Department of Health and Human Services DEPARTMENTAL APPEALS BOARD Civil Remedies Division |
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IN THE CASE OF | |
Isaac Aaron Sultan, |
DATE: November 28, 2001 |
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The
Inspector General
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Docket No.C-00-003 Decision No. CR839 |
DECISION | |
DECISION I modify the length of the exclusion that the Inspector
General (I.G.) imposed against Petitioner, Isaac Aaron Sultan, M.D., from
a term of 15 years to a term of seven years. I. Background Petitioner is a neurologist who practiced medicine in
Rancho Mirage, California. On July 8, 1999, the I.G. sent a notice to
Petitioner in which she advised him that he was being excluded from participating
in Medicare and other federally funded health care programs, including
State Medicaid programs. The I.G. advised Petitioner that he was being
excluded pursuant to section 1128(a)(1) of the Social Security Act (Act),
for a term of 15 years, based on Petitioner's conviction of a criminal
offense related to the delivery of an item or service under Medicare and
State Medicaid programs. Petitioner requested a hearing in order to challenge the
length of the exclusion. The case originally was assigned to another administrative
law judge for a hearing and a decision. It was reassigned to me recently
due to that judge's illness. The I.G. moved for a decision based on her
written submission. Petitioner opposed the motion. Neither party requested
that I conduct a hearing in person. The I.G. submitted proposed exhibits in support of her
motion, which are identified as I.G. Exhibits (I.G. Exs.) 1-8. Petitioner
submitted proposed exhibits with his response to the I.G.'s motion which
are identified as Petitioner's Exhibits (P. Exs.) A-S. Petitioner offered
P. Ex. T as a subsequent submission. In the absence of objections from
either party, I am receiving these exhibits into evidence. Certain basic facts of this case are not in dispute. On
February 4, 1997, Petitioner pled guilty to four counts of mail fraud
related to his medical practice. I.G. Exs. 4, 6. The mail fraud was an
element of a scheme by Petitioner to defraud Medicare and MediCal, the
California Medicaid program. Petitioner's scheme consisted of systematically
claiming reimbursement for patients' brief office visits as if they involved
more complicated procedures that were entitled to a higher level of remuneration
than were the office visits. I.G. Ex. 4, at 3-4. The scheme occurred from
approximately 1991 through 1996. Id., at 2. No specific proof was offered in Petitioner's criminal
case of the dollar amount of Petitioner's fraud against Medicare and MediCal.
Petitioner agreed to pay restitution in the amount of $118,749. I.G. Ex.
6, at 1. In his plea agreement, Petitioner agreed that, for sentencing
purposes, an appropriate estimate of the loss caused by Petitioner was
$120,000. I.G. Ex. 3, at 2. The United States Attorney agreed that a loss
in excess of that amount was not readily provable. Id. Petitioner's sentence included - in addition to paying
restitution - a period of six months in a home detention program and a
three year period of supervised release. I.G. Ex. 6, at 1. Petitioner
was required to be monitored electronically during his home detention.
Id. His sentence also included the requirement that he perform
3,000 hours of community service and that, during the period of his supervised
release, he not provide medical services to any Medicare beneficiary,
MediCal recipient, or any participant of any insurance program that receives
federal funding. P. Ex. R, at 1. On December 1, 1997, the Medical Board of California filed
an accusation against Petitioner in which it charged him with unprofessional
conduct. I.G. Ex. 7. The causes for disciplinary action that were recited
in the accusation included Petitioner's February 4, 1997 guilty plea to
charges of mail fraud. Id., at 4. Additional causes were drawn
from the criminal information that had been filed against Petitioner and
which led to his guilty plea. Id., at 5-8. On February 18, 1999,
Petitioner entered into a stipulation in which he agreed to surrender
his license to practice medicine in California. I.G. Ex. 8. The stipulation
resolved the disciplinary proceeding that had been brought against Petitioner.
Id. Petitioner did not admit that he was liable for the charges
that had been made against him. Id., at 3. II. Issue, findings of fact and conclusions of
law
Petitioner has not denied that he was convicted of a criminal
offense related to the delivery of items or services under Medicare or
a State Medicaid program within the meaning of section 1128(a)(1) of the
Act, or that a basis exists to exclude him pursuant to that section. Nor
does Petitioner contest that the I.G. must exclude him for at least five
years. See Act, section 1128(c)(3)(B). He argues only that the
length of the exclusion - 15 years - is unreasonable. The issue that remains in this case is whether the 15-year
exclusion that the I.G. imposed is unreasonable.
