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                              Roji Esha, DAB CR6083 (2022)
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Roji Esha, DAB CR6083 (2022)








  
  
    

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





Roji Esha,
(OI File No.: B-20-41397-9),
Petitioner,

v.

The Inspector General,

Respondent.
Docket No. C-22-75Decision No. CR6083May 23, 2022

        
              
    

      DECISION

The Inspector General of the United States Department of Health and Human Services (IG) excluded Petitioner, Roji Esha, from participation in Medicare, Medicaid, and all other federal health care programs pursuant to section 1128(a)(1) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(1)).  Petitioner’s exclusion for the minimum period of five years is required by section 1128(c)(3)(B) of the Act (42 U.S.C. § 1320a-7(c)(3)(B)).  While the IG proved the presence of two aggravating factors and is therefore permitted to extend the minimum exclusion period of five years, an additional exclusion of two years, for a total minimum exclusion of seven years, is unreasonable based on consideration of the specific facts and circumstances of the two aggravating factors.  I affirm the IG’s exclusion determination and reduce the length of exclusion to five years and six months.

I.   Procedural History

The IG issued a notice to Petitioner on August 31, 2021, informing her that she was being excluded from participation in Medicare, Medicaid, and all federal health care programs for seven years.  IG Exhibit (Ex.) 1 at 1.  The IG cited section 1128(a)(1) of the Act as

Page 2

the basis for Petitioner’s exclusion.  The IG stated that the exclusion was based on Petitioner’s conviction in the Superior Court of California, County of Sacramento, of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  The IG extended the mandatory five-year exclusion to seven years, because (a) Petitioner’s sentence included incarceration, and (b) the State of California, Department of Health Care Services suspended Petitioner from participating in the Medi-Cal program.  IG Ex. 1 at 1-2.  The Petitioner timely requested a hearing, and I was designated to hear and decide this case.  The Civil Remedies Division issued an Acknowledgment Notice and my Standing Prehearing Order (Prehearing Order).

I conducted a pre-hearing telephone conference on January 11, 2022, the substance of which I memorialized in my January 14, 2022 Order, including a schedule for submission of arguments and evidence by the parties.  The IG submitted a brief (IG Br.), and nine exhibits (IG Exs. 1-9), while Petitioner submitted a brief (P. Br.) and seven exhibits (P. Exs. 1-7).  The IG also submitted a reply brief (IG Reply).

II.   Exhibits and Decision on the Record

Neither party objected to the proposed exhibits.  I therefore admit IG Exhibits 1 through 9 and Petitioner’s Exhibits 1 through 7 into evidence.

Although Petitioner requests an oral hearing on this matter, Petitioner has not proposed any witnesses.  P. Br. at. 3.  The IG requests that Petitioner’s request for an oral hearing be denied.  IG Reply at 5.  An in-person hearing would serve no purpose in this matter given the current record and is therefore unnecessary; this matter as such will be decided on the written record.  *See* Civ. Remedies Div. P. § 19(d).

III.   Issues

The Secretary of Health and Human Services (the Secretary) has by regulation limited my scope of review to two issues:  Whether the IG has a basis for excluding Petitioner from participating in Medicare, Medicaid, and all other federal health care programs and, if so, whether the length of the exclusion imposed by the IG is unreasonable.  *See* 42 C.F.R. § 1001.2007(a)(1).  Here, the Petitioner concedes the IG has a basis to exclude her from participation in federal health care programs under section 1128(a)(1) of the Act.  RFH at 4.  Therefore, the only issue in this case is whether the seven-year period of exclusion imposed by the IG is reasonable.  42 C.F.R. § 1001.2007.

IV.   Applicable Law

Section 1128(f) of the Act (42 U.S.C. § 1320a-7(f)) establishes Petitioner’s right to a hearing by an administrative law judge (ALJ) and judicial review of the final action of the Secretary.  The right to a hearing before an ALJ is set forth in 42 C.F.R.

Page 3

§§ 1001.2007(a) and 1005.2, while the rights of both the sanctioned party and the IG to participate in a hearing are specified at 42 C.F.R. § 1005.3.

