Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Center for Tobacco Products,
(FDA No. FDA-2017-H-1483)

Complainant,
v.

Ameer LLC
d/b/a Quicky’s Discount,

Respondent.
Docket No. T-17-2795
Decision No. TB2424

Date: February 5, 2018

INITIAL DECISION AND DEFAULT JUDGMENT

The Center for Tobacco Products (CTP) filed an Administrative Complaint (Complaint)
against Respondent, Ameer LLC d/b/a Quicky’s Discount, that alleges that Quicky’s
Discount impermissibly sold cigarettes or smokeless tobacco products to minors and
failed to verify, by means of photo identification containing a date of birth, that the
purchasers were 18 years of age or older, thereby violating the Federal Food, Drug, and
Cosmetic Act (Act), 21 U.S.C. § 301 et seq., and its implementing regulations, 21 C.F.R.
pt. 1140. Therefore, CTP seeks to impose a $550 civil money penalty against
Respondent Quicky’s Discount. Respondent filed an Answer to the Complaint, but has
failed to comply with multiple judicial directions and orders during the hearing process. I
therefore strike Respondent’s answer and issue this decision of default judgment.
I. Procedural History

On March 20, 2017, CTP began this matter by serving a Complaint on Respondent
Quicky’s Discount, seeking a $550 civil money penalty. On April 19, 2017, Respondent
timely filed its answer to CTP’s Complaint in the DAB E-File system. On April 28,
2017, an Acknowledgment and Pre-Hearing Order (APHO) was issued. The APHO
generally explained to the parties what they must do to present evidence and arguments in
this case. Specifically, it explained that the parties may request copies of documents
relevant to this case and that the requesting party must serve the request for documents no
later than May 29, 2017. As indicated in the APHO, a party who received such a request
was required to provide the requested documents no later than 30 days after the request
had been made. CTP has provided evidence to show that it served a Request for
Production of Documents (RFP) on Respondent on May 26, 2017.

On June 28, 2017, CTP filed a Motion to Extend Deadlines. In that motion, CTP
indicated that it had not received a response to its RFP and intended to file a Motion to
Compel Discovery (MTC). Judge Bill Thomas, the Administrative Law Judge previously
assigned to this case, postponed ruling on the Motion to Extend Deadlines until CTP filed
the MTC. Subsequently, on July 13,2017, CTP filed the MTC. See 21 C.F.R.

§ 17.23(a). On July 17, 2017, CTP filed a Notice of Pending Settlement and Unopposed
Motion to Extend Deadlines. An Order was issued on July 18, 2017, extending CTP’s
pre-hearing exchange deadline to August 17, 2017, and Respondent’s pre-hearing
exchange deadline to September 7, 2017. On August 17, 2017, CTP filed its pre-hearing
exchange. To date, Respondent has not filed its pre-hearing submission.

On October 31, 2017, an Order was sent by U.S. Mail to Respondent’s counsel of record,
scheduling a pre-hearing telephone conference (PHC) for November 16, 2017 at

1:00 PM Eastern Time. On the scheduled date and time for the PHC, neither Respondent
nor its counsel appeared to participate in the conference call. In an Order dated
November 20, 2017, the PHC was rescheduled for December 14, 2017. The order for the
rescheduled PHC was sent to CTP, and both Respondent (by DAB E-File) and
Respondent’s counsel (by U.S. Mail). Neither Respondent nor its counsel appeared at the
rescheduled PHC on December 14, 2017. On December 18, 2017, this matter was
transferred from Judge Thomas to me, and on December 19, 2017, I issued an Order to
Show Cause giving Respondent until January 3, 2018 to file a written explanation for its
failure to appear at the scheduled PHCs. In the Order, I also noted:

. ..on December 13, 2017, CTP filed its Renewed Motion to Compel
Discovery (Renewed Motion). At this time, I will hold CTP’s Renewed
Motion in abeyance pending the expiration of the deadline for
Respondent’s submission of its written explanation in response to this
Order. Should Respondent fail to show cause for its failure to appear at the
pre-hearing conference, CTP’s Renewed Motion would be moot, and an
Initial Decision and Default Judgment would be rendered ....

To date, Respondent has not filed a response to my Order to Show Cause.
Il. Striking Respondent’s Answer

Pursuant to 21 C.F.R. § 17.35, Lam striking Respondent’s Answer for failing to comply
with multiple judicial orders/directions. Specifically, Respondent has not complied with
the deadline set forth in the Acknowledgment and Pre-Hearing Order for responding to
any discovery request and submission of pre-hearing exchange documents; the order
granting CTP’s motion to extend deadlines issued on July 18, 2017; the orders scheduling
and rescheduling pre-hearing conferences issued on October 31,2017, and November 20,
2017; and finally the Order to Show Cause issued on December 19, 2017. The harshness
of the sanctions I impose upon either party must relate to the nature and severity of the
misconduct or failure to comply, and I find here that Respondent’s repeated failure to
comply is sufficiently egregious to warrant striking the answer and issuing a decision
without further proceedings. See 21 C.F.R. § 17.35(b).

III. Default Decision

Striking Respondent’s Answer leaves the Complaint unanswered. Therefore, I am
required to issue an initial decision by default if the Complaint is sufficient to justify a
penalty. 21 C.F.R. § 17.11(a). Accordingly, I must determine whether the allegations in
the Complaint establish violations of the Act.

For purposes of this decision, I assume the facts alleged in the Complaint are true and
conclude the default judgment is merited based on the allegations of the Complaint and
the sanctions imposed on Respondent for failure to comply with the orders. 21 C.F.R.
§ 17.11. Specifically:

e At approximately 6:16 PM on July 13, 2016, at Respondent’s business
establishment, 1535 Franklin Avenue, New Orleans, Louisiana 70117, an
FDA-commissioned inspector documented Respondent’s staff selling a package of
Doral Menthol Box cigarettes to a person younger than 18 years of age. The
inspector also documented that staff failed to verify, by means of photographic
identification containing a date of birth, that the purchaser was 18 years of age or
older. Complaint J 9.

e Ina warning letter dated July 28, 2016, CTP informed Respondent of the
inspector’s July 13, 2016 documented violations, and that such actions violate
federal law. The letter further warned that Respondent’s failure to correct its
violations could result in a civil money penalty or other regulatory action.
Complaint §§ 9-10.

e At approximately 6:54 PM on October 5, 2016, at Respondent’s business
establishment, 1535 Franklin Avenue, New Orleans, Louisiana 70117, an
FDA-commissioned inspector documented Respondent’s staff selling a package of
Marlboro Gold Pack cigarettes to a person younger than 18 years of age. The
inspector also documented that staff failed to verify, by means of photographic
identification containing a date of birth, that the purchaser was 18 years of age or
older. Complaint § 7.

These facts establish Respondent Quicky’s Discount’s liability under the Act. The Act
prohibits misbranding of a tobacco product. 21 U.S.C. § 331(k). A tobacco product is
misbranded if sold or distributed in violation of regulations issued under section 906(d)
of the Act. 21 U.S.C. § 387f(d); see 21 U.S.C. § 387c(a)(7)(B); 21 C.F.R. § 1140.1(b).
The Secretary of the U.S. Department of Health and Human Services issued the
regulations at 21 C.F.R. pt. 1140 under section 906(d) of the Act. 21 U.S.C. § 387a-1;
see 21 U.S.C. § 387f(d)(1); 75 Fed. Reg. 13,225, 13,229 (Mar. 19, 2010); 81 Fed. Reg.
28,974, 28,975-76 (May 10, 2016). Under 21 CFR. § 1140.14(a)(1)!, no retailer may
sell cigarettes and/or smokeless tobacco to any person younger than 18 years of age.
Under 21 C.F.R. § 1140.14(a)(2)(i), retailers must verify, by means of photographic
identification containing a purchaser’s date of birth, that no cigarette and/or smokeless
tobacco purchasers are younger than 18 years of age.

Under 21 C.F R. § 17.2, a $550 civil money penalty is permissible for three violations of
the regulations found at 21 C.F.R. pt. 1140.

ORDER

For these reasons, I enter default judgment in the amount of $550 against Respondent
Ameer LLC d/b/a Quicky’s Discount. Pursuant to 21 C.F.R. § 17.11(b), this order
becomes final and binding upon both parties after 30 days of the date of its issuance.

/s/
Wallace Hubbard
Administrative Law Judge

' On August 8, 2016, the citations to certain tobacco violations changed. For more
information see: https://federalregister.gov/a/2016-10685.


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

Center for Tobacco Products,
(FDA No. FDA-2016-H-2167)
Complainant
v.

Bruce Tobacco for Less LLC
d/b/a Bruce Discount Tobacco / Tobacco for Less,

Respondent.
Docket No. T-16-1415
Decision No. TB2425

Date: February 5, 2018

INITIAL DECISION

The Center for Tobacco Products (CTP) filed an Administrative Complaint
(Complaint) against Respondent, Bruce Tobacco for Less LLC d/b/a Bruce
Discount Tobacco / Tobacco for Less, that alleges facts and legal authority
sufficient to justify the imposition of a civil money penalty of $550. For the
reasons outlined below, I enter judgment against Respondent and assess a civil
money penalty of $550.

I. Procedural History.

On September 2, 2016, CTP served its Complaint on Respondent by United Parcel
Service (UPS), pursuant to 21 C.F.R. §§ 17.5 and 17.7. It asserted that
Respondent impermissibly sold cigarettes to minors and failed to verify that
cigarette purchasers were 18 years of age or older, in violation of the Federal
Food, Drug, and Cosmetic Act (Act), 21 U.S.C. § 301 et seq., and its
implementing regulations found at 21 C.F.R. pt. 1140.
CTP seeks a civil money penalty of $550. In the Complaint and accompanying
cover letter, CTP explained that within 30 days, Respondent should pay the
proposed penalty, file an answer, or request an extension within which to file an
answer. After initially requesting an extension of time to do so, Respondent
through counsel timely filed its Answer, Mitigating Circumstances and
Affirmative Defenses of Respondent (Answer) on November 2, 2016.

On November 10, 2016, I issued an Acknowledgment and Pre-Hearing Order
which established a schedule to regulate the course of discovery and the parties’
submission of evidence and arguments. On November 14, 2016, counsel for
Respondent filed a Notice of Withdrawal as Respondent’s Counsel.

