SUBJECT: Sharon R. Anderson, D.P.M.,

Petitioner,

The Inspector General

FINAL DECISION ON REVIEW OF

ADMINISTRATIVE LAW JUDGE DECISION

Sharon R. Anderson, D.P.M. (Dr. Anderson), appealed the July 10, 2001 decision of Administrative Law Judge Alfonso J. Montano, dismissing as untimely filed her request for a hearing on her exclusion from Medicare and State health care programs. Sharon R. Anderson, D.P.M., CR793 (2001) (ALJ Decision). On appeal, Dr. Anderson alleged that the ALJ erred --

• by holding that Dr. Anderson was not entitled to notice and opportunity for hearing "concerning the May 16, 2000, notice of exclusion";
• by failing to "consider, much less find, that any alleged waiver by Petitioner contained in the 1994 Settlement Agreement was of no effect . . ."; and
• by failing to "consider, much less find, that Respondent, in reinstating Petitioner by its letter dated July 11, 1994, explicitly agreed to provide her with notice and an opportunity to be heard regarding any reimposition of the exclusion."
  

Notice of Appeal at 1-2. Dr. Anderson requested that the Board reverse and remand the case for a full hearing on the merits, or, at a minimum, remand for further proceedings, including reopening this matter for additional evidence and argument, on the issue of jurisdiction. P. Appeal Br. at 2.

Dr. Anderson has had ample opportunity to make her case on jurisdiction (including in an unsolicited reply brief which we accept into the record). The written record fully supports the ALJ's findings in this matter and establishes that dismissal was proper. We grant review for the limited purpose of addressing her arguments that the ALJ clearly rejected, but did not explicitly address.

For the reasons stated below, we conclude that Dr. Anderson's allegations have no merit. Accordingly, we affirm the ALJ Decision dismissing her request for hearing.

1. The ALJ did not err in finding that the May 16, 2000 letter gave notice of reinstatement of an exclusion that had previously been stayed, and was not an appealable notification of exclusion.

Dr. Anderson's argument is premised on her assertion that the May 16, 2000 letter from the Office of the Inspector General (I.G.) to her was a notice excluding her based on her alleged failure to repay a Health Education Assistance Loan (HEAL). The ALJ found, however, that the May 16, 2000 notice was simply a notice that an exclusion that had previously been imposed and stayed pursuant to a Settlement Agreement dated June 20, 1994 had been reinstated. This is clear on the face of the May 16 notice (submitted by Dr. Anderson with her request for hearing and as I.G. Exhibit 1). Dr. Anderson's attempt to read this letter as a notice of exclusion is unreasonable.

The right to notice and an opportunity for a hearing on an exclusion for failure to pay a HEAL debt arises under section 1128(f) of the Social Security Act (Act), 42 U.S.C. � 1320a-7(f). That section provides that "any individual or entity that is excluded (or directed to be excluded) from participation under this section is entitled to reasonable notice and an opportunity for a hearing . . . ." Under the regulations implementing that section, the notice that triggers the time period for requesting a hearing on an exclusion for defaulting on a HEAL debt is the notice described in 42 C.F.R. � 1001.2002. See, also, 42 C.F.R. � 1001.1501. That notice will be sent "if the OIG determines that exclusion is warranted, . . ." 42 C.F.R. � 1001.2002(a). The notice must state, among other things, the basis for and length of the exclusion. The issues that may be raised in a hearing are generally limited to whether there is a basis for the exclusion and whether the length of the exclusion is reasonable. 42 C.F.R. � 1001.2007(a)(1).

Dr. Anderson did not point to any statutory or regulatory provision specifically according a hearing right when a stay of the effect of an exclusion pursuant to a Settlement Agreement has been lifted. She argued instead that section 1128(f) of the Act draws no distinction between the act of lifting a stay of an exclusion and the act of imposing an exclusion. While section 1128(f) of the Act does not explicitly draw such a distinction, it requires only that "an opportunity for a hearing" be afforded. Section 1001.2002 of the implementing regulations offers that opportunity in response to the notice issued at the time the I.G. determines that an exclusion is warranted. Reading the statute and regulations to afford a petitioner two opportunities to challenge whether there was a basis for exclusion is unreasonable.

The I.G. submitted to the ALJ a copy of a notice of Dr. Anderson's exclusion, meeting the requirements of 42 C.F.R. � 1001.2002, dated September 20, 1993. I.G. Ex. 5. Under the regulations, the time for requesting a hearing was 60 days after receipt of this notice. 42 C.F.R. �� 1001.2007(b); 1005.2(c). Receipt of such notice is deemed to be five days after the date of the notice, unless there is a reasonable showing to the contrary. 42 C.F.R. � 1005.2(c).