I make findings of fact and conclusions of law (Findings) to support my decision in this case. I set forth each Finding below as a separately numbered heading. I discuss each Finding in detail.
The Secretary of the U.S. Department of Health and Human
Services (Secretary) has published regulations which govern the length
of exclusions that are imposed pursuant to section 1128 of the Act. 42
C.F.R. Part 1001. The regulation which establishes criteria to govern
the length of an exclusion that is imposed under section 1128(a)(1) is
42 C.F.R. � 1001.102. This regulation identifies "aggravating" factors
which may be used, if present in a case, as a basis to lengthen an exclusion
beyond the five-year minimum period and "mitigating" factors which may
be used, if present in a case, to offset any aggravating factors that
are established. 42 C.F.R. � 1001.102(b), (c). The regulation makes it clear that only those
factors that it identifies as either aggravating or mitigating may be
considered to determine whether an exclusion of more than five years is
reasonable in a case involving section 1128(a)(1). The aggravating and
mitigating factors operate as rules of evidence in such a case. Evidence
which does not relate to an identified aggravating or mitigating factor
is irrelevant to determining the length of an exclusion and may not be
considered.
An individual who is excluded has a right to a hearing
before an administrative law judge. Such a hearing is conducted pursuant
to section 205(b) of the Act. That section has been interpreted on numerous
occasions to afford a party who is entitled to a hearing a de novo hearing
and an independent decision by an administrative law judge. That is not to suggest that the administrative law judge
is free to ignore entirely the determination that is made by the I.G.
The I.G. has expertise in making exclusion determinations and her determinations
deserve to be respected. The I.G.'s determination should be sustained
as reasonable if that determination falls within a reasonable range of
possible exclusions given the evidence that is presented. However, the
administrative law judge must evaluate independently the evidence relating
to the aggravating and mitigating factors that are set forth in the regulations.
If the administrative law judge concludes, based on his or her independent
and de novo evaluation of the evidence, that the exclusion imposed by
the I.G. departs significantly from that which the administrative law
judge decides is reasonable, then the administrative law judge may modify
the length of the exclusion to assure that the exclusion falls within
a reasonable range of exclusions.
The I.G. established the presence of five aggravating
factors in this case. They are as follows:
It is an aggravating factor if the acts that resulted
in an excluded individual's conviction, or similar acts, resulted in a
financial loss of $1,500 or more to a government program. 42 C.F.R. �
1001.102(b)(1). Petitioner's crimes resulted in losses being incurred
by Medicare and/or MediCal that exceeded $1,500. Losses in excess of $1,500
may be inferred from Petitioner's admission in his guilty plea of having
caused federal programs to lose about $120,000. I.G. Ex. 3, at 2. Losses
in excess of $1,500 may also be inferred from the fact that Petitioner
was sentenced to pay restitution of $118,749. I.G. Ex. 6, at 1.
An aggravating factor is present if the acts that result
in a conviction or similar acts occur over a period of a year or more.
42 C.F.R. � 1001.102(b)(2). In this case, Petitioner admitted to engaging
in criminal conduct over a period of more than one year. Petitioner pled
guilty to a criminal scheme that took place from about 1991 through about
1996. I.G. Ex. 4, at 2.
It is an aggravating factor if an excluded individual's sentence for his crime includes a period of incarceration. 42 C.F.R. � 1001.102(b)(5). The term "incarceration" is defined under the regulations that implement section 1128 of the Act as being any type of confinement with or without supervised release, including community confinement, house arrest, and home detention. 42 C.F.R. � 1001.2(d). Petitioner was incarcerated inasmuch as his sentence included a six-month period of home detention. I.G. Ex. 6, at 1.
An aggravating factor is present if an excluded individual
has been overpaid in the amount of $1,500 or more by Medicare or a State
Medicaid program as a result of that individual's intentional improper
billings. 42 C.F.R. � 1001.102(b)(7). The evidence in this case does not
establish precisely how much Petitioner was overpaid as a result of the
false reimbursement claims that he made. It is reasonable to infer, however,
that he was overpaid more than $1,500 by the fact that he agreed to pay
restitution in the amount of $118,749. I.G. Ex. 6, at 1.