On January 26, 2017, CTP filed a Motion to Compel Discovery, asserting
Respondent had not responded to its timely served document production request.
On the same date, CTP also requested an extension of the pre-hearing exchange
deadlines. Through a by-direction letter, I gave Respondent additional time, until
February 14, 2017, to file a response to CTP Motion to Compel Discovery. I also
issued an order extending the parties’ pre-hearing exchange deadlines.

On February 13, 2017, the U.S. Postal Service returned these documents, which
had been sent to Respondent’s address of record on January 31,2017. At my
direction, on February 22, 2017, these documents were re-issued to Respondent at
an alternate address. I again extended Respondent’s deadline to file its response to
CTP’s Motion to Compel Discovery to March 3, 2017.

Respondent failed to file a response to CTP’s Motion to Compel Discovery. On
March 13, 2017, I issued an Order granting CTP’s Motion to Compel Discovery,
and directing Respondent to comply with CTP’s Request for Production of
Documents by March 28, 2017.

On March 30, 2017, CTP filed an Updated Status Report and Motion to Impose
Sanctions. CTP stated that Respondent failed to comply with the Request for

Production of Documents. It therefore requested that Respondent’s Answer be
stricken from the record and that a default judgment in favor of CTP be issued.

I provided Respondent additional time, until April 28, 2017, to respond to CTP’s
Motion to Impose Sanctions. I again extended the parties’ pre-hearing exchange
deadlines, and advised them that no further extensions would be granted. On
April 28, 2017, Respondent submitted its response to CTP’s Motion to Impose
Sanctions via e-mail. Respondent indicated it could not produce the documents
requested by CTP “because I don’t have the records. They are almost three years
old and I didn’t keep them.”
In light of this response, I directed CTP to indicate whether it still sought to
compel discovery against Respondent. CTP subsequently withdrew its Motion to
Compel Discovery.!

In accordance with the extended deadlines I established on May 9, 2017, CTP
filed its pre-hearing exchange on May 30, 2017. Respondent, however, did not
file a pre-hearing exchange. I scheduled a pre-hearing conference which was
eventually held on September 7, 2017. In attendance were CTP counsel and
Hazem Fadhel, Respondent’s principal and representative. During the pre-hearing
conference, Mr. Fadhel confirmed that the Answer filed in this matter on behalf of
Respondent still reflected Respondent’s position. Mr. Fadhel also indicated that
Respondent did not intend to present exhibits or witness testimony in this case.

The parties agreed that a hearing was not necessary in this matter and consented to
a decision on the record. CTP indicated that it would stand on the arguments
submitted in its pre-hearing exchange. I afforded Respondent the opportunity to
file its arguments and any documents in support of its position by October 27,
2017. Respondent did not file any arguments or documentation. On November 9,
2017, CTP counsel indicated via e-mail that CTP did not intend to file a reply. See
Docket No. 35.

Il. A Decision on the Record Is Appropriate.

The parties agreed at the September 7, 2017, pre-hearing conference that a
decision on the record is appropriate in this matter. As Respondent has not
indicated any objection to CTP’s exhibits, I now admit CTP Exhibits 1 through 37
into the record.

III. Discussion.
Respondent has not provided any arguments disputing the allegations made in

CTP’s Complaint beyond the blanket denials found in its Answer.” Nor has it
submitted exhibits or witness testimony pertaining to liability or mitigating

' Because CTP withdrew its Motion to Compel, I deny its Motion to Impose
Sanctions as moot, since it was based on Respondent’s failure to comply with the
Motion to Compel.

? Respondent’s then-legal counsel responded to paragraphs 9 through 11 of the
Complaint stating “Respondent is without sufficient information to either admit or
deny the allegations at Paragraph[s 9 through 11] and, therefore, denies same,
including all inferences and conclusions sought to be drawn therefrom.” Answer
at 4.
factors. Accordingly, I find the record establishes by preponderance of the
evidence that:

e Respondent owns Bruce Discount Tobacco / Tobacco for Less, an
establishment that sells tobacco products and is located at 100 South
Pontotoc Road, Bruce, Mississippi 38915. Complaint §§ 6-7.

e During an inspection of Respondent’s establishment on October 13, 2014,
at approximately 2:47 PM, an FDA-commissioned inspector documented
that “a person younger than 18 years of age was able to purchase a package

of Marlboro Menthol cigarettes ....” The inspector also documented that

“the minor’s identification was not verified before the sale... .” Id. at J 10.

¢ On October 30, 2014, CTP issued a Warning Letter to Respondent
regarding the inspector’s documented violations from October 13, 2014.
The letter explained that the documented violations constituted violations
of regulations, and that the named violations were not necessarily intended
to be an exhaustive list of all violations at the establishment. The Warning
Letter went on to state that if Respondent failed to correct the violations,
regulatory action by the FDA or a civil money penalty action could occur
and that Respondent is responsible for complying with the law. Id. at

§§ 10-11.

e During a subsequent inspection of Respondent’s establishment on
January 19, 2016, at approximately 3:30 PM, an FDA-commissioned
inspector documented that “a person younger than 18 years of age was able
to purchase a package of Newport Non-Menthol Box cigarettes . . . [.]”
The inspector also documented that “the minor’s identification was not
verified before the sale... .” Id. at§ 8.

These facts establish that Respondent is liable under the Act, which prohibits
misbranding of a tobacco product. 21 U.S.C. § 331(k). A tobacco product is
misbranded if distributed or offered for sale in any state in violation of regulations
issued under section 906(d) of the Act. 21 U.S.C. § 387c(a)(7)(B); 21 C.F. R.

§ 1140.1(b). The applicable regulations prohibit the sale of cigarettes to any
person younger than 18 years of age, and also require retailers to verify, by means
of photo identification containing a purchaser’s date of birth, that no cigarette
purchasers are younger than 18 years of age. 21 C.F.R. §§ 1140.14(a)(1),
1140.14(a)(2)(i).

I find Respondent violated the prohibition against selling cigarettes to persons
younger than 18 years of age, 21 C.F.R. § 1140.14(a)(1), on October 13, 2014, and
January 19,2016. On those dates, Respondent also violated the requirement that
retailers verify, by means of photo identification containing a purchaser’s date of
birth, that no cigarette purchasers are younger than 18 years of age. 21 C.F.R.

§ 1140.14(a)(2)(i). Therefore, Respondent’s actions constitute violations of law
that merit a civil money penalty.

Respondent did not submit any evidence concerning factors that could mitigate the
penalty, despite being given numerous opportunities to do so. Respondent instead
alleged only that:

Respondent specifically denies that Petitioner is entitled to any
recovery from Respondent, or, in the alternative, Respondent would
submit that the proposed penalty should be reduced ... .

Respondent is a small, locally owned business with limited finances
and, therefore, has a limited ability to satisfy the judgment as
proposed by Petitioner ....

See Answer at 5. These unsupported statements are insufficient, and even if taken
at face value, the latter claim does not establish Respondent cannot pay a $550
fine. Respondent has failed to submit any evidence that would allow me to
consider its ability to pay the penalty sought or any other mitigating statutory
factors. See 21 U.S.C. § 333(f)(5)(B). Accordingly, I find the $550 penalty
amount sought by CTP to be appropriate.

ORDER

For the reasons discussed above, I enter judgment in the amount of $550 against
Respondent Bruce Tobacco for Less LLC d/b/a Bruce Discount Tobacco /
Tobacco for Less. Pursuant to 21 C.F.R. § 17.11(b), this order becomes final and
binding upon both parties after 30 days of the date of its issuance.

/s/
Bill Thomas
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
Andrew Louis Barrett,

(OI File No. 2-12-40153-9),
Petitioner,

v.

The Inspector General.

Docket No. C-17-537
Decision No. CR5020

Date: February 5, 2018

DECISION

The Inspector General (IG) of the U.S. Department of Health and Human Services
excluded Petitioner, Andrew Louis Barrett, from participation in Medicare, Medicaid,
and all other federal health care programs for at least 23 years pursuant to section
1128(a)(1) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(1)). Petitioner now
challenges the exclusion. For the reasons stated below, I conclude that the IG had a basis
for excluding Petitioner from program participation and that the 23-year exclusion period
is not unreasonable. I therefore affirm the IG’s exclusion determination.

I. Case Background and Procedural History

On February 28, 2017, the IG notified Petitioner of his exclusion from participation in
Medicare, Medicaid, and all federal health care programs under 42 U.S.C.

§ 1320a-7(a)(1) for a period of at least 23 years. IG Brief (IG Br.) Exhibit (Ex.) 1.' The
IG based the exclusion on Petitioner’s conviction for a criminal offense in the United

' Document 9a in the official case file maintained in the DAB E-file system; for clarity and simplicity, I
will cite to the exhibits attached by the parties to their respective briefs by the exhibit numbers indicated
by the parties, not the document numbers assigned by DAB.
States District Court for the Eastern District of New York (District Court) related to the
delivery of an item or service under Medicare or a State health care program, including
the performance of management or administrative services relating to the delivery of
items or services under any such program. Id. at 1.

The IG identified three aggravating factors as a basis for increasing the exclusion period
from five to 23 years: (1) the criminal acts resulting in Petitioner’s conviction caused or
were intended to cause financial loss to a government program or other entities of at least
$5,000, in this case approximately $2,700,000; (2) the District Court’s sentence included
a term of incarceration, in this case 43 months; and (3) Petitioner was the subject of
another adverse action based on the same set of circumstances, specifically when the
New York State Office of Medicaid Inspector General excluded him from participation in
the Medicaid program. Id. at 2.

Petitioner requested a hearing before an administrative law judge to dispute the length of
the exclusion. This case was originally assigned to Administrative Law Judge Scott
Anderson. On May 17, 2017, Judge Anderson held a prehearing conference by telephone
with counsel for the parties, the substance of which is summarized in his May 22, 2017
Order Summarizing Prehearing Conference (Summary Order). At the prehearing
conference, Petitioner’s counsel, Jeffrey Granat, stated that he intended to represent
Petitioner in only a limited capacity, which did not include filing a prehearing brief on his
behalf. Summary Order at 1. He requested that Judge Anderson stay the proceedings for
approximately three years, until Petitioner’s release from prison. Judge Anderson
determined a stay to be inappropriate and denied Petitioner’s request; I concur with his
reasoning. Id. at 1-2. Judge Anderson acknowledged Petitioner’s state of incarceration
and indicated Petitioner could request additional time to submit his prehearing exchange
if necessary. Id. at 2.

