Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division
Napa Nursing Center, Inc.
(CCN: 05-5161),
Petitioner,
Vv.
Centers for Medicare & Medicaid Services.
Docket No. C-09-121
Decision No. CR2091

Date: March 15, 2010

DECISION

I sustain the determination of the Centers for Medicare & Medicaid Services (CMS) to
impose remedies against Petitioner, Napa Nursing Center, Inc., consisting of a per-
instance civil money penalty of $5,000 and denial of payment for new admissions for a
nine day period that began on November 29, 2008.

I. Background

Petitioner is a skilled nursing facility in California. It participates in the Medicare
program. Its participation in Medicare is governed by sections 1819 and 1866 of the
Social Security Act and by implementing regulations at 42 C.F.R. Parts 483 and 488. Its
right to a hearing in this case is governed by regulations at 42 C.F.R. Part 498.

CMS determined to impose the remedies that I describe in the opening paragraph of this
decision based on findings of noncompliance with participation requirements that were
made at a survey of Petitioner’s facility that was completed on October 9, 2008 (October
survey). The determination to impose a per-instance civil money penalty was based
explicitly on Petitioner’s alleged failure to comply with the requirements of 42 C.F.R.
§ 483.25(h). This regulation mandates a skilled nursing facility to ensure that: (1) its
resident environment remains as free of accident hazards as is possible; and (2) each of
its residents receives adequate supervision and assistance devices to prevent accidents.

Petitioner requested a hearing and the case was assigned to me for a hearing and a
decision.’ I held an in-person hearing by teleconference on December 2, 2009. At the
hearing I received exhibits from CMS that I identified as: CMS Ex. 1 —- CMS Ex. 10;
CMS Ex. 17 — CMS Ex. 19; CMS Ex. 22 — CMS Ex. 23; and CMS Ex. 25 — CMS Ex. 29.
I received exhibits from Petitioner that I identified as P. Ex. | — P. Ex. 15. I heard the
cross-examination and redirect testimony of several witnesses.

IL. Issues, findings of fact and conclusions of law
A. Issues
The issues in this case are whether:

1. Petitioner failed to comply substantially with the requirements of 42
C.F.R. § 483.25(h);

2. CMS’s remedy determinations are reasonable.
B. Findings of fact and conclusions of law
I make the following findings of fact and conclusions of law (Findings).

1. Petitioner failed to comply substantially with the requirements of 42
CF.R. § 483.25(h).

The regulation has been the subject of much litigation. As a general rule, it requires that
a facility take every reasonable measure to protect its residents against sustaining
accidents from factors that are known or foreseeable. Woodstock Care Center, DAB No.
1726, at 28 (2000), aff’d Woodstock Care Center v. Thompson, 363 F.3d 583 (6th Cir.
2003). In order to comply with the regulation a facility must do several things. First, it
must assess each resident in order to identify those hazards to which the resident is
exposed, either environmentally, or as a result of physical and/or mental problems that

' The noncompliance findings made at the October survey include findings in addition to
Petitioner’s alleged noncompliance with the requirements of 42 C.F.R. § 483.25(h).
These are findings that Petitioner failed to comply substantially with the requirements of:
42 C.F.R. §§ 483.20(k)(3)(i) (comprehensive care plans); and 483.35(h)(2) (sanitation).
Petitioner no longer challenges these additional noncompliance findings and, so, they are
administratively final.
are unique to that resident. Second, it must plan the resident’s care to address all of the
hazards to which the resident is assessed as being exposed. The care plan should identify
all interventions that are reasonably necessary to protect the resident. Finally, the facility
must implement all of the interventions which are planned for that resident.

CMS’s allegations of noncompliance center around the care that Petitioner gave to a
resident who is identified as Resident # 25. The resident is an inveterate cigarette
smoker. CMS alleges that Petitioner failed to assess the risks that the resident was
exposed to by virtue of his smoking, failed appropriately to plan the resident’s care, and
failed to implement interventions that were necessary to protect this resident.

More specifically, CMS alleges that:

e Petitioner’s staff failed to assess the resident comprehensively for hazards that
might be associated with his smoking despite their knowledge that the resident
suffered from limitations that might render smoking dangerous to his personal
safety. CMS asserts that, for a period of approximately 18 months, Petitioner’s
staff failed to assess the resident for risks related to his smoking even though
they knew that serious risks existed.

e The staff failed to plan interventions that they knew or should have known were
reasonably necessary to protect Resident # 25 in light of his limitations and his
past risky behavior.

e Petitioner’s staff failed to supervise the resident adequately when he smoked.
CMS contends that the resident was allowed to smoke essentially unsupervised
by Petitioner’s staff.

Petitioner has a policy governing smoking by its residents. CMS Ex. 10, at 67. It allows
residents to smoke subject to rules published by the facility and distributed to the
residents and their families. /d. Petitioner assigns responsibility to its inter-disciplinary
team (IDT) for ensuring that safety risks are evaluated and that smoking is conducted in a
safe manner. Jd. Petitioner charges its IDT with ensuring that: each resident is assessed
for smoking safety and other relevant factors upon admission and with each significant
change in the resident’s condition; residents smoke only in designated safe areas; staff
controls smoking materials; residents agree and adhere to facility smoking rules; and
residents who smoke are evaluated and have appropriate interventions implemented to
assure that they smoke safely. Jd.

Petitioner developed and implemented a “Resident Smoking Assessment” form in order
to assure that its smoking policies were implemented in individual cases and that each
resident was protected adequately against the hazards of smoking. CMS Ex. 10, at 69.
The form is designed to be completed by the facility IDT. It identifies three broad
categories of behavior related to smoking (“Resident is able to light cigarette, cigar, or
pipe safely with a lighter,” “Resident smokes safely,” and “Resident is able to extinguish
cigarette safely and completely when finished smoking”). Jd. Each of these categories
contains subcategories (e.g., under “Resident smokes safely” the first subcategory is
“Does not allow ashes or lit material to fall on clothing while smoking”). The form
prescribes that a resident is considered to be a safe smoker and may smoke independently
only if all of the items — all of the subcategories — are assessed affirmatively. Jd.

Resident # 25 was, as of the October survey, a long-term resident in Petitioner’s facility.
He has physical problems that include loss of mobility and balance even while sitting.
CMS Ex. 10, at 50. He has mental problems that include short term memory loss and
impaired decision making skills. /d. at 18, 38. Petitioner’s staff assessed the resident as
not being able to understand complicated subject matter and missing parts of messages.
Id. at 38. He has also been note to be abusive frequently to members of Petitioner’s staff.
Id.

Resident # 25 is a heavy cigarette smoker. Smoking is, in fact, the resident’s primary
recreational activity. CMS Ex. 10, at 38. The resident spends much of his waking hours
smoking, often on a patio that is part of Petitioner’s premises.

The evidence in this case overwhelmingly establishes that Petitioner failed to discharge
its duty to assess Resident # 25 for the safety risks associated with his almost continuous
smoking. Petitioner’s IDT failed to conduct a smoking assessment of this resident at any
time after March 16, 2007. That is so notwithstanding that the IDT had previously
identified several potentially serious risks associated with the resident’s smoking and
notwithstanding further that, after March 16, 2007, the resident was observed to engage
in potentially highly dangerous conduct (smoking while in his room).

Petitioner’s IDT conducted a resident smoking assessment of Resident # 25 on October
24, 2006. CMS Ex. 10, at 51. The staff found that there were numerous risk factors
associated with his smoking. The IDT determined that the resident: did not store or
handle a lighter securely or safely; light a lighter while holding it securely; prevent ashes
or lighted material from falling on his clothing while he smoked; assure that lighted
material fell in areas outside of an ashtray; and smoke only in a designated area. Under
Petitioner’s smoking policy the presence of even one of these risk factors meant that the
resident could not smoke safely while unsupervised. CMS Ex. 10, at 67.

The IDT reevaluated Resident # 25 on March 16, 2007. CMS Ex. 10, at 51. CMS
contends that the IDT concluded that the resident continued to manifest six problems
associated with his smoking (those which I have enumerated above). That is not entirely
clear. The evaluation form contains several checkmarks that are dated “3-16-07” which
appear to indicate that the resident no longer manifested problems that were identified
previously. /d. On the other hand the assessment contains no commentary or analysis
that states that the resident had overcome his previous problems nor does it explain how
or why he would have done so. There was, for example, nothing added to the smoking
assessment in March 2007 showing that the IDT had concluded that the resident’s mental
problems had improved to the extent that he could function at a level of cognition that
made him a safe smoker. I conclude that the ambiguities in the assessment form are
simply that and do not persuasively establish that the resident had improved between
October 24, 2006 and March 16, 2007. Jd.

In any event, the March 16, 2007 reassessment of the resident was the last assessment of
his smoking behavior by the IDT prior to the October survey. There are no documents in
Petitioner’s records other than the smoking assessment form completed in October 2006
and March 2007 which show that the IDT reevaluated comprehensively the resident’s
ability to smoke at any time between March 2007 and October 2008. A total of about 18
months elapsed after this assessment without Petitioner’s staff reassessing the resident.
For example, although Petitioner prepared several minimum data sets and RAP
worksheets for Resident # 25 during his stay at the facility, none of them contain the
detailed analysis of the risks of smoking that is directed by Petitioner’s smoking policy
and the resident smoking assessment. CMS Ex. 10, at 17-50. Nor do such assessments
exist in nursing notes, interdisciplinary progress notes, or interdisciplinary team
conference notes. /d. at 9-16.

Petitioner’s staff also prepared care plans for the resident. CMS Ex. 10, at 52-57. But,
the care plans that are in evidence do not show a comprehensive analysis of the risks
encountered by Resident # 25 when he smoked. Furthermore, the care plans do not
specify any interventions to protect the resident. There is no statement in the care plans
that Resident #25 could smoke safely while unsupervised. The care plans direct,
however, as a standard intervention, that the resident should be assessed for safe
smoking. CMS Ex. 10, at 52.

