$05:Exclusion Case
Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of: )
)
Joseph Marcel-Saint Louis, M.D., Petitioner,
- v. -
The Inspector General.
DATE: June 7, 1994
Docket No. C-94-016
Decision No. CR320
DECISION
The Inspector General (I.G.) of the United States Department of
Health and Human Services (DHHS) notified Petitioner by letter
dated October 27, 1993 (Notice) that, until he repaid his Health
Education Assistance Loans (HEAL loans), he was being excluded from
participation in the Medicare program and State health care
programs as defined in section 1128(h) of the Social Security Act
(Act). 1/ The Notice informed Petitioner that his exclusion from
Medicare was authorized by section 1892 of the Act and that his
exclusion from Medicaid was authorized by section 1128(b)(14) of
the Act. The Notice stated that his exclusion resulted from his
failure to repay his HEAL loans or to enter into an agreement to
repay the loans.
By letter dated November 22, 1993, Petitioner timely requested a
hearing before an administrative law judge (ALJ) and the case was
assigned to me for a hearing and a decision. Following several
telephone prehearing conferences, I conducted an in-person hearing
in Boston, Massachusetts, on March 29, 1994.
During the in-person hearing, Petitioner admitted that he failed to
file a written request for deferment of his HEAL loans beyond June
30, 1990, the date his last written deferment expired.
I have considered the evidence of record, the parties' arguments,
and the applicable law in this case. I find and conclude that
Petitioner's indefinite exclusion is reasonable. The evidence in
this case clearly establishes that Petitioner failed to repay his
HEAL loans, that Petitioner is in default, and that Petitioner has
consistently refused to enter into an agreement to repay since his
deferment expired on June 30, 1990.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
Having considered the entire record, the arguments, and the
submissions of the parties, and being advised fully, I make the
following Findings of Fact and Conclusions of Law (FFCL) 2/:
1. While attending medical school at the University of Minnesota,
Petitioner applied for, and, on October 26, 1983 was granted, a
Health Education Assistance Loan (HEAL) in the amount of $5,388.00.
I.G. Exs. 1 and 2. 3/
2. On October 3, 1984, September 4, 1985, and July 24, 1986,
Petitioner applied for and received additional HEAL loans in the
amounts of $13,384.00, $7,141.00 and $16,147.00, respectively.
I.G. Exs. 1, 3-5.
3. Petitioner executed a promissory note for each HEAL loan in
which he promised to repay the HEAL beginning on the first day of
the tenth month after the month in which he ceased being a
full-time student at a HEAL school. I.G. Exs. 6-9.
4. Petitioner promised also to promptly notify the lender of any
change of name, address, or school enrollment status, or of any
other change which would affect his eligibility to receive a
deferment on his obligation to repay. I.G. Exs. 6-9.
5. The Student Loan Marketing Association (SLMA) purchased
Petitioner's four HEAL loans and received assignments of the
lender's rights. I.G. Ex. 1.
6. Petitioner graduated from medical school in December 1987. Tr.
at 42.
7. Petitioner requested a deferment of his obligation to repay his
four HEAL loans while in an internship program at Cambridge
Hospital in Cambridge, Massachusetts. I.G. Ex. 10; Tr. at 42-44.
8. Petitioner attended Tufts University Fletcher School of Law and
Diplomacy during the 1988-1989 academic year and did not file a
written request for a deferment. Tr. at 44-45.
9. Petitioner requested a deferment for the period of the fall
semester of 1989 through June 30, 1990 while he was enrolled in a
residency program at Carney Hospital in Boston, Massachusetts.
I.G. Ex. 11.
10. Petitioner did not file a written request for a deferment from
his obligation to repay his four HEAL loans beyond June 30, 1990.
I.G. Ex. 1; Tr. at 23-25, 30-32, 36, 39-40, 45.
