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                              Lonnie K. Sipsy, DO, DAB CR5640 (2020)
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Lonnie K. Sipsy, DO, DAB CR5640 (2020)








  
  
    

  
      
Department of Health and Human Services 
    DEPARTMENTAL APPEALS BOARD
          Civil Remedies Division





Lonnie K. Sipsy, DO
	(NPI: 1518925767 / PTANs: WV6202B; WV6202C)
	Petitioner,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-19-256Decision No. CR5640June 29, 2020

        
              
    

      DECISION
The Medicare enrollment and billing privileges of Petitioner are revoked pursuant to 42 C.F.R. § 424.535(a)(3),1
 effective October 29, 2007.  There is a basis for listing Petitioner on the Centers for Medicare & Medicaid Services (CMS) preclusion list for the duration of his three-year reenrollment bar.
**Page 2**
I.  Background
Palmetto GBA, a Medicare administrative contractor (MAC), notified Petitioner by letter dated August 18, 2017, that his Medicare enrollment and billing privileges were revoked pursuant to 42 C.F.R. § 424.535(a)(3), effective December 1, 2015.  The MAC stated the exclusion was based on Petitioner's February 1, 2008 felony conviction by the U.S. District Court, Southern District of West Virginia (district court) of knowingly and intentionally acquiring and obtaining possession of a schedule III controlled substance by deception and subterfuge.  CMS advised Petitioner that he was subject to a three-year reenrollment bar pursuant to 42 C.F.R. § 424.535(c) to begin 30 days after August 18, 2017, the date of CMS's letter.  CMS Exhibit (Ex.) 1 at 9-10.
Petitioner requested reconsideration by letter dated September 7, 2017.  CMS Ex. 1 at 7‐8.  On December 8, 2017, a CMS hearing officer issued a reconsidered determination upholding the revocation.  CMS Ex. 1 at 1-6.  The hearing officer upheld revocation pursuant to 42 C.F.R. § 424.535(a)(3), but clarified that the applicable subsection of the regulation is 42 C.F.R. § 424.535(a)(3)(ii)(D).  CMS Ex. 1 at 3-4.
Petitioner requested a hearing before an administrative law judge (ALJ) on February 8, 2018 (RFH).  The case was docketed as C-18-529.  On February 14, 2018, the case was assigned to me for hearing and decision and an Acknowledgment and Prehearing Order (Prehearing Order) was issued.
On March 16, 2018, CMS filed a motion for summary judgment and brief in support of its motion (CMS Br.) and CMS Ex. 1.  Petitioner filed his response in opposition to the CMS motion for summary judgment (P. Br.) on April 12, 2018, with Petitioner's exhibits (P. Exs.) 1 through 4.  CMS filed a reply brief on April 25, 2018 (CMS Reply).
On August 1, 2018, CMS notified Petitioner that he would be listed on the CMS preclusion list as defined by 42 C.F.R. §§ 422.2, and 423.100, effective January 1, 2019.  CMS Ex. 2 at 9-10.  Petitioner requested reconsideration on August 27, 2018.  CMS Ex. 2 at 11-12.  On November 30, 2018, a CMS hearing officer upheld the initial determination to place Petitioner on the CMS preclusion list for the duration of his reenrollment bar.  CMS Ex. 2 at 1-6.
On December 4, 2018, Petitioner requested a hearing before an ALJ on the reconsidered determination upholding his placement on the CMS preclusion list.  The case was docketed as C-19-256.  On December 21, 2018, I issued an "Acknowledgment and Order Consolidating C-18-529 and C-19-256 and Dismissing C-18-529."
On January 22, 2019, CMS filed an amended motion for summary judgment and supporting brief addressing both revocation and preclusion list issues.  CMS also filed
**Page 3**
CMS Ex. 2.  On February 13, 2019, Petitioner filed his amended response (P. Br. II) to CMS's motion.  Petitioner also filed on February 13, 2019, a document that is not marked as an exhibit; I treat that document as if marked P. Ex. 5.  CMS waived filing a further reply.
Petitioner objected to my consideration of CMS Ex. 1 to the extent it incorrectly reflects that the date of Petitioner's conviction was February 1, 2008.  P. Br. at 3 n.2, 20.  As explained hereafter, I conclude that the date of Petitioner's conviction was actually October 29, 2007.  CMS Ex. 1 is admitted but any reference therein to a date of conviction of February 1, 2008, is given no weight.  Petitioner did not object to my consideration of CMS Ex. 2 and it is admitted.
CMS objects to my consideration of P. Exs. 1 through 4 on grounds of relevance and that Petitioner has not shown good cause for submitting the documents for the first time before me, rather than previously submitting those documents at reconsideration.  CMS cites 42 C.F.R. § 498.56(e).  CMS Reply at 7-8.  The regulation requires that I examine any new documentary evidence filed by Petitioner to determine whether Petitioner "has good cause for submitting the evidence for the first time at the ALJ level."  42 C.F.R. § 498.56(e)(1).  If I conclude there is good cause, I must include the documentary evidence and consider it in reaching a decision.  If I conclude there is not good cause, I must exclude the evidence and not consider it in reaching a decision.  The regulations in 42 C.F.R. pt. 498 do not define the term "good cause," and the Departmental Appeals Board (Board) has never provided a precise or complete definition of "good cause" as used in 42 C.F.R. pt. 498.  *West Side House LTC Facility*, DAB No. 2791 at 6 (2017) (citing *Rutland Nursing Home*, DAB No. 2582 at 5 (2014)).  Board decisions turn on evaluation of the facts and determination on a case-by-case basis whether the facts fit within any reasonable definition of good cause.  *See e.g.*, *West Side*, DAB No. 2791; *Rutland*, DAB No. 2582; *Nursing Inn of Menlo Park*, DAB No. 1812 (2002); *Cary Health & Rehab. Ctr.*, DAB No. 1771 (2001).  I conclude there is good cause to admit P. Ex. 1 to correct the record for the following reasons.  P. Ex. 1 includes the information filed against Petitioner in the district court; his written guilty plea dated October 29, 2007; the district court day book for October 29, 2007; and the order of the district court dated October 29, 2007 establishing that Petitioner pleaded guilty, his guilty plea was accepted, and he was convicted on October 29, 2007.  P. Ex. 1.  Petitioner erroneously advised the reconsideration hearing officer in his request for reconsideration that he pleaded guilty in the district court in November 2007.  CMS Ex. 1 at 46 ¶ 5; P. Br. at 3-4 n.2.  The hearing officer apparently ignored or did not understand the significance of the Petitioner's statement that he pleaded guilty in November 2007, because she did not request clarification and concluded that Petitioner pleaded guilty on February 1, 2008.  CMS Ex. 1 at 3.  As discussed hereafter, the issue of whether Petitioner was convicted and the date of the conviction must be determined in accordance with 42 C.F.R. § 1001.2.  Furthermore, it is important to correctly determine the date of Petitioner's conviction in
**Page 4**
order to correctly determine the proper effective date for revocation of Petitioner's enrollment.  Accordingly, there is good cause to admit P. Ex. 1 to correct the record presented by CMS and to determine the effective date for revocation of Petitioner's enrollment.