Following the prehearing conference, Mr. Granat withdrew from representation of
Petitioner, but requested continued access to the DAB E-file system in order to assist
Petitioner and his family if needed; Judge Anderson granted his request, subject to
Petitioner’s objection. Id. On June 2, 2017, this case was transferred to me to hear and
decide.

The IG timely filed his brief on July 10, 2017, with exhibits marked as IG Exhibits |
through 8. After I granted him additional time, Petitioner, proceeding pro se, filed a brief
(P. Br.) on October 11, 2017, with exhibits marked as Petitioner’s Exhibits 1 through 11.
The IG filed a reply brief (IG Reply) on November 3, 2017. Petitioner subsequently
requested leave to file a sur-reply, which I denied on December 8, 2017.
II. Decision on the Record

A. Exhibits

Petitioner did not object to any of the IG’s exhibits; I therefore admit IG exhibits 1
through 8. The IG objected to all of Petitioner’s exhibits, asserting Petitioner submitted
them for the exclusive purpose of collaterally attacking his conviction, making them
irrelevant and inadmissible. IG Reply at 8. While I agree that admitting these documents
would be improper to allow Petitioner to attack the conviction underlying his exclusion, it
appears from Petitioner’s exchange that he submitted them in the context of addressing
mitigating factors he believed would support reducing the length of his exclusion. P. Br.
at 3-7. Accordingly, I will address the probative value of this evidence in my analysis of
mitigating factors. I therefore overrule the IG’s objection and admit all of the proposed
exhibits by both parties into the record. Apr. 19, 2017 Acknowledgment, Prehearing
Order, and Notice of Prehearing Conference (Prehearing Order) § 12; 42 C.F.R.

§ 1005.8(c); Civil Remedies Division Procedures § 14(e).

B. Hearing

Both parties indicated that a hearing is not necessary in this case and that they did not
have any witnesses to offer. IG Br. at 13; P. Br. at 7. Accordingly, I will decide this case
on the briefs submitted and the exhibits of record.

III. Issues

The issues in this case are limited to determining if the IG has a basis for excluding
Petitioner from participating in Medicare, Medicaid, and all other federal health care
programs and, if so, whether the length of the exclusion imposed by the IG is
unreasonable. See 42 C.F.R. § 1001.2007(a)(1).

IV. Jurisdiction

Ihave jurisdiction to hear and decide this case. 42 C.F.R. §§ 1001.2007(a)(1)-(2),
1005.2(a); see also 42 U.S.C. § 1320a-7(f)(1).
V. Findings of Fact, Conclusions of Law, and Analysis?

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

The IG relied on section 1320a-7(a)(1) of the Act as the legal basis to exclude Petitioner.
The IG must exclude an entity from participation in Medicare, Medicaid, and all other
federally-funded health care programs if that entity “has been convicted of a criminal
offense related to the delivery of an item or service under title XVIII or under any State
health care program.” 42 U.S.C. § 1320a-7(a)(1); 42 C.F.R. § 1001.101(a). Thus, to
sustain Petitioner’s exclusion pursuant to section 1320a-7(a)(1) in this case, the IG must
prove: (1) Petitioner was convicted of a criminal offense; and (2) Petitioner’s offense
was related to the delivery of an item or service under Medicare or a State health care
program. See id.

The IG has clearly established through documentary evidence that Petitioner was
convicted of a criminal offense. An entity is considered “convicted” when a judgment of
conviction has been entered by a federal, state, or local court, or a plea of guilty or no
contest has been accepted in a federal, state, or local court. 42 U.S.C. § 1320a-7(i)(1),
(3). On September 9, 2016, pursuant to Petitioner’s plea, the District Court entered
Judgment adjudicating Petitioner guilty of one count of Health Care Fraud in violation of
18 U.S.C. § 1347 and one count of Tax Fraud in violation of 26 U.S.C. § 7206(1). IG Ex.
4 at 1. Petitioner concedes he was convicted of a criminal offense. P. Br. at 1. Based on
these facts, I conclude that, for purposes of exclusion, Petitioner was convicted of a
criminal offense.

I further find the IG has established Petitioner’s conviction was for an offense “related
to” the delivery of an item or service under Medicare. The term “related to” simply
means that there must be a nexus or common sense connection. See Quayum v. U.S.
Dep't of Health and Human Servs. , 34 F. Supp. 2d 141, 143 (E.D.N.Y. 1998); see also
Friedman v. Sebelius, 686 F.3d 813, 820 (D.C. Cir. 2012) (describing the phrase “related
to” in another part of section 1320a-7 as “deliberately expansive words,” “the ordinary
meaning of [which] is a broad one,” and one that is not subject to “crabbed and
formalistic interpretation”) (internal quotation marks omitted).

Here, Petitioner pleaded guilty to one count of Health Care Fraud, identified as count one
of the superseding indictment. IG Ex. 4 at 1. Count one of the superseding indictment
accused Petitioner of willfully and knowingly executing a scheme to defraud Medicare
and Medicaid by making materially false pretenses, representations, and promises to

2 My findings of fact and conclusions of law appear in bold and italics.
induce payment by those entities “in connection with the delivery of and payment for
health care benefits, items and services.” IG Ex. 3 at 9-10.

Petitioner specifically conceded the criminal acts that resulted in his conviction were “in
connection with the delivery of health care benefits, items, and services.” See id; IG Ex.
2 at 1,12. He continues to concede he was appropriately excluded on that basis. See P.
Br. at 2. Accordingly, I conclude that the criminal conduct for which Petitioner was
convicted was related to the delivery of a health care item or service under the Medicare
program. See 42 U.S.C. § 1320a-7(a)(1). The record fully supports Petitioner’s
mandatory exclusion.

2. Petitioner must be excluded for a minimum of five years.

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

3. The IG has established three aggravating factors in this case that support an
exclusion period beyond the five-year statutory minimum.

The regulations establish aggravating factors that the IG may consider to lengthen the
period of exclusion beyond the five-year minimum for a mandatory exclusion. 42 C.F.R.
§ 1001.102(b). If an aggravating factor justifies a length of exclusion longer than five
years, then I may consider mitigating factors as a basis for reducing the period of
exclusion to no less than five years. 42 C.F.R. § 1001.102(c).

In this case, the IG advised Petitioner in the February 28, 2017 exclusion notice that there
were three aggravating factors that justified excluding him for more than five years: (1)
the criminal acts resulting in Petitioner’s conviction caused or were intended to cause
financial loss to a government program or other entities of at least $5,000, in this case
approximately $2,700,000; (2) the District Court’s sentence included a term of
incarceration, in this case 43 months; and (3) Petitioner was the subject of another
adverse action based on the same set of circumstances, specifically when the New York
State Office of Medicaid Inspector General excluded him from participation in the
Medicaid program. IG Ex. | at 2.

3 The IG’s February 28, 2017 exclusion notice erroneously indicated the loss amount necessary to trigger
this aggravating factor was $5,000. IG Ex. 1 at 2. In fact, the triggering amount increased on

February 13, 2017 from $5,000 to $50,000. See 82 Fed. Reg. 4100, 4112 (Jan. 12, 2017). However, I
note the loss amount caused by Petitioner’s criminal acts, approximately $2,700,000, is well over either
threshold.
a. The IG established financial loss to a government program of $50,000
or more, as required by 42 C.F.R. § 1001.102(b)(1).

The IG has provided evidence sufficient to demonstrate Petitioner’s acts resulting in his
criminal conviction caused a financial loss to a government program of $50,000 or more.
Here, Petitioner pled guilty to a criminal charge and admitted that his criminal conduct
induced Medicare and Medicaid to make payments in connection to the delivery of health
services. IG Ex. 2 at 1; IG Ex. 3 at 9-10. As part of his plea, Petitioner explicitly
admitted that the loss caused by his conduct resulting in his conviction for health care
fraud resulted in a loss to Medicare and Medicaid of $2.7 million. IG Ex. 2 at 4.

These admissions formed the basis of the District Court’s order requiring Petitioner to
pay restitution totaling $1,906,200 to Medicaid, and $793,800 to Medicare. IG Ex. 4 at 5.
It is well-established that an amount ordered as restitution constitutes proof of the amount
of financial loss to a government program. See, e.g., Juan de Leon, Jr., DAB No. 2533 at
5 (2013); Craig Richard Wilder, DAB No. 2416 (2011). The IG has sustained its burden
of proving financial loss to a government program of $50,000 or more.

b. The IG established Petitioner’s sentence included a period of
incarceration.

The IG has demonstrated sufficient facts for me to conclude Petitioner’s criminal
conviction resulted in a sentence of incarceration. See 42 C.F.R. § 1001.102(b)(5). The
evidence of record clearly demonstrates that the District Court sentenced Petitioner to 43
months of incarceration. IG Ex. 4 at 2. The IG has therefore established application of
this aggravating factor was appropriate.

c. The IG established Petitioner was the subject of another adverse
action by another government agency based on the same set of
circumstances forming the basis of the exclusion.

The IG properly determined an aggravating circumstance arose as the result of an adverse
action taken against Petitioner by another government entity based on the same set of
circumstances for which he was excluded. See 42 C.F.R. § 1001.102(b)(9). Specifically,
the IG has submitted documentary evidence showing the New York State Office of
Medicaid Inspector General excluded Petitioner from participating in the New York State
Medicaid program because he was charged with a criminal offense under New York law
that related to or resulted from either furnishing or billing for medical care, services or
supplies, or the performance of management or administrative services to the same. IG
Ex. 6. The IG has therefore established application of this aggravating factor was
appropriate.
7. Petitioner has not demonstrated any mitigating factors upon which I may rely
to reduce the exclusion period.

Because I have concluded that aggravating factors are present in this case, the applicable
regulations require me to next consider whether any mitigating factors exist that would
offset those aggravating factors. See 42 C.F.R. § 1001.102(c). The regulations
specifically outline what factors may be considered in mitigation. See id. In this case,
Petitioner’s arguments for mitigation generally do not relate to those regulatory
mitigating factors. I am accordingly unable to consider them.

