$05:Exclusion Case
Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
In the Case of: Paul D. Weinstein, M.D., Petitioner,
- v. -
The Inspector General.
DATE: July 20, 1994
Docket No. C-94-012
Decision No. CR323
DECISION
By letter dated September 13, 1993, Paul D. Weinstein, M.D., the
Petitioner herein, was notified by the Inspector General (I.G.),
U.S. Department of Health & Human Services (HHS), that it had been
decided to exclude him for a period of five years from
participation in the Medicare, Medicaid, Maternal and Child Health
Services Block Grant and Block Grants to States for Social Services
programs. 1/ The exclusion was to be in effect as of 20 days from
the date of the notice letter.
The I.G.'s rationale was that exclusion, for at least five years,
is mandated by sections 1128(a)(1) and 1128(c)(3)(B) of the Social
Security Act (Act) because Petitioner had been convicted of a
criminal offense related to the delivery of an item or service
under Medicaid.
Petitioner filed a timely request for review of the I.G.'s action.
The I.G. moved for summary disposition.
Because I have determined that there are no facts of decisional
significance genuinely in dispute, and that the only matters to be
decided are the legal implications of undisputed facts, I have
decided the case on the basis of the parties' written submissions,
in lieu of an in-person hearing.
I conclude that the I.G.'s determination to exclude Petitioner from
participation in the Medicare and Medicaid programs for a period of
five years is supported by substantial evidence.
APPLICABLE LAW
Sections 1128(a)(1) and 1128(c)(3)(B) of the Act make it mandatory
for any individual who has been convicted of a criminal offense
related to the delivery of an item or service under Medicare or a
State health care program to be excluded from participation in such
programs for a period of at least five years. The definition of
what constitutes a "State health care program" is set forth in
section 1128(h) of the Act, and it includes the Medicaid program.
FINDINGS OF FACT AND CONCLUSIONS OF LAW (FFCLs)
1. On December 20, 1993, Petitioner and the I.G. entered into a
stipulation of agreed upon facts and conclusions of law. Agreed
Upon Facts and Conclusions of Law, dated December 20, 1993. I
adopt the significant and material elements of this stipulation
which are relevant to my decision and summarize them below. 2/
2. The parties stipulated that Petitioner was a physician licensed
by, and practicing in, Massachusetts.
3. The parties stipulated that, on February 28, 1992, Petitioner
was indicted on 136 counts relating to violations of the
Massachusetts Medicaid False Claims Act, as well as two counts of
larceny.
4. The parties stipulated that Petitioner negotiated a plea
agreement with the prosecution, pursuant to which he entered, and
the court accepted, a plea of guilty on October 8, 1992, to one
count of larceny and two counts of filing false Medicaid claims.
5. The parties stipulated that the court sentenced Petitioner to
two years in the Middleton House of Correction (one year to be
suspended) and supervised probation thereafter, as had been agreed
upon as part of the plea agreement.
6. The parties stipulated that Petitioner voluntarily surrendered
his medical license to the Commonwealth of Massachusetts Board of
Registration in Medicine (Registration Board) on October 8, 1992.
7. The parties stipulated that, on December 16, 1992, the
Registration Board revoked Petitioner's license to practice
medicine for a period of five years.
8. The parties stipulated that, on or about January 13, 1993, the
Commonwealth of Massachusetts notified the Office of the Inspector
General, U.S. Department of Health and Human Services (OIG), of
Petitioner's conviction.
9. The parties stipulated that, by letter dated January 15, 1993,
the I.G. informed Petitioner that he was subject to an impending
five-year exclusion from the Medicare and State health care
programs, under the authority of section 1128(a) of the Act, based
upon his conviction of offenses related to the delivery of an item
or service under the Medicaid program.
10. The parties stipulated that, by letter dated September 13,
1993, the I.G. informed Petitioner of the imposition of said
exclusion, effective 20 days from the date of the notice letter.
11. The parties stipulated that, by letter dated October 24, 1993,
Petitioner requested an administrative hearing solely upon the
issue of the effective date of his exclusion.
12. The parties stipulated that Petitioner was "convicted" within
the meaning of section 1128(i) of the Act.