P. Exs. 2, 3, and 4 are not admitted because they are not relevant.  Evidence is relevant if "it has any tendency to make a fact [of consequence, i.e., material] more or less probable than it would be without the evidence."  Federal Rule of Evidence (Fed. R. Evid.) 401.  The narrow issue before me is whether CMS has a basis to revoke Petitioner's Medicare enrollment and billing privileges.  *Dinesh Patel, M.D.*, DAB No. 2551 at 10-11 (2013); *Fady Fayad, M.D.*, DAB No. 2266 at 16 (2009), *aff'd*, *Fayad v. Sebelius*, 803 F. Supp. 2d 699 (E.D. Mich. 2011); *Abdul Razzaque Ahmed, M.D.*, DAB No. 2261 at 16-17, 19 (2009), *aff'd*, *Ahmed v. Sebelius*, 710 F. Supp. 2d 167 (D. Mass. 2010).  Also, at issue before me is whether CMS had a basis to place Petitioner's name on its preclusion list.  The only determination of CMS or the MAC subject to my review in a provider and supplier enrollment case is the reconsidered determination.  42 C.F.R. § 498.5(*l*)(1)-(2); *Neb Group of Ariz. LLC*, DAB No. 2573 at 7.  P. Exs. 2, 3, and 4 are not relevant to any issue I may decide.  Accordingly, P. Exs. 2, 3, and 4 are not admitted as evidence.  42 C.F.R. § 498.60(b)(1) (ALJ only receives relevant evidence.).  Furthermore, I accept as true for purposes of summary judgment that:  Petitioner was employed by FamilyCare Health Centers (FamilyCare) (P. Ex. 3 at 1); Petitioner's employer was a Federally Qualified Health Center (P. Ex. 2); and Petitioner's debarment by the U.S. Office of Personnel Management ended effective September 4, 2013 (P. Ex. 4).
CMS did not object to P. Ex. 5.  Petitioner offers P. Ex. 5 to show that the CMS preclusion action against Petitioner has had an improper adverse effect upon Petitioner's employer, FamilyCare.  P. Br. II at 2-3.  The reconsidered determination dated November 30, 2018, upholds the initial determination to place Petitioner on the CMS preclusion list.  The November 30, 2018 reconsidered determination (CMS Ex. 2 at 1-6) and the August 1, 2018 initial determination placing Petitioner on the preclusion list (CMS Ex. 2 at 9-10) do not purport to place Petitioner's employer on the CMS preclusion list.  Therefore, Petitioner's employer is not an affected party within the meaning of 42 C.F.R. § 498.2, and it has no right to a hearing or ALJ review pursuant to 42 C.F.R. § 498.5(*l*).  P. Ex. 5 includes two letters, one stating that FamilyCare has been placed on a Medicare preclusion list and the other indicating that WomenCare, Inc. was placed on the Medicare preclusion list.  Because I have no reconsidered determination that Petitioner's employer was placed on a CMS or Medicare preclusion list, I have no jurisdiction to review whether they were.  Evidence is relevant if "it has any tendency to make a fact [of consequence] more or less probable than it would be without the evidence."  Fed. R. Evid. 401.  P. Ex. 5 is not relevant to any issue I may decide.  Accordingly, P. Ex. 5 is not admitted as evidence.  42 C.F.R. § 498.60(b)(1).
**Page 5**
II.  Discussion
**A.  Applicable Law**
Section 1831 of the Social Security Act (Act) (42 U.S.C. § 1395j) establishes the supplementary medical insurance benefits program for the aged and disabled known as Medicare Part B.  Payment under the program for services rendered to Medicare-eligible beneficiaries may only be made to eligible providers of services and suppliers.2
  Act §§ 1835(a) (42 U.S.C. § 1395n(a)), 1842(h)(1) (42 U.S.C. § 1395u(h)(1)).  Petitioner, a physician, is a supplier.
The Act requires that the Secretary of Health and Human Services (Secretary) issue regulations that establish a process for the enrollment in Medicare of providers and suppliers, including the right to a hearing and judicial review of certain enrollment determinations, such as revocation of enrollment and billing privileges.  Act § 1866(j) (42 U.S.C. § 1395cc(j)).  Pursuant to 42 C.F.R. § 424.505, a supplier must be enrolled in the Medicare program and be issued a billing number to have billing privileges and to be eligible to receive payment for services rendered to a Medicare-eligible beneficiary.
The Secretary has delegated the authority to revoke enrollment and billing privileges to CMS.  42 C.F.R. § 424.535.  CMS or its Medicare contractor may revoke an enrolled supplier's Medicare enrollment and billing privileges and supplier agreement for any of the reasons listed in 42 C.F.R. § 424.535.  The effective date of the revocation is controlled by 42 C.F.R. § 424.535(g).  After a supplier's Medicare enrollment and billing privileges are revoked, the supplier is barred from reenrolling in the Medicare program for a minimum of one year, but no more than three years.  42 C.F.R. § 424.535(c).