Specifically, Petitioner allots a considerable portion of his prehearing brief to an attempt
to establish the greater culpability of another individual for the actions that resulted in his
criminal conviction. To the extent Petitioner is attempting a collateral attack on his
conviction, his claim to mitigation is without merit. See 42 C.F.R. § 1001.2007(d).
Whether another individual bears more or less blame for the criminal conduct in which
Petitioner participated is irrelevant. As established by the IG, Petitioner pleaded guilty to
and was convicted of charges that demonstrated he was part of a scheme to defraud
Medicare and Medicaid. His precise level of involvement in a criminal scheme, in
comparison to anyone else, is not a mitigating factor under the governing regulations.
The exhibits Petitioner submitted do not establish any mitigating circumstances I am
authorized to consider, and again appear to either attack his own conviction or place
greater blame at the feet of one of his co-conspirators. I give them no weight in my
decision.

The only argument Petitioner makes that I can even consider is his claim that he
participated in a “sting” operation conducted by the Food & Drug Administration (FDA),
which purportedly led to the arrest and conviction of other individuals. P. Br. at 5-6.
This is a valid mitigating factor I can consider. See 42 C.F.R. § 1001.102(c)(3).4
However, Petitioner bears the burden of demonstrating any mitigating factors by a
preponderance of the evidence. 42 C.F.R. §§ 1005.15(c), (d); Prehearing Order § 5.
Here, he has failed to do so. Petitioner claims he cooperated in an undercover operation
with the FDA, but provides no documentary evidence corroborating that claim. He
claims the District Court, in sentencing him, took his alleged cooperation into account,
but again provides no corroborating documentary evidence. His description of his
cooperation is self-serving and undocumented. And, while Petitioner identified an FDA
agent in his prehearing brief he claims could verify the circumstances of his mitigation
claim, he did not identify this agent as a potential witness, provide a summary of his
testimony, or even indicate he believed a hearing was necessary in this matter. P. Br. at

* Specifically, cooperation with government officials that results in: (i) others being convicted or
excluded from Medicare, Medicaid and all other Federal health care programs, (ii) additional cases being
investigated or reports being issued by the appropriate law enforcement agency identifying program
vulnerabilities or weaknesses, or (iii) the imposition against anyone of a civil money penalty or
assessment under 42 C.F.R. Part 1003.
6-7. In sum, Petitioner has not met his burden of proof as to this or any other mitigating
factor that would justify reducing the period of exclusion imposed by the IG.

8. A 23-year exclusion period is not unreasonable.

I must uphold the IG’s determination as to the length of exclusion if it is not
unreasonable. 42 C.F.R. § 1001.2007(a)(1)(ii). This means that:

So long as the amount of time chosen by the OIG is within a
reasonable range, based on demonstrated criteria, the ALJ has
no authority to change it under this rule. We believe that the
deference § 1001.2007(a) grants to the OIG is appropriate,
given the OIG’s vast experience in implementing exclusions
under these authorities.

57 Fed. Reg. 3298, 3321 (Jan. 29, 1992).

In making my determination, the quality of the aggravating (or mitigating) factors is of
greater significance than the mere number of the factors present in a given case. As the
Secretary of Health and Human Services stated in the preamble to the final rule
establishing the exclusion regulations:

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

Id. at 3314-15.

Here, the quality of the aggravating factors proven by the IG demonstrates a longer
exclusion period to be reasonable. A federal court convicted Petitioner for participating
in a scheme to defraud Medicare and Medicaid that resulted in losses to those victim
agencies of approximately $2.7 million. IG Ex. 2 at 4. This amount of loss, approaching
$3,000,000, is significantly more than the $50,000 threshold to be considered
aggravating. See 42 C.F.R. § 1001.102(b)(1). Financial loss is an “exceptional
aggravating factor” when the loss is “very substantially greater than the statutory
standard.” Jeremy Robinson, DAB No. 1905 (2004); Donald A. Burstein, Ph.D., DAB
No. 1865 (2003). A loss amount substantially greater than the minimum triggering
amount is sufficient to support a significantly increased length of exclusion. See
Anderson v. Thompson, 311 F. Supp. 2d 1121, 1130 (D. Kan. 2004) (considering a
“program-related loss [that] was more than forty times the amount of loss necessary to
find an aggravating factor” in justifying a 15-year exclusion). Here, the $2.7 million loss
to Medicare and Medicaid caused by Petitioner amounts to approximately 54 times the
loss necessary to constitute an aggravating factor.>

In addition, Petitioner engaged in a sophisticated criminal scheme that involved
defrauding several federal agencies and, despite lasting approximately two years, netted
him almost $3 million. His actions resulted in a significant sentence of incarceration.
The state of New York, upon becoming aware of his conduct, excluded him from
participation in the New York State Medicaid program. IG Exs. 6-7. I must also
consider these aggravating circumstances in determining the reasonableness of the IG’s
exclusion period determination.

Petitioner asserts the exclusion selected by the IG was not reasonable, citing the amount
of time he was excluded by the sentencing judge in his criminal case, and attempting to
distinguish other cases of exclusion cited by the IG. P. Br. at 8-13.

I find Petitioner’s arguments unpersuasive. The District Court that sentenced Petitioner
did not determine a three-year exclusion period appropriate, as Petitioner contends.
Instead, the District Court made abstention from contact with Medicare or Medicaid one
of the many conditions with which Petitioner was required to comply as a part of a
three-year period of supervised release to follow his term of incarceration. IG Ex. 4 at 4.
The sentencing court’s purpose in setting conditions for supervised release is to supervise
and assist individuals in their reintegration into the community following incarceration.
See U.S. Sentencing Commission, Federal Offenders Sentenced to Supervised Release
(July 2010) at 1, available at https://www.ussc.gov/sites/default/files/pdf/trainin g/annual-
national-training-
seminar/2012/2_Federal_Offenders_Sentenced_to_Supervised_Release.pdf. The
sentencing court’s purpose was not to determine an appropriate period of exclusion.
Congress vested that power in the Secretary of Health and Human Services, who
delegated it to the IG. See 42 U.S.C. § 1320a-7(a)(1); 42 C.F.R. § 1001.101.

5 Thave not discussed the tax fraud count to which Petitioner pleaded guilty, as the IG did not appear to
rely upon it as a basis for exclusion, but I note in the context of discussing the severity of this particular
aggravating factor that Petitioner caused a loss to the Internal Revenue Service of an additional $736,192.
See IG Ex. 4 at 5.
10

Petitioner’s attempt to characterize the IG’s selection of an exclusion period as arbitrary
and capricious by comparing his case to those of other excluded individuals is equally
unavailing. The Board has observed that “the reasonableness of exclusion periods must
be made on a case-by-case basis, and, similarities notwithstanding, the facts of each case
are unique to that case.” Sushil Aniruddh Sheth, M.D., DAB No. 2491 at 15 (2012).
Merely pointing out surface discrepancies with other IG exclusion cases is insufficient to
show the IG’s determination in this case is unreasonable.

Ultimately, I do not have the authority to substitute my own judgment for that of the IG,
or impose a period of exclusion that seems more reasonable to me. See de Leon, Jr.,
DAB No. 2533 at 5; Wilder, DAB No. 2416 at 8. Based on the seriousness of the
aggravating factors described above, I conclude the IG has satisfactorily established that
Petitioner’s criminal conduct had a substantial financial impact on the Medicaid program
and demonstrates his untrustworthiness to participate in federal health care programs.
Accordingly, the length of exclusion imposed by the IG is not unreasonable.

VI. Conclusion

For the reasons discussed above, I affirm the IG’s determination to exclude Petitioner
from participating in Medicare, Medicaid, and all other federal health care programs for a
period of 23 years.

/s/
Bill Thomas
Administrative Law Judge


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

Center for Tobacco Products,
(FDA No. FDA-2017-H-2474)

Complainant
v.

Iman Crown, Inc.
d/b/a Ever Green,

Respondent.
Docket No. T-17-3695
Decision No. TB2422

Date: February 1, 2018

INITIAL DECISION

The Center for Tobacco Products (CTP) began this matter by serving an Administrative
Complaint (Complaint) on Respondent, Iman Crown, Inc. d/b/a Ever Green, at 6819 Loch
Raven Boulevard, Towson, Maryland 21286, and by filing a copy of the Complaint with
the Food and Drug Administration (FDA) Division of Dockets Management. The
Complaint alleges that Ever Green impermissibly sold cigarettes to minors, held open
packages of cigarettes intended for the sale of individual cigarettes, and failed to verify,
by means of photo identification containing a date of birth, that the purchasers were 18
years of age or older, thereby violating the Federal Food, Drug, and Cosmetic Act (Act),
21 U.S.C. § 301 et seq., and its implementing regulations, 21 C.F.R. pt. 1140. The
Complaint likewise alleges that Respondent Ever Green previously admitted to five
violations of regulations found at 21 C.F.R. pt. 1140 and, therefore, CTP seeks to impose
an $11,182 civil money penalty against Respondent Ever Green. During the
administrative proceeding, Respondent failed to comply with judicial directions and
failed to appear for a pre-hearing conference. Therefore, I strike Respondent’s answer
and issue this decision of default judgment.
I. Procedural History

CTP began this matter by serving an Administrative Complaint, seeking an $11,182 civil
money penalty, on Respondent, Iman Crown, Inc. d/b/a Ever Green, at 6819 Loch Raven
Boulevard, Towson, Maryland 21286. On May 24, 2017, Respondent filed an Answer to
CTP’s complaint. On June 2, 2017, I issued an Acknowledgment and Prehearing Order
(APHO) that set deadlines for the parties’ submissions, including the July 12, 2017
discovery deadline. !

On August 17, 2017, CTP filed a Motion to Compel Discovery. In its motion, CTP stated
that on July 12, 2017, CTP served a Request for Production of Documents on
Respondent, but had not received a response to its request. On August 17, 2017, CTP
also filed a Motion to Extend Deadlines. An August 21, 2017 letter issued by my
direction allowed Respondent until September 5, 2017 to file a response to CTP’s Motion
to Compel Discovery. The letter also granted CTP’s Motion to Extend Deadlines and
extended the parties’ pre-hearing exchange deadlines.

On September 11, 2017, I issued an Order that granted CTP’s Motion to Compel
Discovery. I noted that Respondent had not filed a response to CTP’s Motion to Compel
Discovery and ordered Respondent to comply with CTP’s Request for Production of
Documents by September 25, 2017.