Dr. Anderson asserted for the first time on appeal that she did not receive the September 1993 notice. For the following reasons, we conclude that Dr. Anderson is not entitled to a hearing on this assertion and that substantial evidence in the record supports the ALJ findings that she did have notice in 1993 of her exclusion, but that she did not timely appeal:

• While she now offers generally to present evidence to support her assertions regarding jurisdiction, Dr. Anderson did not before the ALJ even assert that she did not receive the September 20, 1993 notice, much less offer any affidavit or other evidence to support such an assertion. See Petitioner's Opposition to Inspector General's Motion to Dismiss at 1.
• In support of its motion to dismiss, the I.G. submitted a copy of the Settlement Agreement, which specifically states that Dr. Anderson was notified of her exclusion in 1993. I.G. Ex. 6.⁽¹⁾ Yet, she did not assert that she filed a request for an administrative hearing in response to that notice at any time before August 14, 2000.
• Dr. Anderson admitted that the signature on the Settlement Agreement document is hers. P. Appeal Br. at 6, n.2. Although she asserted that she cannot recall signing anything other than a repayment agreement and that she was under duress at the time, she submitted no affidavit to the ALJ to support these assertions, nor did she offer testimony to the ALJ to support these assertions.

In light of these factors, the ALJ did not err in concluding that Dr. Anderson did not make a "reasonable showing" to overcome the regulatory presumption that she received the September 20, 1993 notice on September 25, 1993.

An opportunity for a hearing is all that the statute and regulations require. Dr. Anderson had that opportunity and did not timely exercise her hearing right.

2. Substantial evidence supports the ALJ findings regarding the waiver, but in any event, these findings are not necessary to the decision.

The ALJ concluded that --

even if Petitioner had timely filed a request for hearing, she voluntarily waived her right to further notice and any appeal rights when she executed the June 24, 1994 Agreement with the United States and, then, subsequently defaulted on her obligations under the Agreement.

ALJ Decision at 7, citing I.G. Exs. 6, 22, 23, and 1.

Dr. Anderson argued that the ALJ erred by relying on the waiver in the Settlement Agreement (entered into in California) without considering whether the waiver was valid under California law. She cited California court cases for the proposition that, to be valid, a waiver of rights must be voluntary and the party executing it must be fully informed of (1) the existence of the right being waived; (2) the meaning of the waiver; (3) the effect of the waiver; and (4) a full understanding of the explanation of the waiver. P. Appeal Br. at 12 -14.

Although the ALJ did not specifically address Dr. Anderson's arguments regarding California law, the ALJ did find that the waiver was voluntary. ALJ Decision at 7. Substantial evidence in the record supports this finding since the Settlement Agreement contains a provision to that effect and Dr. Anderson offered no evidence below to support her allegation of duress. Moreover, as noted above, Dr. Anderson did not dispute before the ALJ that she received the September 20, 1993 letter, which fully explained the appeal rights available to her.

In any event, we need not resolve the issue of whether it was error to rely on the waiver as valid since finding a waiver was not necessary in order to support the dismissal. The only right to a hearing that Dr. Anderson had arose from the exclusion action in 1993. She failed to timely exercise that right or to make a reasonable showing that she did not receive notice of the action and of the existence of a right to a hearing. Even if she signed the Settlement Agreement under duress as she alleged, and her waiver of the right was not voluntary, the Settlement Agreement nonetheless evidences that she did receive notice of the right at least by June 1994.

3. The ALJ did not err by failing to find that the I.G. had agreed to afford Dr. Anderson notice and an opportunity for hearing if the stay were lifted.

Dr. Anderson relied on a statement in a July 11, 1994 letter from the I.G. as an agreement by the I.G. to afford her a hearing if the stay of the exclusion were lifted. That letter informed her that her exclusion had been stayed because she had entered into a repayment agreement and stated:

Failure to adhere to the terms of the repayment agreement will result in the stay's being lifted and the exclusion's going back into effect in accordance with the terms outlined in our letter to you.

I.G. Ex. 21. According to Dr. Anderson, this refers to the September 20, 1993 notice, which set out her hearing rights, and therefore constitutes an agreement by the I.G. to grant her a hearing on the "reimposition" of the exclusion in May 2000. She further argued that the I.G. should be estopped from denying her right to a hearing because of this statement. Dr. Anderson acknowledged that equitable estoppel does not generally lie against the Federal Government, but argued that it should apply here because the I.G. engaged in "affirmative misconduct" by sending the May 16, 2000 letter and other documents to an outdated address. P. App. Br. at 17, citing Office of Personnel Management v. Richmond, 496 U.S. 414 (1990).

