Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of:
Arnulfo Rodriguez, M.D.,
Petitioner,
- v. -
The Inspector General.
DATE: May 22, 1992
Docket No. C-92-029
DECISION
By letter dated November 4, 1991, the Inspector General (I.G.) notified Arnulfo
Rodriguez, M.D.
(Petitioner) that he would be excluded from participation in the Medicare program
and any federally-
assisted State health care program (such as Medicaid) as defined in section
1128(h) of the Social Security
Act (Act), for a period of five years. 1/ The I.G. further advised Petitioner
that his exclusion was due to his
federal conviction of a criminal offense related to the delivery of an item
or service under the Medicaid
program.
Petitioner timely requested a hearing before an Administrative Law Judge (ALJ)
to contest his exclusion.
The case was assigned to me for hearing and decision. The I.G. filed a motion
for summary judgment, and
Petitioner filed a response.
On January 29, 1992, the Secretary of the Department of Health and Human Services
(DHHS) published
new regulations containing procedural and substantive provisions affecting exclusion
cases. I gave the
parties the opportunity to submit comments on the issue of what, if any, effect
these regulations might have
on the outcome of this case. The parties did not comment. I find that the new
regulations do not affect my
decision in this case.
I have considered the parties' arguments, the documentary evidence submitted,
and the applicable federal
law and regulations. I conclude that there are no disputed questions of material
fact that would require an
evidentiary hearing. I further conclude that the exclusion imposed and directed
by the I.G. in this case is
mandated by law. Therefore, I enter summary disposition in favor of the I.G.
ISSUES
The remaining issues in this case are:
1. Whether Petitioner was "convicted" of a criminal offense, within
the meaning of section 1128(i) of the
Act.
2. Whether Petitioner was convicted of a criminal offense "related to
the delivery of an item or service,"
within the meaning of section 1128(a)(1) of the Act.
3. Whether Petitioner is subject to the minimum mandatory exclusion provisions
of sections 1128(a)(1)
and 1128(c)(3)(B) of the Act.
FINDINGS OF FACT AND CONCLUSIONS OF LAW 2/
Having considered the entire record, the arguments and the submissions of the
parties, and being advised
fully herein, I make the following Findings of Fact and Conclusions of Law:
1. Petitioner is a physician who is licensed to practice medicine in the State
of New York and who
specializes in internal medicine and pulmonary diseases. I.G. Ex. 10. 3/
2. In an undated superseding indictment filed in the United States District
Court for the Eastern
District of New York (District Court), Petitioner was charged with four criminal
counts. I.G. Ex. 1.
3. Count One alleged that Petitioner and a co-conspirator did knowingly and
intentionally combine,
conspire, and agree to violate "Section 1001 of Title 18, United States
Code," by knowingly, willfully, and
unlawfully making false, fictitious, and fraudulent statements on forms to insurance
carriers under
government contract to DHHS, so that payments under the Medicare program would
be made to one of the
conspirators. I.G. Ex. 1.
4. Counts Two through Four of the superseding indictment alleged that Petitioner
did knowingly and
willfully solicit and receive from another remuneration, in return for ordering
and arranging for the
ordering of one or more items for which payment may be made in whole or in part
under the Medicaid and
Medicare programs. I.G. Ex. 1.
5. On June 1, 1990, after a jury trial in the District Court, Petitioner was
convicted of one felony
count of receiving a kickback in exchange for ordering medical equipment for
which reimbursement could
be made under the Medicare and Medicaid programs, in violation of 42 U.S.C.
1320a-7(b)(1)(B).
Petitioner was not found guilty as to the other three counts and they were discharged.
I.G. Ex. 2.
6. Imposition of sentence of incarceration was suspended. Petitioner was not
placed on probation.
I.G. Ex. 2/2.
7. Petitioner was ordered to pay a fine of $3,000 and a special assessment of $50. I.G. Ex. 2/4.
8. On April 25, 1991, the judgment of the District Court was affirmed by the
United States Court of
Appeals for the Second Circuit. I.G. Ex. 3.
9. Petitioner was "convicted" of a criminal offense "related
to the delivery of an item or service"
under Medicaid. FFCL 5-8.
10. The Secretary of Health and Human Services delegated to the I.G. the authority
to determine,
impose, and direct exclusions pursuant to section 1128(a)(1) of the Act.
11. On November 17, 1991, the I.G. excluded Petitioner from participating in
Medicare and directed
that he be excluded from Medicaid, pursuant to section 1128(a)(1) of the Act.
12. There are no disputed issues of material fact in this case and summary disposition is appropriate.
13. The exclusion imposed and directed against Petitioner is for five years,
the minimum period
required under the Act. Act, sections 1128(a)(1) and 1128(c)(3)(B).