Pursuant to section 1128(a) of the Act, the Secretary must exclude from participation in any federal health care program any individual convicted under federal or state law of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  Act § 1128(a)(1).  A state health care program includes a state Medicaid program.  Act § 1128(h)(1) (42 U.S.C. § 1320a-7(h)(1)).  Pursuant to section 1128(i) of the Act (42 U.S.C. § 1320a-7(i)), an individual is convicted of a criminal offense when, among other things, a plea of guilty or no contest is accepted by a court.  The Secretary has promulgated regulations implementing these provisions of the Act.  42 C.F.R. § 1001.101(a), (c).1
  There may be no collateral attack of the conviction that is the basis for the exclusion.  42 C.F.R. § 1001.2007(d).

Exclusion for a minimum period of five years is mandatory for any individual or entity convicted of a criminal offense for which exclusion is required by section 1128(a) of the Act.  Act § 1128(c)(3)(B) (42 U.S.C. § 1320a-7(c)(3)(B)).  Pursuant to 42 C.F.R. § 1001.102(b), an individual’s period of exclusion may be extended based on the presence of specified aggravating factors.  Only if the aggravating factors justify an exclusion of longer than five years, however, are mitigating factors considered as a basis for reducing the period of exclusion to no less than five years.  42 C.F.R. § 1001.102(c).

In this proceeding, the standard of proof is a preponderance of the evidence.  42 C.F.R. § 1001.2007(c).  Petitioner bears the burden of proof and the burden of persuasion on any affirmative defenses or mitigating factors, and the IG bears the burden on all other issues.  42 C.F.R. § 1005.15(b), (c); Prehearing Order ¶ 5.

V.   Findings of Fact, Conclusions of Law, and Analysis

My conclusions of law are set forth in bold and followed by pertinent findings of fact and analysis.

**A. I have jurisdiction to hear this case.**

Petitioner timely requested a hearing.  I therefore have jurisdiction to hear and decide this case.  *See* 42 C.F.R. §§ 1001.2007(a)(1)-(2), 1005.2(a); *see also* 42 U.S.C. § 1320a-7(f)(1).

Page 4

**B. Petitioner was convicted of a criminal offense related to the delivery of a health care item or service under the Medicare program requiring exclusion under 42 U.S.C. § 1320a-7(a)(1).**

The IG must exclude an individual from participation in federal health care programs if the individual was convicted of a criminal offense related to the delivery of a health care item or service under the Medicare program.  42 U.S.C. § 1320a-7(a)(1).  Here, Petitioner concedes she was convicted of an offense requiring exclusion.  RFH at 4; P. Br. at 1.  Nevertheless, because the nature and circumstances of her conviction are relevant to the outcome here, I note them for the record.

On February 27, 2019, in a Felony Complaint (Complaint) filed in the Superior Court of the State of California, County of Sacramento (state court), Petitioner was charged with committing crimes set out in five counts.  IG Ex. 2 at 1-3.  Count 1 of the Complaint alleged that “[f]rom on or about April 4, 2015, to on or about March 8, 2016, [Petitioner] unlawfully took from the State of California property of a value in excess of . . . $950, to wit, $18,193.46, in violation of section 487, subdivision (a) of the [California] Penal Code, a felony.”  *Id.* at 1.  Count 2 of the Complaint alleged:

[f]rom on or about April 4, 2015, to on or about March 8, 2016, [Petitioner], with intent to defraud, presented and caused to be presented for allowance and payment false and fraudulent claims for furnishing services under the Medi Cal Act, to wit, time sheets for In-Home Supportive Services allegedly provided to [a named individual], in violation of section 14107, subdivision (b)(1) of the [California] Welfare and Institutions Code, a felony.

*Id.* at 2.

