period
of exclusion of five years
is mandated by federal law. In addition, I conclude that the I.G.'s determination
to exclude Petitioner for
seven years is reasonable. I therefore sustain the exclusion.
__________________________________
Charles E. Stratton
Administrative Law Judge
1. "State health care program" is defined by section 1128(h) of the
Act, 42 U.S.C. 1320a-7(h), to cover
three types of federally-assisted programs, including State plans approved under
Title XIX (Medicaid) of
the Act. Unless the context indicates otherwise, I use the term "Medicaid"
hereafter to represent all State
health care programs from which Petitioner was excluded.
2. The transcript of the hearing will be referred to as Tr. (page).
3. On page two of his January 28, 1992 Ruling Denying the I.G.'s Motion to
Dismiss Request for
Hearing, Judge Riotto admitted four exhibits offered by the I.G. which he referred
to as I.G. Ex. 1, I.G. Ex.
2, I.G. 3, and I.G. Ex. 4. He also admitted one exhibit offered by Petitioner
which he referred to as P. Ex 4.
The exhibits offered by the parties at the August 24, 1992 hearing were also
numbered sequentially
beginning with number 1. In order to avoid confusion, I will not change the
numbers of the exhibits
offered and admitted into evidence at the hearing, but I will refer to them
as "hearing" exhibits. Citations
to the hearing exhibits in this decision will be as follows:
I.G. Hearing Exhibits I.G. H. Ex. (number/page)
Petitioner's Hearing Exhibits P. H. Ex. (number/page)
4. Petitioner renewed this objection in his posthearing brief.
5. 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.
6. In light of the Bassim decision, I do not need to decide the issue of whether
the regulations establish
criteria which govern ALJs' review of exclusion cases. I note, however, that
in Steven Herlich, DAB
CR197 (1992), the ALJ reasoned that the regulation cited by the I.G. establishes
criteria to be used by the
I.G. in making exclusion determinations, but does not establish criteria binding
on an ALJ in conducting a
de novo review of the reasonableness of the exclusion. See also Charles J. Barranco,
M.D., DAB CR187
(1992).
7. It is unclear whether the count to which Petitioner pled guilty alleged
that Petitioner filed more than
one cost report containing false statements for the period January 1, 1981 through
December 31, 1981. For
the purpose of this decision, I will assume that Petitioner pled guilty to filing
only one cost report
containing false statements covering the period from January 1, 1981 through
December 31, 1981.
8. Even if I were to accept that the false statements resulted from a mistake
made by an accounting firm
which Petitioner did not review, I would still find that Petitioner manifested
a high level of culpability.
Petitioner admitted at the hearing that he was aware in 1983 that the accounting
firm which prepared the
cost report was making mistakes. Tr. 74. Although Petitioner stated that he
might have corrected the
misstatements, he did not produce any evidence to substantiate this claim. Tr.
75. Assuming for the sake
of argument that Petitioner did not intend to make any false statements, his
failure to provide evidence
showing that he corrected the mistakes upon learning about them reveals a propensity
for dishonesty.
9. Although Petitioner's probation officer stated that Petitioner has complied
with his terms of probation,
the record shows that Petitioner's three year probation sentence has been extended
for a year. This was
done because Petitioner has failed to comply with the court's order to pay the
restitution during the three
year probationary period. Petitioner testified that as of the August 24, 1992
hearing, he had paid only
$2,000 of the $35,205 he owes in restitution. Petitioner explained that the
reason for his not paying more is
that the exclusion has had a devastating effect on his ability to earn a livelihood.
Tr. 33. In view of the
fact that Petitioner's probation officer has attested to Petitioner's cooperation
during the probationary
period, and in the absence of evidence showing that Petitioner has the financial
ability to pay more
restitution than he has, I refrain from drawing a negative inference as to Petitioner's
trustworthiness, based
on the fact that he has paid only $2,000 as of the August 24, 1992 hearing.