**Page 6**
Effective June 15, 2018, CMS was required to establish a preclusion list as defined by 42 C.F.R. §§ 422.2 and 423.100 (2018).  There is only one preclusion list.  83 Fed. Reg. 16,440, 16,641-67 (Apr. 16, 2018).  CMS adds to the preclusion list suppliers whose  Medicare enrollment and billing privileges are revoked pursuant to 42 C.F.R. § 424.535,  who are currently subject to a reenrollment bar under 42 C.F.R. § 424.535(c), and whose conduct that is the basis for revocation CMS determines is detrimental to the best interests of the Medicare program.  In deciding whether conduct is detrimental to Medicare, CMS considers the seriousness of the conduct, the degree to which the conduct could affect the integrity of the Medicare program, and other evidence CMS considers relevant.  Suppliers not enrolled in Medicare may be added to the preclusion list if CMS determines that their conduct would have provided a basis for revocation of Medicare enrollment and after consideration of the other factors listed above.  42 C.F.R. §§ 422.2, 423.100 (2018).  No payment under Medicare Parts C and D may be made to anyone on the preclusion list.  42 C.F.R. §§ 422.222-.224, 422.504(i)(2)(v), 423.120(c)(6) (2018).  CMS must notify a supplier in writing that the supplier is being added to the preclusion list, the basis for the action, and inform the supplier of the right to ALJ review and appeal pursuant to 42 C.F.R. pt. 498.  42 C.F.R. §§ 422.222(a)(2); 423.120(c)(6)(v) (2018).
A supplier whose enrollment and billing privileges have been revoked or who has been placed on the preclusion list may request reconsideration and review as provided by 42 C.F.R. pt. 498.  42 C.F.R. §§ 424.545(a); 422.222(a)(2); 423.120(c)(6)(v) (2018).  A supplier submits a written request for reconsideration to CMS or its contractor.  42 C.F.R. § 498.22(a).  CMS or its contractor must give notice of its reconsidered determination to the supplier, giving the reasons for its determination and specifying the conditions or requirements the supplier failed to meet, and the right to an ALJ hearing.  42 C.F.R. § 498.25.  If the decision on reconsideration is unfavorable to the supplier, the supplier has the right to request a hearing by an ALJ and further review by the Board.  Act § 1866(j)(8) (42 U.S.C. § 1395cc(j)(8)); 42 C.F.R. §§ 424.545, 498.3(b)(17), (20) (2018), 498.5.  A hearing on the record, also known as an oral hearing, is required under the Act, unless waived.  *Crestview Parke Care Ctr. v. Thompson*, 373 F.3d 743, 748-51 (6th Cir. 2004).  CMS is also granted the right to request ALJ review of a reconsidered determination with which it is dissatisfied.  42 C.F.R. § 498.5(*l*)(2).  The supplier bears the burden to demonstrate that it meets enrollment requirements with documents and records.  42 C.F.R. § 424.545(c).  Preclusion list review is strictly limited to whether there is a basis for adding the supplier to the preclusion list.  83 Fed. Reg. at 16,642.
**B.  Issues**
Whether summary judgment is appropriate;
Whether there was a basis for the revocation of Petitioner's billing privileges and enrollment in Medicare;
**Page 7**
The effective date of revocation; and
Whether there is a basis to list Petitioner on the CMS preclusion list.
**C.  Findings of Fact, Conclusions of Law, and Analysis**
My conclusions of law are set forth in bold followed by the undisputed facts and analysis.
**1.  Summary judgment is appropriate.**
CMS filed a motion for summary judgment, and Petitioner opposes the motion.  A supplier whose enrollment has been revoked and/or who has been placed on the preclusion list has a right to a hearing and judicial review, and a hearing on the record is required under the Act.  Act §§ 205(b) (42 U.S.C. § 405(b)), 1866(h)(1), (j) (42 U.S.C. §§ 1395cc(h)(1), (j)); 42 C.F.R. §§ 498.3(b)(17), 498.5; *Crestview*, 373 F.3d at 748-51.  A party may waive appearance at an oral hearing, but must do so affirmatively in writing.  42 C.F.R. § 498.66(a).  In this case, Petitioner has not waived the right to oral hearing or otherwise consented to a decision based only upon the documentary evidence or pleadings.  Accordingly, disposition on the written record alone is not permissible, unless summary judgment is appropriate as I conclude it is in this case.
Summary judgment is not automatic upon request, but is limited to certain specific conditions.  The Secretary's regulations at 42 C.F.R. pt. 498 that establish the procedures to be followed in adjudicating Petitioner's case do not establish a summary judgment procedure or recognize such a procedure.  However, the Board has long accepted that summary judgment is an acceptable procedural device in cases adjudicated pursuant to 42 C.F.R. pt. 498.  *See, e.g.*, *Ill. Knights Templar Home*, DAB No. 2274 at 3-4 (2009); *Garden City Med. Clinic*, DAB No. 1763 (2001); *Everett Rehab. & Med. Ctr.*, DAB No. 1628 at 3 (1997).  The Board also has recognized that the Federal Rules of Civil Procedure (Fed. R. Civ. P.) do not apply in administrative adjudications such as this, but the Board has accepted that Fed. R. Civ. P. 56 and related cases provide useful guidance for determining whether summary judgment is appropriate.  A summary judgment procedure is described and made available in the adjudication of this case by the Prehearing Order, ¶¶ II.D, G.
Summary judgment is appropriate when there is no genuine dispute as to any issue of material fact for adjudication and/or the moving party is entitled to judgment as a matter of law.  In determining whether there are genuine issues of material fact for trial, the ALJ must view the evidence in the light most favorable to the non-moving party, drawing all reasonable inferences in that party's favor.  The party requesting summary judgment bears the burden of showing that there are no genuine issues of material fact for trial
**Page 8**
and/or that it is entitled to judgment as a matter of law.  Generally, the non-movant may not defeat an adequately supported summary judgment motion by relying upon the denials in its pleadings or briefs but must furnish evidence of a dispute concerning a material fact, i.e., a fact that would affect the outcome of the case if proven.  *Mission Hosp. Reg'l Med. Ctr.*, DAB No. 2459 at 4-5 (2012) (and cases cited therein); *Experts Are Us, Inc.*, DAB No. 2452 at 5-6 (2012) (and cases cited therein); *Senior Rehab. & Skilled Nursing Ctr.*, DAB No. 2300 at 3 (2010) (and cases cited therein); *see also Anderson v. Liberty Lobby, Inc.*, 477 U.S. 242, 248 (1986).