On October 21, 2020, Petitioner entered a plea of guilty to Counts 1 and 2 of the Complaint.  IG Ex. 3; IG Ex. 2 at 1-2.  The state court accepted Petitioner’s guilty plea, found her guilty of Counts 1 and 2 as misdemeanors, found that Petitioner’s plea was voluntary, and that there was a factual basis for the plea.  IG. Ex. 3.  According to a report from the California Attorney General’s Office to the Office of Inspector General on Petitioner’s convictions for “Presenting False Medi-Cal [In-Home Support Services] Claims” and “Grand Theft,” Petitioner “provided In-Home Support Services to a beneficiary, who subsequently entered a Skilled Nursing Facility as a resident.  Despite this, [Petitioner] continued to bill for In-Home Support Services that she did not provide.”  IG. Ex. 4 at 2.

Petitioner states that while her mother, the beneficiary, was admitted, she continued to care for her and “would visit her at the hospital and bring her cultural food that

Page 5

[Petitioner] cooked, and clothing, and stay [sic] at the hospital and slept in a chair beside her bed.”  P. Ex. 7 at ¶ 8.  Petitioner further states that while her mother was admitted at various facilities, Petitioner “continued to put on the IHSS timecards the maximum hours that [Petitioner] was allowed as a Provider, because no one at IHSS told [Petitioner] that [Petitioner] could not be paid for the continued care of [her] mother while she was in the hospital” and that “[d]ue to [Petitioner’s] limited English, [Petitioner] was unable to read and understand in detail the print on [sic] IHSS Provider Agreement.”  *Id.*at ¶ 9.

On October 22, 2020, the state court sentenced Petitioner to 90 days in the county jail and three years of probation.  Petitioner was also ordered to pay $440 in fees and fines and restitution of $16,671.71 – for which she paid in full.  IG. Ex. 4 at 2; IG Ex. 5; IG. Ex. 6; *see*P. Ex. 5 at 2 (confirming receipt of Petitioner’s restitution prior to her plea).

The facts pertaining to Petitioner’s conviction clearly establish that Petitioner was convicted of a criminal offense related to the delivery of a health care item or service under the Medicare program requiring exclusion under 42 U.S.C. § 1320a-7(a)(1).  *See* *Travers v. Shalala*, 20 F.3d 993, 998 (9th Cir. 1994) (affirming conviction for filing fraudulent claims with the Medicaid program is “a program‐related offense” and “such financial misconduct is exactly what Congress sought to discourage” through imposing exclusions).

**C. Petitioner must be excluded for a minimum of five years.**

Because I have concluded that a basis exists to exclude Petitioner pursuant to 42 U.S.C. § 1320a-7(a)(1), she must be excluded for a minimum of five years.  42 U.S.C. § 1320a-7(c)(3)(B).

**D. The IG has established two aggravating factors which together permit the IG to lengthen the exclusion beyond the five-year statutory minimum.**

Of the two aggravating factors identified by the IG, Petitioner disagrees to both the weight assigned to them and the appropriateness of their application.  P. Br. at 4-5.  I have reviewed the application of both aggravating factors as the IG bears the burden of establishing that they are warranted.  42 C.F.R. § 1005.15(c).  Petitioner also argues that the IG failed to consider several mitigating factors.  P. Br. at 2-3.  Petitioner has the burden of proving mitigating factors, and I analyze the application of this factor below as well.  42 C.F.R. § 1005.15(c).

Page 6

**1. The IG established Petitioner was incarcerated as part of her sentence as required by 42 C.F.R. § 1001.102(b)(5).**

As a result of the plea agreement Petitioner made with the government, the state court rendered judgment against her.  IG Ex. 4.  As part of that judgment, the state court sentenced Petitioner to 90 days in the county jail with no objection to work release.  IG Ex. 5; P. Ex. 7 at ¶ 14.  Petitioner ultimately served a total of 46 days in a remote electronic monitoring program.  RFH at 4; IG Ex. 9.  The regulations define incarceration to include “any type of confinement with or without supervised release, including, but not limited to, community confinement, house arrest and home detention.”  42 C.F.R. § 1001.2.  The IG has established Petitioner’s sentence included a period of incarceration.

