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                              Ilya Kogan, DAB No. 3034 (2021)
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Ilya Kogan, DAB No. 3034 (2021)








  
  
    

  
      
Department of Health and Human Services 
    DEPARTMENTAL APPEALS BOARD
          Appellate Division





Ilya Kogan
Docket No. A-21-14Decision No. 3034March 5, 2021

        
              
    

      FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE DECISION

Ilya Kogan (Petitioner) appealed the Administrative Law Judge (ALJ) decision upholding the Inspector General (I.G.) determination to exclude Petitioner for 15 years under sections 1128(a)(1) and 1128(a)(3) of the Social Security Act (Act) in *Ilya Kogan*, DAB CR5750 (2020) (ALJ Decision).  Petitioner did not dispute that the I.G. was authorized to exclude him based on his guilty pleas to the federal crimes of health care fraud, conspiracy to commit health care fraud, and conspiracy to commit mail fraud.  The crimes arose from a conspiracy to bill Medicare and Medicaid for physical therapy services that were not provided as claimed.  Petitioner also did not dispute that multiple aggravating factors identified in the regulation were present and relevant to extending the length of the exclusion period beyond the minimum of five years.  The issue in dispute, resolved adversely to Petitioner at the ALJ level, was whether Petitioner proved a mitigating factor that made the 15-year exclusion period unreasonable.  ALJ Decision at 4-5.

On appeal, Petitioner presses his contention that a mitigating factor existed that would justify reducing the exclusion period and argues that the ALJ erred by failing to conduct an in-person hearing to further establish this point.  We find no merit to either argument.  Therefore, we uphold the ALJ Decision and sustain the imposition of a 15-year exclusion.

Applicable legal authority

Exclusions imposed pursuant to sections 1128(a)(1) or (a)(3) must be for a minimum of five years.  Act § 1128(c)(3)(B).  The I.G. may exclude an individual under either of these sections for a longer period if certain aggravating factors are present and are not offset by the presence of mitigating factors.  42 C.F.R. § 1001.102(b), (c).

The I.G. relied on the following aggravating factors:  (1) The acts resulting in Petitioner's conviction, or similar acts, caused, or were intended to cause, a financial loss to a government agency or program of $50,000 or more; (2) The acts that resulted in

**Page 2**

Petitioner's conviction, or similar acts, were committed over a period of one year or more; and (3) Petitioner was sentenced to a period of incarceration.  I.G. Ex. 1, at 2; 42 C.F.R. § 1001.102(b)(1), (2), (5).  Petitioner urged application of the mitigating factor at 42 C.F.R. § 1001.102(c)(2), which applies if "[t]he record in the criminal proceedings, including sentencing documents, demonstrates that the court determined that the [excluded] individual had a mental, emotional or physical condition before or during the commission of the offense that reduced the individual's culpability."

Case background

It is undisputed that Petitioner provided acupuncture services in New York City which were not covered under Medicare or New York Medicaid.  He conspired with a physical therapy group with which his office was co-located to bill acupuncture or massage services as physical therapy and to use an in-house doctor or physician assistant to authorize the services, among other improper practices.  I.G. Ex. 2, at 5-9 (investigative statement describing operation of the scheme); *see also* Sentencing Opinion at 7-12.1
  He was also a principal in an elaborate scheme involving misrepresented ownership and improper billing by several acupuncture and billing enterprises obtaining funds from no-fault insurance companies.  *Id*.; *see also* Sentencing Opinion at 13-19.  Based on these facts, Petitioner pled guilty to one count of conspiracy to commit health care fraud, one count of health care fraud, and one count of conspiracy to commit mail fraud.  Sentencing Opinion at 1; I.G. Ex. 5, at 2; I.G. Ex. 6, at 1, 2; I.G. Ex. 7; I.G. Ex. 8; I.G. Ex. 9.  He was ordered to pay $1,590,851 in restitution for these crimes.  I.G. Ex. 11, at 6.