It is an aggravating factor if an excluded individual
has been the subject of any other adverse action by any federal, State,
or local government agency or board, if the adverse action is based on
the same set of circumstances that are the basis for the imposition of
that individual's exclusion. 42 C.F.R. � 1001.102(b)(9). In this case,
Petitioner was the subject of other adverse State action that arose from
the same facts that led to his conviction. That consisted of the disciplinary
proceeding that was brought against him by the Medical Board of California.
I.G. Ex. 7. Petitioner argues that he surrendered his license to practice
medicine in California voluntarily in order to settle the State administrative
action against him. He asserts that the State proceeding was not an adverse
action within the meaning of 42 C.F.R. � 1001.102(b)(9) because the Medical
Board of California made no findings of culpability. The term "adverse action" is not defined by 42 C.F.R.
� 1001.102(b)(9). If the regulation is considered in isolation, it might
be logical to read it as requiring a finding of culpability in order for
there to be an adverse action against an individual. However, the regulation
is not an isolated regulation. It is part of a broader set of regulations
which implement the subparts of section 1128 of the Act. The Act and regulations
make it clear, in contexts other than exclusions imposed pursuant to section
1128(a)(1) of the Act, that settling an administrative proceeding by surrendering
a license to provide health care should have the same significance and
consequences as does a finding of culpability and a mandated loss of license.
For example, a separate basis for exclusion exists under section 1128(b)(4)
of the Act where an individual loses his or her license to provide health
care for reasons related to that individual's professional competence,
professional performance, or financial integrity. The Act provides, at
section 1128(b)(4)(B), that a surrender of a license in order to settle
an administrative proceeding is a basis for an exclusion. Under section
1128(b)(5) of the Act, an individual may be excluded if that individual
is excluded or suspended from a State health care program as a consequence
of a State administrative proceeding. Regulations make it plain that exclusion
or suspension includes voluntary withdrawal from a State health care program
in the face of an adverse administrative proceeding. 42 C.F.R. � 1001.501(a)(2). It would make no sense to read 42 C.F.R. � 1001.102(b)(9) as distinguishing a settled proceeding that results in a loss of license from a loss of license resulting from a finding of culpability when all other parts of the Act and regulations which address such circumstances do not make that distinction. For that reason, I conclude that an adverse action under 42 C.F.R. � 1001.102(b)(9) includes the circumstance where an excluded individual surrenders his or her license to provide care as a way of settling an administrative proceeding that is based on the facts that resulted in that individual's conviction of an offense covered by section 1128(a)(1) of the Act.
Petitioner offered no evidence which establishes any of
the mitigating factors that are identified at 42 C.F.R. � 1001.102(c).
Petitioner has offered numerous statements from professional associates
and others attesting to his skill as a physician and his dedication to
his profession, his patients, and his community. See P. Exs. B-J,
N, O. I admitted these statements in order to complete the evidentiary
record of this case. However, they are irrelevant to my decision in that
none of them contain evidence that relates to any mitigating factor. Petitioner
also has offered evidence to show that he has resumed practicing medicine
in New York with the approval of New York State authorities. Such evidence
also is irrelevant inasmuch as it does not relate to a mitigating factor.
Petitioner also has offered evidence concerning the personal hardship
he has experienced since his conviction, including his diagnosis of cancer.
This evidence also is not relevant. Petitioner also argues that he has cooperated with prosecuting authorities. That may be true, but that cooperation does not establish a mitigating factor. A mitigating factor may be established pursuant to 42 C.F.R. � 1001.102(c)(3)(i),(ii), or (iii) where an individual's cooperation results in: others being convicted or excluded from federally financed health care programs; additional cases being investigated or reports being issued by the appropriate law enforcement agency identifying program vulnerabilities or weaknesses; or, imposition of civil money penalties or assessments. Petitioner established that none of these consequences flowed from his cooperation.
Although 42 C.F.R. � 1001.102(b) and (c) establish the
sole factors which may be considered in deciding whether an exclusion
of more than five years is reasonable, these subsections do not prescribe
the weight which is to be given to any factor. The regulation contains
no formula prescribing any exclusion length based on the presence of aggravating
factors or on the absence of mitigating factors beyond the five-year minimum
period that is required by the Act itself. The regulation merely identifies
the factors which may be used to lengthen an exclusion beyond the minimum
period. I must look to the purpose of the Act in order to decide
what is the reasonable length of an exclusion where aggravating or mitigating
factors are present, in the absence of any statement in the regulation
as to how much weight must be given to an aggravating or mitigating factor.
