SUBJECT:
Judy Pederson Rogers,

Petitioner,

The Inspector General.

SUBJECT:
William Ernest Rogers,

Petitioner,

The Inspector General.

DECISION

I sustain the Inspector General's (I.G.) determination to exclude Petitioners, Judy Pederson Rogers and William Ernest Rogers, from participation in Medicare, Medicaid, and all federal health care programs, pursuant to section 1128(b)(5) of the Social Security Act (Act), until they are reinstated by the Connecticut Department of Social Services (Connecticut DSS), the state health care program that took the original action against them.

I. Background

By letters dated November 30, 2004, the I.G. notified Petitioners that they were being excluded, pursuant to section 1128(b)(5) of the Act, from participation in Medicare, Medicaid, and all federal health care programs, because they had been "excluded, suspended, or otherwise sanctioned" by Connecticut DSS, a state health care program, for "reasons bearing on [their] professional competence, professional performance, or financial integrity." The I.G. further notified Petitioners that the exclusions would remain in effect until they had been reinstated by Connecticut DSS.

Petitioners timely requested hearings and their cases were assigned to me for hearing and decision. Although Petitioners had been notified of their exclusions by separate letters dated November 30, 2004, they sought a hearing together by letter dated January 29, 2005. Thus, I held a joint prehearing conference in the two cases, by telephone, on March 28, 2005. I first ascertained that Petitioners understood that they had a right to counsel. Petitioners stated that they understood, but that they would proceed with the cases unrepresented. Petitioners also asked to have their cases heard together, but did not ask that they be consolidated, and I have not consolidated them for hearing. ⁽¹⁾ I then set a briefing schedule for the cases. However, I left open the possibility that if I could not decide the cases based on the parties' briefs and accompanying documentary evidence, or if a party requested it and I found that material facts were in dispute, I would schedule a hearing to take in-person testimony. ⁽²⁾

The parties filed briefs and documentary evidence. The I.G. filed a brief (I.G. Br.) and a reply brief (I.G. R. Br.). The I.G.'s brief was accompanied by two exhibits, I.G. exhibits (Exs.) 1 and 2. Petitioners filed a brief (P. Br.) in response to the I.G.'s brief and a sur-reply (P. R. Br.) to the I.G.'s reply. Petitioners' brief was accompanied by eight exhibits,

Petitioners' exhibits (P. Exs.) 1 through 8. The I.G. objects to Petitioners' exhibits, arguing that they are irrelevant to the cases before me as they constitute a collateral attack by re-litigating and reopening the underlying issues between Petitioners and Connecticut DSS forming the basis for the exclusions. I agree with the I.G. that these exhibits are not particularly relevant to the issues before me, except as background information with regard to Petitioners' dealings with Connecticut DSS. However, I will admit them into evidence. Thus, I.G. Exs. 1-2 and P. Exs. 1-8 are admitted.

II. Issues

The issues that I am authorized to hear by Act and regulation are limited. ⁽³⁾ They are solely whether:

1. The I.G. has a basis upon which to exclude Petitioners under section 1128(b)(5)(B) of the Act, which is premised upon whether Petitioners: (a) have been excluded, suspended, or otherwise sanctioned under a state Medicaid program and, if so, whether; b) the exclusion, suspension, or other sanction is related to Petitioners' professional competence, professional performance, or financial integrity, and whether;

2. The length of the exclusion is reasonable.

III. Findings of Fact and Conclusions of Law

I make findings of fact and conclusions of law (Findings) to support my decision in these cases. I set forth each Finding below, in italics and bold, as a separate heading.

A. Petitioners' Settlement Agreement with Connecticut DSS, a state Medicaid program, to be permanently excluded from engaging in any health care services in Connecticut, provides a basis for their exclusion under section 1128(b)(5)(B) of the Act.

Section 1128(b)(5)(B) of the Act authorizes the I.G. to exclude "any individual or entity which has been suspended or excluded from participation, or otherwise sanctioned, under . . . a State health care program, for reasons bearing on the individual's or entity's professional competence, professional performance, or financial integrity." The regulations provide further that the term "or otherwise sanctioned" is intended to cover all actions that limit the ability of a person to participate in the program at issue regardless of what an action is called, and includes situations where an individual or entity voluntarily withdraws from a program to avoid a formal sanction. 42 C.F.R. � 1001.601(a)(2).