11. On May 18, 1990, SLMA notified Petitioner of his obligation to
begin to repay his four HEAL loans and that Petitioner was
obligated to begin monthly payments on his four HEAL loans on July
24, 1990. I.G. Exs. 24-25.
12. Petitioner failed to begin repayment of his four HEAL loans on
July 24, 1990 and has consistently avoided his obligations and
promises to repay. I.G. Exs. 1-12; Tr. at 47-57.
13. SLMA sent Petitioner a demand letter on November 27, 1990
instructing Petitioner to remit payment in full of his four HEAL
loans or his account would be filed as a default. I.G. Ex. 1.
14. Because of Petitioner's failure to repay his four HEAL loans
as promised, SLMA filed an insurance claim with the United States
Public Health Service (PHS) on June 8, 1991. I.G. Exs. 1, 12.
15. On July 3, 1991, PHS paid the insurance claim in the amount of
$76,524.00 and received an assignment of Petitioner's four unpaid
HEAL loans from SLMA. I.G. Exs. 1, 13-14.
16. PHS notified Petitioner that he had been placed on default
status for failure to repay his four HEAL loans as promised and
instructed him to remit the total amount due within 30 days or
submit a proposal for a repayment arrangement. I.G. Ex. 1, 15.
17. PHS notified Petitioner on August 22, 1991 that it would refer
his debt to the Internal Revenue Service for offset of any tax
refunds and advised him that repayment in full would terminate such
offset proceedings.
18. PHS notified Petitioner that his failure to repay his four
HEAL loans as promised resulted in PHS referring his obligations to
Payco American Corporation, a collection agency. I.G. Ex. 1.
19. On September 22, 1992, PHS again instructed Petitioner to
enter into a repayment arrangement to correct the failure of
Petitioner to repay his four HEAL loans as promised. I.G. Ex. 1.
20. PHS notified Petitioner on February 4, 1993 that he could
agree to have amounts due him under Medicare or Medicaid offset
against his unpaid HEAL loans. I.G. Ex. 1, 19.
21. Petitioner admitted that he received the notices sent to him
by SLMA and PHS and that he failed to respond in writing to them.
Tr. at 54-57; I.G. Ex. 1.
22. Petitioner is in default on his obligations and his promises
to repay his four HEAL loans. FFCL 1-21.
23. The Secretary of DHHS has taken all reasonable steps available
to her to secure repayment from Petitioner of his four HEAL loans.
FFCL 1-21.
24. Petitioner owes the PHS $91,613.44 as a result of his default
on his HEAL obligations. I.G. Ex. 1; Tr. at 58.
25. The I.G. had authority to exclude Petitioner from Medicare and
Medicaid under section 1128(b)(14) and section 1892 of the Act.
FFCL 1-24.
26. The exclusion imposed against Petitioner by the I.G. in this
case is reasonable. FFCL 1-25.
27. Petitioner misled this ALJ by stating throughout the
prehearing process that he had a written deferment from his
obligation to repay his four HEAL loans for periods after June 30,
1990 and that he would produce documentary evidence of such
deferment. February 24, 1994 Prehearing Order and Notice of
Hearing, page 2; Tr. at 7-9, 16, 23-24, 30-31, 36-39, 50.
28. At the hearing, Petitioner admitted that he did not have a
written deferment after June 30, 1990 and that he was now seeking
a "retroactive" deferment from me. Tr. at 30-32, 50.
29. Petitioner has refused to enter into a repayment agreement,
has refused to repay his four HEAL loans as promised, and is in
default. Tr. at 1-61; FFCLs 1-28.
30. Petitioner maintained throughout these proceedings that his
default status on his HEAL obligations was an error, when, despite
his contentions, he knew that he was in default on his HEAL
obligations. Tr. at 9-14, 17-20, 23-61; FFCLs 1-29.
31. Petitioner fabricated the concepts of "oral deferment" and
"retroactive deferment" in an attempt to rationalize his failure to
properly repay his HEAL obligations. Tr. at 1-61; FFCLs 1-30.