On October 3, 2017, CTP filed Complainant’s Status Report and Motion to Impose
Sanctions, indicating that Respondent had not complied with my September 11, 2017
Order. On that same date, CTP filed a Motion to Extend Deadlines. An October 4, 2017
letter issued by my direction allowed Respondent until October 18, 2017 to file a
response to CTP’s Motion to Impose Sanctions. The letter also granted CTP’s Motion to
Extend Deadlines. On October 17, 2017, CTP filed Complainant’s Status Report and
Withdrawal of Motion to Impose Sanctions, indicating that Respondent provided a
response to CTP’s Request for Production of Documents. On November 21, 2017, CTP
filed its pre-hearing exchange. Respondent did not file a pre-hearing exchange by the
December 15, 2017 deadline.

On December 20, 2017, I issued an Order Scheduling Pre-Hearing Conference. The
telephone pre-hearing conference was scheduled for January 5, 2018, at 11:30 AM
Eastern Time. The parties were provided with a call in telephone number and passcode.
However, Respondent did not appear at the pre-hearing conference call or otherwise
provide any response to the Order that scheduled the pre-hearing conference.

' Along with its May 24, 2017 Answer, Respondent also filed a Waiver Request from
using the DAB E-File System. I granted the Waiver Request in my June 2, 2017 APHO.
On January 8, 2018, I issued an Order giving Respondent until January 22, 2018, to show
cause for its failure to appear at the pre-hearing conference. Respondent was informed
that failure to respond to the Order could “result in sanctions, including the issuance of a
an Initial Decision and Default Judgment finding Respondent liable for the violations
listed in the Complaint and imposing a civil money penalty.” As of the date of this
Decision, a response to the Order has not been received.

IL. Striking Respondent’s Answer
Pursuant to 21 C.F.R. § 17.35(a), I may sanction a party for:

() Failing to comply with an order, subpoena, rule, or procedure
governing the proceeding;

(2) Failing to prosecute or defend an action; or

(3) Engaging in other misconduct that interferes with the speedy,
orderly, or fair conduct of the hearing.

21 C.F. § 17.35(a).

Here, Respondent failed to appear at the January 5, 2018 pre-hearing conference call and
did not comply with my January 8, 2018 Order. Respondent has failed to comply with
orders and procedures governing this proceeding, and failed to defend the action. 21
C.F.R. § 17.35(a). Respondent’s misconduct has interfered with the speedy, orderly, or
fair conduct of this proceeding. /d. Therefore, I find that sanctions are appropriate under
21 C.F.R. § 17.35.

The harshness of the sanctions I impose upon either party must relate to the nature and
severity of the misconduct or failure. 21 C.F.R. § 17.35(b). I find and conclude that
Respondent’s misconduct is sufficiently egregious to warrant striking its May 24, 2017
Answer and issuing a decision without further proceeding. 21 C.F.R. §§17.35(c)(3),
17.11(a).

Ill. Default Decision

Striking Respondent’s Answer leaves the Complaint unanswered. Therefore, I am
required to issue an initial decision by default if the complaint is sufficient to justify a
penalty. 21 C.F.R. § 17.11(a). Accordingly, I must determine whether the allegations in
the Complaint establish violations of the Act.

For purposes of this decision, I assume the facts alleged in the Complaint are true and
conclude the default judgment is merited based on the allegations of the Complaint and
the sanctions imposed on Respondent for failure to comply with the orders. 21 C.F.R.
§ 17.11. Specifically:
¢ On August 1, 2016, CTP initiated a previous civil money penalty action, CRD
Docket Number T-16-1297, FDA Docket Number FDA-2016-H-2036 (see also
CRD Docket Number C-15-2280, FDA Docket Number FDA-2015-H-1446),
against Respondent for five’ violations of 21 C.F.R. pt. 1140 within a thirty-six
month period. CTP alleged those violations to have occurred at Respondent’s
business establishment, 6819 Loch Raven Boulevard, Towson, Maryland 21286,
on July 9, 2014, December 4, 2014, and January 12, 2016;

e The previous action concluded when Respondent admitted the allegations
contained in the Complaint issued by CTP, and agreed to pay a monetary penalty
in settlement of the claim. Further, “Respondent expressly waived its right to
contest such violations in subsequent actions”;

¢ On December 9, 2016, at Respondent’s business establishment, 6819 Loch Raven
Boulevard, Towson, Maryland 21286, an FDA-commissioned inspector observed
a plastic jar containing individual cigarettes behind the sales counter. The most
responsible person on duty stated that the establishment sells individual cigarettes.

These facts establish Respondent Ever Green’s liability under the Act. The Act prohibits
misbranding of a tobacco product. 21 U.S.C. § 331(k). A tobacco product is misbranded
if sold or distributed in violation of regulations issued under section 906(d) of the Act.

21 U.S.C. § 387f(d); see 21 U.S.C. § 387c(a)(7)(B); 21 C.F.R. § 1140.1(b). The
Secretary of the U.S. Department of Health and Human Services issued the regulations at
21 C.F.R. pt. 1140 under section 906(d) of the Act. 21 U.S.C. § 387a-1; see 21 U.S.C.

§ 387f(d)(1); 75 Fed. Reg. 13,225, 13,229 (Mar. 19, 2010); 81 Fed. Reg. 28,974, 28,975-
76 (May 10, 2016). Under 21 C.F.R. § 1140.14(a)(1),? no retailer may sell cigarettes to
any person younger than 18 years of age. Under 21 C.F.R. § 1140.14(a)(2)(i), retailers
must verify, by means of photographic identification containing a purchaser’s date of
birth, that no cigarette purchasers are younger than 18 years of age. Under 21 C.F.R.

§ 1140.14(a)(4), retailers are prohibited from breaking or otherwise opening any cigarette
package to sell or distribute individual cigarettes.

2 Two violations were documented on July 9, 2014 (sale to a minor and failure to verify
the age of a purchaser), two on December 4, 2014 (sale to a minor and failure to verify
the age of a purchaser), and two on January 12, 2016 (sale to a minor and failure to verify
the age of a purchaser). In accordance with customary practice, CTP counted the
violations at the initial inspection as a single violation, and all subsequent violations as
separate individual violations.

3 On August 8, 2016, the citations to certain tobacco violations changed. For more
information see: https://federalregister.gov/a/2016-10685.

Under 21 C.F.R. § 17.2, an $11,182 civil money penalty is permissible for six violations
of the regulations found at 21 C.F.R. pt. 1140.

Order

For these reasons, I enter default judgment in the amount of $11,182 against Respondent
Iman Crown, Inc. d/b/a Ever Green. Pursuant to 21 C.F.R. § 17.11(b), this order
becomes final and binding upon both parties after 30 days of the date of its issuance.

/s/
Margaret G. Brakebusch
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
Premier Integrity Solutions, Inc.

(NPI: 1982047700, 1992047179)
Petitioner,

v.

Centers for Medicare & Medicaid Services.
Docket No. C-17-764
Decision No. CR5018

Date: February 1, 2018

DECISION

CGS Administrators, LLC (CGS), an administrative contractor acting on behalf of the
Centers for Medicare & Medicaid Services (CMS), revoked the Medicare enrollment and
billing privileges of Petitioner, Premier Integrity Solutions, Inc., effective December 18,
2016. CMS upheld that determination in a reconsidered determination. CMS and CGS
determined that, pursuant to Medicare program regulations, Petitioner had provided false
or misleading information in a Medicare enrollment application. For the reasons stated
below, I affirm the revocation of Petitioner’s Medicare enrollment and billing privileges.

I. Background and Procedural History

Petitioner is a clinical laboratory that was enrolled as a supplier in the Medicare Program.
See CMS Exhibits (Exs.) 1,5. On January 29, 2015, Petitioner entered into a settlement
agreement with CMS in which it acknowledged that its enrollment had been revoked on
October 24, 2013, and that the revocation of its enrollment “shall stand for the period
October 24, 2013 through October 23, 2014.” CMS Ex. 6 at 1.
On or about September 16, 2016, Petitioner updated its enrollment information through
the internet-based Provider Enrollment, Chain and Ownership System (PECOS). CMS
Ex. 1. In response to a question in Section 3 of the application asking whether “a final
adverse action [had] been imposed against an applicant under any current or former name
or business entity,” Petitioner answered, “No.”! CMS Ex. | at 2. Petitioner’s Chief
Financial Officer, Angela Ragle, who is identified as an authorized official on the
application, electronically signed and certified the enrollment application. CMS Ex. | at
3,7.

By letter dated November 18, 2016, CGS notified Petitioner that its Medicare enrollment
and billing privileges would be revoked effective December 18, 2016, explaining:

42 [C.F R. § ]424.535(a)(4) — False or Misleading Information

On your Change of Information application, signed by Authorized Official
Angela Ragle on September 16, 2016, you verified as true that Premier
Integrity Solutions Inc[.] had no final adverse legal action history.
However, Premier Integrity Solution Inc[.]’s Medicare billing privileges
were previously revoked from Medicare based on a settlement agreement
related to a one year suspension. Your Medicare billing privileges were
revoked from Medicare effective 10/24/2013 through 10/24/2014. A prior
Medicare-imposed revocation of any Medicare billing privileges is a final
adverse action, as defined by 42 [C.F.R. § ]424.502.

CMS Ex. 3 at 1 (emphasis omitted). CGS also informed Petitioner that it would be
barred from re-enrolling in the Medicare program for a period of three years, effective 30
days from the postmark date of the letter. CMS Ex. 3 at 1-2.