14. The exclusion imposed and directed against Petitioner by the I.G. is mandated
by law. FFCL 1-
10; Act, sections 1128(a)(1) and 1128(c)(3)(B).
15. Neither the I.G. nor the ALJ has the discretion or authority to reduce
the five-year minimum
exclusion mandated by section 1128(c)(3)(B) of the Act.
DISCUSSION
I. Petitioner was "convicted" of a criminal offense as a matter of federal law.
Section 1128(a)(1) of the Act mandates 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].
Section 1128(c)(3)(B) provides that the minimum term for any exclusion imposed
under section 1128(a)(1)
is five years.
The first criterion that must be satisfied in order to establish that the I.G.
had the authority to exclude
Petitioner under section 1128(a)(1) is that Petitioner was convicted of a criminal
offense. Petitioner does
not dispute that he was convicted of a criminal offense, within the meaning
of the Act. Section 1128(i)
defines the term "convicted" of a criminal offense to include those
circumstances when a judgment of
conviction has been entered against an individual by a federal, State, or local
court, regardless of whether
there is an appeal pending. The undisputed facts establish that, after a jury
trial, Petitioner was adjudged
guilty of a felony count related to Medicaid fraud. I.G. Ex. 2. Further, the
United States Court of Appeals
for the Second Circuit affirmed the District Court. I conclude that Petitioner
was "convicted," within the
meaning of sections 1128(i) and 1128(a)(1) of the Act.
II. Petitioner was convicted of a criminal offense "related to the delivery
of an item or service" under
the Medicare or Medicaid programs.
Having concluded that Petitioner was "convicted" of a criminal offense,
I must determine whether the
criminal offense which formed the basis for the conviction 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.
I find and conclude that Petitioner's criminal offense was "related to
the delivery of an item or service"
under the Medicaid program. The name of the criminal offense which formed the
basis of Petitioner's
conviction was "Medicaid Fraud." I.G. Ex. 2. The subsection of the
statute under which Petitioner was
convicted provides:
Whoever knowingly and willfully solicits or receives any remuneration (including
any kickback,
bribe, or rebate) directly or indirectly, overtly or covertly, in cash or in
kind--in return for purchasing,
leasing, ordering, or arranging for or recommending purchasing, leasing, or
ordering any good, facility,
service, or item for which payment may be made in whole or in part under subchapter
XVIII of this chapter
or a State health program, shall be guilty of a felony upon conviction thereof.
42 U.S.C. 1320a-7b(b)(1)(B).
Petitioner states that he is innocent of all charges and that he has not committed
fraud against any health
care program, even though he was convicted. P. Pet. 1. 4/ Petitioner contends
that he was the victim of a
dishonest man (i.e., the co-conspirator who was not indicted). P. Pet. 1. Petitioner
also argues that the
I.G.'s exclusion did not take into consideration the degree of the offense,
since he allegedly accepted a
$500 bribe. P. Pet. 1. Petitioner further avers that the I.G.'s exclusion is
draconian, unjustified, and
excessive. P. Pet. 1. Petitioner contends that there was no impropriety in his
billing practices and that he
was one of the lowest Medicare and Medicaid billers in Brooklyn. P. Pet. 1.
In support of his contentions,
Petitioner provided a letter written by his wife to the judge presiding over
his trial in the District Court. P.
Pet. 5.
Petitioner was adjudged guilty after a jury trial of one count of receiving
a kickback in exchange for
ordering medical equipment for which reimbursement could be made under the Medicaid
and Medicare
programs, in violation of 42 U.S.C. 1320a-7(b)(1)(B). I.G. Ex. 2. Specifically,
Petitioner was found
guilty of knowingly and wilfully soliciting and receiving $500 from a medical
supplier in return for
certifying that there was a medical need for breathing equipment. I.G. Ex. 1/2,
/5. Petitioner allegedly
filled out or caused to be filled out the necessary forms indicating that a
certain medical test had been
performed and that the result of that test demonstrated the medical need for
the breathing equipment. I.G.
Ex. 1.
That section of the statute under which Petitioner was convicted is titled
"Criminal Penalties for Acts
Involving Medicare or State Health Care Programs." Both the section under
which he was convicted,
section 1320-7B(b)(1)(B), and the section under which he was excluded section
1128(a)(1), involve crimes
against the Medicare and Medicaid programs. On June 1, 1990, the District Court
entered judgment
against Petitioner, imposing a $3,000 fine together with a $50 special assessment
fee. I.G. Ex. 2.
The Act does not define what it means to be "related to" the delivery
of an item or service under Medicare
or Medicaid. However, case law has consistently held that a criminal offense
falls within the reach of
section 1128(a)(1) of the Act where the delivery of an item or service is an
element in the chain of events
giving rise to the offense. For example, in Jack W. Greene, DAB 1078 (1989),
aff'd sub nom., Greene v.