The Departmental Appeals Board (Board) has held that to justify exclusion under section 1128(b)(5)(B), the I.G. only needs to prove that: 1) a petitioner must have been excluded or suspended from a state health care program; and 2) that the exclusion or suspension must have been for reasons bearing on the petitioner's professional competence, professional performance, or financial integrity. C. William Alexander, Ph.D., DAB CR479 (1997); George Iturralde, M.D., DAB No. 1374 (1992). Because exclusion under section 1128(b)(5)(B) is wholly derivative of suspension or exclusion under a state health care program, a petitioner may not collaterally attack the state proceeding which led to the state exclusion or suspension in a hearing before an administrative law judge. C. William Alexander, Ph.D., DAB CR479; Olufemi Okonuren, DAB No. 1319 (1992); see 42 C.F.R. � 1001.2007(d) (When the exclusion is based on . . . a determination by another Government agency . . . the basis for the underlying . . . determination is not reviewable and the individual . . . may not collaterally attack it either on substantive or procedural grounds in this appeal). Moreover, an administrative law judge is not required to determine the guilt or innocence of a petitioner with reference to the conduct on which the state action is based. C. William Alexander, Ph.D., DAB CR479; Behrooz Bassim, M.D., DAB No. 1330 (1992). As stated by the Board, "there would be no point in relying on these [state] actions if they would be reopened and relitigated during the [section 1128] exclusion proceedings." George Iturralde, M.D., DAB No. 1374, at 7; C. William Alexander, Ph.D., DAB CR479. Finally, the Board stated in Iturralde that exclusion under section 1128(b)(5)(B) is authorized where there is a "common sense connection between a state's findings and either professional competence, performance or financial integrity." George Iturralde, M.D., DAB No. 1374, at 9; C. William Alexander, Ph.D., DAB CR479.

Petitioners do not dispute that they signed a "Settlement Agreement and Consent Order" (Agreement) with Connecticut DSS, a state health care program, in which they "voluntarily agree[d] to permanently refrain from engaging in any health care services or related administration of such services within the State of Connecticut." I.G. Ex. 2, at 4. The preamble of the Agreement states that Petitioners, through their businesses J.P. Rogers and Associates, Inc. (JPR), a home health agency, and J.P. Rogers Pharmacy, Inc. (JPRP) a medical equipment, devices and supplies company, were providers in the Connecticut Medicaid program. ⁽⁴⁾ Petitioner Judy Pederson Rogers was the co-owner and president of these companies and Petitioner William Ernest Rogers was the co-owner and vice-president. The preamble states that audits conducted of these businesses identified exceptions that led to disallowance of payments and that Connecticut DSS notified Petitioners of its intent to recoup overpayments. Petitioners filed a request for administrative hearing based on the Connecticut DSS decision. The preamble asserts that the audit findings and a subsequent investigation led Connecticut DSS to issue a notice of regulatory violations and proposed sanctions (notice of violations) against Petitioners alleging violations of law and causing Connecticut DSS to make overpayments to Petitioners' businesses. ⁽⁵⁾ Petitioners denied the violations. The preamble states that Connecticut DSS then determined to commence an administrative hearing based on the notice of violations. The preamble then states that since complex legal and factual questions involving the administrative hearing and the respondents' defenses existed, and that resolution of the issues by means of litigation would be time consuming and costly for the parties, the parties agreed to resolve the dispute to avoid further litigation. The preamble also states that Petitioners' performance of the Agreement did not constitute an admission of the allegations contained in the notice of violations or of any violation of law by Petitioners. I.G. Ex. 2, at 1-3. However, Petitioners specifically agreed that the Agreement "shall be in lieu of a final decision on said issues . . . shall have the same force and effect of law as an Order entered into as a final decision after a full hearing with Findings of Fact and Conclusions of Law . . . [Petitioners further agreed] that they waive all rights to seek judicial review or otherwise contest or challenge the validity of the Consent Order entered into pursuant to this Settlement Agreement . . . [the] Settlement Agreement shall be governed by the laws of the State of Connecticut [and the] parties agree that exclusive jurisdiction and venue for any dispute arising under this Settlement Agreement shall be the Superior Court for the Judicial District of Hartford." I.G. Ex. 2, at 7-8.

With reference to this Agreement, Petitioners now argue passionately before me that they were coerced by circumstances into signing the Agreement and that it was not signed voluntarily. Their briefs expand on the specifics of this argument, by asserting essentially that Petitioners were victimized by Connecticut DSS and lack of resources into signing the Agreement. Whether or not the circumstances asserted by Petitioners are true, however, I do not have the authority to reopen the Agreement and look behind its terms. Petitioners' arguments are impermissible collateral attacks on the Connecticut proceedings which resulted in the Agreement. As noted above, my authority under section 1128(b)(5)(B) is wholly derivative of state proceedings and I am not authorized to reopen and relitigate those proceedings. See C. William Alexander, Ph.D., DAB CR479; 42 C.F.R. � 1001.2007(d). I am only authorized to examine the results of state proceedings to determine if those proceedings give the I.G. the authority to exclude Petitioners under section 1128(b)(5)(B). ⁽⁶⁾