The standard for deciding a case on summary judgment, and an ALJ's decision-making in deciding a summary judgment motion, differ from that used in resolving a case after a hearing or when a hearing is waived.  On summary judgment, the ALJ does not make credibility determinations, weigh the evidence, or decide which inferences to draw from the evidence, as would be done when finding facts after a hearing on the record or when a hearing is waived.  Rather, on summary judgment, the ALJ construes the evidence in a light most favorable to the non-movant and avoids deciding which version of the facts is more likely true.  *Holy Cross Vill. at Notre Dame, Inc.*, DAB No. 2291 at 5 (2009).  The Board also has recognized that, on summary judgment, it is appropriate for the ALJ to consider whether a rational trier of fact could find that the party's evidence would be sufficient to meet that party's evidentiary burden.  *Dumas Nursing & Rehab., L.P.*, DAB No. 2347 at 5 (2010).  The Secretary has not provided in 42 C.F.R. pt. 498 for the allocation of the burden of persuasion or the quantum of evidence required to satisfy the burden of persuasion.  However, the Board has provided some persuasive analysis regarding the allocation of the burden of persuasion in cases subject to 42 C.F.R. pt. 498.  *Batavia Nursing & Convalescent Ctr.*, DAB No. 1904 (2004), *aff'd*,*Batavia Nursing & Convalescent Ctr. v. Thompson*, 129 Fed. App'x 181 (6th Cir. 2005).
There is no dispute that Petitioner was convicted of a felony or that the Inspector General (IG) for the U.S. Department of Health and Human Services (HHS) excluded Petitioner from participation in Medicare and all federal health care programs pursuant to section 1128(a) of the Act (42 U.S.C. § 1320a-7(a)) based on his conviction.  Whether or not there is a basis for revocation pursuant to 42 C.F.R. § 424.535(a)(3)(ii)(D) must be resolved against Petitioner as a matter of law.  Petitioner's asserted defenses must also be resolved against him as a matter of law.  The effective date of revocation must also be resolved against Petitioner as matter of law by applying the regulation to the undisputed facts.  Having determined that there is a basis for revocation, whether or not there is a basis for adding Petitioner to the CMS preclusion list must also be resolved against him as a matter of law.
Viewing the evidence before me in a light most favorable to Petitioner and drawing all inferences in Petitioner's favor, I conclude that there are no genuine disputes as to any material facts pertinent to revocation under 42 C.F.R. § 424.535(a)(3)(ii)(D) or the
**Page 9**
addition of Petitioner to the CMS preclusion list that require a hearing in this case.  CMS is entitled to judgment as a matter of law.  Accordingly, summary judgment is appropriate.
**2.  Petitioner pleaded guilty and was convicted on October 29, 2007, by the district court of the felony offense of knowingly and intentionally acquiring and obtaining possession of a quantity of hydrocodone, a schedule III controlled substance, by deception and subterfuge, in violation of 18 U.S.C. § 2 and 21 U.S.C. § 843(a)(3).**
**3.  The Secretary has determined and provided by regulation that CMS may revoke the Medicare enrollment of a supplier who, within the preceding 10 years, was convicted of a felony that CMS determines is detrimental to the best interests of Medicare and its beneficiaries, in this case a felony that resulted in exclusion pursuant to section 1128(a) of the Act.  42 C.F.R. § 424.535(a)(3).**
**4.  The IG excluded Petitioner from Medicare and all federal health care programs pursuant to section 1128(a)(4) of the Act based on his October 29, 2007 felony conviction by the district court and, therefore, Petitioner was convicted for an offense that is per se detrimental to Medicare and its beneficiaries under 42 C.F.R. § 424.535(a)(3)(ii)(D).**
**5.  Petitioner's October 29, 2007 felony conviction occurred within the ten years preceding the date on which the MAC issued the August 18, 2017 initial determination to revoke Petitioner's Medicare enrollment and billing privileges.**
**6.  There is a basis for the revocation of Petitioner's Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3).**
**7.  The effective date of revocation of Petitioner's Medicare enrollment and billing privileges is, as a matter of law, the date of Petitioner's conviction, October 29, 2007.  42 C.F.R. § 424.535(g).**
**8.  I have no authority to review CMS's determination to impose a three-year bar to Petitioner's re-enrollment in Medicare.**
**9.  The three-year bar to reenrollment began 30 days after the date on which the MAC mailed the notice of revocation, in this case September 17, 2017.  42 C.F.R. § 424.535(c)(i).**
**Page 10**
**10.  There is a basis for adding Petitioner to the CMS preclusion list for the duration of his bar to reenrollment.**
**a.  Undisputed Facts**
The parties were advised in the Prehearing Order ¶ II.G that, for purposes of ruling on a motion for summary judgment, a fact alleged and not specifically denied would be accepted as true, and offered evidence would be considered admissible and true absent a specific objection.  The following findings of fact are based upon the undisputed or conceded facts.  I do not make credibility determinations, weigh the evidence, or decide which inferences to draw from the evidence in deciding a summary judgment motion.  The evidence is viewed in the light most favorable to Petitioner, the nonmovant, with all inferences drawn in Petitioner's favor.
On October 29, 2007, Petitioner pleaded guilty to one count of knowingly and intentionally acquiring and obtaining possession of a quantity of hydrocodone, a schedule III controlled substance, by deception and subterfuge in violation of 18 U.S.C. § 2 and 21 U.S.C. § 843(a)(3).  P. Ex. 1 at 1-2.  The district court accepted Petitioner's guilty plea and adjudged him guilty, also on October 29, 2007.3
  P. Ex. 1 at 3-8; P. Br. at 3.  Whether one has been convicted is to be determined pursuant to 42 C.F.R. § 1001.2.  42 C.F.R. § 424.535(a)(3)(i).  A conviction occurs when a judgment of conviction is entered, a finding of guilt has been made, or a when a guilty plea or no contest plea has been accepted.  42 C.F.R. § 1001.2.  Therefore, I find that October 29, 2007, was the date of Petitioner's conviction.
On March 12, 2008, the IG notified Petitioner that he was required to be excluded from participation in Medicare, Medicaid, and all health care programs pursuant to section 1128(a) of the Act, based on his conviction in the district court.  CMS Ex. 1 at 11-12, 46 ¶ 7, 49-50; P. Br. at 4.  The IG reinstated Petitioner's eligibility to participate in Medicare effective September 4, 2013.  CMS Ex. 1 at 13, 48; P. Br. at 4.