Indeed, there is no evidence that at any time prior to the October survey did Petitioner’s
staff consider that Resident # 25 needed to be supervised closely while he smoked.
Throughout the period leading up to the survey the resident was allowed to sit for
extended periods of time on an outdoor patio smoking while not closely supervised by
anyone.

However, during this 18-month period the resident engaged in behavior that put
Petitioner’s staff on notice that his smoking could endanger himself or other residents of
Petitioner’s facility. On January 12, 2008, Resident # 25 was found to be smoking in his
room. CMS Ex. 10, at 66. This violation of Petitioner’s smoking policy did not trigger a
new comprehensive assessment of the risks associated with the resident smoking.
Petitioner’s smoking privileges were restricted for a time but they were restored after a
few months without any additional comprehensive assessment being performed of the
risks associated with his smoking.
There was also good reason for the staff to question whether the resident was capable of
understanding the instructions given to him about smoking. As I note above, the resident
was assessed as having both short term memory loss and impaired decision making skills.
Yet, the IDT did not, after March 16, 2007, consider whether these impairments might
make it difficult or impossible for the resident to understand and remember facility
policies concerning smoking. The resident was also noted to exhibit aggressive and
combative behavior towards Petitioner’s staff. CMS Ex. 10, at 18. No assessment was
made to determine whether this behavior, coupled with other mental or psychological
problems, might render the resident’s smoking a hazard to himself or to others.

Moreover, credible observations of Resident # 25 made by surveyors confirm that this
resident was not an individual who could be left unattended while he smoked. Ramona
McSweeney, a registered nurse, observed Resident # 25 on October 9, 2008. CMS Ex.
27, at 6. She saw the resident sitting, completely unsupervised, on Petitioner’s patio area,
awake and smoking. /d. at 7. The resident had a red blanket in his lap. Ms. McSweeney
counted 15 burn holes in the blanket, measuring from 4 to 2 inch in diameter. Id.
Another surveyor, Stephanie Barch, who is also a registered nurse, observed the resident
on two occasions on October 7, 2008, sitting on Petitioner’s patio, apparently nodding off
to sleep while holding a lighted cigarette. CMS Ex. 28, at 4.

Petitioner disputes that the resident actually slept while smoking. However, it would be
very difficult for any staff to determine whether the resident slept while he smoked
without closely observing and assessing him and the record is devoid of evidence to show
that the staff did that after March 16, 2007. Moreover, the risks to the resident should
ave been apparent even if the resident merely slumped over while he smoked.

It is evident that, to the extent that Petitioner’s staff considered any of the risks associated
with the resident’s smoking, their concern was limited to and focused on the resident’s
proclivity to smoke in his room. Thus, on May 1, 2008 Petitioner’s staff assessed the
resident only to determine whether they could restore the privileges that they had
removed after he was found smoking in his room in January. CMS Ex. 10, at 11; Tr. at
134-35; 141-42. The staff’s finding that it was safe to restore the resident’s smoking
privileges apparently was based on discussions with the resident concerning Petitioner’s
policy and the resident’s assertion that he knew that smoking was not permitted inside the
facility. CMS Ex. 10, at 11. But, there is no indication that the staff actually
comprehensively assessed the resident on or before May 1. No consideration was given
at that time to the overall issue of whether it was safe for Resident # 25 to continue
smoking without close supervision or without other interventions that might be needed to
protect him. There is no evidence that the staff observed the resident while he smoked in
order to determine whether any of the problems that had been identified previously by the
IDT - such as the resident’s inability to handle a lighter safely — persisted or had become
worse.

The evidence also overwhelmingly supports my conclusion that Petitioner’s staff failed to
take effective measures to supervise Resident # 25 when he smoked. The failure by
Petitioner’s staff was not just a failure to assess the resident or to plan his care, but to take
affirmative actions in order to protect him against the risks associated with his smoking.

Essentially, Petitioner’s staff allowed Resident # 25 to smoke independently —
notwithstanding identified risk factors — and without meaningful supervision. None of
the care plans that were prepared for the resident directed the staff to supervise him.
CMS Ex. 10, at 52-57. During the October survey, surveyors observed the resident on
several occasions smoking on Petitioner’s exterior patio. On none of these occasions was
the resident being directly supervised or even watched by Petitioner’s staff. CMS Ex. 1,
at 5-9; CMS Ex. 17, at 12; CMS Ex. 18, at 1; CMS Ex. 19, at 12.

Petitioner’s staff had no way of knowing how much supervision the resident required
when he smoked because they had failed to assess those risks for a period of 18 months.
They knew, however, that previous assessments had identified problems that suggested
strongly that the resident was not a safe smoker. That information should have triggered
a plan to ensure that the resident did not smoke while unsupervised. Just the fact that the
resident had been assessed in the past as not being able to handle a cigarette lighter safely
was a reason for the staff to impose some reasonable supervision of the resident while he
smoked. There were other reasons that compelled the staff to consider supervising the
resident. These included his proclivity to smoke in prohibited areas and the fact that the
resident was observed to slump forward while sitting in his wheelchair.

Petitioner makes several assertions and contentions in an attempt to counter the evidence
that I have discussed. I have considered these and I find them to be unpersuasive.

It argues first that the manner in which it cared for Resident # 25 struck a balance
between protecting the resident and allowing him to maintain his sense of dignity and to
control his daily life. Petitioner’s Post-Hearing brief at 2-3. From this Petitioner
suggests that allowing the resident to smoke essentially unsupervised is a product of the
balance that the staff struck in his case. The problem with this analysis is that there is
nothing in the record of the resident’s care that supports any conclusion that Petitioner’s
staff — and its IDT in particular — made the kind of reasoned determination to factor risks
against benefits that Petitioner asserts occurred. The record in this case is devoid of any
comprehensive assessment of Resident # 25’s smoking after March 2007. Similarly, the
record is devoid of any analysis showing that the staff strove to balance the resident’s
rights against the need to protect him.

Petitioner next asserts that Resident # 25 was subject to continual assessments and
reviews by the staff to determine whether he was able to make decisions, particularly as
to his ability to smoke, and whether the staff should implement safety measures in order
to protect him. Petitioner’s Post-Hearing brief at 3-6. I find this assertion to be
unsupported.

Petitioner points to the smoking assessments that it conducted of Resident # 25 in
October 2006 and March 2007 as evidence of its staff’s focus on the potential hazards
related to the resident’s smoking. The problem with this, of course, is that Petitioner’s
staff did nothing after March 2007 to assess comprehensively the risks related to the
resident’s smoking. CMS’s case is based on what happened after the March 2007
assessment was performed. The fact that Petitioner’s IDT performed assessments up to
that date is no evidence that they continued to do so. However, that evidence shows that
the IDT knew or should have known that continued reassessments of the resident needed
to be performed.

Next, Petitioner cites to the resident’s care plan as evidence that the staff was reassessing
the resident and planning for anticipated risks. CMS Ex. 10, at 52. However, and as I
discuss above, this care plan is no evidence that Petitioner’s IDT reassessed the resident
after March 2007. Nor does it show that anyone else on the staff reassessed the resident
comprehensively after March 2007 for the risks related to his smoking. The plan
contains printed instructions which are not particularized to the resident and which state
no specific interventions that were designed to protect him (“assess for safe smoking,”
“reinforce risks smoking behavior,” “inform appropriate smoking areas,” “offer smoking
cessation encouragement”). Jd. Indeed, not only does the plan fail to describe specific
interventions but it is apparent that the plan’s directive that the resident be assessed for
safe smoking was not carried out after March 2007. The plan also contains some specific
discussion of episodes in October 2006 and January 2008 in which the resident was found
to be smoking in his room. Jd. These episodes were treated in the plan as isolated
incidents and no comprehensive assessment is shown as having been performed after the
2008 episode. Jd.

Petitioner then asserts that its nursing staff and its social services personnel “regularly
assessed Resident 25 and his smoking habits.” Petitioner’s Post-Hearing brief at 4 (citing
to various CMS exhibits). I do not find that the exhibits cited to by Petitioner support
this assertion. There are references in Petitioner’s nursing notes to the resident’s smoking
and to specific episodes related to his smoking. CMS Ex. 10, at 9, 11. However, these
references do not comprise comprehensive assessments of the resident’s smoking
behavior and the risks that he might encounter when he smoked. For example, a nursing
note of May 1, 2008 recites that the resident’s smoking privileges were resumed after the
resident promised not to smoke again inside Petitioner’s facility. CMS Ex. 10, at 11.
This note contains no analysis of the resident’s cognitive state and whether he was
capable of intelligently making the promises recited in the note. Nor does it address how
safely the resident would smoke once his privileges were resumed.

Petitioner then contends that the facility’s awareness and assessments of the resident’s
smoking are contained in IDT progress notes. However, there are only two notes cited to
by Petitioner that refer to the resident’s smoking. One of these is dated February 5, 2005,
years before the relevant time period of this case. CMS Ex. 10, at 13. The other is an
IDT conference note of May 31, 2007. CMS Ex. 10, at 15. This note recites that the
resident “smokes outside daily.” Jd. That laconic comment aside, there is no discussion
whatsoever of the resident’s smoking behavior.

Activity progress notes are also cited by Petitioner as evidence of the alleged continual
assessments that its staff made of Resident # 25’s smoking. CMS Ex. 10, at 62-66.
These notes contain occasional references to the resident’s smoking. But, they contain
absolutely no assessment of his ability to smoke safely.”