32. Petitioner is not a credible witness as to any matter at issue
in this case; he is credible only when he gives an account of minor
factual details (such as when he graduated from medical school,
when he enrolled in graduate school, when and where he served his
residency, and other facts of that nature) and when he makes a
declaration against his own interest. Tr. at 1-61; FFCLs 28-31.
DISCUSSION
I. By reason of federal law and regulations, Petitioner must be
excluded indefinitely from Medicare and Medicaid until he repays
his four HEAL loans as promised.
Section 1128(b)(14) of the Act authorizes the Secretary to exclude
from Medicare and to direct the exclusion from Medicaid of any
individual who is in default on a HEAL and with respect to whom the
Secretary has taken all reasonable steps to secure repayment of the
HEAL. Because the I.G. proved that Petitioner has had an
obligation to repay his four HEAL loans from the period following
the expiration of his deferment on June 30, 1990, and that
Petitioner has failed to do so, despite numerous attempts by PHS to
get Petitioner to enter into a repayment agreement, I find and
conclude that Petitioner should be excluded until such time as he
satisfies the debt. 4/
Petitioner admitted, and the I.G. proved, that Petitioner now owes
PHS $91,613.44.
Petitioner became obligated to begin repaying his four HEAL loans
shortly following the expiration of his deferment on June 30, 1990.
Petitioner admitted at the evidentiary hearing in this case that he
has not had a written deferment from repaying his four HEAL loans
since his deferment expired on June 30, 1990.
However, Petitioner states in his posthearing brief that because he
has lofty goals and is pursuing a career in international public
health, he should be placed in a very special category of future
leaders and be exempt from the ordinary obligations placed upon him
by reason of federal law and his promises to repay. He states that
he should be indefinitely deferred from his obligation to pay back
his four Heal loans and that, if his income allows, he should be
allowed to begin repayment some time in 1995. P. Br. at 2-6.
Petitioner admitted at the hearing that he did not ever make a
written request for a deferment from the period June 30, 1990 to
date. However, even if Petitioner had made a written request for
a deferment, his studies, including his current studies, do not
qualify him for a deferment.
At the in-person hearing in this case, Petitioner acknowledged
receipt of the numerous attempts made by PHS or its designated
agents and collection agencies to collect the debt owed by
Petitioner since July 1990. Petitioner chose to ignore all
collection efforts made by PHS, including efforts made up to the
date of the hearing, to get Petitioner to enter into a repayment
agreement.
In summary, Petitioner has been in default for almost four years
and should be excluded from Medicare and Medicaid until he repays
his four HEAL loans.
II. Petitioner misled this ALJ.
It seems that Petitioner will resort to almost any means to avoid
his obligations to repay, including misleading this ALJ.
Petitioner told me for months, and especially during the February
18, 1994 prehearing conference, that he had a deferment and was
never in default. Petitioner further stated that, at the hearing,
he would produce written evidence of his deferment. February 24,
1994 Prehearing Order And Notice Of Hearing, page 2. Then, at the
hearing and while under oath, Petitioner admitted that he did not
have a written deferment. FFCLs 28-29.
I have concluded that Petitioner is very intelligent and that he
has known all along that he has not been eligible for a deferment
since June 30, 1990. But, since Petitioner wanted to pursue
studies that did not qualify him for a deferment, he attempted to
manipulate the system to his advantage and avoid repayment until he
was ready to repay. However, Petitioner went too far by knowingly
and repeatedly misrepresenting to the I.G. and to me that he had a
written deferment and by claiming that he had written proof that he
had been granted a deferment on his HEAL obligations. During the
months before the hearing, at several prehearing conferences,
Petitioner persisted in this deceitful claim of having a written
deferment and further stated that he would produce written proof of
that deferment at the hearing. Then, at the hearing and while
under oath, Petitioner admitted that he did not ever have a written
deferment after June 30, 1990. Instead of attempting to explain
his statements concerning his claims of having a written deferment,
he ignored his previous statements, changed his story, and then
brazenly requested a retroactive deferment. There is no provision
in the law or federal regulations which entitles Petitioner to a
retroactive deferment. 5/
Petitioner's testimony inadvertently supports the I.G.'s allegation
that he never obtained a written deferment on his HEAL obligations.