The Agreement signed by Petitioners shows that Petitioners agreed to permanently withdraw from providing health care services in the State of Connecticut, including providing services to Connecticut Medicaid recipients, in the face of an administrative hearing. The notice of violations on which the hearing was to be based dealt with allegations that Petitioners made false statements or representations, obstructing Connecticut DSS's ability to review the medical necessity and proper coverage of services to compute reimbursement, failed to comply with applicable law and policy governing reimbursement for goods or services provided to Medicaid recipients, and accepted payment for goods or services provided to Medicaid recipients exceeding the amount of goods or services actually supplied. I am not authorized to reopen the Connecticut proceedings to determine whether or not these allegations are true. I am only authorized to determine whether, in fact, Petitioners were otherwise sanctioned by Connecticut DSS by agreeing to be permanently excluded by Connecticut DSS for reasons bearing on their professional competence, performance or financial integrity. There is no question under the Agreement that Petitioners were otherwise sanctioned as they agreed to be permanently excluded from engaging in health care services or the related administration of such services in Connecticut. Moreover, a common sense connection with professional competence, professional performance, or financial integrity is obvious and exists in the notice of violations which encompasses all three elements, as the violations noted include their professional competence (for example, failure to comply with applicable law and policy); performance (for example, failure to comply with applicable law and policy); and financial integrity (for example, accepting payment for goods or services exceeding the amount of goods or services actually supplied). It is irrelevant to my decision that Petitioners did not admit the truth of the allegations in the Agreement. The only relevant fact is that they withdrew from providing health care services in the State of Connecticut in the face of an administrative hearing which concerned their professional competence, professional performance, and financial integrity. Thus, I find that the Agreement signed by Petitioners authorizes the I.G. to exclude Petitioners and that there are no material facts raised by Petitioners that I can consider which would necessitate an in-person hearing.

B. The length of Petitioners' exclusion is reasonable as a matter of law.

Section 1128(c)(3)(E) of the Act provides that where an individual is excluded under section 1128(b)(5) the period of the exclusion is not to be less than the period during which the individual is excluded from a state health care program. 42 C.F.R. � 1001.601(b)(1). The I.G. has excluded Petitioners until such time as Petitioners have been reinstated by Connecticut DSS. Such exclusions are reasonable as a matter of law.

IV. Conclusion

I find that the I.G. had the authority to exclude Petitioners, pursuant to section 1128(b)(5)(B) of the Act, because they were "otherwise sanctioned" by Connecticut DSS for reasons bearing on their professional competence, professional performance, and financial integrity. Further, the length of the exclusions imposed is reasonable as a matter of law.

Anne E. Blair

Administrative Law Judge

1. I have, however, heard the cases together and I am issuing a joint decision as the facts and analysis in the cases are identical.

2. In their brief, Petitioners asked for an in-person hearing. P. Br. at 10. However, I am denying Petitioners' request because there are no material facts in dispute in this case. The facts Petitioners assert to be in dispute, as discussed below, all relate to actions of the Connecticut DSS which are not in contention in this proceeding given the limited nature of my authority under the Act and implementing regulations.

3. Petitioners have asserted that they have a Constitutional right of due process to appeal the results of unregulated audits by Connecticut DSS upon which their exclusions are based. P. Br. at 3-4. I note that under the Settlement Agreement the proper venue for a dispute under the Agreement is the Superior Court for the Judicial District of Hartford. I.G. Ex. 2, at 8. Moreover, administrative law judges do not have the authority to rule on the constitutionality or validity of the exclusion provisions of the Act. See Susan Malady, DAB CR835, at 5 (2001), aff'd DAB No. 1816 (2002); Mannochio v. Kusserow, 961 F.2d 1539 (11 ^th Cir. 1992); 42 C.F.R. � 1005.4(c)(i).

4. In fact, Petitioners state that JPR and JPRP depended upon Connecticut Medicaid for nearly all of their revenue. P. Br. at 3.

5. The notice of violations stated that Connecticut DSS was proposing sanctions against Petitioners for violating laws, rules, and regulations governing reimbursement for Medicaid payments of the Connecticut Medical Assistance Program (Connecticut Medicaid). The specific conduct alleged in the notice of violations included Petitioners': 1) knowingly and willfully making or causing to be made false statements or representations of material facts for the purpose of claiming or determining payment for the services provided to Medicaid recipients by JPR and JPRP; 2) impeding, impairing, and obstructing Connecticut DSS's ability to effectively ascertain, assess, and review the medical necessity and proper coverage of services, and correctly compute the appropriate level of reimbursement, for claims submitted by JPR and JPRP for services furnished to Medicaid recipients; 3) failing to comply with applicable laws, rules, regulations and policies governing reimbursement for costs of goods and services furnished by enrolled . . . providers to Medicaid recipients, including those laws and regulations pertaining to the maintenance of records and submission of claims such that would fully disclose the extent of necessary services provided to Medicaid recipients and to permit an audit of those records and claims; and 4) accepting payment for goods and/or services provided to recipients of the Medicaid program which exceeded the amount of goods and services actually provided. CMS Ex. 1, at 12-13.

6. I note that the Agreement itself gives exclusive jurisdiction to the Superior Court for the Judicial District of Hartford as the venue for any dispute arising under the Agreement.