In November 2015, Petitioner signed enrollment applications (CMS-855I and CMS-855R – the November applications) to reenroll in Medicare and to reassign to his employer his right to file claims with Medicare for services delivered to Medicare-eligible beneficiaries, i.e., his billing privileges.  CMS Ex. 1 at 42, 54; P. Br. at 6; CMS Reply at
**Page 11**
5.4
>  There is no dispute Petitioner properly disclosed his felony conviction in his November application (CMS-855I), though the form in evidence does not reflect the IG exclusion.  CMS Ex. 1 at 3-4, 28.  There is no dispute that the November applications were approved and Petitioner was enrolled in Medicare with his billing privileges reassigned to his employer.  P. Br. at 6; CMS Reply at 5.  The effective date of Petitioner's reenrollment is not reflected in the evidence or the briefs of the parties.
Nearly two years later, the MAC notified Petitioner by letter dated August 18, 2017, of its initial determination to revoke his Medicare enrollment and billing privileges.  The MAC cited Petitioner's 2007 felony drug conviction as the basis for revocation pursuant to 42 C.F.R. § 424.535(a).  The MAC incorrectly alleged the conviction occurred on February 1, 2008 rather than October 29, 2007.  Otherwise, there is no dispute the MAC correctly alleged the offense of which Petitioner was convicted, that the offense was a felony, and that the conviction was by the district court.  The MAC advised Petitioner that the revocation was effective December 1, 2015. 5
  The MAC also imposed a three‐year bar to
**Page 12**
reenrollment effective 30 days after August 18, 2017, i.e., September 17, 2017.  CMS Ex. 1 at 9-10.
Petitioner asserts that the current reenrollment bar ends 13 years after his conviction. P. Br. at 7.  The actual period of revocation, based on a correctly determined conviction date of October 29, 2007 under 42 C.F.R. § 424.535(g) plus the current three-year bar to re‐enrollment, is 12 years, 10 months, and 19 days.
If it is determined that there was a basis for revocation of Petitioner's enrollment and billing privileges, there are no other facts that must be found related to the preclusion action.
**b.  Analysis**
Congress granted the Secretary authority to revoke the enrollment of a provider or supplier convicted under federal or state law of a felony offense that the Secretary determines is detrimental to the program or its beneficiaries.  Act § 1866(b)(2)(D) (42 U.S.C. § 1395cc(b)(2)(D)).  The Secretary delegated to CMS the authority to revoke a supplier's billing privileges if CMS determines that the "supplier was, within the preceding 10 years, convicted (as that term is defined in 42 C.F.R. § 1001.2) of a Federal or State felony offense that CMS determines is detrimental to the best interests of the Medicare program and its beneficiaries."  42 C.F.R. § 424.535(a)(3)(i).  The Secretary has specified those crimes that are per se detrimental to the best interests of the program and its beneficiaries in 42 C.F.R. § 424.535(a)(3)(ii).  The listing of per se detrimental felonies in 42 C.F.R. § 424.535(a)(3)(ii) is not exhaustive, but specifically permits revocation for detrimental felonies similar to the crimes listed.  *Abdul Razzaque Ahmed, M.D.*, DAB No. 2261 at 10.
The elements necessary for revocation pursuant to 42 C.F.R. § 424.535(a)(3) are:  (1) the supplier was convicted of a federal or state felony offense; (2) the conviction occurred within the 10 years preceding the revocation action; and (3) the Secretary has specified that the conviction is per se detrimental in 42 C.F.R. § 424.535(a)(3)(ii) or CMS has determined on a case-by-case basis under 42 C.F.R. § 424.535(a)(3)(i) that the supplier's felony offense is detrimental to the best interests of the Medicare program and its beneficiaries.  The Secretary has specified that the conviction of any felony that triggers mandatory exclusion under section 1128(a) of the Act is per se detrimental to the best interests of the Medicare program and its beneficiaries.  42 C.F.R. § 424.535(a)(3)(ii)(D).
I conclude that the undisputed facts establish a basis for revocation of Petitioner's Medicare enrollment under 42 C.F.R. § 424.535(a)(3).  Following are my findings of fact as to each element of the CMS prima facie case:
**Page 13**
(1)  Petitioner was convicted of a felony offense by the federal district court on October 29, 2007.
(2)  The MAC's initial determination to revoke was issued on August 18, 2017, just within the 10 year period of limitations that began the date of Petitioner's conviction – October 29, 2007.
(3)  Petitioner's felony conviction triggered mandatory exclusion pursuant to section 1128(a)(4) of the Act and, for that reason, is per se detrimental pursuant to 42 C.F.R. § 424.535(a)(3)(ii)(D).
The regulation, 42 C.F.R. § 424.535(a), specifies the reasons for which CMS may legally revoke a provider or supplier's billing privileges.  So long as an ALJ finds that CMS had a regulatory basis for revocation, the ALJ (and the Board on appeal) may not refuse to apply the regulation and must sustain the revocation.  *See, e.g.*, *Stanley Beekman, D.P.M.*, DAB No. 2650 at 10 (2015) (an ALJ and the Board must sustain a revocation "[i]f the record establishes that the regulatory elements are satisfied"); *Letantia Bussell, M.D.*, DAB No. 2196 at 13 (2008) (the only issue before an ALJ and the Board in enrollment cases is whether CMS has "established a legal basis for its actions").  It is not my prerogative to review the CMS exercise of discretion to revoke once I have concluded that there is a basis for revocation.
Petitioner makes several arguments for why revocation should not be upheld.
Petitioner argues that the MAC and CMS revocation actions are time barred because his October 29, 2007 conviction occurred more than 10 years before the December 8, 2017 reconsidered determination by CMS.  The Board has stated:
[T]he relevant time frame for assessing compliance [with statutory or regulatory requirements] is when the [MAC] made the initial determination being appealed.  For example, in *Marcus Singel, D.P.M.*, the supplier admitted that its hours of operation had not been posted for several years (allegedly for security reasons) but argued that the hours were reposted right after the site inspection and supplied an (undated) photograph.  DAB No. 2609, at 4 (2014).  The Board rejected these claims of correction, holding that "corrections made after revocation are immaterial to whether the revocation was authorized in the first place."  *Id.* at 7 (citing *Orthopaedic Surgery Assoc.*, DAB No. 2594, at 6 (2014); *Neb Group of Ariz. LLC*, DAB No. 2573, at 6 (2014); and *A to Z DME, LLC*, DAB No. 2303, at 6-7 (2010)); *see also* 73 Fed. Reg.