By letter, dated April 30, 2020, the I.G. informed Petitioner that he was being excluded from participation in Medicare, Medicaid, and all Federal health care programs for 15 years.  I.G. Ex. 1.  Petitioner timely sought an ALJ hearing to challenge the I.G. determination.

The ALJ reviewed the evidence relating to the three aggravating factors and concluded Petitioner was "highly untrustworthy."  ALJ Decision at 3.  The ALJ described Petitioner as "a determined and deliberate criminal," who participated in the lengthy conspiracy

**Page 3**

causing major losses to federal and other programs.  *Id*.  Petitioner was sentenced to more than four years in prison.  *Id*.  The ALJ concluded that Petitioner was subject to exclusion and that the 15-year exclusion period was reasonable considering the three aggravating factors and the absence of any mitigating factor.  *Id*. at 5.

Standard of review

On disputed issues of law, the Board's standard of review is whether the ALJ's decision is erroneous. 42 C.F.R. § 1005.21(h).  On disputed issues of fact, the Board's standard of review is whether the ALJ's decision is supported by substantial evidence on the whole record.  *Id.*

Analysis

We first address Petitioner's position that the ALJ should have conducted an in-person hearing and, by failing to do so, denied him due process.  Finding no error in the ALJ's process, we then turn to the claim that the existing record established the existence of the mitigating factor set out in section 1001.102(c)(2) of the regulations and explain why we conclude that it did not.

1. *Petitioner failed to demonstrate need for an in-person hearing*.

Petitioner, despite being represented by counsel, disregarded the ALJ's clear instructions on the prerequisites to any in-person hearing.  Moreover, Petitioner's claims about the proposed content of a potential hearing do not establish that any proffered testimony would have addressed the essential elements of the asserted mitigating factor or could have altered the result.

The ALJ's scheduling order explained the process for receiving witness testimony as follows:

Because of the nature of these cases, I very frequently decide cases such as these based on the written materials that the parties submit as part of their prehearing exchanges (short-form briefs, documentary evidence).

Either party may submit witness testimony if the party feels it necessary.  I will **only**accept witness testimony that is not *cumulative* (i.e., duplicative of other material a party has submitted) and that is *relevant* to the issue before me.  Witness testimony must be submitted in the form of an affidavit or a written sworn declaration.  If I accept witness testimony from a party, the opposing party will have an opportunity to request to cross-examine the witness.

**Page 4**

ALJ Scheduling Order at 3 (underlining added, other emphases in original).  Thus, all direct testimony had to be submitted in writing.2
  The ALJ would provide an opportunity for in-person testimony only if either party sought to cross-examine a witness for whom the opposing party submitted testimony.  The order explicitly permitted the parties to offer any objections to this process in writing within 10 days.  *Id.* at 4.

Petitioner did not object to the scheduling order and did not file any written direct testimony.  Because no written direct testimony was filed, neither party requested cross-examination.  Because cross-examination was not requested, no in-person hearing was held.  We find no error in this result.  *See, e.g., James Brian Joyner, M.D.*, DAB No. 2902, at 11-12 (2018) (finding no error in issuance of decision on the written record without in-person hearing where neither party offered written direct testimony as required by scheduling order).

Instead of following the ALJ's instructions,3
 Petitioner included a statement in his brief to the ALJ that an in-person hearing was "necessary" and his witnesses would include Petitioner, his substance abuse counselor (unnamed), and "potentially other designated experts in the field of alcoholism and substance abuse."  P. Appeal of I.G. Exclusion at 7.  With this vague witness list, Petitioner suggested that in-person testimony would address his alcoholism "during the relevant time of the indictment," his court-ordered treatment, and his current progress in treatment.  *Id*.