13. The parties stipulated that section 1128(c)(3)(B) of the Act
required the I.G. to exclude Petitioner for not less than five
years.
14. Petitioner does not dispute that the Act and applicable
regulations mandate a five-year exclusion in his case. FFCL 1-13.
15. Inasmuch as Petitioner entered a plea of guilty to larceny and
to filing false Medicaid claims, and the court accepted his plea
and sentenced him, Petitioner was "convicted" within the meaning of
section 1128(i)(3) of the Act.
16. A conviction for financial misconduct directed at the Medicare
or Medicaid programs constitutes a program-related offense (i.e.,
an offense related to the delivery of items or services under
Medicare or Medicaid) within the meaning of section 1128(a)(1) of
the Act, justifying mandatory exclusion.
17. The parties stipulated that the filing of false Medicaid
claims is a criminal offense "related to the delivery of an item or
service" within the meaning of section 1128(a)(1) of the Act.
18. Petitioner's conviction for filing false Medicaid claims
precisely satisfies the statutory requirement of a program-related
criminal offense. FFCL 1-17.
19. The I.G. did not have any regulatory or statutory deadline by
which she had to commence the exclusion action against Petitioner.
20. There is no evidence or basis in law for concluding that the
I.G. exceeded the authority delegated to her, that she acted
contrary to law, or that she deprived Petitioner of some protected
right or interest.
21. There is no evidence or basis in law for concluding that it is
legally required that a federal exclusion be coterminous with a
State-imposed sanction based upon the same program-related
misconduct.
22. The Secretary of the Department of Health and Human Services
has delegated to the I.G. the authority to determine, impose, and
direct exclusions pursuant to section 1128 of the Act. 48 Fed.
Reg. 21662 (1983).
23. An administrative law judge does not have the authority or
discretion to reduce the length of a five-year minimum exclusion
mandated by section 1128(c)(3)(B) of the Act. 42 C.F.R.
1001.2007(a).
24. An administrative law judge does not have the authority or
discretion to alter the effective date of an exclusion imposed by
the I.G. 42 C.F.R. 1001.2007(a).
25. The I.G. properly excluded Petitioner for a period of five
years, as required by the minimum mandatory exclusion provisions of
sections 1128(a)(1) and 1128(c)(3)(B) of the Act. FFCL 1-24.
PETITIONER'S ARGUMENT
Petitioner acknowledges that, on October 8, 1992, he pled guilty to
larceny and to filing false claims under the Massachusetts Medicaid
program. 3/ He contends, though, that, inasmuch as he voluntarily
surrendered his (only) license to practice medicine on the date of
his plea, he has effectively been excluded since such date. 4/
Petitioner's Request for Hearing, dated October 24, 1993; P. Br. at
2. In his brief, Petitioner contended further that the effective
date of his exclusion "should run from the time of initial
notification by the Boston office of the HHS, January 23, 1993."
P. Br. at 2. Petitioner argued also that the length of time
between the initial notification by the Boston office of HHS and
the issuance of the exclusion letter was unreasonable. Id.
Petitioner contends that for the I.G. to commence his exclusion as
of October 3, 1993 (the effective date), would transform his
five-year exclusion into a six-year exclusion, which is not what
Congress intended for offenses such as his. Further, Petitioner
asserts that this would constitute punitive - rather than remedial
- action. Petitioner's Request for Hearing; P. Br. at 2.
THE I.G.'s ARGUMENT
The I.G. contends that an administrative law judge has no authority
to review the commencement date of an exclusion. I.G. Br. at 5.
In any event, the I.G. asserts that the exclusion herein cannot be
deemed unreasonable, inasmuch as Petitioner does not dispute that
the facts of his case and the relevant law and regulations require
that he be excluded from Medicare and Medicaid for five years.
I.G. Br. at 4-5. The I.G. contends also that she exercised
reasonable discretion within her statutory and regulatory
authority. I.G. Br. at 6.
DISCUSSION
The first statutory requirement for mandatory exclusion pursuant to
section 1128(a)(1) of the Act is that the individual or entity in
question must have been convicted of a criminal offense. The term
"convicted" is defined at section 1128(i) of the Act. This section
sets forth four alternative definitions of the term "convicted."