**2. The IG established that Petitioner was subject to an adverse action by a Federal, State or local government under 42 C.F.R. § 1001.102(b)(9).**

On February 18, 2021, the Petitioner’s criminal conviction resulted in the agency that administers California’s Medicaid program – the Department of Health Care Services (DHCS) – suspending Petitioner from participation in the Medi-Cal program.  IG. Ex. 7 at 1.  In the notice of suspension, DHCS stated that Petitioner “unlawfully claimed payment for IHSS claims when [she] did not actually provide such services to the beneficiary.”  *Id.*  DHCS determined that Petitioner’s conviction was “substantially related to the qualifications, functions, or duties of a provider of service” to require her suspension from participating in the Medi-Cal program under the requirements of the California Welfare and Institutions Code section 14123(a).  *Id.*The IG has established that Petitioner has been the subject of an adverse action by a State government agency – DHCS – based on the same set of circumstances that serves as the basis for the imposition of the IG’s exclusion.

**3. There are no mitigating factors applicable in this case.**

If any of the aggravating factors authorized by 42 C.F.R. § 1001.102(b) that permit the IG to impose an exclusion of longer than five years apply, as they do in this case, then mitigating factors may be considered as a basis for reducing the period of exclusion to no less than five years.  42 C.F.R. § 1001.102(c).  The IG did not list, and therefore did not consider, any mitigating factors in deciding to extend Petitioner’s exclusion to seven years.  In response to Petitioner’s argument that certain mitigating factors should reduce the length of exclusion, the IG argues there is no evidence of any mitigating factors under 42 C.F.R. § 1001.102(c) to support the reduction of Petitioner’s exclusion to the mandatory minimum of five years.  IG Reply at 2-3; *see also*IG Br. at 12.

Page 7

The only authorized mitigating factors that I may consider are listed in 42 C.F.R. § 1001.102(c):

(1)  In the case of an exclusion under § 1001.101(a), whether the individual or entity was convicted of three or fewer misdemeanor offenses and the entire amount of financial loss (both actual loss and intended loss) to Medicare or any other Federal, State, or local governmental health care program due to the acts that resulted in the conviction, and similar acts, is less than $5,000;

(2)  The record in the criminal proceedings, including sentencing documents, demonstrates that the court determined that the individual had a mental, emotional or physical condition before or during the commission of the offense that reduced the individual’s culpability; or

(3)  The individual’s or entity’s cooperation with Federal or State officials resulted in –

(i)  Others being convicted or excluded from Medicare, Medicaid and all other Federal health care programs,

(ii)  Additional cases being investigated or reports being issued by the appropriate law enforcement agency identifying program vulnerabilities or weaknesses, or

(iii)  The imposition against anyone of a civil money penalty or assessment under part 1003 of this chapter.

Petitioner has the burden to prove by a preponderance of the evidence that there is a mitigating factor for me to consider.  42 C.F.R. § 1005.15(c); Prehearing Order ¶ 5.

Petitioner urges me to consider the following to be mitigating factors that justify reducing the period of her exclusion:  Petitioner’s limitations of the English language that caused her to be unaware of the policies regarding provider payments while her mother was in the hospital; Petitioner’s completion of her restitution payment;2
 and Petitioner’s lack of

Page 8

prior convictions.  P. Br. at 2-3.  Petitioner also argues that “[t]he ‘punishment’ of an enhanced period of seven years is disproportionate” with her conviction and exclusion from the Medi-Cal program and violates the double jeopardy clause.  *Id.* at 3.