Section 1128 of the Act is remedial. Its purpose is not to punish the
excluded individual, but to protect federally funded health care programs
and the beneficiaries and recipients of program funds from an individual
whose conduct establishes him or her not to be trustworthy. In assessing
the length of any exclusion that is imposed under section 1128, the ultimate
issue that must be addressed is: how long of an exclusion is reasonably
necessary to protect programs and their beneficiaries and recipients from
an untrustworthy individual? An individual may not be excluded arbitrarily for a period of more than five years simply because aggravating factors are present. The evidence that pertains to those factors must be weighed in order to establish the degree of untrustworthiness that is manifested by the excluded individual. An exclusion that is not based on what the evidence shows about the trustworthiness of the excluded individual may be arbitrary and unreasonably punitive. In this case, the record does not establish a basis for the extraordinarily long exclusion that the I.G. determined to impose. The I.G. has imposed what is tantamount to a lifetime exclusion against Petitioner. Yet, the evidence relating to aggravating factors does not suggest that Petitioner is so untrustworthy as to merit so lengthy an exclusion.The evidence pertaining to aggravating factors shows that Petitioner's crimes were relatively less serious than crimes which have supported much shorter exclusion periods in other cases. The amount of money that Petitioner converted to his use - while substantial - was substantially less than amounts that have been used to determine shorter exclusions in other cases. The relatively less serious nature of Petitioner's crime is reflected in the sentence which Petitioner received which, while including incarceration, did not include a prison term. I am not suggesting that the evidence in this case shows
Petitioner to be trustworthy. Indeed, the evidence which relates to aggravating
factors establishes that Petitioner perpetrated a serious crime over a
long period of time. That justifies an exclusion of more than five years.
But, I find that the exclusion that the I.G. imposed is beyond a reasonable
range of exclusions in light of all of the evidence that relates to aggravating
factors and I modify the exclusion accordingly. The I.G. argues that Petitioner's criminal scheme unfolded
over a long period of time and asserts that this is evidence of a high
degree of untrustworthiness. I agree with the I.G. that the length of
time over which Petitioner engaged in fraud is evidence of lack of trustworthiness.
In this case, Petitioner committed acts of fraud for nearly five years. However, other evidence that the I.G. relies on as evidence
of untrustworthiness is not impressive. Although it is true that Petitioner
was incarcerated, his sentence was neither lengthy nor severe. Home confinement
may be incarceration under the applicable regulation, but it does not
suggest the same level of untrustworthiness as a prison sentence. Moreover,
in this case, Petitioner's home confinement was for a brief period of
six months. Most significantly, while the amount of Petitioner's fraud
was substantial it does not rise to the level that I have seen in many
cases in which the I.G. determined to impose substantially shorter periods
of exclusion. For example, in William D. Neese, M.D., DAB CR467
(1997), the I.G. excluded a physician for a period of 10 years. In that
case, the petitioner had defrauded a State Medicaid program for two years
and had committed fraud totaling about $600,000. It is hard to reconcile
the exclusion that the I.G. imposed in Neese with the much lengthier
exclusion that the I.G. imposed here, where the amount of Petitioner's
fraud was only about 1/5 as great as occurred in that case. Furthermore, some of the aggravating factors which exist
in this case do not, when examined closely, add anything substantive to
the evidence of lack of trustworthiness. The fact that Petitioner may
have been overpaid more than $1,500 merely is a restatement of the fact
that he perpetrated fraud in excess of $1,500. And, the adverse administrative
action that was brought against Petitioner by the State of California
was based on the identical facts that supported the criminal charges against
Petitioner. Thus, the action does not suggest a higher degree of untrustworthiness
so much as it shows that the State of California was concerned that Petitioner
was untrustworthy based on the same evidence as was the basis for the
criminal charge. I note that the federal district court judge who sentenced
Petitioner recommended that he be excluded only for five years provided
he pay the full restitution that was imposed. P. Ex. T. I do not rely
on this recommendation for the decision that I have made in this case.
The recommendation is not evidence of a mitigating factor. Moreover, it
is a conditional recommendation, premised on Petitioner paying the full
restitution that was ordered by the judge. Petitioner has not yet paid
that restitution. III. Conclusion I conclude that an exclusion of 15 years is outside of a reasonable range of exclusions given the evidence that relates to aggravating factors. The evidence suggests that an exclusion in the range of from five to ten years is reasonable. Therefore, I modify Petitioner's exclusion to a term of seven years. |
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JUDGE | |
Steven T. Kessel Administrative Law Judge
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