$05:Exclusion Case
Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of: Ernest Mullen, Petitioner,
- v.-
The Inspector General.
DATE: October 5, 1994
Docket No. C-94-299
Decision No. CR337
DECISION
By letter dated February 8, 1994, Ernest Mullen, the Petitioner
herein, was notified by the Inspector General (I.G.) of the United
States Department of Health and Human Services (HHS), that it had
been decided to exclude Petitioner for a period of five years from
participation in the Medicare program and from participation in the
State health care programs described in section 1128(h) of the
Social Security Act (Act), which are referred to in this decision
as "Medicaid." The I.G.'s rationale was that exclusion, for at
least five years, is mandated by sections 1128(a)(1) and
1128(c)(3)(B) of the Act because Petitioner had been convicted of
a criminal offense related to the delivery of an item or service
under Medicaid.
Petitioner filed a timely request for review of the I.G.'s action
by an administrative law judge (ALJ) of the Departmental Appeals
Board (DAB). The I.G. moved for summary disposition. Petitioner
opposed the motion and requested an in-person evidentiary hearing.
I have determined that there are no facts of decisional
significance genuinely in dispute, and that the I.G. is entitled to
prevail even if all the facts alleged by Petitioner are accepted as
true. Therefore, I am granting the I.G.'s motion and deciding this
case based on the parties' written submissions.
I find no reason to disturb the I.G.'s determination to exclude
Petitioner from participation in the Medicare and Medicaid programs
for a period of five years.
APPLICABLE LAW
Sections 1128(a)(1) and 1128(c)(3)(B) of the Act make it mandatory
for any individual who has been convicted of a criminal offense
related to the delivery of an item or service under Medicare or
Medicaid to be excluded from participation in such programs for a
period of at least five years.
Section 1128(b)(3) permits, but does not mandate, the exclusion of
any individual or entity that has been convicted, under federal or
State law, of a criminal offense relating to the unlawful
manufacture, distribution, prescription, or dispensing of a
controlled substance.
PETITIONER'S POSITION
Petitioner contends that his conviction was not related to the
delivery of an item or service under Medicaid because he was never
engaged in the delivery of Medicaid items or services. He alleges
that he is not a provider of services under Medicare or Medicaid
and receives no direct reimbursement from those programs.
Petitioner points out that a Physician's Assistant can only render
services under the direct supervision of a licensed physician, and
it is the physician, not the Physician's Assistant, who
participates as a provider with Medicare or Medicaid. Therefore,
according to Petitioner, it is the physician, not the Physician's
Assistant, who is engaged in delivering Medicare or Medicaid items
or services.
Petitioner asserts that, because his conviction was not related to
the delivery of an item or service under Medicaid, mandatory
exclusion pursuant to section 1128(a)(1) of the Act is inapplicable
to his case. Petitioner argues, instead, that the criminal offense
of which he was convicted was related to the unlawful prescription
of a controlled substance. Thus, according to Petitioner, he
should be subject to a permissive exclusion pursuant to section
1128(b)(3) of the Act.
Petitioner argues that the permissive exclusion provision of
section 1128(b)(3) applies to his case because the acts for which
he was convicted involved, essentially, his improper prescription
of a controlled substance. Petitioner acknowledges that a
Physician's Assistant may not prescribe controlled substances.
Petitioner also acknowledges that he authorized the refill of a
prescription for Tylenol with codeine -- a controlled substance.
Petitioner asserts that, in authorizing the refill, he was acting
in accordance with longstanding written instructions from his
supervising physician.
Petitioner does not dispute that the patient for whom the Tylenol
with codeine was prescribed was a Medicaid recipient, nor that a
claim for the prescription was presented to Medicaid.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
A. Undisputed Findings of Fact
1. During the period relevant to this case, Petitioner was a
Physician's Assistant in the State of Michigan. I.G. Br. at 3; P.
Br. at 3. 1/
2. Notwithstanding the fact that a Physician's Assistant may not
lawfully prescribe controlled substances, Petitioner prescribed a
controlled substance for a patient. I.G. Ex. 1; P. Ex. 1; P. Br.
at 3-4. 2/
3. On or about July 16, 1993, a felony complaint was issued in the
District Court for Michigan's Judicial District 54-A, charging
Petitioner with one count of violating Michigan Comp. Laws
400.607(1)(Michigan's Medicaid False Claims Act). I.G. Ex. 1; I.G.
PF #1; P. PF #1.
4. The complaint alleged that Petitioner prescribed a controlled
substance (Tylenol with Codeine #3) without statutory authority,
thereby causing a false Medicaid claim to be made or presented.
I.G. Ex. 1; P. PF #1.