Petitioner argues also that the resident’s care plan was reviewed periodically, citing
review dates of March, June, September, and December 2007, and March, June, and
September 2008. Petitioner’s Post-Hearing brief at 5. From this Petitioner would have
me infer that these reviews included a comprehensive reassessment of the risks associated
with Resident # 25’s smoking. I am not persuaded that these reviews indicate any such
thing. That is because, aside from March 2007, there were no assessments done by the
IDT for the care plan reviewers to consider. A care plan is a document that is supposed
to be constructed from the comprehensive assessments made of a resident by a facility’s
staff. 42 C.F.R. § 483.20(k). In reviewing the resident’s care plan after March 2007
Petitioner’s staff had no updated written assessments on which they could rely. Petitioner
has given me no reason to conclude that, in reviewing the resident’s care plan,
Petitioner’s staff somehow performed the assessment duties that were delegated to the
IDT and which were not performed by that entity.

Additionally, Petitioner contends that the resident’s smoking behavior was assessed in a
document which it refers to as a “multi-discipline care plan.” Petitioner’s Post-Hearing
brief at 5. It asserts also that this document was periodically reviewed, thereby proving
that its staff periodically reassessed the risks related to Resident # 25’s smoking. But, the
document relied on by Petitioner says no such thing. CMS Ex. 10, at 57. It merely lists

* Petitioner also cites to P. Ex. 2, at 4, 5, 20, 21, and 23-39 as evidence of its staff's
alleged continual reassessment of the resident’s smoking behavior. This exhibit appears
largely to duplicate the CMS exhibits which I have discussed. In any event, there is
nothing in the pages cited to by Petitioner that shows any comprehensive assessment of
the resident’s smoking after March 2007.
10

activities that were offered to the resident or in which the resident participated. It recites
that the resident socializes and enjoys smoking with friends on the facility’s patio
throughout the day and it contains a notation that unspecified individuals would “observe
safety [in connection with the resident’s] smoking.” Jd. That is hardly a comprehensive
assessment of the resident’s smoking behavior nor is it a comprehensive description of
interventions intended to protect the resident.

Also, Petitioner argues that there is no objective evidence showing that the resident posed
a hazard to himself or to others when he smoked. As support for this it avers that:

There is not a single notation or observation that Resident 25 ever fell
asleep outside while smoking, nor was he observed in the smoking patio
“with eyes closed, head dropped forward and a lit cigarette in his hand.”

Petitioner’s Post-Hearing brief at 10 (citing P. Ex. 8).

It may be true that Petitioner’s staff never observed the resident asleep while smoking.
But, in fact, he was seen apparently nodding off by a surveyor. And, even if he didn’t
sleep while smoking, the many burns on the resident’s blanket certainly indicated
ongoing careless handling of lighted smoking products by the resident.

Finally, Petitioner asserts that that it adequately supervised Resident #25. As support,
Petitioner cites to the March 16, 2007 smoking assessment of Resident # 25. Petitioner
contends that this is evidence that the resident could smoke safely, essentially
unsupervised. Petitioner’s Post-Hearing brief at 11.

Above, I explain why I conclude that the March 16, 2007 smoking assessment is not
persuasive evidence that the staff had actually determined that the resident’s cognitive
and physical functioning had improved so much that the resident could smoke safely and
unsupervised. But, even if Petitioner’s characterization of the March 16, 2007
assessment is correct, that begs the question of why the staff didn’t reassess the resident
subsequently, especially after the resident displayed behavior (smoking in his room) that
was clearly dangerous. Moreover, it should have been obvious to staff just from
observing the resident that he manifested behaviors that showed that he was dangerous to
himself and to others if he smoked unsupervised. The many burned areas on the
resident’s blanket are proof of the hazards that the resident encountered. So also is the
resident’s distinctive slouching while he sat in his wheelchair and smoked.

2. A per-instance civil money penalty of $5,000 is reasonable.
CMS is authorized to impose a per-instance civil money penalty of between $1,000 and

$10,000 as a remedy for a single deficiency. 42 C.F.R. § 488.438(a)(1)(iii). There exist
regulatory factors for deciding where within this range a specific penalty should lie.
11

These factors are set forth at 42 C.F.R. §§ 488.438(f)(1) — (4) and 488.404 (incorporated
by reference into 42 C.F.R. § 488.438(f)(3)). Factors which may be considered include
the seriousness of a facility’s noncompliance, its performance history, and its financial
condition.

The penalty of $5,000 determined by CMS is at the midpoint of the permissible range for
per-instance civil money penalties. I find it to be reasonable because the penalty amount
is very modest when measured against the seriousness of Petitioner’s noncompliance.
Here, and for a protracted period of more than 18 months, Petitioner failed to safeguard a
resident who clearly was at risk when he smoked. It failed utterly to keep current its
assessment of the resident’s smoking abilities and risks. This meant that the staff was in
no position to know whether the resident’s capabilities were deteriorating. The staff also
allowed the resident to smoke more or less constantly without imposing even minimal
supervision on him. They did so despite the presence of warning signs that the resident
was not trustworthy to smoke unsupervised.

I note also that the civil money penalty that CMS determined to impose against Petitioner
is miniscule when compared against that which CMS could have imposed. Petitioner’s
failures to assess and protect Resident # 25 extended over a period of 18 months.
Penalties of even a few hundred dollars a day — a very low amount for a daily civil money
penalty in a case such as this one — extended over a period of just a few months would
amount to total civil money penalties that are vastly greater than that which CMS
determined to impose and which I sustain.*

/s/
Steven T. Kessel
Administrative Law Judge

> As I discuss at the beginning of this decision CMS also determined to impose a denial of
payment for new admissions against Petitioner for a period of nine days. Petitioner has
not specifically challenged the imposition of this remedy. I find it to be authorized, both
by virtue of Petitioner’s noncompliance with the requirements of 42 C.F.R. § 483.25(h),
but also because of the other noncompliance findings made at the October survey that
Petitioner did not challenge. The presence of even a single deficiency is sufficient
authority for CMS to impose a denial of payment for new admissions. 42 C.F.R. §
488.417(a).


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division
Signature Prosthetics, Inc.
(Supplier No: 1049610001),
Petitioner,

Vv.

Centers for Medicare & Medicaid Services.
Docket No. C-09-754
Decision No. CR2090

Date: March 11, 2010

DECISION

The Centers for Medicare & Medicaid Services (CMS) has revoked Petitioner’s Medicare
supplier number. Petitioner, Signature Prosthetics, Inc., appeals, and CMS moves for
summary judgment.

As discussed below, the uncontroverted facts compel revocation of Petitioner’s supplier
number. I therefore grant CMS’s motion for summary judgment.

I. Background

Until its Medicare supplier number was revoked on July 18, 2009, Petitioner participated
in the Medicare program as a supplier of durable medical equipment, prosthetics,
orthotics and supplies (DMEPOS). See 42 C.F.R. § 424.57. Ina letter dated June 18,
2009, the Medicare contractor, Palmetto GBA National Supplier Clearinghouse, notified
Petitioner that its supplier number would be revoked pursuant to 42 C.F.R. §§ 424.57(e),
424.535(a), 424.535(a)(5)(ii) and other regulations.’ The letter noted that, despite
making four attempts during the facility’s posted office hours, one of the contractor’s
investigators was unable to inspect the supplier’s facility because it was closed. The
doors were locked, and no one responded to the investigator’s knocks. CMS Ex. 1.

Petitioner sought reconsideration. In a reconsideration decision dated August 25, 2009, a
Medicare hearing officer affirmed the revocation of Petitioner’s supplier number. CMS
Ex. 4. Petitioner now appeals that determination.

In an order dated September 29, 2009, I directed the parties to submit their evidence and
briefs “addressing all issues of law and fact.” CMS complied with that order but
Petitioner did not. In a notice dated December 15, 2009, I directed Petitioner to show
cause in writing why its request should not be dismissed as abandoned pursuant to 42
C.F.R. § 498.69(b)(2). In order to continue this appeal, the order directed Petitioner to
submit its evidence and argument. In a letter dated December 21, 2009, Fernando J.
Nunez, who is apparently Petitioner’s owner and operator, said that he had “already filed
its our [sic] exchange of evidence and argument,” apparently referring to Petitioner’s
hearing request and the documents attached thereto. Those documents are not marked as
exhibits as called for in my order and Civil Remedies Division procedures. However, the
evidence Petitioner alludes to is included among CMS’s Exhibits. CMS Exs. 6, 7.

CMS moves for summary judgment. With its motion and brief, CMS submits seven
exhibits (CMS Exs. 1-7).

II. Discussion

CMS is entitled to summary judgment because the
undisputed evidence establishes that the supplier, Signature
Prosthetics, Inc., did not satisfy Medicare enrollment
requirements.

Summary judgment. The Departmental Appeals Board has, on multiple occasions,
discussed the well-settled principles governing summary judgment. See, e.g.,
18661CPayday.com, L.L.C., DAB No. 2289, at 2-3 (2009). Summary judgment is

' Inconsistently, the letter said that Petitioner’s supplier number would be “revoked
effective 30 days from the postmark of this letter,” and that “the effective date of this
revocation has been made retroactive to April 8, 2009.” However, the Medicare hearing
officer resolved that inconsistency. According to the reconsideration decision, “The
effective date of the revocation is 30 days from the postmark of the [June 18, 2009
notice] letter.

> I make this one finding of fact/conclusion of law.
appropriate if a case presents no genuine issue of material fact, and the moving party is
entitled to judgment as a matter of law. 1866/CPayday, at 2; Illinois Knights Templar
Home, DAB No. 2274, at 3-4 (2009), and cases cited therein.

The moving party may show the absence of a genuine factual dispute by presenting
evidence so one-sided that it must prevail as a matter of law, or by showing that the non-
moving party has presented no evidence “sufficient to establish the existence of an
element essential to [that party’s] case, and on which [that party] will bear the burden of
proof at trial.” Livingston Care Center v. Dep’t of Health & Human Services, 388 F.3d
168, 173 (6th Cir. 2004) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)).
To avoid summary judgment, the non-moving party must then act affirmatively by
tendering evidence of specific facts showing that a dispute exists. Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 n.11 (1986); see also Vandalia Park,
DAB No. 1939 (2004); Lebanon Nursing and Rehabilitation Center, DAB No. 1918
(2004).