On January 11, 2017, Petitioner, through counsel, requested reconsideration of the initial
determination revoking its Medicare enrollment and billing privileges. CMS Ex. 4.
Petitioner argued that a third party, Bluegrass Credentialing & Consulting, LLC
(Bluegrass), prepared the enrollment application, and that Bluegrass “negligently failed
to disclose the 2013 revocation on the Application.” CMS Ex. 4 at 4 (emphasis in
original). Petitioner further contended that “Bluegrass negligently failed to include the
instructions portion of the filing (i.e. page 12 of the Form CMS-855B) when it provided a
copy of the Application to Premier for review.” CMS Ex. 4 at 4. Petitioner explained
that “[i]n the absence of these instructions, however, Petitioner reasonably concluded that

' The enrollment application instructs an applicant to list “[a]ny Medicare revocation of
any Medicare billing number” as a final adverse legal action in Section 3 of the
enrollment application. CMS Ex. 2 at 13 (blank Form CMS-855B application).
Petitioner acknowledged that “[t]he instructions discuss what exclusions, revocations
must be reported... .” CMS Ex. 4 at 4.
the 2013 revocation did not need to be disclosed on the Application.” CMS Ex. 4 at 4.
Petitioner further argued that 42 C.F.R. § 424.535(a)(4) is an “invalid” regulation and
that any revocation based on this purportedly invalid regulation is “void.” CMS Ex. 4 at
5. Among its arguments, Petitioner contended that the Secretary “substantially altered”
section 424.535(a)(4) at the time of issuance of the final rule implementing the
regulation.2 CMS Ex. 4 at 7.

On April 11,2017, CMS’s Provider Enrollment & Oversight Group issued a reconsidered
determination in which it determined that CGS properly revoked Petitioner’s Medicare
billing privileges “due to [Petitioner’s] certification as ‘true,’ false or misleading
information on its September 16, 2016 change of information application when
[Petitioner] did not list the October 2013 revocation of its Medicare billing privileges as a
previous final adverse action.” CMS Ex. 5 at 3. CMS, in responding to Petitioner’s
arguments, explained that “[w]hile [Petitioner’s] credentialing was outsourced to
Bluegrass, [Petitioner] still maintained a responsibility to ensure that all information
submitted on its behalf in its CMS-855B Medicare enrollment application was complete,
truthful, and accurate.” CMS Ex. 5 at 3. CMS further explained that Petitioner, “as the
supplier enrolled in the Medicare program, was responsible for the maintenance of its
Medicare enrollment and for abiding by the Medicare regulations.” CMS Ex. 5 at 3.
CMS also stated that it found no merit in Petitioner’s argument that 42 C.F.R.

§ 424.535(a)(4) is an invalid regulation. CMS Ex. 5 at 3.

Petitioner, through counsel, filed a timely request for a hearing (RFH) on May 31, 2017.
On June 13, 2017, I directed the parties to file pre-hearing exchanges, consisting of a

2 As I will address below, I need not address this argument because I cannot invalidate a
regulation. However, I briefly note that the text of section 424.535(a)(4) in both the
proposed rulemaking and the final version of the regulation is substantively identical.
The proposed regulatory language, as relevant here, was as follows: “(4) False or
misleading information. The provider or supplier certified as ‘true’ false or misleading
information on the CMS 855 to be enrolled or maintain enrollment in the Medicare
program.” 68 Fed. Reg. 22,064, 22,085 (Apr. 25, 2003). The same sentence in the final
rule contains nearly verbatim language, stating: ‘“(4) False or misleading information.
The provider or supplier certified as ‘true’ misleading or false information on the
enrollment application to be enrolled or maintain enrollment in the Medicare program.”
71 Fed. Reg. 20,754, 20,780 (Apr. 21, 2006). It is unclear, based on the plain language of
the proposed and final versions of the regulation, how “[t]he Regulation broadened this
scope dramatically to punish every instance in which incorrect information is supplied
....” Petitioner Brief (P. Br.) at 7.

3 Petitioner appended several documents to its RFH, but did not submit any of these
documents as proposed exhibits; therefore, Petitioner has not sought inclusion of these
documents in the evidentiary record. See Acknowledgment and Pre-Hearing (Order),
brief by CMS and a response brief by Petitioner, along with supporting evidence, in
accordance with specific requirements and deadlines. Pre-Hearing Order, §§ 4, 5.

CMS filed a motion for summary judgment (CMS Br.) in lieu of a brief, along with six
exhibits (CMS Exs. | - 6); see Pre-Hearing Order, § 4(c)(i) (authorizing filing of a
motion for summary judgment as part of a pre-hearing exchange). Petitioner submitted a
response to CMS’s motion for summary judgment and a cross-motion for summary
judgment (P. Br.). In the absence of any objections, I admit CMS Exs. | through 6 into
the evidentiary record.

In my Pre-Hearing Order, I advised the parties that they must submit written direct
testimony for any proposed witness and that an in-person hearing would only be
necessary if the opposing party requested an opportunity to cross-examine a

witness. Pre-Hearing Order, §§ 8-10. Neither party has listed any witnesses or provided
any written direct testimony. Consequently, there are no witnesses for the parties to
cross-examine at a hearing. The record is closed, and the case is ready for a decision on
the merits.*

II. Issue

The issue is whether CMS had a legitimate basis for revoking Petitioner’s Medicare
enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(4) based on the
submission of false or misleading information in a Medicare enrollment application.

§§ 4, 5 (requiring each party to submit a list of proposed exhibits and instructing that I
“may refuse to receive an exhibit or exhibits into evidence that are not filed in accordance
with the requirements of this Order”). One of the appended documents is a “confidential
questionnaire” that Petitioner completed at the request of Bluegrass, in which Petitioner
provided a response to a question asking about adverse actions involving “the Medicare
or Medicaid program, or in regard to federal and other federal or state governmental
health care plans of programs.” Even though Bluegrass requested that Petitioner “attach
detailed explanations for each yes answer,” Petitioner vaguely reported that it had been
““revoked’ [and] then reinstated,” without providing any specific information, such as the
health care plan or program from which it had been revoked, the specific date of its
revocation, and the duration of the revocation. Despite Petitioner’s vigorous assertions to
the contrary, Petitioner has not submitted evidence that it fully disclosed its prior
revocation to its credentialing company, even though Bluegrass had requested that it
provide a detailed explanation of such an adverse action.

4+ As an in-person hearing to cross-examine witnesses is not necessary, it is unnecessary
to further address the parties’ motions for summary judgment.
III. Jurisdiction

Ihave jurisdiction to decide this case. 42 C.F.R. §§ 498.3(b)(17), 498.5(1)(2); see also
42 USC. § 1395cc(j)(8).

IV. Findings of Fact, Conclusions of Law, and Analysis?

Petitioner is a “supplier” for purposes of the Medicare program. See 42 U.S.C.

§ 1395x(d); 42 C.F.R. §§ 400.202 (definition of supplier), 410.20(b)(1). In order to
participate in the Medicare program, a supplier must meet certain criteria to enroll and
receive billing privileges. 42 C.F.R. §§ 424.505, 424.510. CMS may revoke a supplier’s
enrollment and billing privileges for any reason stated in 42 C.F.R. § 424.535(a).

CMS may revoke a supplier’s enrollment if the supplier certifies as “true” misleading or
false information, as set forth in 42 C.F.R. § 424.535(a)(4), which currently provides:

(4) False or misleading information. The provider or supplier certified as
“true” misleading or false information on the enrollment application to be
enrolled or maintain enrollment in the Medicare program.

42 CFR. § 424.535(a)(4) (emphasis omitted).

1. Petitioner has been the subject of a final adverse legal action, as
defined by 42 C.F.R. § 424.502, and a Medicare enrollment
application asks a supplier to report whether it has been the subject of
a final adverse action.

Pursuant to the definitions provided in 42 C.F.R. § 424.502, a final adverse action
includes a “Medicare-imposed revocation of any Medicare billing privileges.” Petitioner
does not dispute that its Medicare billing privileges were revoked from October 24, 2013
through October 23, 2014. P. Br. at 2 (Petitioner’s acknowledgement that it “had a final
adverse legal action”); see CMS Ex. 6 at (settlement agreement indicating that
Petitioner’s Medicare enrollment had been revoked from October 24, 2013 through
October 23, 2014).

The Medicare enrollment application specifically asks a supplier whether it has been
subject to a final adverse action. CMS Ex. 2 at 14 (“Has your organization, under any
current or former name or business entity, ever had any of the final adverse actions listed
on page 13 of the application imposed against it?”); see also CMS Ex. 2 at 13 (Form
CMS-855B listing “[a]ny Medicare revocation of any Medicare billing number” as a final
adverse action that must be reported in Section 3 of the application).

5 My findings of fact and conclusions of law are set forth in italics and bold font.
Petitioner has been the subject of a final adverse legal action for Medicare enrollment
purposes, and it would be required to report that information on a Medicare enrollment
application.

2. Petitioner submitted false enrollment information reporting that it was
not the subject of a final adverse legal action and certified that this
information was correct.

Petitioner submitted an enrollment application through PECOS in which it responded
“No” in response to a question asking if it had been subject to a final adverse legal action.
CMS Ex. | at 3. Petitioner’s chief financial officer and authorized official electronically
signed and certified that she had provided correct enrollment information. CMS Ex. | at
3,7. Because Petitioner had previously been the subject of a final adverse action, it
provided false enrollment information when it informed CMS that it had not been the
subject of a final adverse action.

3. CMS and CGS had a legitimate basis to revoke Petitioner’s Medicare
enrollment and billing privileges pursuant to 42 C.F R.
§ 424.535(a)(4) because Petitioner falsely certified on an enrollment
application that it had not been the subject of a final adverse legal
action.

Petitioner retained the services of Bluegrass to handle the credentialing process with
CMS. P. Br. at 5. Petitioner has argued that Bluegrass “negligently” failed to report that
Petitioner had previously been the subject of a final adverse action. CMS Ex. 4 at 4
(“This arose only because Bluegrass negligently failed to accurately complete the Final
Adverse Action section of the Application and failed to provide any instructions to
[Petitioner].”); RFH at 4 (stating that “Bluegrass negligently failed to disclose the 2013
revocation on the Form 855B,” and reporting that Petitioner “has instituted a legal action
against Bluegrass arising from its failure to properly complete the Form 855B.”)
(emphasis in original); P. Br. at 4 (stating that “the undisputed evidence demonstrates that
this inaccurate form was submitted as a result of a negligent shortcoming of [Petitioner’s]
agent”). Petitioner further argues that it “had every right to believe that its chosen expert,
Bluegrass, would do things correctly ....” P. Br. at 4.

