DEPARTMENT OF HEALTH AND HUMAN SERVICES
Departmental Appeals Board
Civil Remedies Division
In the Case of: Kenneth Krulevitz, M.D., Petitioner,
- v.-
The Inspector General.
DATE: April 20, 1989
Docket No: C-75
DECISION AND ORDER
The Petitioner requested a hearing (Request) to contest the Inspector General's
(I.G.'s) determination to
exclude him from participation in Medicare and from participation in State health
care programs (e.g.
Medicaid), for a period of five years. The I.G. then filed a motion for dismissal
of the Request and, in the
alternative, for summary disposition.
APPLICABLE STATUTES AND REGULATIONS
I. Federal Statutes
This case is governed by section 1128 of the Social Security Act (Act); section
1128 is codified at 42
U.S.C. Section 1320a-7 (West U.S.C.A. Supp., 1988). Section 1128(a)(1) of the
Act provides for the
exclusion from Medicare, and a directive to the State to exclude from Medicaid,
any individual or entity
who is "convicted of a criminal offense related to the delivery of an item
or service" under the Medicare or
"any State health care" program. Section 1128(i)(3) provides that
a physician or other individual is
considered to have been "convicted" of a criminal offense when "a
plea of guilty or nolo contendere by the
physician or individual has been accepted by a Federal, State, or local court.
. . ."
Section 1128 (c)(3)(B) provides that the period of exclusion from Medicare
and Medicaid, for conviction
of a criminal offense related to the delivery of an item or service, shall be
for a minimum period of five
years.
II. Federal Regulations
The governing federal regulations (Regulations) are codified in 42 C.F.R. Parts
498, 1001, and
1002(1987). Part 498 governs the procedural aspects of this exclusion case and
Parts 1001 and 1002
govern the substantive aspects.
Section 1001.123(a) requires the I.G. to issue an exclusion notice to an individual
whenever the I.G. has
"conclusive information" that such individual has been convicted of
a crime related to the delivery of a
Medicare or Medicaid item or service; such exclusion must begin "15 days
from the date on the notice."
In accordance with section 498.5(i), a practitioner, provider, or supplier
who has been excluded from
program coverage is "entitled to a hearing before an ALJ (Administrative
Law Judge)." Pursuant to section
1001.128, an individual who has been excluded from participation has a right
to request a hearing before
an ALJ on the issues of whether: (1) he or she was, in fact, convicted; (2)
the conviction was related to his
or her participation in the delivery of medical care or services under the Medicare,
Medicaid, or social
services program; and (3) the length of the exclusion is reasonable.
BACKGROUND
By letter dated October 11, 1988 (Notice), the I.G. notified the Petitioner
that, as a result of his conviction
of a criminal offense related to the delivery of an item or service under Medicaid,
he would be excluded
from participation in Medicare and Medicaid for a mandatory five year period,
commencing 20 days from
the date of the Notice.
In his December 8, 1988 Request, the Petitioner requested a hearing on the
issues of (1) whether he was
convicted, as that term is defined by the Act, (2) whether the acquisition and
use of evidence and witnesses
during the State's investigation was improper, and (3) whether there are factors
of emotional and financial
hardship which would mitigate the period of exclusion.
I conducted a telephone prehearing conference on January 17, 1989, during which
the I.G. expressed his
intent to file a motion for summary disposition of this case. On January 23,
1989, I issued a Prehearing
Order and Notice of Hearing. Thereafter, the I.G. moved to dismiss or summarily
decide the Petitioner's
Request. The Petitioner declined to file a brief in response and did not request
either an evidentiary
hearing or oral argument.
EVIDENCE
For the authenticity of evidence in this record, the I.G. has submitted a Declaration
of Counsel, declaring
that the documents which he submitted are true and correct copies of the original
documents filed in State
of Maryland v. Keaciel K. Krulevitz, No. 28813325. The evidence consists of
Exhibits 1(a), (b), (c), (d),
(e) and 2 through 5.