The latter two topics were plainly irrelevant since the mitigating factor is limited to a criminal court determination about the individual's condition "before or during the commission of the offense."  42 C.F.R. § 1001.102(c)(2).  Petitioner went on to say that the anticipated testimony would address the mitigating factor in "all manner permitted by law," to allow the ALJ to do an "in-depth examination and analysis" of Petitioner's condition at the time of the offense which "the ALJ may find reduced [Petitioner's] culpability, combined with the ALJ's analysis of the Court documents" and the fact of the reduction of Petitioner's sentence from 60 to 50 months of imprisonment.  P. Appeal of I.G. Exclusion at 7.  While this part of the hearing request does address the correct time frame, it does not explain why any testimony about Petitioner's drinking history or testimony by unnamed experts about the effects of alcoholism would help the ALJ analyze whether the "**record in the criminal proceedings**, including sentencing documents" showed a court determination of reduced culpability due to alcoholism.  42

**Page 5**

C.F.R. § 1001.102(c)(2) (emphasis added).  Instead, Petitioner seems to have hoped to persuade the ALJ to independently determine what role, if any, Petitioner's drinking might have played in his crime, which is not a role the regulation delegates to the ALJ.

Petitioner now belatedly suggests that, had an in-person hearing been held, he could have requested that the ALJ issue a subpoena to the Southern District of New York to seek the deceased judge's "sentencing notations" which Petitioner claimed to believe would shed light on the judge's thinking.  Request for Review (RR) at 4-6.  But Petitioner made no request for subpoenas to the ALJ, despite recognizing that the CRD Procedures provided for such requests to be made to the ALJ.  *Id*. at 6.  Petitioner complains that the ALJ did not "allow" the case to "get to discovery proceedings," but the CRD Procedures explain that discovery in matters before the ALJs "is limited, and available only in some cases where provided by regulation" and advise referring "to the specific regulation governing their case for guidance in making a discovery request."  *Id.*; CRD Procedures ¶ 12.  The applicable regulation on discovery at 42 C.F.R. § 1005.7 contemplates initiation by a request from one party to the other with involvement of the ALJ only in the event a party objects to a discovery request.  Discovery is restricted to existing documents that are "relevant and material to the issues before the ALJ," and does not extend to common forms of discovery in court proceedings, such as interrogatories or depositions.  42 C.F.R. § 1005.7.

Further, the CRD Procedures provide for parties to request, and enable the ALJ to issue, subpoenas, "if the requesting party has met all applicable regulatory requirements."  CRD Procedures ¶ 12.c.  The regulations provide that a party seeking to subpoena a witness must file a motion (at least 30 days prior to any hearing) and identify the witness with particularity.  42 C.F.R. § 1005.9(d).  The witness may only be asked to produce evidence meeting the discovery limits, i.e. relevant and material to an issue before the ALJ.  *Id*. § 1005.9(b).

Petitioner points to no such request he ever made to the ALJ for a subpoena, and we see none in the record.  Even describing his reasons for seeking an in-person hearing in his brief to the ALJ, Petitioner made no reference to any need for subpoenas.  *See* P. Appeal of I.G. Exclusion at 7.

Petitioner's argument misrepresents the nature of the proceedings before the ALJ, framing the decision on the written record as "the functional equivalent of a motion to dismiss on the pleadings."  RR at 6.  Nothing in the guidelines nor in the ALJ scheduling order could have led Petitioner to reasonably anticipate that he could await an in-person hearing (despite proffering no witness testimony) before identifying any purported need for a subpoena.  Indeed, Petitioner clearly knew that discovery requests should have been made earlier, because he asserted in his brief to the ALJ that he already requested discovery of the I.G.'s file.  P. Appeal of I.G. Exclusion at 1.  The ALJ did not dismiss the appeal based on any inadequacy in the pleading, but instead fully resolved the matter

**Page 6**

on the merits based on a completed evidentiary record.  The regulations provide that the Board will not consider any issue "that could have been raised before the ALJ but was not."  42 C.F.R. § 1005.21(e).  The purported need to subpoena the sentencing judge's notations could, and should, have been raised before the ALJ.

In any case, Petitioner has failed to demonstrate that a subpoena, had he requested one, would have been likely to generate any admissible evidence.  He provides no basis to believe such notations exist or that, if they do, they contain anything that would be better evidence of the judge's determinations than the official sentencing records in evidence.