Assuming, for the limited purpose of this discussion, that Petitioner’s credentialing
company did not correctly report Petitioner’s previous final adverse legal action on the
enrollment application, such does not absolve Petitioner of the responsibility to report the
final adverse legal action.° A supplier is bound by any false or misleading information

® As I previously discussed, Petitioner argues that it “disclosed to Bluegrass that [it] had
a final adverse legal action” and that “Bluegrass needed that information to accurately
complete section 3 of the 855 form” (P. Br. at 2). According to a questionnaire Petitioner
that a third party lists on its enrollment application, and false or misleading information
may ultimately be submitted to the Medicare administrative contractor if a supplier does
not carefully review all sections of an enrollment application. By signing a certification
statement attesting to the accuracy of the content of an application, the supplier adopts
any false or misleading statements in the application. There is simply no provision under
law that absolves a supplier when its authorized official signs an incorrect enrollment
application, regardless of who prepares the application for that person’s signature. Thus,
even if I were to accept Petitioner’s unsupported claim that Bluegrass somehow erred in
preparing its enrollment application, which I do not find, I also recognize that Petitioner
signed the certification statement and thereby adopted any false or misleading
information contained in the application.

A supplier that “certifie[s] as ‘true’ misleading or false information . . .” may be subject
to revocation of its Medicare enrollment and billing privileges. 42 C.F.R.

§ 424.535(a)(4). “[S]ection 424.535(a)(4) does not require proof that [a supplier]
subjectively intended to provide false information, only proof that [it] in fact provided
misleading or false information that [it] certified as true.” Mark Koch, D.O., DAB No.
2610 at 4 (2014) (emphasis in original). Further, and based on a situation similar to the
one presented here involving the revocation of billing privileges pursuant to section
424.535(a)(4), the Departmental Appeals Board (DAB) explained that “even if [a
supplier] did not subjectively intend to mislead the Medicare program on the [enrollment]
application, he was not without fault.” Id. at 4-5. The DAB continued by stating:
“Petitioner admits that, contrary to his signed certification, he did not read the complete
application before signing and submitting it to Medicare. That omission was certainly
negligent and exhibited indifference to Medicare requirements.” Id. at 5 (citation
omitted). In expanding on its analysis in the Koch decision, the Board later explained, in
a nearly identical situation involving a revocation pursuant to section 424.535(a)(4), the
following:

Petitioner, like Dr. Koch, in fact provided misleading or false information
that she certified as true. Moreover, even accepting that Petitioner did not
intend to mislead the Medicare program, Petitioner admitted that she did

appended its request for hearing, Petitioner reported to Bluegrass, in response to a
question involving various health care programs and plans, that it had been “revoked”
and “reinstated,” without any further detail. Section 3 of the enrollment application
requires an applicant to provide “each final adverse action, when it occurred, the Federal
or State agency or the court/administrative body that that imposed the action, and the
resolution, if any, along with “a copy of the final adverse action documentation and
resolution.” See CMS Ex. 2. Petitioner has not demonstrated that it provided Bluegrass
sufficient information to put it on notice that its Medicare enrollment had been revoked,
nor has is demonstrated that it provided the “detailed explanation” that had been
requested by Bluegrass.
not read at least one of the applications inasmuch as she asserted that she
was not given an opportunity to review the application form itself. By
signing the certification statements in both application forms (and she does
not dispute that the signatures are hers), she attested to the truth, accuracy
and completeness of their content, as is.

As the ALJ correctly noted, once CMS determined that Petitioner submitted
Medicare enrollment applications that contained false or misleading
statements that Petitioner certified as “true,” CMS had a legal basis for
revocation.

Sandra E. Johnson, CRNA, DAB No. 2708 at 15 (2016). Petitioner reported false
information, and CMS had a legitimate basis to revoke its Medicare enrollment pursuant
to section 424.535(a)(4).

Petitioner argues in its brief that revocation is inappropriate because CMS has not
presented evidence of “deliberate intent to mislead” and that section 424.535(a)(4) “is
void and unenforceable because requirements of the Administrative Procedure Act,

5 USC. §§ 551 et seq., were not followed.” P. Br. at 5. While I need not address the
merits of this argument, I reiterate my earlier observation that the text of section

424 .535(a)(4), as proposed in 2003, is substantively identical to the regulation currently
in effect. Further, the DAB has held, on more than one occasion, that CMS need not
establish that a supplier had an “intent” to furnish false or misleading information. See
Mark Koch, D.O., DAB No. 2610 at 4; Sandra E. Johnson, CRNA, DAB No. 2708 at 15.
Neither CMS nor I can ignore statutory and regulatory authority. I am bound by the law,
and I cannot create a new policy that is inconsistent with the law. 1866ICPayday.com,
L.L.C., DAB No. 2289 at 14 (2009) (“An ALJ is bound by applicable laws and
regulations and may not invalidate either a law or regulation on any ground.”); Russell L.
Reitz, M.D., DAB No. 2748 at 8 (2016) (“The ALJ and the Board are bound by the
Secretary’s regulations” and “Petitioner is free to make his . . . argument to a court, but
we may not invalidate or refuse to apply a regulation.”). I must apply the Medicare laws
as they currently exist, and even if I were so inclined, I have no authority to invalidate a
regulation or refuse to ensure adherence with a regulation. Therefore, revocation is
appropriate pursuant to section 424.535(a)(4).”

7 Petitioner does not raise any dispute regarding the effective date of its revocation or the
three-year length of the re-enrollment bar, and it is unnecessary to further address these
issues.
V. Conclusion

For the reasons explained above, I affirm the revocation of Petitioner’s Medicare
enrollment and billing privileges.

/s/

Leslie C. Rogall
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Monique Barbour, M.D.,
(PTAN: 27420W)
(NPI: 11043398175)

Petitioner,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-16-178
Decision No. CR5015

Date: January 30, 2018

DECISION

Petitioner, Monique Barbour, M.D., is an ophthalmologist, practicing in Florida, who
owns and operates Clear Vue Laser Eye Center, Inc., a group medical practice. Until
recently, Petitioner Barbour and her group practice participated in the Medicare program.
The Centers for Medicare & Medicaid Services (CMS) has revoked their billing
privileges, citing abusive billing practices; specifically, CMS charges that Petitioner
Barbour billed for services to Medicare beneficiaries that she could not have provided
because she was out of the country on the dates she ostensibly provided them.

Petitioner appeals. The parties agree on the dispositive facts and have filed cross-motions
for summary judgment. I agree that this case presents no genuine issues of material fact
and that summary judgment is appropriate.

The undisputed evidence establishes that Petitioner Barbour repeatedly billed the
Medicare program for services she could not have provided and, in fact, did not provide.
CMS therefore properly revoked her billing privileges.

Background

In a letter dated June 24, 2015, the Medicare contractor, First Coast Service Options, Inc.,
advised Petitioner Barbour that her Medicare billing privileges were revoked, effective
July 24,2015. The contractor took this action pursuant to 42 C.F.R. § 424.535(a)(8)
because it found that Dr. Barbour submitted multiple claims for services that she could
not have rendered because she was outside the country on the purported dates of service.
CMS Exhibit (Ex.) 3.

Petitioner requested reconsideration. CMS Ex. 2. In a reconsidered determination, dated
October 19, 2015, CMS upheld the revocation. CMS Ex. 1

Petitioner appealed, and her appeal is now before me. CMS has moved for summary
judgment. With its memorandum in support of summary judgment (CMS Br.), it submits
41 exhibits (CMS Exs. 1-41). Petitioner filed a cross-motion for summary judgment (P.
Br.), accompanied by 29 exhibits (P. Exs. 1-29). CMS responded to Petitioner’s cross-
motion (CMS Response), and Petitioner filed a reply (P. Reply).

Discussion

CMS is entitled to summary judgment because the undisputed
evidence establishes that Petitioner Barbour was out of the
country and could not have provided the services for which she
billed the Medicare program. CMS therefore properly revoked
her Medicare enrollment pursuant to 42 C.F.R. § 424.535(a)(8)
and is entitled to summary judgment?

Program rules. CMS regulates the Medicare enrollment of providers and suppliers.
Social Security Act (Act) § 1866(j)(1)(A). It may revoke a supplier’s billing privileges if
she abuses them by submitting a claim or claims for services that she could not have
furnished to a specific individual on the date of service, such as where “the directing
physician . . . is not in the state or country when services were furnished ... .” 42 C.F.R.
§ 424.535(a)(8).3

' In a separate notice and reconsidered determination, the contractor revoked the billing
privileges of Dr. Barbour’s medical practice, Clear Vue, Inc., which filed a separate
appeal. That appeal is docketed as C-16-179.

2 [ make this one finding of fact/conclusion of law.

3 The regulation was amended effective February 2015 and is currently found at 42
CFR. § 424.535(a)(8)(i)(B). See 79 Fed. Reg. 72,532 (December 5, 2014). Here, all but
one of the purported dates of service occurred prior to that effective date, so the old
The plain language of the regulation authorizes CMS to revoke billing privileges based
on a Single bogus claim. 42 C.F.R. § 424.535(a)(8) (authorizing revocation if the
supplier submits “a claim or claims for services that could not have been furnished .. .”).
CMS has decided not to enforce the rule so strictly, however; it will not revoke unless the
supplier has submitted at least three bogus claims. 73 Fed. Reg. 36,448, 36,455 (June 27,
2008).

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
appropriate if a case presents no genuine issue of material fact, and the moving party is
entitled to judgment as a matter of law. Id. at 2; Ill. Knights Templar Home, DAB No.
2274 at 3-4 (2009), and cases cited therein.

The Board has delineated the “facts material” to determining whether CMS properly
revoked a supplier’s Medicare participation under section 424.535(a)(8): 1) whether
Petitioner was out of the country on the dates alleged; and 2) whether she billed Medicare
for services she claimed to have provided to specific individuals on those dates. Zille
Shah, M.D. and Zille Huma Zaim, M.D., PA, DAB No. 2688 at 5 (2016); Mohammad
Nawaz, M.D. and Mohammad Zaim, M.D., PA, DAB No. 2687 at 5 (2016).

To establish that it is entitled to summary judgment, 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
Ctr. v. Dep’t of Health & Human Servs., 388 F.3d 168, 173 (6th Cir. 2004) (quoting
Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (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 & Rehab. Ctr., DAB No. 1918 (2004). The non-moving party may not simply
rely on denials, but must furnish admissible evidence of a dispute concerning a material
fact. Ill. Knights Templar, DAB No. 2274 at 4; Livingston Care Ctr., DAB No. 1871 at 5
(2003), aff'd, 388 F.3d 168 (6th Cir. 2004).