ISSUES
1. Whether the petitioner is subject to the minimum mandatory five year exclusion
provisions of section
1128(c)(3)(B) of the Act.
2. Whether the Petitioner was "convicted" of a criminal offense within
the meaning of 42 U.S.C. 1320a-
7(i).
3. Whether the criminal offense for which the Petitioner was convicted "related
to the delivery of an item
or service" under the Medicaid program within the meaning of section 1128(a)(1)
of the Act.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
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:
1. The Petitioner, a medical doctor, is a resident of the State of Maryland
who has been a provider of
medical care and services for 45 years. Request 1.
2. On May 16, 1988, the Petitioner pleaded guilty, and was found guilty by
the State of Maryland, of
knowingly and willfully making and causing to be made "a series of false
statements and representations of
material facts in application for payment submitted to the Medical Assistance
Program of the Department
of Health and Mental Hygiene of the State of Maryland, a state plan established
by Title XIX of the Social
Security Act. I.G. Ex. 1(a),1(d), and 2.
3. The Petitioner entered his guilty plea under the terms of North Carolina
v. Alford, 400 U.S. 25 (1970).
I.G. Ex. 1(e).
4. At the time the Petitioner entered his guilty plea, he was advised that
the guilty plea would result in a
judgment of guilt. I.G. Ex. 2/7.
5. The Petitioner's guilty plea was entered voluntarily and knowingly. I.G. Ex. 2.
6. The Petitioner's guilty plea was accepted by the State of Maryland. I.G. Ex. 2/8.
7. The Petitioner was "convicted" of a criminal offense within the
meaning of sections 1128(a)(1) and
1128(i) of the Act.
8. The 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.
9. In accordance with section 1128 of the Act, the Petitioner was properly
excluded from participation in
Medicare and Medicaid for a period of five years.
10. Neither the Petitioner's past performance as a physician, nor his financial
and emotional state may be
considered as mitigating factors to remove the exclusion or reduce its length.
Regulations, section
1001.128
11. The alleged improprieties by the State, in the obtaining and use of evidence
during its investigation,
are not issues properly addressed in this forum. Id.
12. The I.G.'s determination to exclude the Petitioner, and to direct that
the State also exclude the
Petitioner, was required and made in accordance with the Act and Regulations.
13. There are no contested issues of material fact which would require an evidentiary
hearing, and the
Petitioner is not requesting an evidentiary hearing or oral argument.
14. The I.G. is entitled to summary disposition in this proceeding.
DISCUSSION
I. A Minimum Mandatory Five Year Exclusion was Required in this Case.
Section 1128(a)(1) of the Act clearly requires the I.G. to exclude individuals
and entities for a minimum
period of five years from the Medicare and Medicaid programs 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 within the meaning of section 1128(a)(1) of the Act. Congressional
intent on this
matter is clear:
A minimum five-year exclusion is appropriate, given the seriousness of the
offenses at issue. . . .
Moreover, a mandatory five-year exclusion should provide a clear and strong
deterrent against the
commission of criminal acts.
S. Rep. No. 109, 100th Cong., 1st Sess. 2; 1987 U.S. Code Cong., and Ad. News 682, 686.
Since the Petitioner was "convicted" of a criminal offense and it
was "related to" the delivery of an item
under the Medicaid program within the meaning of section 1128(a)(1) and (i)
of the Act, the I.G. was
required to exclude the Petitioner for a minimum of five years.
II. The Petitioner was "Convicted" of a Criminal Offense as a Matter of Federal Law
Section 1128(i) of the Act provides that:
a physician or other individual is considered to have been "convicted" of a criminal offense --
(1) when a judgment of conviction has been entered against the physician or
individual by a
Federal, State or local court, regardless of whether there is an appeal pending
or whether the judgment of
conviction or other record relating to criminal conduct had been expunged;
(2) when there has been a finding of guilt against the physician or individual
by a Federal,
State, or local court;
(3) when a plea of guilty of nolo contendere by the physician or individual
has been accepted
by a Federal, State, or local court; or
(4) when the physician or individual has entered into participation in a first
offender or other
program where judgment of conviction has been withheld.