It is apparent that Petitioner received full due process as specified under the applicable regulations.  Petitioner claims that the process he received fell short of constitutional requirements, citing the Fifth Amendment to the Constitution, and, oddly, section 1001.2007(a)(1) of the regulations.  RR at 15-16.  That section provides that, except where otherwise authorized, an excluded individual "may file a request for a hearing before an ALJ only on the issues of whether:  (i) The basis for the imposition of the sanction exists, and (ii) The length of exclusion is unreasonable."

Since the ALJ permitted Petitioner to file his hearing request on the issue of whether the length of the exclusion was unreasonable, the ALJ plainly acted within the authority of this regulation.  As explained above, the written direct testimony process is authorized by regulation and permits testing of credibility in cross-examination, had Petitioner chosen to submit testimony.  42 C.F.R. § 1005.16(b).  Petitioner, however, seems to contend that the ALJ violated the regulation or denied due process because he did not take in-person testimony to bolster Petitioner's position (which the ALJ found unsupported on the record) that the alleged mitigating factor was established.  We find no basis to conclude that the ALJ departed from the regulatory process.  We have no authority to declare applicable regulations unconstitutional, and we would find no basis here to do so even if we had authority.  42 C.F.R. § 1005.4(c)(1); *see also Esohe Agbonkpolor*, DAB No. 3002, at 7 (2020) (citing *W. Scott Harkonen, M.D.*, DAB No. 2485, at 22 (2012), *aff'd, Harkonen v. Sebelius*, No. C 13-0071 PJH, 2013 WL 5734918 (N.D. Cal. Oct. 22, 2013)).

We conclude that no in-person hearing was necessary, and that Petitioner received all process that was due.

2. *We find no error in the ALJ's conclusion that Petitioner failed to prove the mitigating factor under section 1001.102(c)(2).*

Petitioner goes on to argue that, even without further testimony, the existing record should have convinced the ALJ that the mitigating factor was present and should have required the ALJ to consider the reasonableness of the length of the exclusion in light of that mitigating factor.  We disagree.

**Page 7**

First, Petitioner contends that the ALJ applied an erroneous standard for the requisite showing under section 1001.102(c)(2).  RR at 4.  After acknowledging that the sentencing judge recognized that "Petitioner suffered from alcohol abuse," the ALJ, according to Petitioner, erred by requiring that the sentencing judge have made explicit findings that substance abuse occurred at the time of the offense that reduced culpability.  *Id*. (quoting ALJ Decision at 4).  Petitioner cites prior Board decisions as establishing that no such explicit findings were necessary.  *Id*. (citing *Russell Mark Posner*, DAB No. 2033, at 9 (2006) and *Arthur C. Haspel*, DAB No. 1929 (2004)).  Petitioner characterizes the correct inquiry as a "case-specific analysis of whether sufficient evidence supported an inference that the sentencing judge made the necessary determination."  *Id*.  The ALJ could not make such a case-specific analysis in the absence of an in-person hearing and issuance of a subpoena, Petitioner asserts.  *Id*. at 4-5.

Petitioner is mistaken about what the ALJ held.  The ALJ recognized that an explicit determination by the sentencing judge on the record was not a prerequisite to finding such a determination was made, but merely noted that the "most persuasive evidence of a judge's determination of reduced culpability obviously would be his or her own words in pronouncing a sentence."  ALJ Decision at 4.  He went on to find that the judge was not merely silent about why he reduced Petitioner's sentence by ten months, but in fact the "reduction was premised on considerations other than Petitioner's culpability" because the judge stated:

I'm going to impose the sentence as set forth in the sentencing opinion, but I will reduce the term by ten months in each case, *and that's a consideration based on the needs of the family.*

*Id*. (quoting I.G. Ex. 12, at 10 (emphasis added by ALJ)).  He found that the sentencing judge "cited no other considerations as a basis for reducing Petitioner's sentence to 50 months incarceration."  *Id*.