Sullivan, 731 F. Supp. 835 and 838 (E.D. Tenn. 1990), an appellate panel of
the Departmental Appeals
Board held that a conviction for submission of a false Medicaid claim met the
statutory test established by
section 1128(a)(1) of the Act. In reaching this conclusion, the appellate panel
reasoned:
the submission of a bill or claim for Medicaid reimbursement is the necessary
step, following the
delivery of the item or service, to bring the "item" within the purview
of the program.
DAB 1078 at 7. Under this analysis, the appellate panel reasoned that but for
the delivery of the Medicaid
item or service, a false bill for the item or service would not have been submitted.
Since the delivery of the
item or service is an element in the chain of events giving rise to the offense
of false billing, the billing
offense is "related to" the delivery of the Medicaid item or service.
See Charles W. Wheeler and Joan K.
Todd, DAB 1123 (1990).
III. A five-year exclusion is required in this case.
Sections 1128(a)(1) and 1128(c)(3)(B) of the Act require the I.G. to exclude
individuals and entities from
the Medicare and Medicaid programs for a minimum period of five years, when
such individuals and
entities have been "convicted" of a criminal offense "related
to the delivery of an item or service" under the
Medicare or Medicaid programs. 5/
On March 15, 1992, Petitioner forwarded a letter from the Cumberland Neighborhood
Family Care Center,
endorsing Petitioner for Medicaid privileges and stating that it would be devastating
to the administration
of their HIV program to lose Petitioner. Although I am sympathetic to the Center's
stated need, Petitioner
was "convicted" of a criminal offense and it was "related to
the delivery of an item or service" under the
Medicaid program, within the meaning of sections 1128(a)(1) and (i) of the Act.
Thus, the I.G. was
required by section 1128(c)(3)(B) of the Act to exclude Petitioner for a minimum
period of five years.
Neither the I.G. nor the ALJ has discretion to reduce the mandatory minimum
five-year period of
exclusion. See Greene v. Sullivan, 731 F. Supp. 835 and 838 (E.D. Tenn. 1990);
Charles W. Wheeler,
DAB CR28 (1989), aff'd, Charles W. Wheeler and Joan K. Todd, DAB 1123 (1990).
IV. Summary disposition is appropriate in this case.
The issue of whether the I.G. had the authority to exclude Petitioner under
section 1128(a)(1) is a legal
issue. I have concluded as a matter of law that Petitioner was properly excluded
and that the length of his
exclusion is mandated by law. There are no genuine issues of material fact which
would require the
submission of additional evidence, and there is no need for an in-person evidentiary
hearing in this case.
Accordingly, the I.G. is entitled to summary disposition as a matter of law.
Charles W. Wheeler and Joan
K. Todd, DAB 1123 (1990).
CONCLUSION
Based on the law and undisputed material facts in the record of this case,
I conclude that the I.G. properly
excluded Petitioner from the Medicare and Medicaid programs pursuant to section
1128(a)(1) of the Act,
and that the minimum period of exclusion for five years is mandated by federal
law. Therefore, I sustain
the five-year exclusion imposed and directed against Petitioner.
___________________________
Charles E. Stratton
Administrative Law Judge
1. "State health care program" is defined by section 1128(h) of the
Act to cover three types of federally-
assisted programs, including State plans approved under Title XIX of the Act
(Medicaid). I use the term
"Medicaid" hereafter to represent all State health care programs from
which Petitioner was excluded.
2. 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.
3. Citations to the record in this decision are as follows:
Petitioner's Petition P. Pet. (page)
I.G.'s Exhibits I.G. Ex. (number)/(page)
I.G.'s Brief I.G. Br. (page)
Findings of Fact and FFCL (number)
Conclusions of Law
4. In a letter dated February 21, 1991, Petitioner requested a waiver of his
exclusion so that he could
continue working at an AIDS clinic at Cumberland Hospital, Brooklyn, New York.
I informed Petitioner
that I could not grant him that type of relief and advised Petitioner of the
proper procedure for seeking a
waiver, which is provided for at 42 C.F.R. 1001.1801.
5. The I.G. also addressed the issue of whether a permissive exclusion is appropriate
in this case. I.G. Br.
11. The I.G. contends that this issue was raised by Petitioner's representative
after Petitioner received his
Notice determination. See I.G. Ex. 8. Petitioner appeared in this proceeding
pro se. I conclude that I need
not address the issue regarding the permissive exclusion, since I find and conclude
that Petitioner was
convicted of a criminal offense related to the delivery of an item or service,
within the meaning of section
1128(a)(1) of the Act.