To defeat an adequately supported summary judgment
motion, the non-moving party may not rely on the denials in
its pleadings or briefs, but must furnish evidence of a
dispute concerning a material fact... .

Illinois Knights Templar, at 4 (emphasis in original); Livingston Care Center, DAB No.
871, at 5 (2003).

In examining the evidence for purposes of determining the appropriateness of summary
judgment, I must draw all reasonable inferences in the light most favorable to the non-
moving party. 1866/CPayday, L.L.C., at 3; Brightview Care Center, DAB No. 2132, at
2, 9 (2007); Livingston Care Center, 388 F.3d at 172; Guardian Health Care Center,
DAB No. 1943, at 8 (2004); but see Brightview, DAB No. 2132, at 10 (entry of summary
judgment upheld where inferences and views of non-moving party are not reasonable).
Moreover, drawing factual inferences in the light most favorable to the non-moving party
does not require that I accept the non-moving party’s legal conclusions. Cf Guardian
Health Care Center, DAB No. 1943, at 11 (“A dispute over the conclusion to be drawn
from applying relevant legal criteria to undisputed facts does not preclude summary
judgment if the record is sufficiently developed and there is only one reasonable
conclusion that can be drawn from those facts.”).

Requirements fora DMEPOS supplier’s Medicare participation. To receive Medicare

payments for items furnished to a Medicare-eligible beneficiary, a supplier of medical

equipment and supplies must have a supplier number issued by the Secretary of Health
and Human Services. Social Security Act § 1834(j)(1)(A).

To obtain and retain its supplier number, a Medicare supplier must meet the standards set
forth in 42 C.F.R. § 424.57(c), and CMS may revoke its billing privileges if it fails to do
so. 42 C.F.R. §§ 424.57(c)(1) and (d); 42 C.F.R. § 424.535(a)(1). Among other
requirements, the supplier must permit CMS or its agents to conduct on-site inspections
to ascertain its compliance with governing regulations. Its location must be accessible
during reasonable business hours, and it must maintain a visible sign and post its hours of
operation. 42 C.F.R. § 424.57(c)(8).

Undisputed facts and application of law to those facts. Here, CMS has come forward
with evidence establishing that, prior to July 18, 2009, Petitioner was a Medicare-
enrolled DMEPOS supplier located at 9102 Firestone Blvd., Suite E, Downey, California.
Its posted hours were 10:00 a.m. to 6:00 p.m. Monday through Friday. At 11:58 a.m. on
March 12, 2009, Kimberly Smith-Owens, a fraud investigator employed by the
contractor, attempted an onsite inspection at that location. Although the lights were on,
the entrance was locked and no one responded to her knocks. She returned to the facility
three more times: at 11:43 a.m. on March 25; at 10:08 a.m. on March 26; and at 10:39
a.m. on April 8. On each occasion the entrance was locked and the lights were off. No
one responded to her knocks. CMS Ex. 5. Because the investigator could not inspect the
premises, the contractor revoked Petitioner’s supplier number.

Petitioner does not dispute any of these facts. In his June 22, 2009 letter to the
contractor, Mr. Nunez claimed that he is self-employed, with no employees. He said that
he makes business-related visits (to doctors, hospitals) during lunch — which he takes
from noon to 2:00 p.m. -- and that he sometimes returns late. He said that the facility is
also closed on Wednesdays. CMS Ex. 6, at 27. He supplied an order dated April 6,
2009, from Staples Office Supply, for the purchase of a sign saying “Closed 12 p.m. — 2
p.m. for Lunch” and “Closed Wednesdays,” and providing an emergency contact
telephone number. CMS Ex. 6, at 23-24. Among some undated photographs are pictures
of the facility’s entrance with that signage on the door adjacent to the door showing the
former posted hours (“Mon. — Fri. 10:00 a.m. to 6:00 p.m.). CMS Ex. 6, at 6, 7, 8; CMS
Ex. 7, at 18, 19.

Ina letter dated July 15, 2009, Petitioner advised the contractor of the facility’s new
business hours: 10 a.m. to 12:00 p.m. and 2:00 p.m. to 6:00 p.m. Monday, Tuesday,
Thursday, and Friday. CMS Ex. 6, at 14.

For summary judgment purposes, I draw all reasonable inferences in the light most
favorable to Petitioner, and accept that its facility is closed on Wednesdays, and closed
from noon to 2:00 p.m. daily. I also accept that, sometime after April 6, 2009, it changed
its signage to reflect these hours, and that it notified the contractor of its more limited
hours in the July 15, 2009 letter.*

Based on these facts, I find that Petitioner was not in compliance with all of the standards
set forth in section 424.57(c). To sustain its supplier number, a DMEPOS supplier must
permit CMS or its agents to conduct on-site inspections. 42 C.F.R. § 424.57(c)(8). Even
accepting that the facility’s actual hours of operation were 10:00 a.m. to 12:00 noon and
2:00 to 6:00 p.m. four days per week (Mon., Tues., Thurs., Fri.), the undisputed facts
establish that Petitioner was not open and accessible to program beneficiaries and CMS
during those hours. March 12, 2009, was a Thursday, and Investigator Smith-Owens
found it locked at 11:58 a.m., just before the purported lunch hour closing. March 26,
2009 was also a Thursday, and Investigator Smith-Owens found it locked at 10:08 a.m.,
well before its closing time.

Petitioner thus did not meet all of the standards of 42 C.F.R. § 424.57(c), and CMS
properly revoked its billing privileges. 42 C.F.R. § 424.57(d).

Il. Conclusion

Because the undisputed facts establish that Petitioner has not satisfied Medicare
enrollment requirements, I grant CMS’s motion for summary judgment and sustain the
revocation of Petitioner’s supplier number.

/s/
Carolyn Cozad Hughes
Administrative Law Judge

* Because the facility’s hours of operation were different than those posted on its door
when the investigator visited, it was not open and accessible during its posted hours of
operation, and therefore violated the standard. 42 C.F.R. § 424.57(c)(8). Ido not here
address whether a subsequent correction precludes CMS from revoking its supplier
number, based on the situation the investigator found in March 2009.


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division
Deepa P. Kudalkar, M.D.,
(NPI No. 1437157146),
Petitioner,
Vv.
Centers for Medicare & Medicaid Services.
Docket No. C-10-211
Decision No. CR2089

Date: March 10, 2010

DECISION

I dismiss the hearing request of Petitioner Deepa P. Kudalkar, M.D. because under the
applicable regulations Petitioner does not have a right to a hearing before me.

I. Background

Petitioner filed a hearing request with respect to the effective date Petitioner was given
for billing Medicare. Petitioner concedes that her earlier two Medicare enrollment
applications were returned to her as they contained an incorrect or missing signature. A
subsequent application submitted by Petitioner was approved for Medicare enrollment
effective September 8, 2009, and thus, under the regulations in effect as of January 2009,
her right to bill for services provided to Medicare beneficiaries became effective as of
August 9, 2009. Petitioner seeks a retroactive effective date of July 15, 2009.

Following my review of Petitioner’s hearing request it was apparent that Petitioner’s
appeal involves a challenge to regulations which govern the time for which Medicare will
retrospectively reimburse a supplier for items or services provided prior to the effective
date of enrollment by suppliers who are newly enrolled in the Medicare program.
Consequently, I issued an Order to Show Cause on January 15, 2010 directing Petitioner
to respond in writing not later than February 4, 2010 why her request for hearing should
not be dismissed. That Order further directed CMS to show cause by February 24, 2010
why Petitioner’s request for hearing should be dismissed pursuant to 42 C.F.R. §
498.70(b). CMS’s response requesting that Petitioner’s appeal be dismissed was received
on February 4, 2010. Petitioner did not respond to my Order to Show Cause.

II. Issue, findings of fact and conclusions of law.
A. Issue

The issue is whether the Petitioner has a right to a hearing before me.
B. Findings of fact and conclusions of law

I make findings of fact and conclusions of law (Findings) to support my decision in this
case. I set forth my Findings below as separate headings.

1. Petitioner does not have a right to a hearing.

Petitioner is a physician whose request for hearing appears to challenge regulations
governing the time from which Medicare retrospectively reimburses items or services
supplied by physicians who are newly enrolled in the Medicare program (or re-enrolled at
a point in time after enrollment has lapsed), but prior to the effective date of their
enrollment.

Petitioner is a newly enrolled supplier in the Medicare program. Petitioner provided
services to Medicare beneficiaries as of July 15, 2009, prior to the date of her enrollment,
and seeks to claim reimbursement for those services.

Petitioner asks that the filing date of its first enrollment application (June 16, 2009) be
considered and that the effective enrollment date be made retroactive to July 15, 2009.
However, CMS correctly cites to the regulation at 42 C.F.R. § 424.525 which states
without ambiguity as to its interpretation: “Enrollment applications that are rejected are
not afforded appeal rights.” As Petitioner has conceded to, her earlier applications were
not processed because they contained incomplete information. Moreover, the regulation
specifically establishes the point in time (referenced as effective date) from which
Medicare may reimburse retrospective claims for services provided by an enrolled
physician. The regulations provide that the effective date for Medicare billing privileges
for physicians and certain other practitioners is the later of the date of filing of a
Medicare enrollment application that was subsequently approved by a Medicare
contractor or the date that an enrolled physician or other practitioner first began
furnishing serves at a new practice location. 42 C.F.R. § 424.520(d). Therefore,

Medicare will reimburse retrospectively a claim for services by an enrolled physician for
up to 30 days prior to the effective date of enrollment “if circumstances preclude
enrollment in advance of providing services to Medicare beneficiaries.” 42 C.F.R.

§ 424.521(a)(1). Although Petitioner does not advance this argument, Medicare will
reimburse retrospectively for up to 90 days prior to the effective date of enrollment in the
event that a Presidentially-declared disaster precluded enrollment in advance of providing
services. 42 C.F.R. § 424.521(a)(2). Those are the only circumstances under which
retrospective reimbursement is permitted.