5. On or about August 11, 1993, Petitioner entered a plea of nolo
contendere to the offense charged in the complaint. I.G. PF #2; P.
PF #2.
6. On or about September 23, 1993, the 30th Circuit Court, State
of Michigan, entered judgment sentencing Petitioner to one year of
probation and to pay a Crime Victims Fund assessment and costs.
I.G. PF #3; P. PF #3.
7. Petitioner was convicted of a criminal offense within the
meaning of section 1128(i) of the Act. P. PF #3.
B. Findings on Disputed Matters
8. Because the offense to which Petitioner pled nolo contendere
describes on its face a relationship to the Medicaid program, I
need not look to the facts underlying the conviction.
9. Petitioner was convicted of a criminal offense related to the
delivery of an item or service under Medicaid within the meaning of
section 1128(a)(1) of the Act. FFCL 3-8.
10. Mandatory exclusion is applicable to any individual or entity
convicted of a program-related crime; such exclusions are not
limited to physicians or those with Medicare or Medicaid provider
agreements.
11. Where an individual is convicted of a criminal offense which
falls within the mandatory exclusion provisions of section 1128(a)
of the Act, the I.G. is required to impose a mandatory exclusion;
it is irrelevant that the offense arguably could fall also within
the provisions for permissive exclusions under section 1128(b).
12. The five-year exclusion imposed and directed by the I.G.
against Petitioner was required by sections 1128(a)(1) and
1128(c)(3)(B) of the Act. FFCL 9-11.
13. Neither the I.G. nor an administrative law judge has authority
to reduce the length of a five-year minimum mandatory exclusion.
DISCUSSION
To establish that there is a basis for imposing on Petitioner a
mandatory five-year exclusion from participation in the Medicare
and Medicaid programs, the I.G. must prove that: (1) Petitioner
was convicted of a criminal offense, and (2) the offense was
related to the delivery of an item or service under Medicare or
Medicaid. In the present case, Petitioner has admitted that he was
convicted of a criminal offense within the meaning of section
1128(i) of the Act. 3/ However, Petitioner contends that his
conviction was not related to the delivery of an item or service
under Medicaid, as the I.G. argues.
The I.G. moved for summary disposition. Petitioner opposed the
I.G.'s motion and requested an in-person evidentiary hearing. The
I.G. is entitled to summary disposition. First of all, it is not
clear that the I.G. disputes any of the facts Petitioner would seek
to establish at hearing. But even if Petitioner succeeded in
establishing these facts, the I.G. nevertheless would be entitled
to prevail as a matter of law.
Petitioner argues that the only illegal conduct he engaged in was
prescribing controlled substances outside the scope of his license
as a Physician's Assistant. The allegations recited in the
complaint, as well as the probation report offered by Petitioner,
support this contention. I.G. Ex. 1; P. Ex. 1. Yet, even
accepting as true Petitioner's characterization of the facts
underlying his conviction, the I.G. would nevertheless be required
to impose the minimum mandatory exclusion.
Petitioner must be excluded for the mandatory minimum of five years
because in pleading nolo contendere to the charge of presenting a
false claim to Medicaid, he acknowledged, in effect, that the State
would be able to establish the elements of the offense charged in
the complaint. One of the elements of the offense charged is that
Petitioner presented or caused to be presented to the State
Medicaid program a claim that he knew to be false.
A criminal conviction is program-related within the meaning of
section 1128(a)(1) where there is a common-sense connection between
the offense and the delivery of Medicare or Medicaid items or
services; i.e. there is some "nexus" between the crime and the
delivery of an item or service under Medicare or Medicaid. Paul R.
Scollo, D.P.M., DAB 1498, at 12-13 (1994); Thelma Walley, DAB 1367,
at 9 (1992); H. Gene Blankenship, DAB CR42 (1989). In the case at
hand, there is an obvious connection or nexus between causing false
Medicaid claims to be presented and the delivery of items or
services under Medicaid. False claims affect the program's ability
to pay genuine claims and are also generally inimical to public
confidence and sound administration of the program. Moreover, it
is well-settled in DAB case precedent that presenting false
Medicaid claims is an offense related to the delivery of items or
services under Medicaid, within the meaning of section 1128(a)(1).
Travers v. Sullivan, 801 F. Supp. 394, 403 (E.D. Wash. 1992), aff'd
sub nom Travers v. Shalala, 20 F.3d 993 (9th Cir. 1994).
Petitioner contends also that his conviction is not related to the
delivery of an item or service under Medicaid because he is not a
provider and does not receive any direct reimbursement from the
Medicaid program. This argument is unavailing, however, since it
is well-established that mandatory exclusion is not restricted to
health care providers or physicians; it is applicable to any
individual or entity convicted of a program-related crime. Mary K.
Lyons, DAB CR49, at 6 (1989).