He testified that he felt it was not necessary to have a written
deferment because PHS personnel told him to use the telephone to
update them. Tr. at 9-11. Petitioner cannot be believed; he is
not a credible witness. The only part of Petitioner's testimony
that I find to be credible, other than minor factual matters, are
his statements against his own interest. Moreover, even if
Petitioner could be believed, there is no provision in the law for
oral deferments or retroactive deferments. Most importantly, the
forms provided to HEAL borrowers at the time they incur their
obligation notify them that they must make deferment requests in
writing. It is apparent that Petitioner has created the fictions
of retroactive deferment and oral deferment as a means to obtain a
deferment to which he is not entitled in fact or by law.
CONCLUSION
Based on the law and the evidence, I conclude that Petitioner's
indefinite exclusion is reasonable and must stand.
It is so Ordered.
____________________________
Charles E. Stratton
Administrative Law Judge
1. Section 1128(h) of the Act enumerates three types of State
health care programs that receive federal funds, including the
Medicaid program. Unless indicated otherwise, I use the term
"Medicaid" to represent all State health care programs from which
Petitioner was excluded.
2. I cite to the parties' exhibits, briefs, my FFCL, and the
transcript of the hearing as follows:
Petitioner's Exhibit . . . . . . . . P. Ex. (number)
I.G.'s Exhibit . . . . . . . . . . I.G. Ex. (number)
Transcript . . . . . . . . . . . . . Tr. at (page)
Petitioner's post-hearing brief . . P. Br. at (page)
I.G.'s post-hearing brief . . . I.G. Br. at (page)
FFCL . . . . . . . . . . . . . . . . . FFCL (number)
3. At the hearing, the I.G. offered 25 exhibits into evidence.
Petitioner did not object to any of the I.G.'s exhibits, and I
admitted all 25 of them into evidence. Tr. at 20. Petitioner
offered two exhibits into evidence. I admitted both of
Petitioner's exhibits into evidence over the objection of the I.G.
Tr. at 28.
4. It is unnecessary for me to decide whether Petitioner is
entitled to a hearing pursuant to section 1892 of the Act, because
section 1128(b)(14) authorizes exclusion from both Medicare and
Medicaid. Section 1128(b) provides: "The Secretary may exclude
the following individuals and entities from participation in any
program under title XVIII and may direct that the following
individuals and entities be excluded from participation in any
State health care program." Title XVIII is the Medicare program
and the term "State health care program" encompasses Medicaid. See
n. 1. Section 1128(b)(14) makes the permissive exclusion
provisions of section 1128(b) applicable to individuals whom the
Secretary determines are in default on HEAL loans or scholarship
obligations. Therefore, the issue of Petitioner's exclusion from
Medicare under section 1892 is mooted by the fact that his
exclusion from Medicare is authorized also by section 1128(b)(14)
of the Act.
While, for the reasons just stated, I make no findings and
conclusions regarding whether the I.G. properly excluded Petitioner
pursuant to section 1892 of the Act, I do agree with the
preliminary analysis of the appellate panel in Charles K. Angelo,
Jr., M.D., C-92-130 (January 24, 1994) to the extent that it
suggests the possibility that there is a right to an administrative
hearing on an exclusion imposed pursuant to section 1892.
5. In his posthearing brief dated April 15, 1994, Petitioner
again asks for a retroactive deferment and offers a token payment
of $200 per month while he studies in Paris, France until July
1995.