Petitioner’s challenge to the regulations governing the time from which Medicare
retrospectively reimburses items or services supplied by physicians who are newly
enrolled in the Medicare program is not something that I have the authority to hear and
decide. In my capacity as an ALJ I have authority to hear cases where Medicare
enrollment was denied or revoked - but here, Petitioner’s Medicare enrollment was not
improperly denied or revoked. See 42 C.F.R. § 498.3(b)(17). As noted in my Order to
Show Cause, the ALJs of this forum have summarily dismissed such hearing requests
pursuant to 42 C.F.R. § 498.70(b). See, e.g., Bradley D. Anawalt, M.D., et al., DAB
CR2021 (2009); Rachel Ruotolo, M.D., DAB CR2029 (2009); David M. Baker, M.D., et
al., DAB CR2035 (2009); Peter Manis, M.D., DAB CR2036 (2009).

2. I must dismiss Petitioner’s request for hearing.

I may dismiss a hearing request in the circumstance where a party requesting a hearing
has no right to a hearing. 42 C.F.R. § 498.70(b). Petitioner has not established a right to a
hearing, and has in fact declined to express opposition to the position CMS has taken.
Consequently, I dismiss this case.

/s/
Richard J. Smith
Administrative Law Judge


The Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

In the case of: )
)
Social Security Administration, ) Date: March 9, 2010
)
Petitioner, )
)
-Vv.- ) Docket No. C-09-149
) Decision No. CR2087
Steven Getchell. )
)
DECISION

In applying for disability benefits under the Social Security program, Respondent Steven
Getchell claimed to suffer from a plethora of disorders, including bi-polar disorder,
depression, chronic fatigue, fibromyalgia, arthritis, and irritable bowel syndrome. He
claimed to be in constant pain, which precluded him from engaging in any significant
physical activity. The Inspector General (IG) for the Social Security Administration
(SSA) now charges that Respondent Getchell violated section 1129 of the Social Security
Act (Act) because he repeatedly and knowingly made to SSA false statements and
misrepresentations of material fact regarding his alleged disability, functional abilities,
and activities. SSA proposes imposing against Respondent Getchell a $60,000 civil
money penalty (CMP).

For the reasons set forth below, I agree that Respondent Getchell knowingly
misrepresented material facts to SSA for its use in determining his eligibility for
disability insurance and Supplemental Security Income (SSI) benefits, and I consider
$60,000 a reasonable penalty.

I. Background

Section 1129 of the Act subjects to penalty any person (including an organization,
agency, or other entity) who

(A) makes, or causes to be made, a statement or representation of a
material fact, for use in determining any initial or continuing right to or the
amount of monthly insurance benefits under title II or benefits or payments
under title .. . XVI, that the person knows or should know is false or
misleading,’

(B) makes such a statement or representation for such use with knowing
disregard for the truth, or

(C) omits from a statement or representation for such use, or otherwise
withholds disclosure of, a fact which the person knows or should know is
material to the determination of any initial or continuing right to or the
amount of monthly insurance benefits under title II or benefits or payments
under title . .. XVI, if the person knows, or should know, that the statement
or representation with such omission is false or misleading or that the
withholding of such disclosure is misleading... .

See also 20 C.F.R. § 498.102(a) (authorizing the IG to impose a penalty against any
person who has made a statement or representation of a material fact for use in
determining any initial or continuing right to or amount of Title II or Title XVI benefits,
and who knew, or should have known, that the statement or representation was false or
misleading, or who omitted a material fact, or who made such a statement with “knowing
disregard for the truth”).

The Commissioner of Social Security has delegated to the IG the authority to impose
penalties under section 1129. See 20 C.F.R. § 498.102.

In this case, the IG contends that, in pursuing his applications for disability insurance
and/or SSI benefits, Respondent Getchell knowingly made false statements of material
fact and misrepresentations regarding his alleged disability, his functional abilities, and

is activities. By letter dated December 11, 2007, the IG advised Respondent Getchell of
is determination and the proposed penalty. IG Ex. 23. Respondent Getchell requested a
earing.~

After the parties submitted their prehearing briefs and proposed exhibits, the IG moved
‘or summary judgment. I denied the motion. I agreed with the IG that Respondent
Getchell had produced little evidence suggesting material facts in dispute, but, drawing

' Title II of the Act governs the Social Security disability insurance program, and Title
XVI governs the SSI program.

2 J initially dismissed Petitioner’s hearing request as untimely because it was not filed
within 60 days of his receipt of the IG’s notice letter. However, on appeal, Respondent
successfully argued that good cause justified extending the time permitted for filing, and
the matter is now before me on remand.
all reasonable inferences in the light most favorable to Respondent, I could not conclude
that no material facts were in dispute.

I convened a hearing on November 16, 2009, in Tampa, Florida, at which Respondent
Getchell was represented by Mr. N. Albert Bacharach, Jr. The IG was represented by
Ms. Debbie Shaw and Ms. Erin Justice.

I have admitted into evidence IG Exhibits 1-27 (IG Exs. 1-27) and Respondent’s Exhibits
1-7 (R. Exs. 1-7).

II. Issues

The issues before me are: 1) Did Respondent Getchell make, or cause to be made, to
SSA a statement or representation of a material fact for use in determining his entitlement
to Social Security Disability Insurance benefits (Title ID) and/or SSI benefits (Title XVI)
that he knew or should have known was false and misleading, or did he omit a material
fact or make such a statement with knowing disregard for the truth; and 2) if so, is the
penalty imposed -- $60,000 -- reasonable?

II. Discussion

A, Respondent Getchell repeatedly made statements or
representations to SSA that he knew or should have known
were false or misleading.*

In on-line applications filed in January 2004, Respondent Getchell applied for disability
insurance benefits and/or SSI benefits, claiming that, since October 9, 2002, he had been
unable to work because of his physical and mental condition. IG Exs. 1, 2. Ina
questionnaire he completed and signed on February 16, 2004, he admitted that he
performed some household chores (laundry, dishes, yard work and other chores), but said
that he was not capable of handling finances, showered only every few days, and often
wore the clothes he slept in. He said that he exercised less, had no social activities, and
“limited, controlled activities.” He specifically denied being active in church groups,
claiming that he stopped going to church because “the large amount [sic] of people in
such a confined space is difficult to handle.” IG Ex. 3, at 2. He denied visiting friends or
relatives; he said that he was unable to remember things, had a short attention span, had
trouble finishing simple jobs, and could not follow written or spoken instructions
(“Sometimes I forget what I need to do.”). He said that he could not deal with deadlines
or schedules. IG Ex. 3 at 3-4.

* My findings of fact/conclusion of law are set forth, in italics and bold, in the discussion
captions of this decision.
In a separate questionnaire, Respondent Getchell described “constant” pain throughout
his body (toes, feet, knees, hips, lower and upper back, shoulder, right elbow, wrists,
fingers, neck, and muscles) “all day, every day.” IG Ex. 4, at 1. He said that he was
“always in pain.” He claimed that massage and physical therapy did not relieve the pain,
and that medication worked only temporarily. With respect to daily activities, he said
that he needed to rest after long periods of housework, that long periods of walking, lying
down, and sitting caused him severe pain, and that he needed rest after and during
physical work. IG Ex. 4, at 2-3.

In his subsequent submissions to SSA, Respondent Getchell repeated that he could “no
longer exercise much” and that “golf, tennis [and] softball have been taken from my daily
routine.” He said that “doing any physical activity is hard — very painful,” that he could
walk “maybe a few hundred yards,” and that he used a cane, which was prescribed for
him in 1997. IG Ex. 7 at 5-7 (September 22, 2004 function report); see also IG Ex. 8, at
2-4.

His applications were denied initially and on reconsideration, and, as allowed by statute
and regulations, Respondent Getchell requested a hearing before an Administrative Law
Judge (ALJ). IG Exs. 6, 9. His hearing was held on October 23, 2006, before ALJ
Richard E. Ouellette. At the hearing, Respondent Getchell testified, under oath, that his
physical and mental impairments significantly limited his abilities to walk, stand, sit, and
use his hands. He claimed that his impairments caused him to tire easily and significantly
limited his social interaction. He said that he had trouble walking “for a few minutes.”
IG Ex. 10.

He also testified that two weeks prior to the hearing he started a part-time job (three days
per week, four and a half hours per day), but that job only required that he ride in a golf
cart for 15-20 minutes at a time. IG Ex. 10, at 12-13. Otherwise, he had not worked
since October 2002, when he stopped working as a tennis instructor because “I wasn’t
able to run around, I wasn’t able to play, I wasn’t able to stand for any length of time and
teach.” IG Ex. 10, at 10.

When the judge asked specifically about his exercise — tennis, golf, softball, kayaking, he
said:

In 2003 I guess we had just moved here, and to get some
exercise we bought a kayak, but I injured my shoulder using
the kayak, so it sat next to my house for the best of — you
know, almost three years now. And I used to play tennis
quite a bit, but I don’t anymore. And I played softball for a
season when we moved down here, but I can’t do it. It’s just
-- it’s too difficult on my legs and my back.

IG Ex. 10, at 33-34.
Judge Ouellette then told Respondent Getchell that, shortly before the hearing, he
received written statements and other evidence suggesting that, at best, Respondent
Getchell was exaggerating his impairments. The judge said that he received pictures of
Respondent Getchell playing third base, and a 2005 DVD showing him performing in
skits at his church. IG Ex. 10, at 37-39; IG Ex. 26, at 2 (Ouellette Decl. § 4, § 8); Tr. 60-
61; see also IG Ex. 19, 20, 21.

Thereafter, Respondent Getchell withdrew his hearing request. In dismissing the case,
Judge Ouellette pointed out what he characterized as “some of the inconsistencies within
the record,” and advised Respondent Getchell that he was referring the matter “to the
proper component of [SSA] for further inquiry with regard to the issue of fraud.” IG Exs.
16, 17.