Generally, I am bound to follow the federal statutes and regulations and have no authority to declare them unconstitutional.  *Susan Malady, R.N.*, DAB No. 1816 (2002); 42 C.F.R. § 1005.4(c)(1).  In interpreting and applying the Act and regulations, I must do so consistent with Constitutional principles.  Petitioner has preserved her double jeopardy and cruel and unusual punishment arguments for appeal, though both the Board and the federal courts have rejected similar arguments before.  Exclusions imposed by the IG are civil sanctions, remedial in nature and not punitive and criminal.  Because exclusions are remedial sanctions, neither the double jeopardy clause nor the prohibition against cruel and unusual punishment apply.  *Manocchio v. Kusserow*, 961 F.2d 1539 (11th Cir. 1992); *Greene v. Sullivan*, 731 F. Supp. 838 (E.D. Tenn. 1990); *Joann Fletcher Cash*, DAB No. 1725 (2000); *Douglas Schram, R.Ph.*, DAB No. 1372 (1992); *Janet Wallace, L.P.N.*, DAB No. 1326 (1992).  Furthermore, arguments that the exclusion provisions are anything but remedial have been found to be without merit.  *Manocchio*, 961 F.2d at 1541-42; *Greene*, 731 F. Supp. at 839-40.  The federal courts have also rejected claims that the Secretary’s exclusion procedures amount to a deprivation of due process, finding no constitutionally protected property or liberty interests.  *Rodabaugh v. Sullivan*, 943 F.2d 855 (8th Cir. 1991); *Lavapies v. Bowen*, 883 F.2d 465 (6th Cir. 1989); *Hillman Rehab. Ctr. v. U.S. Dep’t. of Health & Human Servs.*, No. 98-3789 (GEB), slip op. at 16, 1999 WL 34813783, at 16 (D.N.J. May 13, 1999); *Travers v. Sullivan*, 801 F. Supp. 394, 404‐05 (E.D. Wash. 1992), *aff’d, Travers v. Shalala*, 20 F.3d 993 (9th Cir. 1994).

Accepting as true Petitioner’s representations as to her lack of English proficiency and its impact on her underlying conviction, the payment of restitution, and her lack of prior convictions, none of Petitioner’s asserted mitigating factors are a mitigating factor that I am authorized to consider to reduce the period of exclusion imposed by the IG.  42 C.F.R. § 1001.102(c).  Therefore, Petitioner has failed to meet her burden to show the existence of any regulatorily permissible mitigating factor.

**E. Given the specific facts pertaining to the applicable aggravating factors, a seven-year exclusion period is unreasonable, and I therefore reduce the length of exclusion to five years and six months.**

The purpose of any exclusion is remedial. *Manocchio*, 961 F.2d at 1541-42; *Greene*, 731 F. Supp. at 839-40.  The intent is not to punish, but to assure that trust funds and their beneficiaries and recipients are protected from individuals who are untrustworthy.  While the IG is not compelled to extend the length of exclusion for any period of time beyond

Page 9

five years in the presence of aggravating factors, it may choose to exercise its discretion to do so.  I must uphold the IG’s determination as to the length of exclusion unless it is unreasonable.  42 C.F.R. § 1001.2007(a)(1)(ii).  As the Secretary stated in the preamble to the final rule establishing the exclusion regulations: “So long as the amount of time chosen by the OIG is within a reasonable range, based on demonstrated criteria, the ALJ has no authority to change it under this rule.”  57 Fed. Reg. 3298 at 3321 (Jan. 29, 1992).  The Board has also made clear that the role of the ALJ in exclusion cases is to conduct a de novo review of the facts related to the basis for the exclusion and the existence of aggravating and mitigating factors identified at 42 C.F.R. § 1001.102 and to determine whether the period of exclusion imposed by the IG falls within a reasonable range.  *Craig Richard* *Wilder*, DAB No. 2416 at 8 (2011); *Joann Fletcher Cash*, DAB No. 1725 at 17 n.6 (2000).

It is important to note in performing a de novo review that it is the quality of the aggravating (or mitigating) factors that is most important when considering the length of exclusion, and not the sheer number of aggravating factors that are present in a given case.  As the Secretary also stated in the preamble to the final rule establishing the exclusion regulations:

We do not intend for the aggravating and mitigating factors to have specific values; rather, these factors must be evaluated based on the circumstances of a particular case.  For example, in one case many aggravating factors may exist, but the subject’s cooperation with the OIG may be so significant that it is appropriate to give that one mitigating factor more weight than all of the aggravating.  Similarly, many mitigating factors may exist in a case, but the acts could have had such a significant physical impact on program beneficiaries that the existence of that one aggravating factor must be given more weight than all of the mitigating.  The weight accorded to each mitigating and aggravating factor cannot be established according to a rigid formula, but must be determined in the context of the particular case at issue.