**Page 14**
36,448, 36,452 (June 27, 2008) ("When a Medicare contractor makes an adverse enrollment determination (for example, enrollment denial or revocation of billing privileges), . . . appeal rights are limited to provider or supplier eligibility at the time the Medicare contractor made the adverse determination.").
*National Seating & Mobility*, DAB No. 2984 at 9 (2020).  In other words, the Board indicates that the question of whether or not action by the MAC or CMS has a basis in fact is answered based on the facts as they existed when the initial determination was made to take the action.  Changes made or actions taken by a provider or supplier after the initial determination do not determine whether or not the provider or supplier was in compliance with regulatory or statutory participation requirements.
Petitioner relies upon some language from my Prehearing Order for an argument that he was not in violation of program participation requirements at the time of the December 8, 2017 reconsidered determination, because more than 10 years had elapsed since his conviction.  P. Br. at 9.  Paragraph II.C of the Prehearing Order states that the issue is whether Petitioner met requirements for participation when the adverse determination was made, citing to the regulatory history.  The formulation, while not specifying which adverse determination, i.e., initial or reconsidered determination, is not inconsistent with the Board's prior statements identifying at what point in time Petitioner's compliance is assessed.  Paragraph II.F of the Prehearing Order discusses the allocation of the burden of persuasion and standard of proof.  The paragraph provides that Petitioner has "the burden of persuasion to show by a preponderance of the evidence that it met program participation requirements or was not in violation of [such] requirements when the reconsidered determination was made."  Unfortunately, the language was not clear enough for Petitioner when read out of context.  Per the Board's decision in *Neb Group of Ariz. LLC*, DAB No. 2573 at 7 and 42 C.F.R. § 498.5(*l*)(2), in provider supplier enrollment cases, a supplier only has the right to request ALJ review of a reconsidered determination by the MAC or CMS.  Furthermore, as Petitioner was notified by paragraph II.E of the Prehearing Order, pursuant to 42 C.F.R. § 498.56(e)(2)(ii), I must exclude evidence not previously offered by Petitioner on reconsideration, absent a showing of good cause.  Therefore, absent a showing of good cause to consider newly offered evidence at the ALJ level, whether or not Petitioner met program participation requirements is judged based on the evidence he offered and the hearing officer considered when making the reconsidered determination – the only adverse determination subject to my review.  Whether or not Petitioner achieved or returned to compliance between the initial determination and the reconsidered determination has never been relevant to my review, though I do not mean to suggest that CMS could not consider such evidence and exercise its discretion to change an earlier action by the MAC or CMS.  Petitioner's incorrect reading of my Prehearing Order provides Petitioner no relief.
**Page 15**
Petitioner provides no credible argument that the CMS initial determination on August 18, 2017, was not within the 10-year period for taking revocation action based on Petitioner's conviction.
Petitioner argues that his Medicare enrollment and billing privileges were revoked due to his exclusion by the IG in 2008 and that revocation ended in 2013 with the reinstatement of Petitioner's eligibility to participate in Medicare.  Petitioner argues that he successfully reenrolled in Medicare following his reinstatement by the IG and that CMS should not be permitted to revoke his enrollment again based on his 2007 conviction.  Petitioner points out that permitting CMS to revoke again based on the 2007 conviction results in a nearly 13-year exclusion from participation in Medicare or revocation of his billing privileges and that should be considered arbitrary and in violation of the purpose of the regulation.  Petitioner argues that the period of revocation should have ended when he was reinstated by the IG and he successfully reenrolled in Medicare in late 2015.  P. Br. at 2; RFH at 1-2.
The Board has previously addressed that revocation by CMS and exclusion by the IG are two distinct administrative remedies that are not mutually exclusive.
The two distinct actions moreover impose different remedies; the revocation impacted only Petitioner's ability to bill the Medicare program for physician services, whereas the exclusion totally bars his participation in all federal health care programs.  *See* 73 Fed. Reg. 36,448, 36,454 (June 27, 2008) (final rule establishing the process for appealing the revocation of billing privileges) ("[u]nlike OIG exclusions which apply government-wide and which generally last for 5 years or longer, the re-enrollment bar only applies to those billing the Medicare program.").
*Gregory J. Salko, M.D.*, DAB No. 2437 at 7 (2012).  Therefore, the Board has concluded that preclusion doctrines such as res judicata and collateral estoppel (issue preclusion) do not bar the IG from imposing exclusion based on the same conviction for which CMS imposed revocation.  *Id*. at 5-6.6
  The Board has stated:  "revocation under [42 C.F.R. § 424.535] and exclusion under section 1128 are distinct remedial tools, each with its own set of prerequisites and consequences for the provider or supplier."  *Abdul Razzaque Ahmed, M.D.*, DAB No. 2261 at 13.  Revocation and exclusion are two different
**Page 16**
administrative enforcement actions delegated to two different components of HHS.  The IG is responsible to impose exclusions pursuant to section 1128 of the Act and 42 C.F.R. pts. 1001.  CMS is responsible for revoking the enrollment of suppliers in Medicare pursuant to 42 C.F.R. § 424.535.  Contrary to the suggestion of Petitioner (P. Br. at 14), the Act and regulations do not limit the discretion of CMS to revoke based upon the same conviction for which the IG has already excluded an individual or entity.  *See Dinesh Patel, M.D.*, DAB No. 2551 at 9 (fact that IG had not yet excluded pursuant to section 1128(a) of the Act, not a bar to revocation based on CMS determination that offense should trigger mandatory exclusion pursuant to section 1128(a)); *Dr. Robert Kanowitz*, DAB No. 2942 at 6 (2019) (enrollment in Medicare denied based on same conviction for which the IG previously excluded the prospective supplier).7
Petitioner argues that the MAC and CMS failed to follow CMS policy published in the Medicare Program Integrity Manual (MPIM), CMS Pub. 100-08, § 15.5.3.  The gist of Petitioner's argument is that when an IG exclusion has ended or been terminated, and if the supplier discloses the prior adverse legal action on an application to enroll, the MAC must process the application unless there is another adverse legal action that precludes processing the application.  P. Br. at 18.  Of course, that is exactly what happened in this case.  There is no dispute that the MAC processed to completion the applications (CMS‐855I and the CMS-855R) that Petitioner signed November 18 and 27, 2015 (CMS Ex. 1 at 42, 54) and enrolled Petitioner in Medicare.  P. Br. at 6; CMS Reply at 5.  Nearly two years later, the MAC revoked Petitioner's billing privileges based on his felony conviction.  CMS Ex. 1 at 9-10.  Petitioner's applications were approved, he was enrolled despite his disclosure of the conviction (but not the exclusion by the IG (CMS Ex. 1 at 28), which was not cited by the MAC or CMS as a basis for revocation), and the MPIM provisions cited by Petitioner were complied with.  However, thereafter the MAC revoked Petitioner's Medicare enrollment and billing privileges.  Petitioner cites no provision of the MPIM that prohibits the MAC or CMS from exercising discretion to revoke under the facts of this case.  The short period of Petitioner's enrollment is effectively rendered a nullity because the regulation requires that the revocation begin effective the date of Petitioner's conviction.  However, that result is not precluded by the
**Page 17**
policies cited by Petitioner.  Furthermore, the reconsideration in this case was conducted by CMS, not the MAC.  The CMS hearing officer specifically considered that the IG excluded and then reinstated Petitioner.  The hearing officer recognized that the conviction underlying the IG action was the same as the conviction upon which the revocation by the MAC is based.  The hearing officer explained in the reconsidered determination that CMS authority to revoke is separate from the IG's exclusion authority and the IG's reinstatement of eligibility for Petitioner to enroll in Medicare did not preclude CMS from revoking Petitioner's subsequent enrollment based on the same conviction, but under separate regulatory provisions that authorize revocation.  CMS Ex. 1 at 4.