As the following discussion shows, overwhelming evidence establishes that, throughout
the time he was claiming significant limitations, Respondent Getchell regularly engaged
in a wide variety of physically demanding activities, including tennis, golf, bicycle-
riding, softball, volleyball, and kayaking. He attended church regularly, and participated
in church activities. As the church’s drama director, he wrote, directed and acted in
weekly skits illustrating themes from his pastor’s sermons. He played fantasy baseball on
his computer. He acted as the primary care-giver for his two small children.

Most dramatic among the evidence establishing that Respondent Getchell misrepresented
his activities and limitations are a DVD and a videotape. The charts below set forth
multiple discrepancies between the claims he made to SSA and his actual capabilities.

The nine-minute videotape from summer/fall 2006 shows Respondent Getchell, tennis
racquet in hand, apparently giving a tennis lesson to an older gentleman. IG Ex. 21; Tr.
37.

Respondent Getchell’s Claims to Videotape (IG Ex. 21)
SSA
Problems using his hands

¢ He has weakness in his hands. ¢ He held the tennis racket for
IG. Ex. 10, at 19. 9 minutes and used it to hit
e When he is holding something in the ball over 10 times
his hands, they stiffen and tire without noticeable
very quickly. His hands and difficulty.
knuckles become very stiff and e He picked up the tennis ball
cannot hold a pen or pencil with from the ground with no
any pressure. IG Ex. 10, at 20. apparent problem.

e He is only able to hold a pen for
5 to 10 minutes. IG Ex. 10, at
20.

e He has problems lifting a gallon
of milk because his hands and
fingers stiffen and it feels like it
is going to slip out of his hand.
IG Ex. 10, at 29.

Without any apparent
difficulty, he repeatedly
used hand gestures in
conversation with an older
man (apparently a tennis
student). He made several
rapid, wide swings of his
tennis racket, serving the
ball without difficulty. He
swung his arms up and
down while serving the ball
more than 8 times.

Problems standing and walking

e Standing hurts his back, legs and
neck. IG Ex. 10, at 14.

e He has trouble with his legs and
can only stand for a few minutes
without leaning on something.
IG Ex. 10, at 10, 28.

e He has pain in his right foot and
his heel is sore and painful. IG
Ex. 10, at 16-17.

e He uses a cane to walk. IG Ex.
7, at 7.

He stood for 9 minutes on
the tennis court with no sign
of difficulty.

He walked across the tennis
court several times without
difficulty, even breaking
into a slight jog to pick up a
ball.

Difficulty bending over
e Itis impossible to bend over
because of the numbing pain. IG
Ex. 10, at 15-16.

He slightly bent over to pick
up the ball and served it
without difficulty.

Problems with thinking and memory
e His memory and ability to
concentrate are bad. IG Ex. 10, at
23, 24.

e He has difficulty thinking of
words or staying focused. IG
Ex. 10, at 23, 24.

He instructed his student.

Difficulty turning neck
e He has difficulty turning his neck
to the right. IG Ex. 10, at 30.

He turned his head from left
to right without difficulty.

Low Energy
e His energy is low and he gets.
tired very often. IG Ex. 10, at
21; 1G Ex. 4, at 2-3.

He stood and actively played
tennis for 9 minutes with no
sign of exhaustion (although
is older student is plainly
tired).

Similarly, Respondent Getchell appears in

in his church in 2005. IG Ex. 20; Tr. 37. The DV.

repeated assertions that he neither attende

IG Ex. 3, at 2 (Respondent claimed that he
below high!
capabilities

a couple of skits on the DVD, which was shot
D’s existence belies Respondent’s

nor participated in church groups. See, e.g.,
stopped going to church). Further, the chart

ights additional discrepancies between his representations to SSA and the
he demonstrated in one 7-minute performance:

Respondent Getchell’s Claims to SSA

The Church Play (IG Ex. 20)

Problems using his hands
He has weakness in his hands.
IG Ex. 10, at 19.

e When he is holding something in
his hands, they stiffen and tire
very quickly. His hands and
knuckles become very stiff and
cannot hold a pen or pencil with
any pressure. IG Ex. 10, at 20.
He is only able to hold a pen for
5 to 10 minutes. IG Ex. 10, at
20.

He has problems lifting a gallon
of milk because his hands and
fingers stiffen and it feels like it
is going to slip out of his hand.
IG Ex. 10, at 29.

e He pulled a golf club out of a
golf bag without any difficulty
and held the club for 7 minutes

without dropping it.

He switched the golf club from
his right to left hand and held the
club horizontally behind his back
and against the back of his neck
for a few seconds without any
sign of difficulty.

He swung the golf club at least 4
times, without any sign of
difficulty, showing no limitations
in hand and wrist movements.
He took small “putts” and a
complete full swing.

He picked up a golf club bag full
of golf clubs, placed it over his
left shoulder, then walked down
the stage steps without any sign
of difficulty.

He used hand gestures while
acting in the skit, even making a
fist with his right hand at one
point while gesturing forcefully
with his right arm.

Problems standing and walking

e Standing hurts his back, legs and
neck. IG Ex. 10, at 14.

e He has trouble with his legs and
can only stand for a few minutes
without leaning on something.
IG Ex. 10, at 10, 28.

e He has pain in his right foot and
his heel is sore and painful. IG
Ex. 10, at 16-17.

He stood in the scene for 7
minutes without any sign of
difficulty.

Difficulty bending over
e Itis impossible to bend over
because of the numbing pain. IG
Ex. 10, at 15-16.

Slightly bent over and swung the
golf club at least 4 times without
any sign of difficulty.

Bent over to pick up the golf
club bag without any sign of
difficulty.

Problems with thinking and memory
e His memory and ability to
concentrate are bad. IG Ex. 10,
at 23, 24.
e He has difficulty thinking of
words or staying focused. IG Ex.
10, at 23, 24.

He memorized and recited over
20 lines while acting in the scene
without any difficulty.

Difficulty turning neck
e He has difficulty turning his neck
to the right. IG Ex. 10, at 30.

He turned his head from left to
right while swinging the golf
club with no sign of difficulty.

Low Energy
e His energy is low and he gets e He stood for 7 minutes in a play
tired very often. IG Ex. 10, at without any sign of exhaustion.
21; 1G Ex. 4, at 2-3. e He carried the golf club bag with

no sign of exhaustion.
e He swung the golf club without
any problems.

Other convincing evidence establishes that Respondent Getchell repeatedly misled SSA
in describing his activities and his capabilities. Photographs dated 2006 show him
playing softball. IG Ex. 19.

The testimony of reliable witnesses establishes that, contrary to his representations to
SSA, Respondent Getchell was active and athletic. Joan Morgan met Respondent
Getchell in late 2003 or early 2004. They attended the same church and her
grandchildren were in preschool with Respondent Getchell’s daughter. IG Ex. 11, at 3
(Morgan Decl. | 2); Tr. 39. She testified, credibly, that she saw him regularly at
preschool activities, birthday parties, soccer games, church, and church activities. IG Ex.
11, at 3 (Morgan Decl. § 4), Tr. 39-40. She often saw him at the children’s play group.
Tr. 39-40, 41, 55-56. She described Respondent Getchell as “the life of the party.” Tr.
41. “He would stand there for long periods of time and talk with the other parents . . .
chatting and eating.” Tr. 41, 42.

Respondent Getchell was the Director of Communications at the church, and Ms. Morgan
testified that he wrote, directed, and performed in church skits. IG Ex. 11, at 3 (Morgan
Decl. § 4); see also IG Ex. 11, at 6.4

She observed him sit, stand and walk for extended periods of time; he engaged in sports,

including volleyball and bicycle riding. He often challenged others to race him, running

and bicycling. He brought his kayak to a church picnic. IG Ex. 11, at 3-4 (Morgan Decl.
45); Tr. 51.

Ms. Morgan described several other incidents. On one occasion, her adult daughter “who
was a pretty avid runner” (she ran in the Peachtree Marathon) tried to race Respondent
Getchell down the beach. Tr. 46. At the children’s soccer games, “he’d want someone to
throw a ball at him or just say, you know, throw me a pass or whatever kind of like
showing off.” Tr. 46-47.

According to Ms. Morgan, Respondent Getchell mowed a lawn for someone and helped
several people move, lifting heavy boxes and furniture. IG Ex. 11, at 4 (Morgan Decl.
6); Tr. 52-54. He “often” went biking with Ms. Morgan’s son-in-law; Ms. Morgan

+ 1G Ex. 11, page 6 is incorrectly marked IG Ex. 6.
10

accompanied them once, but was not able to keep up because she could not go faster than
15 mph. IG Ex. 11, at 4 (Morgan Decl. § 7); Tr. 47.

Similarly, Michael Risley was a member of Respondent Getchell’s church. He also
testified, credibly, that they met in 2004, and that, between 2004 and 2005, he and
Respondent Getchell played volleyball at church outings, and played golf together once
in early 2005 (both hit in the 80s). IG Ex. 13, at 1 (Risley Decl. Jf 3, 4, 5); Tr. 75-77.
According to Mr. Risley, Respondent Getchell was a “tennis pro and an athlete” who
“outplayed me” in both volleyball and golf. “He hit the ball further and more
accurately.” IG Ex. 13, at 1 (Risley Decl. § 4). He confirmed that Respondent Getchell
participated in church activities, including writing and acting in church skits. Tr. 77.
When Mr. Risley expressed surprise at Respondent Getchell’s having filed applications
for disability benefits, Respondent replied “Yeah, but they don’t know [that I don’t look
disabled].” IG Ex. 13, at 1 (Risley Decl. § 5).