The ALJ then considered whether other evidence in the record supported an inference that the judge had nevertheless made the necessary determination about reduced culpability and found it did not.  ALJ Decision at 4.  He discussed the evidence that the judge was aware of Petitioner's problems with alcohol but found nothing suggesting that the judge believed this reduced his culpability at the time of the offense.  *Id*. at 4-5.  The ALJ also rejected Petitioner's premise that, because this particular judge was knowledgeable about substance abuse issues, he should infer that the judge found alcohol abuse to have reduced this Petitioner's culpability.  *Id*. at 5.  The ALJ noted that such awareness would make it, if anything, more likely that the judge would have mentioned any determination about the role of alcohol abuse in the crime when he expressly explained why he reduced the sentence.  *Id*.  The ALJ found Petitioner's reliance on a presentencing report (which was not in the record but quoted in Petitioner's briefing)

**Page 8**

unpersuasive, especially in the absence of any indication that the report recommended reducing the sentence on the basis of alcohol abuse.  *Id*.

The ALJ's analysis is entirely consistent with Board precedent.  In *Mohamad Ahmad Bazzi*, DAB No. 2917 (2018), the Board explained in detail the applicable standard for considering this mitigating factor and the significance of the *Posner* and *Haspel* cases cited by Petitioner, as follows:

Petitioner bore the burden of establishing the mitigating factor.  *See Andrew Lewis Barrett*, DAB No. 2887, at 8 (2018).  To do so, Petitioner had to prove not only that he had a substance abuse problem, but also that the sentencing court made a finding that Petitioner had a substance abuse problem before or during the commission of the crime and that the condition reduced his culpability.  42 C.F.R. § 1001.102(c)(2); *Begum v. Hargan*, 2017 WL 5624388 (N.D. Ill. 2017), *affirming Farzana Begum, M.D.*, DAB No. 2726 (2016).  While the sentencing court need not make explicit findings that a substance abuse problem existed at the time of the offense and reduced culpability, the administrative adjudicator must nevertheless be able to infer clearly from the evidence of the proceedings that the sentencing court made the requisite determination.  *Russell Mark Posner*, DAB No. 2033, at 9 (2006).

In *Posner*, the petitioner asserted before the ALJ that the court's lenity in sentencing, a doctor's evaluation concluding that the petitioner had a drug dependency, along with the court's recommendation for a residential drug program placement were sufficient to establish the mitigating factor.  DAB No. 2033, at 9-10.  The ALJ did not agree, and the Board upheld that determination.  *Id.* at 12.  The Board in *Posner* discussed its prior decision in *Arthur C*. *Haspel, D.P.M.*, DAB No. 1929 (2004), in which –

[t]he Board explained that in cases where the sentencing judge would not be required as part of the sentencing process to make a finding about whether addiction was present at the time of the crime, the regulation should not be read so narrowly as to be inapplicable absent an explicit finding by the judge.  Instead, the Board engaged in case-specific analysis of whether sufficient evidence supported an inference that the sentencing judge made the necessary determination . . . .

*Posner* at 10.  In *Haspel*, the Board had reasoned that the evidence of record, including "Petitioner's own statement to the judge, . . . the unrebutted testimony of his single witness, and the argument to the court from his attorney," supported "the impact of Petitioner's addiction to drugs

**Page 9**

on his life both before and during the commission of the offenses."  *Id.* (quoting *Haspel* at 4).  The Board then noted that the court had sentenced Haspel "to only three months of home confinement and five years of supervised release and imposed no fine whatsoever" when "the maximum sentence was five years on each of the two counts, a fine of $250,000, and a term of supervised release of at least two years up to life."  *Id.* at 11 (quoting *Haspel* at 5).  The Board concluded that, based on this evidence and the extent of the reduction in sentence, it was unreasonable to infer that the court had *not* made a finding that *Haspel* had an addiction at the time of the offense that reduced his culpability.  *Haspel* at 5.  Considering this evidence that the Board had found to be sufficient in *Haspel* as "'replete with details' of that petitioner's 'impaired and confused mental state' at the time of his offenses," the ALJ in *Posner* weighed the evidence Posner had presented and determined "that the evidence adduced by [Posner] did not compare in weight, relevance, reliability, or persuasiveness to the evidence which the Board described in *Haspel* . . . ."  *Id.* at 11 (quoting ALJ's decision in *Posner* at 21-24, *Haspel* at 4).