Petitioner argues that he was convicted October 29, 2007.  P. Br. at 2-3, 12.  Petitioner's assertion is supported by the evidence that shows that on October 29, 2007, Petitioner pleaded guilty and his guilty plea was accepted by the district court.  P. Ex. 1 at 2-8.  Pursuant to 42 C.F.R. § 1001.2, which is incorporated by reference in 42 C.F.R. § 424.535(a)(3), Petitioner was convicted when his guilty plea was accepted and the judgment of conviction was entered by the district court.  The effective date of the revocation8
 is controlled by 42 C.F.R. § 424.535(g).  The regulation provides that when revocation is based on a felony conviction, the effective date of revocation is the date of the conviction.  42 C.F.R. § 424.535(g).
(g) *Effective date of revocation*. Revocation becomes effective 30 days after CMS or the CMS contractor mails notice of its determination to the provider or supplier, **except** if the revocation is based on Federal exclusion or debarment, **felony conviction**, license suspension or revocation, or the practice location is determined by CMS or its contractor not to be operational.  **When a revocation is based on a** Federal exclusion or debarment, **felony conviction,** license suspension or revocation, or the practice location is determined by CMS or its contractor not to be operational,
**Page 18**
**the revocation is effective with the date of** exclusion or debarment, **felony conviction,** license suspension or revocation or the date that CMS or its contractor determined that the provider or supplier was no longer operational.
42 C.F.R. § 424.535(g) (emphasis added).  This regulation grants CMS and its contractor no discretion to choose an effective date of revocation other than the date of the conviction.  Accordingly, the effective date of Petitioner's revocation, pursuant to 42 C.F.R. § 424.535(a)(3), was October 29, 2007.
When a supplier's Medicare enrollment and billing privileges are revoked, the supplier is barred from reenrolling in the Medicare program for one to three years.  42 C.F.R. § 424.535(c).  In this case, CMS determined that a three-year bar was appropriate.  Petitioner argues that the reenrollment bar should have ended in 2010 or 2011 depending on whether it commenced at the time of conviction or exclusion.  P. Br. at 13.  There is no statutory or regulatory language establishing a right to review of the duration of the reenrollment bar CMS imposes, or when it commenced or ended.  Act § 1866(j)(8); 42 C.F.R. §§ 424.535(c), 424.545, 498.3(b), 498.5.  The Board has held that the duration of a revoked supplier's reenrollment bar is not an appealable initial determination listed in 42 C.F.R. § 498.3(b) and, thus, is not subject to ALJ review.  *Vijendra Dave*, DAB No. 2672 at 11 (2016).  Furthermore, Petitioner's argument, which is based on the faulty notion that revocation is automatic without action by CMS, overlooks that the regulation specifically provides that the reenrollment bar commences 30 days after CMS or the MAC mail notice of revocation.  42 C.F.R. § 424.535(c)(1)(i).  Petitioner also argues that his reenrollment in 2015 satisfied the requirements of 42 C.F.R. § 424.535(c) and (d).  P. Br. at 13.  Petitioner's argument fails however because he fails to recognize that the exclusion action by the IG and the reinstatement of Petitioner's eligibility to enroll in Medicare by the IG are not the same administrative action as the revocation by CMS.  It is undisputed that the CMS revocation action did not occur until after Petitioner reenrolled in late 2015.  The IG exclusion barred Petitioner's participation in Medicare, Medicaid, and all federal health care programs until the IG reinstated Petitioner's eligibility to participate.  Following the exclusion, Petitioner had no billing privileges to revoke.  Only after Petitioner reenrolled did he have billing privileges that were subject to revocation by CMS.  For the reasons already discussed, I conclude that no preclusion doctrine or concept of double jeopardy prevents CMS from exercising its discretion to revoke based on facts that the IG excluded Petitioner for the same conviction, the IG subsequently reinstated Petitioner's eligibility to participate in Medicare, or that CMS, subsequent to the reinstatement by the IG, processed to completion an enrollment application that clearly disclosed the prior final adverse legal action, i.e., the conviction (though not the IG exclusion – CMS Ex. 1 at 27-28).
**Page 19**
Petitioner argues that he was employed by FamilyCare because the MAC had permitted him to reenroll and establish Medicare billing privileges.  Petitioner argues that his patients should not be prejudiced by the MAC's arbitrary action of revoking his Medicare enrollment and billing privileges.  P. Br. at 19.  I accept Petitioner's assertions of fact as true for purposes of summary judgment.  However, Petitioner's arguments are requests for equitable relief that I have no authority grant.  When I determine, as I have here, that CMS has a basis for revocation, I have no authority to substitute my judgment and void the revocation based on equitable considerations.  *US Ultrasound*, DAB No. 2302 at 8 (2010).  Furthermore, I am required to follow the Act and regulations and have no authority to declare statutes or regulations invalid.  *1866ICPayday.com, L.L.C.*, DAB No. 2289 at 14 (2009).  Furthermore, to the extent that Petitioner seeks a determination that CMS should be estopped from revoking Petitioner's Medicare enrollment and billing privileges, estoppel against the federal government, if available at all, is presumably unavailable absent "affirmative misconduct," such as fraud.  *See, e.g.*,*Pac. Islander Council of Leaders*, DAB No. 2091 at 12 (2007); *Office of Pers. Mgmt. v. Richmond*, 496 U.S. 414, 421-22 (1990).  Petitioner points to no evidence of affirmative misconduct such as fraud by the MAC.