An individual or entity which satisfies any one of the four
definitions in section 1128(i) is regarded as having been
"convicted" of a criminal offense within the meaning of the Act.
Section 1128(i) of the Act provides that an individual or entity
will be convicted of a criminal offense:
(1) when a judgment of conviction has been entered against the
individual or entity 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
has been expunged;
(2) when there has been a finding of guilt against the
individual or entity by a Federal, State, or local court;
(3) when a plea of guilty or nolo contendere by the individual
or entity has been accepted by a Federal, State, or local court; or
(4) when the individual or entity has entered into
participation in a first offender, deferred adjudication, or other
arrangement or program where judgment of conviction has been
withheld.
In the present case, the parties stipulated that Petitioner was
"convicted" within the meaning of section 1128(i) of the Act. FFCL
12. The facts agreed upon by the parties clearly establish that
Petitioner entered a plea of guilty on October 8, 1992 to one count
of larceny and two counts of filing false Medicaid claims, and that
the court accepted his plea and sentenced him. Thus, I find that
Petitioner was "convicted" within the meaning of section 1128(i)(3)
of the Act. FFCL 15.
I find also that the second requirement of section 1128(a)(1) --
i.e., that the criminal offense leading to the conviction be
related to the delivery of an item or service under Medicare or
Medicaid -- has been satisfied. It is well-established that a
conviction for financial misconduct directed at the Medicare or
Medicaid programs constitutes a program-related offense within the
meaning of section 1128(a)(1), justifying mandatory exclusion.
FFCL 16. In particular, filing fraudulent Medicare or Medicaid
claims has been held to constitute program-related misconduct.
Jack W. Greene, DAB CR19 (1989), aff'd, DAB 1078 (1989), aff'd sub
nom. Greene v. Sullivan, 731 F. Supp. 835, 838 (E.D. Tenn. 1990).
Thus, Petitioner's conviction for filing false Medicaid claims
precisely satisfies the statutory requirement of a program-related
criminal offense. FFCL 18.
Petitioner contends, however, that the determination by the I.G. to
commence his exclusion as of October 3, 1993, unlawfully transforms
his five-year exclusion into a six-year exclusion. Petitioner
contends further that this is, somehow, punitive. I find no legal
support for such a theory.
In fact, the argument advanced by Petitioner has already been
thoroughly considered by an appellate panel of the Departmental
Appeals Board in the case of Samuel W. Chang, M.D., DAB CR74
(1990), aff'd in part and rev'd in part, DAB 1198 (1990). In
Chang, the I.G. had issued an exclusion notice to the petitioner
some 17 months after learning of the petitioner's conviction.
Chang, DAB CR74, at 9. The administrative law judge determined
that "[t]his was not timely and not reasonable notice." Id. The
administrative law judge ruled that the petitioner's exclusion
would be regarded as having commenced one year after the I.G.
received notice of the petitioner's conviction. Id. at 10.
The administrative law judge's decision was appealed. On appeal,
the appellate panel disallowed the administrative law judge's
remedy. The panel concluded that "the ALJ had no authority to
change the effective date of the exclusion." Samuel W. Chang,
M.D., DAB 1198, at 2. 5/ Thus, the appellate panel held that not
only is the administrative law judge without authority to alter the
length of the mandatory exclusionary period set forth in sections
1128(a) and 1128(c)(3)(B) of the Act -- he or she also may not
adjust the commencement date of such exclusion. Id. at 9-10.
The principle enunciated in Chang is consistent with the applicable
law and regulations and has been upheld in later cases. In Shanti
Jain, M.D., DAB CR237 (1992), aff'd, DAB 1398 (1993), the appellate
panel held that "[a]n administrative law judge has no authority to
alter the effective date of exclusion designated by the I.G. where
the I.G. acted within the discretion afforded by statute and
regulation in setting the effective date." Jain, DAB 1398, at 7.