*Bazzi* at 10-11.  The ALJ in *Haspel* had inferred from that extensive record that the sentencing judge's downward departure was at least partially based on a determination that the defendant's addiction reduced his culpability but mistakenly believed that the Board had precluded the mitigating factor unless the sentencing judge made the determination explicit.  *Posner* at 10 (discussing *Haspel*).  The Board corrected that mistake and considered the evidence for the inference so compelling that failure to make the inference in Haspel's favor would have been unreasonable and so drew the inference itself.  *Haspel* at 5.

The evidence to which Petitioner in the present case points is far less compelling than in *Haspel*, or even *Posner*.  As in *Bazzi*, Petitioner's sentence reduction was expressly attributed to a reason unrelated to substance abuse (cooperation with law enforcement in *Bazzi*; needs of the family here).  *Bazzi* at 12.  Contrary to Petitioner's claim, the sentencing decision does not establish that his alcoholism was present at the time of the offense, much less that the judge determined that it mitigated his culpability.  RR at 7.  Petitioner rests this assertion on the fact that the judge's order for substance abuse treatment "may include testing to determine whether the Defendant has reverted to using drugs or alcohol."  *Id*. (quoting Sentencing Opinion at 24-25) (underlining added by Petitioner).  This instruction does not imply that "reverting" to alcohol use meant that the alcoholism stretched back to the time of the offense but only that those treating Petitioner in an outpatient treatment program after his imprisonment could test him during the course of treatment to ensure he did not then revert to abuse while undergoing the treatment services.

**Page 10**

Petitioner quotes at length from a presentencing report which, as the ALJ noted, he did not submit for the record.  RR at 8 (citing ALJ Decision at 5).  Petitioner suggests that the I.G.'s failure to submit the report, to which Petitioner says the I.G. had access, should have been viewed as an admission.  Petitioner's argument that the ALJ somehow erred in this regard makes little sense.  For one thing, Petitioner never sought any order to compel the I.G. to produce this or other documents he requested.  For another, Petitioner apparently had access to the report since he attempted to incorporate it "by reference" via quotations.  *Id*.  Finally, the ALJ noted that the report was not in the record but nevertheless considered the material quoted by Petitioner to conclude that it nowhere indicated a recommendation to reduce the sentence based on alcohol abuse.  ALJ Decision at 5.

The material quoted by Petitioner again in his brief to us, even were it properly in the record, offers no support for his assertions about reduced culpability.

The defendant reported that he **previously consumed alcohol minimally** in the form of an occasional glass of wine while socializing or during a special event, but stated that **his usage gradually started to increase in 2014**.  Kogan explained that he learned that charges were going to be filed against him in connection with his involvement in the instant offense and he was not working as much, both of which caused him to experience increased stress.  The defendant stated that he began to consume half a bottle of wine or other assorted beer/liquor each week until his initial arrest in December 2015.  Kogan informed that since that time and when he is not working or required to attend a court proceeding, he consumes alcohol several times per week to the point of intoxication.

RR at 8 (bold emphasis added; Petitioner's underlining omitted).