The pastor of Respondent’s church, Reverend Edward DeJesus, testified that Respondent
Getchell began attending his church in 2004 and they became friends. Between 2004 and
2006, Respondent Getchell attended church every Sunday and played volleyball at church
outings. IG Ex. 27, at 1 (DeJesus Decl. fj 4, 5); Tr. 81. Reverend DeJesus confirmed
that from October 2004 until April 2005, Respondent Getchell was the church’s Director
of Communications, a volunteer position. In that capacity, he wrote, created, directed,
and acted in church skits. IG Ex. 27, at 2 (DeJesus Decl. § 6). Reverend DeJesus would
tell Respondent Getchell the theme for his sermon, “and then he would run with it.” Tr.
86.

A member of the church videotaped many of the skits, and, in October 2006, the church
provided a copy of the DVD to Respondent’s estranged wife, with the understanding that
it would be shown to an SSA Judge. IG Ex. 27, at 2 (DeJesus Decl. §§ 7, 9); IG Ex. 20.

According to Reverend DeJesus,

Steve is an incredibly gifted individual. His creativity doing
dramas, organizing people, doing skits, writing them down,
as been, was a tremendous help for us as a church. And
were there times where I observed him getting frustrated in
is role? Yeah, absolutely. There isn’t anybody in church I
aven’t experienced eventually gets frustrated [sic] when
you’re dealing with volunteers and timing and trying to
organize something and people don’t make their
appointments. ... I see a lot of people get frustrated over the
course of time and life and pressure and so I didn’t take that
his bipolar disorder] was a hindrance for him doing his role.
If thought it was I would have removed him or anybody in

11

the church if I felt that they had a problem that they couldn’t
function.

Tr. 85-86. I found Reverend DeJesus’s testimony completely credible. Not only was it
wholly consistent with the testimony of the IG’s other witnesses, but Reverend DeJesus
showed particular concern for the respondent’s welfare, and he unquestionably took no
pleasure in causing injury to his former parishioner.

Finally, the medical evidence, which is sparse, establishes virtually no physical
limitations, and a mental impairment that was well-controlled. Respondent Getchell
consulted a physician on September 29, 2003, about four months before he applied for
benefits. The report of his initial office visit describes his “biggest complaint” as a
toothache. He also complained of “generalized body aches” and a potentially broken toe
caused by his toe hitting a door when he fell on wet tile. IG Ex. 18 at 12, 13. He
reported a history of arthritis, bipolar disorder, migraines, hypertension, “chronic
fatigue,” and depression. IG Ex. 18, at 12. Nevertheless, he told the doctor that he
exercised “by playing tennis, golfing, softball, and kayaking.” IG Ex. 18, at 13. He also
complained of sleep problems, and significant weight gain (55 pounds) since he stopped
working as a tennis pro. His physical exam showed good muscle tone and bulk, full
range of motion, no tenderness in any extremity, but his right fourth toe was bruised,
swollen and tender. His neurological exam was normal; his strength was 5/5 throughout,
and his gait was normal. He showed good affect, good insight, and good judgment. IG
Ex. 18, at 14.

A consultative examination dated November 9, 2004, found normal range of motion in all
of his joints, and noted that he did not require an assistive device (e.g., a cane) for
ambulation. IG Ex. 18, at 15-17.

The report of his annual physical exam, dated December 8, 2004, indicates that he is
feeling “well,” although he gained weight and complained of back pain. His exam was
within normal limits. IG Ex. 18, at 11.

Psychiatric reports from 2004, 2005, and 2006, show that his bipolar disorder was well-
controlled. He was consistently described as cooperative, neatly groomed, with normal
speech and memory, logical and coherent thought content, average cognitive ability, and
good judgment. IG Ex. 18, at 1-9; R. Ex. 7.

Respondent Getchell has not rebutted any of this evidence. Nor has he explained the
obvious discrepancies between what he told SSA he could do and what the recorded
images show him doing. Rather, he responds only to the evidence provided by his former
wife, Heidi Swedberg (nee Heidi Getchell). Respondent attacks her credibility, pointing
out, with some justification, that, until their estrangement, Ms. Swedberg supported his
application for disability benefits. In these proceedings, as well as during their
acrimonious divorce proceedings, she has offered multiple inconsistent statements as to
12

Respondent Getchell’s limitations and activities. I agree that her inconsistent statements
undermine her credibility, and, aside from accepting her representations as to the dates of
the video and DVD — which Respondent has not challenged -- I accord her testimony no
weight.

Thus, the largely undisputed evidence establishes that, in applying for disability benefits,
Respondent Getchell knowingly and repeatedly misrepresented his functional abilities
and his activities.

B. Respondent Getchell’s misrepresentations were
material.

The Act defines a material fact as one that “the Commissioner of Social Security may
consider in evaluating whether an applicant is entitled to benefits under title I. . . or
eligible for benefits or payments under title XVI.” Act, section 1129(a)(2). Regulations
governing eligibility for Social Security disability insurance (Title II of the Act) are
found at 20 C.F.R. Part 404, and regulations governing SSI eligibility (Title XVI of the
Act) are found at 20 C.F.R. Part 416. Under each part, an individual is disabled if he is
unable to perform any “substantial gainful activity” because of a “medically determinable
physical or mental impairment which can be expected to result in death or which has
lasted or can be expected to last for a continuous period of not less than 12 months.” 20
C.F.R. §§ 404.1505(a), 416.905(a).

To satisfy the basic definition of disability, an individual must have a severe impairment
that makes him unable to perform his past relevant work or any other substantial gainful
work. 20 C.F.R. §§ 404.1505(a), 416.905(a). Ifthe individual is not working, he may be
found disabled if, based on his “residual functional capacity” and certain vocational
factors (age, education, work experience), he is unable to return to his past relevant work
or perform other work. 20 C.F.R. § 404.1505(a). Residual functional capacity is defined
as “the most [an individual] can still do despite [his] limitations.” 20 C.F.R.

§ 404.1545(a). To determine residual functional capacity, the agency assesses the nature
and extent of the individual’s physical limitations.

A limited ability to perform certain physical demands
of work activities, such as sitting, standing, walking,
lifting, carrying, pushing, pulling, or other physical
functions (including manipulative or postural
functions, such as reaching, handling, stooping or
crouching), may reduce your ability to do past work
and other work.

20 C.F.R. § 404.1545(b). The agency also assesses the nature and extent of mental
limitations and restrictions.
13

A limited ability to carry out certain mental activities, such as
limitations in understanding, remembering, and carrying out
instructions . .. may reduce [the individual’s] ability to do
past work and other work.

20 C.F.R. § 404.1545(c).

Thus, the types of limitations described by Respondent Getchell in his efforts to get
benefits would limit a claimant’s ability to perform substantial gainful activity, enhancing
his claim of disability, and must be considered material.

C. The IG proposes a reasonable penalty, $60,000,
against Respondent Getchell.

The statute authorizes imposition of a CMP of “not more than $5,000 for each such
statement or representation.” Act, section 1129(a)(1); 20 C.F.R. §§ 498.103(a), 498.104.

The IG cites “at least” 17 false statements or misrepresentations made by Respondent
Getchell in his efforts to qualify for disability benefits.

I am not prepared to find that all of the representations cited by the IG fall within the
ambit of section 1129. Some, such as his list of impairments and complaints of pain and
other symptoms are either supported by the evidence or are simply too vague to be
considered knowing misrepresentations. IG Ex. 2 (Respondent Getchell claimed to suffer
from bi-polar disorder, depression, chronic fatigue, fibromyalgia, arthritis, and irritable
bowel syndrome, poor concentration, and constant pain); IG Ex. 4 (general complaints of
pain); IG Ex. 9 (an undated Disability Report providing virtually no usable information).

On the other hand, I find that the following statements and representations fall within
section 1129 because they are false and misleading, and that Respondent Getchell knew
or should have known that they were false and misleading:

e Inhis February 16, 2004 Activities of Daily Living report, Respondent Getchell
claimed that he engaged in no social activities; that he stopped going to church
because the number of people in such a confined space made it difficult; that he
did not go out or visit others; and that he was unable to deal with deadlines or
schedules. IG Ex. 3, at 2, 3, 4;

e Inhis July 10, 2004 Disability Report, he claimed that “doing any activity, either
standing, sitting, or moving causes constant pain throughout my body.” IG Ex. 6,
at 6;
14

e Inan Adult Function Report, completed on September 22, 2004, he claimed that
doing any physical activity is hard and very painful; that he is able to walk only a
few hundred yards without stopping to rest; and that he uses a cane to walk. IG
Ex. 7, at 6, 7;

e He claimed on a September 22, 2004 pain questionnaire that walking and standing
“are both very tough” and these activities, as well as sitting and sleeping, cause
him pain if he does them for any length of time. IG Ex. 8, at 2; and

e During his hearing before Judge Ouellette, Respondent Getchell made numerous
false or misleading statements. I have listed twelve of them in the charts, above.
He also falsely denied attending church. IG Ex. 10, at 33. He said that he had not
used his kayak in three years. IG Ex. 10, at 33. He said that he did not play tennis
anymore, and had played softball only for one season “when we moved down
here.” IG Ex. 10, at 34.

Given the number of false and misleading statements contained in the reports he
submitted to SSA and made while he testified under oath at his disability hearing, the
proposed penalty falls well below the statutory maximum of $5,000 per
misrepresentation.

I now apply the regulatory criteria to assess the appropriateness of the penalty. Iam
specifically authorized to affirm, deny, increase, or reduce the penalties proposed by the
IG. 20 C.F.R. § 498.220. In determining the appropriateness of the penalty, I must
consider: 1) the nature of the statements and representations and the circumstances under
which they occurred; 2) the degree of culpability of the person committing the offense; 3)
the history of prior offenses of the person committing the offense; 4) the financial
condition of the person committing the offense; and 5) such other matters as justice may
require. 20 C.F.R. § 498.106.

I note that Respondent Getchell has no history of prior offenses. With respect to his
financial condition, he failed to return to the IG a financial disclosure form for use in
determining his ability to pay. Nor did he provide to this forum any credible evidence of
his financial condition.