In his Request, the Petitioner states that he "took an Alford plea"
and did not "admit guilt." Request 1. The
Petitioner further alleges that he misunderstood the effect of his Alford plea
and thus is not properly
excluded from participation in Medicare and Medicaid. The Petitioner does not
deny that he entered a
guilty plea, but, in the alternative, argues that the factors which he considered
in electing to enter his plea
are controlling. The I.G. does not dispute the Petitioner's allegation that
he did not admit guilt. Although
an Alford plea does not require an admission of guilt, it is nonetheless a plea
of guilty.
I find and conclude that the Petitioner was "convicted" within the
meaning of section 1128(a)(1) and (i).
First, it is axiomatic that the interpretation of a federal statute or regulation
is a question of federal and not
state law. United States v. Allegheny Co., 322 U.S. 174, 183 (1944); United
States v. Anderson Co.,
Tenn., 705 F.2d 184, 187 (6th Cir., 1983), cert. denied, 464 U.S. 1017 (1984).
My task is to interpret the
words of the Act in light of the purposes they were designed to serve and to
discern the meaning of those
words. See Chapman v. Houston Welfare Rights Organization, 441 U.S. 600, 608
(1979).
The term "accepted" in section 1128(i)(3) is defined by Webster's
Third New International Dictionary,
1976 Unabridged Edition, as the past tense of "to receive with consent."
In Alford, the issue presented did not involve whether a plea of guilty was
"accepted," as here, but
concerned the validity of the guilty plea entered. Mr. Alford pleaded guilty,
but maintained that he was
innocent and was choosing to plead guilty only to avoid the possible imposition
of a harsher penalty. The
Court in Alford concluded that a guilty plea is valid if the plea represents
a "voluntary and intelligent
choice among the alternative courses of action open to the defendant."
400 U.S. at 30. The Court held that
the desire of the defendant in Alford to limit a possible penalty would not
"demonstrate that the plea of
guilty was not the product of free and rational choice, especially where the
defendant was represented by
competent counsel." Id.
The issue which the Petitioner raises may relate to the issue of whether his
guilty plea was entered
voluntarily and intelligently, prerequisites for a court determining that a
guilty plea is valid. Id. However,
this is not the proper forum in which to address those issues. The Court in
Alford stated that it would defer
to the States' wisdom in deciding whether to accept or reject guilty pleas under
the terms of Alford. The
State of Maryland has chosen to accept Alford pleas and view them as the guilty
pleas which they are. See
Deyermand v. State, 19 Md. App. 698, 313 A.2d 709 (1974), Baneguar v. Taylor,
312 Md. 609, 541 A.2d
969 (Md. 1988), and State of Maryland v. Keaciel Kenneth Krulevitz, Case No.
28813325 (1988).
The State presented the following questions to the Petitioner regarding the
nature of his plea: 1) "Dr.
Krulevitz, you understand that you are pleading guilty today to the charge that
has been filed?" I.G. Ex.
2/3(2) "and are those factors that went into your decision along with the
strength of the evidence produced
by the State, are those factors that went into your decision to enter a plea
under the Alford case, which is
essentially a plea of guilty, which will result in a judgement of guilt . .
.?" I.G. Ex. 2/7. The Petitioner
answered affirmatively to the above questions. The State accepted the Petitioner's
plea, and, by doing so,
in its wisdom, determined in effect that the plea was entered voluntarily and
intelligently. The finding of
guilt and acceptance by the State of the Petitioner's plea thus satisfies the
definition set forth in Section
1128(i)(3) for finding that the Petitioner was "convicted." I.G. Ex.
2.