57 Fed. Reg. 3298 at 3314-15.  *See also**Sushil Aniruddh Sheth, M.D.*, DAB No. 2491 at 5 (2012) (finding that the evaluation of what constitutes an appropriate range does not depend on the number of aggravating or mitigating factors, or any rigid formula for weighing those factors, but rather on a case-specific analysis of the weight merited by each factor “based on a qualitative assessment of the circumstances surrounding the factors” at issue).

Here, the IG proved by a preponderance of the evidence two aggravating factors, but in quality, the aggravating factors have little to no weight in demonstrating the further

Page 10

untrustworthiness of the Petitioner beyond that which can be assessed from the facts forming the basis of the exclusion itself.  The IG failed to demonstrate that a two-year lengthening of the exclusionary period – which is nearly 50% longer than the statutorily required five-year base exclusion period – falls within a reasonable range.

**1. The length of incarceration imposed in the sentence was minimal and therefore it would be unreasonable for the period of exclusion to be lengthened by more than six months on these facts.**

Petitioner was sentenced to 90 days incarceration and ultimately served only 46 days of remote electronic monitoring in lieu of custodial incarceration as a result of her guilty plea to two misdemeanors.3
  IG Exs. 5, 9.  Given the short period of incarceration in the sentence and an even shorter time served only via remote electronic monitoring, it would be unreasonable for the length of exclusion to be extended more than six months, and the IG could certainly have reasonably concluded to extend the exclusionary period for less than six months or not at all.  *Cf. Jason Hollady, M.D., a/k/a Jason Lynn Hollady,*DAB No. 1855 (2002) (finding that a nine-month period of incarceration was more than “a token incarceration.”).

**2. The IG failed to demonstrate that Petitioner’s suspension from Medi-Cal further evidences Petitioner’s lack of trustworthiness such that an increase in the length of exclusion would be reasonable.**

In the preamble to the final rule first establishing additional convictions or adverse actions as a permissive aggravating factor,4
 the Secretary articulated the following intent behind promulgating this aggravating factor:

While the language set forth in these sections is permissive, it is specifically designed to address the issue of an individual's or entity's trustworthiness.

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* * * *

The intent of the revised language is to allow the OIG to increase the length of exclusion if an individual or entity was convicted of *other* offenses at the same time as he or she was convicted of the offense that served as the basis for the exclusion.  Inclusion of this aggravating factor will permit the OIG to increase a length of exclusion when an individual is convicted of Medicare fraud and any other offense, such as drug distribution or income tax evasion.  The aggravating factor will take into consideration ***separate and different*** types of convictions that occurred concurrently; ***we do not intend to use the basis of the OIG exclusion more than once as a factor in lengthening an exclusion***.

63 Fed. Reg. 46676, 46680-81 (Sept. 2, 1998) (bolded and italicized emphasis added).  From this preamble discussion, the intent behind the aggravating factor is thus to allow the IG to lengthen the period of exclusion from five years if the facts forming the basis of the exclusion are such that they also result in multiple *separate and different* convictions or adverse actions in addition tothe one forming the basis of the OIG’s exclusion, *e.g.,*Medicare fraud and income tax evasion.  Ostensibly, the idea being that if one is subject to *separate and different* convictions or adverse actions based on the same set of facts – but different from the conviction or adverse action forming the basis of the IG’s exclusion – the individual or entity may be more untrustworthy than if the circumstances underlying the basis of exclusion only resulted in a single conviction or adverse event.  And conversely, if a separate adverse event occurs but is based on the same conviction as the one that is the basis for the IG’s exclusion, then its occurrence has no additional bearing on an individual or entity’s trustworthiness – as it is already accounted for in the IG exclusion.