With respect to the other factors, I find that, from at least February 2004 until the date of
his disability hearing in October 2006, his actions were deliberate. At each stage of the
appeals process, he added to the misrepresentations. Most disturbing, he made false
statements under oath at his ALJ hearing. Respondent Getchell has offered no evidence
to mitigate his offenses, but persists in claiming that he made no false statements.

That he has been diagnosed with a mental impairment (bipolar disorder) and may even
have experienced some decline in his physical abilities (although the record contains little
support for any significant physical impairment) does not justify his efforts to obtain
15

benefits through fraud and perjury. Nothing in this record suggests that his mental
impairment compelled him to make false statements, nor rendered him unable to
recognize that they were false. In fact, his remarks to Mr. Risley reveal a cynical and
deliberate effort to gain benefits that he thought would otherwise be denied.

Finally, I note that the integrity of the disability system depends on each claimant
accurately describing his functional abilities, so that SSA can determine whether he
qualifies for benefits. Where, as here, a claimant deliberately misrepresents his
functional capacity, he undermines the integrity of that system.

IV. Conclusion

Respondent Getchell violated section 1129 of the Act when he knowingly misrepresented
material facts to SSA for its use in determining his eligibility for benefits under titles II
and XVI. I consider reasonable the imposition of a $60,000 CMP.

/s/
Carolyn Cozad Hughes
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

George Andrew Love,
Petitioner,
Vv.
The Inspector General.
Docket No. C-10-129
Decision No. CR2086

Date: March 09, 2010

DECISION

I sustain the determination of the Inspector General (I.G.) to exclude Petitioner,
George Andrew Love, from participating in Medicare and other federally funded
health care programs for a period of at least five years.

I. Background

On September 30, 2009 the I.G. notified Petitioner that he was excluded from
participating in Medicare and other federally funded health care programs for a
period of at least five years. The I.G. told Petitioner that he was being excluded
because he had been convicted of a criminal offense as is described at section
1128(a)(1) of the Social Security Act (Act). This section mandates the exclusion
of any individual who has been convicted of a criminal offense related to the
delivery of an item or service under Medicare or a State health care program (a
State Medicaid program).
Petitioner requested a hearing and the case was assigned to me for a hearing and a
decision. Each party submitted a brief. The I.G. decided not to file a reply brief.
The I.G. additionally filed six proposed exhibits which are identified as I.G. Ex. 1
—I1.G. Ex. 6. Petitioner filed no proposed exhibits. I receive LG. Ex. 1 —1.G. Ex.
6 into the record. Neither party requested that I convene an in-person hearing.

II. Issues, findings of fact and conclusions of law
A. Issues
The issues in this case are whether:

1. Petitioner was convicted of a criminal offense as is described at
section 1128(a)(1) of the Act; and

2. The five year minimum exclusion imposed by the LG. is
reasonable as a matter of law.

B. Findings of fact and conclusions of law
I make the following findings of fact and conclusions of law (Findings).

1. Petitioner was convicted of a criminal offense as is described at
section 1128(a)(1) of the Act.

On April 21, 2009 Petitioner was convicted in United States District Court for the
District of South Carolina after Petitioner pled guilty to a single count of a
superseding criminal information. I.G. Ex. 4, at 1; 1.G. Ex. 5, at 1. Petitioner pled
guilty to a scheme in which he and another individual submitted 3,287 false claims
for Medicaid reimbursement with the South Carolina Department of Health and
Human Services. LG. Ex. 3, at 2. In essence, Petitioner was convicted of falsely
representing that claims had been filled at a pharmacy that he controlled when, in
fact, the claims had been filled at another pharmacy. /d. The purpose of this
scheme was to enable payments for the false claims to be divided between
Petitioner and a co-conspirator. I.G. Ex. 6, at 2.

The conviction plainly is of an offense that is related to the delivery of items or
service under a State health care program (The South Carolina Medicaid program)
and thus, falls within the reach of section 1128(a)(1) of the Act. The scheme
perpetrated by Petitioner and another individual was essentially to defraud the
South Carolina Medicaid program by inducing it to make payments to him for
items that he did not supply. Indeed, the crime was not just related to Medicaid
items or services but such services were the target of the crime. Falsely claimed
Medicaid services were, in fact, the crime’s principal element. The crime had a
financial impact. Petitioner was sentenced to pay restitution of more than $3,800.
LG. Ex. 5, at 3.

Petitioner argues that he was convicted only of the crime of “improperly
submitting claims that should have originated at his co-defendant’s pharmacy.”
Petitioner’s brief at 3. That may be so, but it is not a defense. Petitioner has not
denied that he committed fraud against the South Carolina Medicaid program or
that the fraud involved claims for Medicaid items or services.

2. An exclusion of at least five years is mandatory.

Exclusion of an individual who is convicted of an offense that is described in
section 1128(a)(1) of the Act is, by law, mandatory. The I.G. has no discretion in
this case, he must exclude Petitioner. The Act requires that anyone who is
excluded pursuant to section 1128(a)(1) must be excluded for a minimum period
of five years. Act § 1128(c)(3)(B). That is the exclusion that the LG. imposed
against Petitioner. Consequently, Petitioner’s exclusion is reasonable as a matter
of law.

/s/
Steven T. Kessel
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division
Jeanette Sovereign
(OI File No. 2-09-40152-9),
Petitioner,
v.

The Inspector General.
Docket No. C-10-172
Decision No. CR2085

Date: March 08, 2010

DECISION

I sustain the determination of the Inspector General (I.G.) to exclude Petitioner, Jeanette
Sovereign, from participating in Medicare and other federally funded health care
programs for a minimum period of five years. Exclusion is mandated in this case because
Petitioner was convicted of a criminal offense that is related to neglect or abuse of
patients in connection with the delivery of a health care item or service.

I. Background

Petitioner is a nurse. The I.G. determined to exclude her from participation in Medicare
and other federally funded health care programs for a minimum of five years because he
concluded that Petitioner had been convicted of a criminal offense as is described at
section 1128(a)(2) of the Social Security Act (Act). This section mandates the exclusion
of any individual who is convicted of a criminal offense that is related to neglect or abuse
of patients in connection with the delivery of a health care item or service.
Petitioner requested a hearing and the case was assigned to me for a hearing and a
decision. Each party submitted a brief and proposed exhibits. The I.G. submitted four
exhibits which are identified as I.G. Ex. 1 — LG. Ex. 4. Petitioner submitted a single
proposed exhibit which is identified as P. Ex. 1. I receive all of these exhibits into
evidence.

Neither party requested an in-person hearing of the case.

IL. Issues, findings of fact and conclusions of law

A. Issue

The issue in this case is whether Petitioner was convicted of a criminal offense as
described at section 1128(a)(2) of the Act.

B. Findings of fact and conclusions of law
I make the following findings of fact and conclusions of law (Findings).

1. Petitioner was convicted of a criminal offense as is described at
section 1128(a)(2) of the Act.

The evidence offered by the 1G. establishes that, on June 25, 2009, Petitioner was
convicted in a New York court of a single misdemeanor offense of falsifying patient
records. I.G. Ex. 2; 1.G. Ex. 3; 1.G. Ex. 4. Petitioner was convicted of failing to report an
allegation of resident abuse at a nursing home which employed her. The conviction was
based on allegations that Petitioner had been apprised of an alleged act of mistreatment of
a resident by another employee at the nursing home but had failed to report or make a
record of what had been told to her. I.G. Ex. 2.

The evidence offered by the I.G. plainly establishes that Petitioner was convicted of a
criminal offense as is described by section 1128(a)(2). It was clearly a conviction related
to abuse against a patient (a nursing home resident) committed in connection with the
delivery of health care items or services to that resident. Petitioner’s conviction was
related to neglect or abuse of a patient because the alleged victim is a resident at the
nursing home that employed Petitioner. Her conviction of falsifying patient records
emanates directly from allegations that she failed to make a written report of abuse
allegations that had been communicated to her. There would have been no need for
Petitioner to create a record, and no reason to falsify one, had allegations of resident
abuse not been communicated to her. The alleged abuse of the resident was in connection
with the delivery of a health care item or service in that it involved actions by another
employee of the nursing home perpetrated during the course of his providing health care
items or services to residents who included the victim of the alleged abuse.
Petitioner does not deny the facts that I have just cited. She asserts however, that she
lacked reasonable cause to believe that a resident at the nursing home where she worked
had been abused. That argument, essentially, reduces to the contention that Petitioner
was not convicted of an offense as is described at section 1128(a)(2) because she is not, in
fact, guilty of having committed a crime.

This assertion establishes no defense. I may not look behind Petitioner’s conviction in
order to decide whether she is actually guilty. The authority to exclude pursuant to
section 1128(a)(2) derives from a conviction in a court and not from the underlying acts
or omissions on which the criminal charges leading to the conviction are based. Here,
Petitioner plainly was convicted of an offense as described in section 1128(a)(2) and the
1.G.’s authority to exclude Petitioner derives from that conviction. The allegations that
led to the charges against Petitioner and her ultimate conviction of those charges were
explicit. 1G. Ex. 2.

Petitioner also argues that her conviction was not of an offense described in section
1128(a)(2). According to her, she was convicted solely of the record keeping offense of
failing to make an entry in a medical log.

However, this argument avoids the fact that Petitioner was charged with, and convicted
of, failing to make a record of an allegation of resident abuse committed in the context of
the delivery of health care items or services to the victim. That nexus is all that is
necessary to establish a basis to exclude pursuant to section 1128(a)(2).

2. Petitioner’s five-year exclusion is mandatory.

Section 1128(a)(2) of the Act mandates the I.G. to exclude any individual who is
convicted of an offense that falls within the reach of that section. The LG. had no choice
but to exclude Petitioner as a consequence of her conviction. Section 1128(c)(3)(B) of
the Act requires that the minimum period of any mandatory exclusion be for five years.

Here, the L.G. imposed the statutory minimum exclusion period against Petitioner. The
reasonableness of the exclusion is therefore not at issue.

/s/
Steven T. Kessel
Administrative Law Judge