While the ALJ should perhaps have addressed these arguments explicitly since they were made below, he did implicitly reject them. We conclude that the arguments lack merit, for the following reasons:

• In context, the statement in the July 11, 1994 letter refers to the previous letter for the effect of the exclusion and does not purport to alter the terms of the stay of that exclusion.
• As the ALJ pointed out, the Settlement Agreement specifically stated that it "contains a complete description of the bargain between the parties" and contains "[a]ll material representations, understandings and promises of the parties concerning the stay of the exclusion . . . ." I.G. Ex. 6, at 3.⁽²⁾
• The Settlement Agreement further provided that the exclusion would go back into effect if Dr. Anderson defaulted on the payment schedule to which she agreed and that she waived "all" rights to a hearing. Id. at 2.
• In light of the statements in the Settlement Agreement, Dr. Anderson could not reasonably rely on the statement in the I.G. letter, even if it did provide something different from the Settlement Agreement.
• Dr. Anderson's own assertion that she never received the September 23, 1993 notice calls into question her supposed reliance on its terms being incorporated by reference into the July 11, 1994 letter.
  

Dr. Anderson also attempted to raise fairness and due process considerations, arguing that surely she should have an opportunity to contest the May 16, 2000 action since it was unfairly made "retroactive" to May 1, 2000, and will cost her thousands of dollars that she is owed for Medicare and Medicaid services she provided before she received notice of the action.

This argument also lacks merit. Both the Settlement Agreement and the July 11, 1994 letter clearly informed Dr. Anderson of what the effect of the exclusion was and that this effect would be stayed only so long as she complied with the Settlement Agreement by making monthly payments on her debt. She did not deny that she did not comply.⁽³⁾ The I.G. provided evidence that she made very few payments. I.G. Ex. 24. Given her clear knowledge that she was not complying, she could not reasonably count on the stay of the effect of the exclusion as a basis for thinking she was entitled to Medicare and Medicaid payments -- in the Settlement Agreement, she acknowledged that the "Agreement provides for a stay of the effect of the exclusion while the debtor is in compliance with its terms." I.G. Ex. 6, at 2.

While the I.G. perhaps should have checked for a more current address for Dr. Anderson before sending her the May 16, 2000 letter, this hardly constitutes affirmative misconduct given that, under the Settlement Agreement, the exclusion should have automatically gone back into effect when Dr. Anderson breached the terms of the Settlement Agreement by failing to pay according to schedule. In effect, the May 16, 2000 letter was not even an adverse action, since it changed the terms of the Settlement Agreement in Dr. Anderson's favor, by stating that the effect of the exclusion was reinstated only as of May 1, 2000 rather than as of when she first failed to comply with the Settlement Agreement.

Conclusion

For the reasons stated above, we affirm the ALJ Decision dismissing Dr. Anderson's request for a hearing.

Marc R. Hillson

M. Terry Johnson

Judith A. Ballard
Presiding Board Member

1. The Settlement Agreement refers to a notice dated August 25, 1993, which is the date given on a document referred to as Certificate of Indebtedness, rather than the notice of exclusion. Compare I.G. Ex. 6 and I.G. Ex. 18. Both documents were sent to the same address, however. Moreover, even if this erroneous date somewhat undercuts the I.G.'s reliance on the Settlement Agreement as evidencing that Dr. Anderson received the September 1993 notice, the Settlement Agreement itself gives notice of a hearing right. Yet, she never attempted to exercise that right prior to August 14, 2000.

2. Dr. Anderson questioned whether the I.G. was a party to the Settlement Agreement, but provided no reason for doubting that the U.S. Attorney was representing all affected government agencies. By agreeing to stay the effect of the exclusion imposed by the I.G., the U.S. Attorney was holding himself out as having the authority to do so.

3. While Dr. Anderson alleged vaguely that the I.G. had agreed to offset against her HEAL debt $30,000 in Medicare payments that were due to her in 1994 and that this was sufficient to pay all that she owed, this allegation was not supported by any affidavit or documentary evidence and is contradicted by documents submitted by the I.G. Those documents show that she owed substantially in excess of this amount at the time the judgment was obtained against her in 1994 as well as in August 1993 and that she only made minimal other payments in 1994. I.G. Exs. 18, 19, 20, and 24. Moreover, she continued to make some payments in subsequent years (albeit sporadically), which is inconsistent with her assertion that she believed her debt was paid in full. I.G. Ex. 24.