Petitioner argues in response to the CMS motion for summary judgment, related to adding Petitioner to the CMS preclusion list, that the underlying revocation is invalid.  P. Br. II at 1-2.  However, because I have found that there is a basis for revocation, CMS has a basis for adding Petitioner to the CMS preclusion list for the duration of his reenrollment bar.  I find no authority to conduct review of the CMS exercise of discretion in determining that Petitioner's underlying conduct was detrimental to Medicare and in adding Petitioner to the preclusion list where, as here, I determine that there is a basis for such action.  42 C.F.R. §§ 422.2, 423.100 (2018) (definition of preclusion list); 83 Fed. Reg. 16,440, 16,641-67.  Petitioner also argues that placing him on the preclusion list has adversely affected his employer.  P. Br. II at 2-3.  However, Petitioner's employer is not a party to the proceeding before me and, even if it was, I have no authority to fashion any equitable relief for the reasons already discussed.
**Page 20**
III.  Conclusion
For the foregoing reasons, the Medicare enrollment and billing privileges of Petitioner are revoked pursuant to 42 C.F.R. § 424.535(a)(3), effective October 29, 2007.  There is a basis for listing Petitioner on the CMS preclusion list for the duration of his three‐year bar to reenrollment.


          /s/
        Keith W. Sickendick

                      Administrative Law Judge
      1. Citations are to the 2016 revision of the Code of Federal Regulations (C.F.R.) which was in effect at the time of the initial determination, unless otherwise indicated.  An appellate panel of the Departmental Appeals Board (Board) concluded in Mark A. Kabat, D.O., DAB No. 2875 at 9-11 (2018) that the applicable regulations are those in effect at the time of the initial determination.  However, the Board previously concluded that the only determination subject to my review in a provider and supplier enrollment case such as this is the reconsidered determination.  Neb Group of Ariz. LLC, DAB No. 2573 at 7 (2014).  In this case, the applicable regulations did not change between the issuance of the initial and reconsidered determinations. back to note 1
                      2. A "supplier" furnishes services under Medicare and includes physicians or other practitioners and facilities that are not included within the definition of the phrase "provider of services."  Act § 1861(d) (42 U.S.C. § 1395x(d)).  A "provider of services," commonly shortened to "provider," includes hospitals, critical access hospitals, skilled nursing facilities, comprehensive outpatient rehabilitation facilities, home health agencies, hospice programs, and a fund as described in sections 1814(g) (42 U.S.C. § 1395f(g)) and 1835(e) (42 U.S.C. § 1395n(e)) of the Act.  Act § 1861(u) (42 U.S.C. § 1395x(u)).  The distinction between providers and suppliers is important because they are treated differently under the Act for some purposes. back to note 2
                      3. Petitioner was sentenced on February 1, 2008.  CMS Ex. 1 at 56-61.  The date of sentencing does not determine the date of conviction.  42 C.F.R. § 1001.2. back to note 3
                      4. CMS states in its reply brief that it is undisputed that Petitioner submitted an application to enroll in 2013 that was approved.  CMS Reply at 5.  The date 2013 appears to be a clerical error as there is no evidence or assertion by Petitioner that he submitted an enrollment application in 2013 that was approved.  Petitioner explains in a letter submitted with his November 2015 applications that he submitted an application in November 2014, that was denied pursuant to 42 C.F.R. § 424.530.  Petitioner does not indicate whether the denial was based upon his conviction.  However, Petitioner states that the denial was subsequently changed to a rejection pursuant to 42 C.F.R. § 424.525.  The rejection provoked the filing of the new CMS-855I and CMS-855R by Petitioner in November 2015.  CMS Ex. 1 at 44-45. back to note 4
                      5. Petitioner points out that the evidence shows that applications Petitioner signed in November 2015 were not postmarked until December 8, 2015.  Petitioner also states that Petitioner's employer did not start billing Medicare for Petitioner's services until May 2016.  Petitioner expresses confusion about why the MAC's initial determination to revoke provided that revocation was effective December 1, 2015.  CMS Ex. 1 at 14; P. Br. at 6 n.4.  The CMS hearing officer also failed to address in her reconsideration determination why revocation was effective December 1, 2015, rather than the date the applications were received by the MAC.  CMS Ex. 1 at 1-6.  It is not necessary for me to determine the reason the MAC determined revocation was December 1, 2015, for, as discussed hereafter, that determination was in error and violated 42 C.F.R. § 424.535(g), which grants the MAC and CMS no discretion in determining the effective date of a revocation once the determination to revoke is made. back to note 5
                      6. The Board also commented that preclusion doctrines simply have no application in the context of a revocation by CMS and an exclusion by the IG.  Id. at 6. back to note 6
                      7. Petitioner does not specifically assert that the revocation and exclusion violate the Double Jeopardy Clause of the US Constitution (US Const. amend. V).  Had he done so, I would conclude that there is no violation on the same rationale as discussed by the Board in Joann Fletcher Cash, DAB No. 1725 at 4-8 (2000).  In short, the Double Jeopardy Clause only protects against multiple criminal punishments for the same offense.  The fact that the exclusion and revocation are based on the same criminal conviction does not render either exclusion or revocation criminal punishment and subject to the Double Jeopardy Clause. back to note 7
                      8. Petitioner asserts that his billing privileges were revoked as a matter of law on the date of his felony conviction, citing 42 C.F.R. § 424.535(g).  P. Br. at 11.  While the effective date of revocation is determined based on the date of the felony conviction, contrary to Petitioner's suggestion, revocation is not automatic, but CMS has discretion not to revoke.  The regulation is clear that CMS "may revoke" for any of the reasons listed in 42 C.F.R. § 424.535(a).  42 C.F.R. § 424.535(a).  However, once the decision is made to revoke, CMS has no discretion under 42 C.F.R. § 424.535(g) to determine the effective date of revocation, as the regulation specifies that date is the date of conviction. back to note 8 Back to top
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