Here, the adverse action at issue is Petitioner’s suspension from Medi-Cal – California’s Medicaid program.  IG Ex. 7; IG Br. at 11.  While there is no doubt that Petitioner’s Medi-Cal suspension is an adverse action that arises from the same circumstances as the basis of exclusion, the IG has failed to demonstrate that it is cause to assess Petitioner more untrustworthy than from solely the conviction forming the OIG’s basis for exclusion.  Contrary to the preamble discussion excerpted above, Medi-Cal’s suspension of Petitioner is in fact based on the *same conviction* as the IG’s basis of exclusion and, in essence, is not *separate and different* from the IG’s exclusion.  *See*IG. Ex. 7 (“[Y]ou were convicted of a misdemeanor violation of Welfare and Institutions Code section 14107(b)(1)–Presenting False Medi-Cal In-Home Support Services (IHSS) Claims . . .” and “Welfare and Institutions Code section 14123(a) requires the Director to suspend a provider of service from participating in the Medi-Cal program for a conviction of any

Page 12

felony or misdemeanor involving fraud, abuse of the Medi-Cal program or any patient, or otherwise substantially related to the qualifications, functions, or duties of a provider of service.”).

Moreover, as part of its Medicaid State Plan, the Secretary requires the State agency that administers Medicaid to “have administrative procedures in place that enable it to exclude an individual or entity for any reason for which the Secretary could exclude such individual or entity under parts 1001 or 1003 of this chapter.”  42 CFR § 1002.210.  California’s Welfare and Institutions Code section 14123(a)5
 is one of California’s answers to this Federal directive and analogs to 42 C.F.R. § 1001.101, which sets forth the bases for the IG’s mandatory exclusion authority.  Therefore, Medi-Cal’s suspension of Petitioner not only has the same conviction as the IG’s as its basis, but it is essentially regulatorily subsumed within the IG’s mandatory bases of exclusion.

Medi-Cal’s suspension is also factually subsumed within the IG’s exclusion:  Medi-Cal is allowing Petitioner to seek reinstatement after one year, IG Ex. 7, while Petitioner will have to wait four and half more years to seek reinstatement from the IG’s exclusion to ultimately be able to receive payment for items or services furnished by Petitioner by any Federal Health Care Program, including Medicaid.

Medi-Cal’s suspension of Petitioner is an adverse action that does not further evidence that Petitioner is less trustworthy than had Medi-Cal not suspended Petitioner and only Petitioner’s conviction remained.  As such, the IG has failed to demonstrate that any lengthening of Petitioner’s exclusion due to this aggravating factor would be reasonable.

VI.   Conclusion

I affirm the IG’s determination to exclude Petitioner from participating in Medicare, Medicaid, and all other federal health care programs.  The seven-year exclusion imposed by the IG is not within a reasonable range and is reduced to a period of five years and six months.


          /s/
        Jacinta L. Alves

                      Administrative Law Judge
      1. Citations are to the 2021 revision of the Code of Federal Regulations (C.F.R.), unless otherwise stated. back to note 1
                      2. To support this argument, Petitioner cites to 42 C.F.R. § 1001.102(c)(1) in her brief.  P. Br. at 2-3.  Although Petitioner has been convicted of only two misdemeanor offenses, the loss to Medicare and the Medi-Cal program totaled $18,193.46, which is in excess of the $5,000 threshold allowed to apply this mitigating factor.  Even though the $5,000 threshold was set twenty years ago, there is no inflationary or other adjustment mechanism that increases the threshold amount permitted in the regulations.  See 67 Fed. Reg. 11928, 11929 (Mar. 18, 2002). back to note 2
                      3. It is unclear from the record what, if any, restrictions were placed on Petitioner’s movement while subject to remote electronic monitoring.  See IG Ex. 9. back to note 3
                      4. When first promulgated in 1998, the aggravating factor for convictions and adverse events was styled as a single factor:  “[w]hether the individual or entity was convicted of other offenses besides those which formed the basis for the exclusion, or 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 serves as the basis for imposition of the exclusion.”  See 63 Fed. Reg. 46676, 46688 (Sept. 2, 1998).  In 2017, this aggravating factor was bifurcated into two separate aggravating factors, 42 C.F.R. § 1001.102(b)(8) and (9), but the wording is otherwise substantially and materially the same.  See 82 Fed. Reg. 4100 at 4101; 4112 (January 12, 2017). back to note 4
                      5. California’s Welfare and Institutions Code section 14123(a) required Petitioner’s suspension from Medi-Cal based on the same conviction that forms the basis of the IG’s exclusion.  IG Ex. 7. back to note 5 Back to top
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