The criminal schemes to which Petitioner pled guilty began in 2010.  The health care fraud conspiracy was charged as lasting "at least" from January 2010 through August 2013 (I.G. Ex. 5, at 2) and the mail fraud conspiracy from March 2014 through June 2016 (I.G. Ex. 7, at 1).  According to Petitioner's own account, he was merely a minimal social drinker until 2014, and his drinking then only gradually increased.  RR at 8.  He "began to consume half a bottle of wine" a week until December 2015, when he was arrested, and his consumption escalated from then through the conviction.  *Id*.  Throughout his appeal, Petitioner refers to his alcohol abuse "during periods within the time frame of the indictment," rather than the period before and during the commission of his offense.  *See, e.g., id*. at 12.  This phrasing obscures the fact that he engaged in these conspiracies over the course of six years and he describes drinking to intoxication only in the period after arrest.  The ALJ correctly found this information (quoted as part of Petitioner's argument) insufficient to conclude that the sentencing judge had determined Petitioner's

**Page 11**

alcohol abuse prior to or during the commission of his crimes reduced his culpability.  ALJ Decision at 5.

Petitioner suggests that the ALJ process was somehow inconsistent with federal criminal procedure rules that direct federal judges to provide access to and allow comment on or objection to presentencing reports, and to rule on any disputes about them.  RR at 9 (citing Fed. R. Crim. P. §§ 32(i)(l)(D) and 32(i)(l).  Petitioner's theory seems to be that, because the I.G. did not argue or prove that prosecutors objected to the presentence report, the ALJ should have estopped the I.G. from disputing it and was required to presume that the sentencing judge "considered" Petitioner's alcohol issues.  RR at 8-10.  The rules of criminal procedure are inapplicable in this civil administrative proceeding.  Since both parties had access to the presentencing report and neither chose to submit it as an exhibit, the I.G. had no reason to object to it or to provide evidence on whether the prosecutor objected to it in the criminal proceedings.  But in any case, as we have noted, the excerpt which Petitioner quoted does not support any finding that the sentencing judge considered his drinking, especially at the levels reported before and during his criminal activity, to have reduced his culpability.  No one disputed that the sentencing judge was aware, as the presentencing report indicated, that Petitioner was abusing alcohol at the time of sentencing or that the judge ordered his participation in substance abuse treatment as a result.  As the ALJ correctly concluded, however, those facts are "irrelevant to deciding whether the 15-year minimum exclusion imposed by the [I.G.] falls within a reasonable range, absent proof that the sentencing judge found that Petitioner's substance abuse diminished his culpability."  ALJ Decision at 5.

Petitioner discusses various sources showing that alcoholism has been recognized as a disease that may be disabling and that the sentencing judge was knowledgeable about substance abuse.  RR at 10-12.  He further suggests that the judge's reduction of the sentence by ten months based on the needs of the family reflected that the substance abuse treatment would allow Petitioner to heal and return to his family.  *Id*. at 12.4
  Even if the hope that Petitioner's alcoholism would be improved by treatment during his incarceration figured in the judge's reduction of the sentence from 60 to 50 months (of which there is no evidence in the record), that would not imply that the judge believed his alcoholism existed at the time of the offense or reduced his criminal culpability.

**Page 12**

We find no error in the ALJ's conclusion that Petitioner failed to carry his burden of proving the presence of the asserted mitigating factor.

3. *The ALJ did not err in concluding that the 15-year exclusion period was within a reasonable range under the applicable regulatory requirements.*

Because Petitioner failed to prove the existence of any mitigating factor and did not dispute the presence of the aggravating factors cited by the I.G., the ALJ properly considered the reasonableness of the exclusion period based on the evidence of record relating to those aggravating factors.  ALJ Decision at 3.  Those factors, quoted in full earlier, were that Petitioner's offenses caused loss to a government program of $50,000 or more; that they were committed over a period of one year or more; and that Petitioner was sentenced to a period of incarceration.  42 C.F.R. § 1001.102(b)(1), (2), (5).  The ALJ described the relevant evidence as follows:

Petitioner has been a determined and deliberate criminal.  He engaged in a concerted and obviously carefully thought out conspiracy extending over a period of several years to defraud Medicare, Medicaid, and private insurers.  That conspiracy had a massive financial impact, causing these programs and private insurers to sustain substantial losses exceeding $1.5 million.  He was sentenced to a prison term of more than four years.