The regulations provide that, in exclusion cases, the only issues
the ALJ may decide are whether "the basis for the imposition of the
sanction exists," and whether "the length of exclusion is
unreasonable." 42 C.F.R. 1001.2007. The regulations further
state that where an exclusion is based on the mandatory exclusion
provisions of the Act, and the length of the exclusion is not in
excess of five years, an administrative law judge is no longer
called upon to decide the issue of the reasonableness of the length
of the exclusion. 42 C.F.R. 1001.2007(a)(2).
By contrast, regulatory constraints upon the I.G. are few. 42
C.F.R. 1001.2001-.2002, which sets forth procedures for the I.G.
to follow in imposing exclusions, neither requires the I.G. to act
within a particular number of days after learning of an
individual's criminal conviction, nor sets any "limitations
period," beyond which new charges based upon old facts would be
barred. Thus, the I.G. did not have any regulatory or statutory
deadline by which she had to commence the exclusion action against
Petitioner. FFCL 19.
Assessing the undisputed facts herein in light of the relevant law,
I find that Petitioner was convicted of financial crimes directed
at the Medicaid program and must, therefore, be excluded from
participation for not less than five years.
Finally, I find no evidence or basis in law for concluding that the
I.G. exceeded the authority delegated to her, that she acted
contrary to law, or that she deprived Petitioner of some protected
right or interest. FFCL 20. I note, in particular, that
Petitioner, notwithstanding his assertions, submitted no evidence
at all to show that the I.G.'s action was contrary to legislative
intent. There is no evidence or basis in law for concluding that
it is legally required that a federal exclusion be coterminous with
a State-imposed sanction based upon the same program-related
misconduct. 6/ FFCL 21.
CONCLUSION
Sections 1128(a)(1) and 1128(c)(3)(B) of the Act mandate that the
Petitioner herein be excluded from the Medicare and Medicaid
programs for a period of at least five years because of his
criminal conviction for filing false Medicaid claims.
There is no evidence or basis in law for concluding that the I.G.
exceeded the authority delegated to her, that she acted contrary to
law, or that she deprived Petitioner of some protected right or
interest.
I do not have the authority or discretion to reduce the length of
a five-year minimum exclusion mandated by section 1128(c)(3)(B) of
the Act. FFCL 23. Further, I do not have the authority or
discretion to alter the effective date of an exclusion imposed by
the I.G. FFCL 24.
I conclude that the I.G. properly excluded Petitioner for a period
of five years, as required by the minimu
mandatory exclusion provisions of sections 1128(a)(1) and
1128(c)(3)(B) of the Act. FFCL 25.
The five-year exclusion, in effect as of 20 days from September 13,
1993, is, therefore, sustained.
Joseph K. Riotto
Administrative Law Judge
1. In this decision, I refer to all programs from which
Petitioner has been excluded, other than Medicare, as "Medicaid."
2. I cite the I.G.'s brief as "I.G. Br. at (page)." I cite
Petitioner's response as "P. Br. at (page)." Neither party
introduced any additional evidence apart from the jointly submitted
stipulation of agreed upon facts and conclusions of law.
3. Initially, in his Request for Hearing, Petitioner stated
that he had pled guilty on October 5, 1992. However, this date
appears to be incorrect. The correct date on which Petitioner pled
guilty appears to be October 8, 1992, the date given in the
stipulation signed by the parties.
4. At the prehearing telephone conference held on November 23,
1993, Petitioner argued that, in the alternative, his exclusion
should begin from the time when he was notified by the State of his
exclusion from Medicaid. Order and Schedule for Filing Briefs and
Documentary Evidence, dated December 3, 1993.
5. The appellate panel uses the abbreviation "ALJ" to mean
"administrative law judge."
6. In fact, an appellate panel of the DAB has stated that an
individual who has been sanctioned by State authorities is still
subject to exclusion by the federal government under section
1128(a)(1) of the Act, for the full mandatory exclusion period
under that section. Jain, DAB 1398, at 6 n.4. Specifically, in
Jain, the appellate panel asserted that the State's earlier
suspension of Petitioner from State health care programs was
"irrelevant under section 1128" and that Petitioner would not be
entitled to any reduction in the mandatory exclusion period based
on a prior State-imposed suspension or exclusion. Id.