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. Livingston Care Ctr., 388 F.3d at 172; Guardian Health Care Ctr., DAB
No. 1943 at 8 (2004); but see Brightview Care Ctr., DAB No. 2132 at 10 (2007) (entry of

citation applies. In any event, the amendments did not change the substantive provisions
that underlie this case.
summary judgment upheld where inferences and views of non-moving party are not
reasonable). However, 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 Ctr., 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.”).

Undisputed material facts. Petitioner Barbour is a physician practicing in Lake Worth,
Florida. The parties agree that, over a period of six years, she billed the Medicare

program for services provided while she was out of the country:

e July 9-19, 2009 two claims submitted. CMS Ex. 2 at 17.

e September 24-27, 2009 18 claims submitted. CMS Ex. 2 at 18.

e December 1-5, 2009 20 claims submitted. CMS Ex. 2 at 19.
e June 27-July 3, 2010 one claim submitted. CMS Ex. 2 at 20.
e June 17-21,2011 10 claims submitted. CMS Ex. 2 at 20.
e August 14-21, 2011 three claims submitted. CMS Ex. 2 at 21.
e January 3-8, 2012 one claim submitted. CMS Ex. 2 at 21.

e July 30—-August 8,2012 seven claims submitted. CMS Ex. 2 at 21.
e July 30-August 10,2013 32 claims submitted. CMS Ex. 2 at 22.
e February 14-26, 2014 43 claims submitted. CMS Ex. 2 at 23.

e May 2-7, 2014 four claims submitted. CMS Ex. 2 at 24.

e March 19-22, 2015 one claim submitted. CMS Ex. 2 at 24.

Petitioner Barbour concedes that, for almost all of these 142 claims, she was out of the
country on the dates she ostensibly provided the services for which she billed Medicare.
P. Br. at 7, 13; see CMS Ex. 2 at 4, 29-30 (Barbour Decl. §§ 6, 7).

She acknowledges that other judges have upheld revocations where physicians billed for
services ostensibly provided while they were out of the country, but she distinguishes
herself from those cases by claiming (gratuitously) that she “did not say that she provided
the services to the beneficiaries herself, for the claims with dates of services when she
was traveling and unavailable.” P. Br. at 9. While Petitioner may have admitted during
these proceedings that she did not provide the services, she concedes that, when she
submitted bills to the Medicare program, she represented that she had provided the
services. Petitioner excuses these as billing errors: modifiers were omitted or incorrect
dates of service were provided. P. Br. at 11-12.

The Board has repeatedly observed that the Medicare rules provide no exceptions “for
inadvertent or accidental billing errors.” John M. Shimko, D.P.M., DAB No. 2689 at 6
(2016), quoting Louis J. Gaefke, D.P.M., DAB No. 2554 at 7 (2013). Nothing in section
424.535(a)(8) (or its preamble) requires CMS to establish that the improper claims were
not accidental. Howard B. Reife, D.P.M., DAB No. 2527 at 6 (2013). Physicians are
responsible for Medicare claims submitted on their behalf and at their direction. Their
efforts to assign the blame elsewhere (billing agent, assistants) “do not relieve [them] of
[their] responsibility for the improper claims or bar CMS from revoking [their] billing
privileges.” Id. at 8.

Petitioner was out of the country on the dates alleged, and she billed the Medicare
program for services she claimed to have provided to specific individuals on those dates.
Thus, both of the “facts material” to determining whether CMS properly revoked
Petitioner Barbour’s Medicare enrollment are resolved in CMS’s favor, and CMS is
entitled to summary judgment.

Nor am I persuaded that Petitioner’s additional arguments should alter this result. She
asserts that she is not subject to revocation because the services billed for were, in fact,
provided to Medicare beneficiaries, just not by her. She offers four categories of
explanation:

First, for three of the 142 claims — dated July 13, 2009, June 29, 2010, and August 16,
2011 — she asserts that she provided the services while she was in the country, but the
dates listed on the billing forms were inaccurate. The bills should have indicated July 7,
2009, June 25, 2010, and August 11,2011. P. Br. at 5; P. Exs. 4-64

4 This is a bit of a departure from Petitioner’s position at the reconsideration level. In the
written declaration she filed during those proceedings, she claimed that a technician
provided “ancillary ophthalmological testing services” while she was out of the country
from July 9 through 19, 2009. CMS Ex. 2 at 29 (Barbour Decl. § 7). But she also
maintained that three other claims were provided while she was in the country, and her
billing personnel entered incorrect dates of service. She did not then identify those three
claims. CMS Ex. 2 at 5.
Petitioner has come forward with evidence that she provided services to three individuals
on two of the dates claimed (July 7, 2009 and June 25, 2010). P. Exs. 4,6. With respect
to the third, the date of service is August 10, 2011, not August 11; that apparent error is
inconsequential because she was in the country on both days. P. Ex. 5. For purposes of
summary judgment, I accept that Petitioner provided services on those dates and, drawing
all reasonable inferences in her favor, that the service dates submitted to Medicare were
in error. P. Exs. 4-6. However, based on the Board’s sound reasoning in Shimko and
Gaefke, she does not escape responsibility by showing that her billing agent submitted
erroneous claims.

Moreover, even if I eliminate these claims (which I could not justify doing), CMS has
come forward with ample other examples of her billing for services that she did not
provide.

Second, Petitioner maintains that “some of the services provided and billed while
[Petitioner] was out of the country were provided by substitute practitioners ....” P. Br.
at 5. But she concedes that the claims she submitted indicated that she provided the
services. P. Br. at 6; CMS Exs. 7-255

As a threshold matter, I note that CMS may revoke a physician’s billing privileges if she
knowingly allows another individual to use her billing number. 42 C.F.R.

§ 424.535(a)(7); see Kermit E. White, M.D., & Kermit E. White M.D., P.C., DAB No.
2765 (2017).

In any event, Petitioner has again come forward with some evidence that other physicians
covered for her while she was out of the country. In a written declaration, Catherine
Ford, O.D., asserts that she worked for Petitioner at Clear Vue from December 2014 until
June 2015; that she “routinely” provided services for Petitioner’s patients when Petitioner
was out of town; and that she did so on March 20, 2015. P. Ex. 1 at 1 (Ford Decl. 99 5,
7). However, Petitioner proffers no evidence to show that Dr. Ford provided any of the
services for which she submitted claims. Similarly, Brian Haft, M.D., and Kevin Kelly,
M_D.., state, generally, that they “routinely provided coverage” for Petitioner Barbour
when she was out of town but, again, they do not cite any specific services for which they
submitted claims using Petitioner’s name and billing number. P. Ex. 2 (Haft Decl. 6);
P. Ex. 3 (Kelly Decl. § 7).

5 At the reconsideration level, Petitioner also maintained that “some of the services
provided” while she was out of the country were provided by substitute physicians. CMS
Ex. 2 at 4, 7.5. She provided no numbers, although she submitted a written declaration
listing the periods of travel during which the services were provided: July 24 through 27,
2009; December | through 5, 2009; and March 19 through 22, 2015. CMS Ex. 2 at 4, 29
(Barbour Decl. § 6). For these periods, she submitted 18 claims, 20 claims, and one
claim, respectively. CMS Ex. 2 at 18-19, 24.
Petitioner also submits some treatment notes, which, she represents, show that Dr. Karen
Rojas provided services on dates that Petitioner was out of the country: September 25,
2009, and December | through 4, 2009. P. Br. at 6; P. Exs. 7-25. Petitioner does not
mention Dr. Rojas’s qualifications, and she submits no written declaration from Dr.
Rojas.

Viewed in the light most favorable to Petitioner, and accepting Petitioner’s otherwise
unsupported representation, the treatment notes show that Dr. Rojas provided some
services for which claims were submitted. P. Exs. 7-25. At best, however, these account
for 35 claims for services provided to 20 patients, leaving a significant number of
erroneous claims to justify revocation.

Third, Petitioner alludes to “other claims” (number not specified) for services provided
by technicians “under general supervision” of physicians, as provided for in 42 C.F.R.

§ 410.32. P. Br. at 6. She has come forward with no additional evidence that any of the
claims submitted fall into this category but simply cites to the same proffered exhibits (P.
Exs. 7-25) she submitted to show that Dr. Karen Rojas provided the services.

Finally, on some travel dates -- she mentions January 3, 2012 -- Petitioner asserts that
she left the country late in the day and provided the services on the dates of her departure.
P. Br. at 7. But she offers evidence of the time she left the country for two dates only:
5:45 p.m. on July 30, 2013, and 4:03 p.m. on May 2, 2014. P. Exs. 27, 28. None of the
challenged claims for services provided were submitted on either of those dates. CMS
Ex. 2 at 21, 24.

Thus, at best, Petitioner has proffered evidence disputing fewer than 40 of the 142 claims.
To consider those submissions material, I would have to disregard the reasoning of
Shimko and Gaefke, and I would have to find it permissible for her to bill Medicare,
representing that she provided services that were, in fact, provided by others. I therefore
do not consider the evidence material.

© This represents a significant change from Petitioner’s earlier representation. At the
reconsideration level, Petitioner claimed that she (not other physicians) had provided
supervision pursuant to section 410.32. CMS Ex. 2 at 4,7n.6. Again, she provided no
specific numbers, but listed, in her written declaration, the periods of travel during which
the services were provided: July 9 through 19, 2009; June 17 through 21, 2011; January
3 through 8, 2012; July 30 through August 8, 2012; July 30 through August 10, 2013;
February 14 through 26, 2014; and May 2 through 7, 2014. CMS Ex. 2 at 29-30
(Barbour Decl. § 7). For these periods she submitted 2 claims; 10 claims; 1 claim; 7
claims; 32 claims; 43 claims; and 4 claims, respectively. CMS Ex. 2 at 17, 20-24. It is
well-settled that a physician who is out of the country cannot provide the level of
supervision required by section 410.32. Zille Shah, M.D., DAB No. 2688 at 9-10.
Conclusion

The evidence establishes that Petitioner Monique Barbour, M.D., submitted multiple
claims to the Medicare program, representing that she provided the services for which she
billed. She concedes that, with a few exceptions, she was out of the country and did not
provide the services for which she billed Medicare. CMS therefore properly revoked her
Medicare enrollment.

/s/
Carolyn Cozad Hughes
Administrative Law Judge