Once it is shown that an individual has been convicted of a
program-related crime, exclusion is mandatory under section
1128(a)(1) as a purely derivative action. In other words, it is
the fact of conviction of a relevant offense that triggers
exclusion. Consequently, the administrative law judge need not
look beyond such a conviction. Robert H. Davis, R.Ph., DAB CR285,
at 6 (1992). Nor may Petitioner utilize these administrative
proceedings to, in effect, collaterally attack his conviction by
arguing that he was guilty of a different crime than the one to
which he pled nolo contendere. See Peter J. Edmonson, DAB 1330, at
4-5 (1992).
Petitioner argues that he should be excluded, if at all, pursuant
to section 1128(b)(3) of the Act, because his conviction was
related to the unlawful prescription of a controlled substance. It
is certainly possible to characterize the offense of which
Petitioner was convicted as related to the unlawful prescription of
a controlled substance, within the meaning of section 1128(b)(3).
However, because Petitioner's conviction is related also to the
delivery of an item or service under Medicaid, I need not decide
whether section 1128(b)(3) is applicable.
As I have stated, Petitioner's conviction for causing a false
Medicaid claim to be submitted is sufficient in itself to invoke
the mandatory exclusion provisions of section 1128(a)(1). If an
individual is convicted of a criminal offense which satisfies the
requirements of section 1128(a)(1), then that section is
controlling and the I.G. must exclude the individual for a period
of not less than five years. Boris Lipovsky, M.D., DAB 1363, at 8
(1992). The fact that the criminal conviction may also appear to
satisfy the permissive exclusion criteria of section 1128(b) is
irrelevant. Id. Neither the I.G. nor the administrative law judge
has the discretion to choose, instead, to impose a permissive
exclusion pursuant to section 1128(b). Id.
Petitioner has requested an in-person hearing at which he could
present mitigating evidence. Petitioner's conviction of a criminal
offense related to the delivery of an item or service under
Medicaid subjects him to a mandatory period of exclusion of not
less than five years. In the present case, the I.G. has imposed
the minimum statutory period of exclusion. Thus, any mitigating
evidence which Petitioner might offer at an in-person hearing would
be irrelevant, since I lack authority to reduce the exclusion below
five years.
CONCLUSION
Sections 1128(a)(1) and 1128(c)(3)(B) of the Act mandate that the
Petitioner herein be excluded from the Medicare and Medicaid
programs for a period of at least five years because of his
criminal conviction for causing a false Medicaid claim to be
submitted. Such a conviction is related to the delivery of an item
or service under Medicaid, within the meaning of section
1128(a)(1). Neither the I.G. nor the judge is authorized to reduce
the five-year minimum mandatory exclusion.
The five-year exclusion is, therefore, sustained.
___________________________
Joseph K. Riotto
Administrative Law Judge
1. I cite to the parties' submissions as follows:
I.G. Brief (I.G. Br.) at (page)
Petitioner's Brief (P. Br.) at (page)
I.G. Exhibit (I.G. Ex.)
Petitioner's Exhibit (P. Ex.)
I.G. Proposed Finding (I.G. PF #)
Petitioner's Proposed Finding (P. PF #)
2. With her brief, the I.G. offered five exhibits; with his
brief, Petitioner offered two exhibits. Neither party objected to
the other's exhibits. I therefore admit I.G. Ex. 1-5 and P. Ex. 1
and 2 into evidence. By letter dated September 28, 1994, received
in this office on September 30, 1994, Petitioner offered two
additional documents. I have marked as P. Ex. 3 the document
entitled "Petition and Order for Discharge from Probation," dated
September 12, 1994. I have marked as P. Ex. 4 a letter dated
September 13, 1994, from Karen L. Ryan, Probation Officer, to LuAnn
Cheyne Frost, Assistant Attorney General. In a telephone contact
of October 4, 1994, the I.G. stated that she had no objection to my
admitting these exhibits. Therefore, I admit these exhibits in
evidence. I accord P. Ex. 3 and 4 no weight, however. These
documents are relevant, if at all, to the length of the exclusion
imposed and directed against Petitioner. As discussed more fully
below, I need not consider any evidence as to the length of
Petitioner's exclusion because the I.G. has imposed the minimum
exclusion permitted under the circumstances of this case.
3. Section 1128(i) of the Act defines the term "conviction" to
include four types of dispositions: (1) a court enters a judgment
of conviction; (2) a court makes a finding of guilt; (3) a court
accepts a plea of guilty or nolo contendere; or (4) a court
withholds entry of a judgment of conviction under a first offender
or other deferred adjudication program. Petitioner's plea of nolo
contendere and the court's action on that plea fit within the
definition of conviction at 1128(i)(3).