III. The Petitioner's Conviction Is "Related To" The Delivery Of A
Service Under Medicaid
Section 1128(a)(1) requires the I.G. to exclude from participation any individual
who is convicted of a
criminal offense "related to the delivery of an item or service" under
Medicaid. The Petitioner was
convicted of "knowingly and willfully making and causing to be made, pursuant
to a scheme and
continuous course of conduct, a series of false statements and representations
of material facts in
applications for payment submitted to the Medical Assistance Program of the
Department of Health and
Mental Hygiene of the State of Maryland, a state plan established by Title XIX
of the Act." I.G. Ex. 1(d);
I.G. Ex. 2 Specifically, the Petitioner was charged with submitting Physician's
Reports and Invoice forms
to the State Medical Assistance Program in which he falsely represented that
services had been performed
which the Petitioner knew had not been performed I.G.Ex. 1(d).
The criminal offense for which the Petitioner was convicted evidences an attempt
by the Petitioner to
fraudulently obtain reimbursement from Medicaid for items or services which
were not rendered as
claimed. Congress intended to exclude individuals convicted of this type of
offense. In the legislative
history to the 1977 enactment, Congress stated that:
Perhaps the most flagrant fraud involves billings for patients whom the practitioner
has
not treated. A related form of fraud involves claims for servicesto a practitioner's
patients that were not
actually furnished and intentionally billing more than once for the same service.
H.R. Rep. No. 393-Part II, 95th Cong., 1st Sess. 47; 1977 U.S. Code Cong. & Ad. News 3039, 3050.
In 1987, Congress reiterated its intent by enacting the Medicare and Medicaid
Patient and Program
Protection Act and stating that its purpose in enacting the legislation was:
to improve the ability of the Secretary and Inspector General of the Department
of Health
and Human Services to protect the Medicare, Medicaid, Maternal and Child Health
Services Block grant,
and Title XX Social Services Block Grant from fraud and abuse, and to protect
the beneficiaries from
incompetent practitioners and from inappropriate and inadequate care.
S. Rep. No. 109, 100th Cong., 1st Sess. 2; 1987 U.S. Code Cong. & Ad. News 682.
Thus, the criminal offense for which the Petitioner was convicted is one "related
to" the delivery of an item
or service within the meaning of section 1128(a)(1) of the Act.
IV. Mitigating Factors
The Petitioner alleges financial and emotional reasons for choosing to plead
guilty under the terms of
Alford. The court, in questioning the Petitioner prior to accepting his plea,
and in subsequently accepting a
guilty plea under Alford, apparently recognized this fact. The court specifically
asked the Petitioner if he
was primarily pleading guilty "because of the intense pressure that this
case has placed upon you and your
family emotionally and financially?" and "is it true that the pendency
of this case and investigation has
already had a significant impact upon your mental and physical health."
I.G. Ex.2/7. Although the
Petitioner's allegations may be true, this forum is not the proper place to
address those issues. The I.G. is
required by section 1128(a) of the Act to exclude from participation, and to
direct that the State exclude
from participation, any individual who is "convicted of a criminal offense
related to the delivery of an item
or service under Title XVIII or under any State health care program," and
to direct that the exclusion be for
a minimum period of five years. The Petitioner was convicted of a criminal offense
related to the delivery
of a health care service or item, and thus, was properly excluded. Neither the
I.G., nor I, have the
discretion in a mandatory exclusion case to take into account the factors of
emotional and financial
hardship in determining whether the period of exclusion should be lessened,
or removed in its entirety.
V. Alleged Improprieties During Investigation
The alleged improprieties in the State's gathering and use of evidence during
its investigation and
prosecution of the Petitioner are also not issues properly addressed in this
forum. Section 1001.128
provides that an ALJ may consider: (1) whether there was a conviction, (2) whether
the conviction was
related to his or her participation in the delivery of medical care or services,
and (3) whether the length of
the exclusion is reasonable. Thus, I do not decide whether there were improprieties
and, even if there
were, whether the validity of the conviction was impaired.
CONCLUSION
Based on the material facts and the law, I conclude that the I.G's determination
to exclude the Petitioner
was appropriate and required by the Act and Regulations.
IT IS SO ORDERED.
________________________________
Charles E. Stratton
Administrative Law Judge