ALJ Decision at 3.  Apart from his insistence on a mitigating factor which he failed to establish, Petitioner has not offered us any basis to disagree with the ALJ that these circumstances relating to the three cited aggravating factors make the extension of the exclusion from the 5-year minimum period to a 15-year period "eminently reasonable."  *Id*.

Finally, the Board lacks authority to consider Petitioner's various constitutional attacks on the exclusion and the overall appeal process so long as they are consistent with the applicable law and regulations, as we have found they were.  We also recognize, as the I.G. points out, that federal courts have repeatedly rejected constitutional challenges to exclusion proceedings, including those based on claims of providers' property interests as asserted by Petitioner here.  I.G. Br. at 14 (citing *Aiman M. Hamdan, M.D.*, DAB No. 2955 (2019) (citing*Manocchio v. Kusserow*, 961 F.2d 1539 (11th Cir. 1992); *Green v. Sullivan*, 731 F. Supp. 838 (E.D. Tenn. 1990);*Parrino v. Price*, 869 F.3d 392, 397-98 (6th Cir. 2017) (finding no protected property or liberty interest in continuing to participate in federal health care programs); *Erickson v. United States ex rel. Dep't of Health & Human Servs.*, 67 F.3d 858 (9th Cir. 1995) (same))).

**Page 13**

Conclusion

For the reasons explained above, we uphold the ALJ Decision in its entirety and sustain the I.G.'s imposition of a 15-year period of exclusion.


          /s/
        Michael Cunningham

                      Board Member
          /s/
        Christopher S. Randolph

                      Board Member
          /s/
        Leslie A. Sussan

                      Presiding Board Member
      1. Petitioner submitted several items with his request for an ALJ hearing, including the sentencing opinion of the judge in his criminal case.  These materials were not identified as exhibits.  Petitioner later submitted two numbered exhibits (Petitioner's exhibits 1 and 2) which were articles relating to substance abuse.  The ALJ referenced Petitioner's exhibits 1 and 2 but did not clearly state what documents were admitted into the record for decision.  ALJ Decision at 1.  His scheduling order (on page three; quoted in greater length below) advised that he might decide the case "based on the written materials that the parties submit as part of their prehearing exchanges (short-form briefs, documentary evidence)."  This statement does not specify that only formally admitted exhibits would be considered.  Given the ambiguous status of these documents, out of an abundance of caution, and in the absence of any clear objection by the I.G. to Petitioner's use of them, we have considered them in assessing whether Petitioner offered evidence substantiating the existence of the claimed mitigating factor.  Even doing so, we find, for the reasons fully discussed below, that he did not. back to note 1
                      2. The regulations expressly permit the ALJ to admit testimony in the form of a sworn written statement instead of in person.  42 C.F.R. § 1005.16(b). back to note 2
                      3. In addition to the direct instructions of the ALJ, Petitioner was provided with the Civil Remedies Division (CRD) Procedures (Eff. March 28, 2016).  Paragraph 19(d) warns parties that an ALJ "may determine that an oral hearing is unnecessary . . . if the parties . . . do not offer the written direct testimony of any witnesses when ordered to do so . . . .  Under these circumstances, the ALJ may decide the case based on the written record." back to note 3
                      4. Petitioner's claim about the judge's intentions made on appeal to us is unsupported by any evidence of record.  Indeed, it is contradicted by a written statement Petitioner's spouse submitted to the court prior to sentencing requesting leniency because Petitioner had four young children (some with medical needs), his wife was pregnant with a fifth child, and she was unable to "earn a living wage."  See Letter from Petitioner's Spouse to Judge Sweet, included with Petitioner's ALJ hearing request.  The statement has no mention of his alcohol abuse or any negative effect of such abuse on his family or children.  Id.  To the contrary, his spouse described Petitioner as a "caring and responsible person," a role model to his older boys, the "bread winner" of the family, and an attentive father who takes an active role in his children's education, physical development, and medical needs.  Id.  We find nothing to suggest that the judge's consideration of the family's needs was related to Petitioner's substance abuse or its treatment. back to note 4 Back to top
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