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

Virginia Prewitt
(OI File No.: H-12-42546-9),

Petitioner,
v.

The Inspector General,
U.S. Department of Health and Human Services.

Docket No. C-13-656

Decision No. CR2821

Date: June 12, 2013
DECISION

The request for hearing of Petitioner, Virginia Prewitt, is dismissed pursuant to 42 C.F.R.
§ 1005.2(e)(4),! for failure to raise any issue that may properly be addressed in a hearing.

I. Background

The Inspector General for the Department of Health and Human Services (1.G.) notified
Petitioner by letter dated March 29, 2013, that she was being excluded from participation
in Medicare, Medicaid, and all federal health care programs for the minimum statutory
period of five years pursuant to section 1128(a)(2) of the Social Security Act (the Act)
(42 U.S.C. § 1320a-7(a)(2)), effective 20 days from the date of the letter. The basis cited
for Petitioner’s exclusion was her conviction in the Norwich City Court, Chenango
County, New York, of a criminal offense related to neglect or abuse of patients in
connection with the delivery of a health care item or service. Act § 1128(a)(2); 42 C.F.R.
§ 1001.101(a). Petitioner requested a hearing pursuant to 42 C.F.R. § 1005.2, by letter

References are to the 2012 revision of the Code of Federal Regulations (C.F.R.) in
effect at the time of the agency action, unless otherwise stated.
dated April 13, 2013, but filed on April 14, 2013. The case was assigned to me for
hearing and decision on April 19, 2013.

On April 29, 2013, the L.G. filed a motion to dismiss Petitioner’s request for hearing with
1.G. Exhibit (LG. Ex. 1), a copy of the March 29, 2013 letter advising Petitioner of her
exclusion. The I.G. moved to dismiss pursuant to 42 C.F.R. § 1005.2(e)(4), alleging that
Petitioner request for hearing failed to raise an appealable issue. On May 6, 2013,
Petitioner filed a response to the I.G. motion to dismiss.

On May 13, 2013, I convened a telephonic prehearing conference the substance of which
is memorialized in my Prehearing Conference Order and Schedule for Filing Briefs and
Documentary Evidence dated May 14, 2013. During the conference, Petitioner was
advised of her right to counsel. The I.G.’s motion to dismiss was also discussed with
Petitioner during the conference and she conceded that she was convicted of a criminal
offense related to neglect or abuse of patients in connection with the delivery of a health
care item or service. Petitioner was granted until May 24, 2013, to file any additional
response to the I.G. motion to dismiss, and she was advised that if she failed to file a
supplemental response, I would decide the motion on the record before me. No
additional response has been received from Petitioner. Petitioner has not objected to my
consideration of I.G. Ex. | and the document is admitted as evidence.

Il. Findings of Fact, Conclusions of Law, and Analysis
My conclusions of law are set forth in bold, followed by the pertinent facts and analysis.
1. Petitioner has raised no issue that I may decide.

2. Petitioner’s request for hearing must be dismissed pursuant to
42 C.F.R. § 1005.2(e)(4).

Pursuant to 42 C.F.R. § 1001.2007(a)(1), an individual excluded by the LG. may request
review by an administrative law judge on the issues of whether: (1) there is a basis for
exclusion; and (2) the period of exclusion is reasonable. However, when the I.G. imposes
on the minimum period of exclusion, the regulation provides that there is no issue of the
reasonableness of the period of exclusion. 42 C.F.R. § 1001.2007(a)(2). Pursuant to 42
C.F.R. § 1005.2(e)(4), I must dismiss a request for hearing that does not raise an issue
that may be properly addressed in a hearing. I am bound to comply with the regulations.
42 CFR. § 1005.4(c)(1).

The LG. notified Petitioner by letter dated March 29, 2013, that she was being excluded
pursuant to section 1128(a)(2) of the Act based upon her conviction in New York of a
criminal offense related to neglect or abuse of patients in connection with the delivery of
a health care item or service. The I.G. also notified Petitioner that she was being
excluded for five years, which is the minimum period authorized by section
1128(c)(3)(B) of the Act.

Petitioner admits in her April 13, 2013 request for hearing, as she did during the
prehearing conference, that she was convicted in New York of a criminal offense related
to the neglect or abuse of patients in connection with the delivery of a health care item or
service. Petitioner states in her request for hearing that she requests review only as to the
length of the period of exclusion imposed by the I.G. Petitioner also requests in her
response to the I.G. motion to dismiss, that I allow her “to have full privileges to practice
as a nurse,” which I construe to be a request that I reinstate her in Medicare.

Congress mandated the exclusion of one who has been convicted under federal or state
law of a criminal offense related to neglect or abuse of a patient in connection with the
delivery of a health care item or service. Act § 1128(a)(2). Petitioner admits that she has
such a conviction. Therefore, the I.G. has no choice but to exclude Petitioner and there is
no issue for me to decide of whether or not there is a basis for exclusion. Further, the
1.G. imposed exclusion for five years, the minimum period authorized by Congress.
Therefore, pursuant to 42 C.F.R. § 1001.2007(a)(2), whether or not the period of
exclusion is reasonable is not an issue for which review may be requested or granted.

Accordingly, I conclude that Petitioner has raised no issue that may be properly reviewed
and dismissal is required by 42 C.F.R. § 1005.2(e)(4).

III. Conclusion

For the foregoing reasons, Petitioner’s request for hearing must be dismissed.

/s/
Keith W. Sickendick
Administrative Law Judge


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

LCD Complaint: L11518 Positive Airway Pressure Devices
for the Treatment of Obstructive Sleep Apnea,

Docket No. C-13-690
Decision No. CR2820

Date: June 11, 2013

DECISION DISMISSING LCD COMPLAINT

The complaint of a Medicare beneficiary (Complainant) dated April 8, 2013, challenging
a Local Coverage Determination (LCD) L11518, titled “Positive Airway Pressure (PAP)
Devices for the Treatment of Obstructive Sleep Apnea” is dismissed as unacceptable
pursuant to 42 C.F.R. § 426.410(c)(2).” The purported aggrieved party is entitled to
request further review by the Appellate Division of the Departmental Appeals Board (the
Board) as explained hereafter.

I. Background

On April 8, 2013, Complainant filed a letter in which he requested Medicare coverage for
two replacement mask cushions for his positive airway pressure device each month rather
than only one. The case was assigned to me on April 29, 2013. Complainant did not
specifically state that he was challenging a LCD or which LCD might be the subject of
his request. I construed the letter to be a complaint challenging LCD L11518, titled
“Positive Airway Pressure (PAP) Devices for the Obstructive Sleep Apnea,” which
applies in the Complainant’s state of residence, as I have jurisdiction to review LCDs but
not to decide entitlement to Medicare benefits.

“ The names of Medicare beneficiaries are not listed in published decisions to protect
their privacy. 68 Fed. Reg. 63,691, 63,709 (Nov. 7, 2003).
I advised Complainant by letter dated May 6, 2013, that I had evaluated his complaint
pursuant to 42 C.F.R. § 426.410 and concluded that it was unacceptable. Therefore, I
granted Complainant until June 3, 2013, to file an acceptable amended complaint. As of
the date of this decision, the Medicare beneficiary has not filed an amended complaint
and dismissal is appropriate.

IL. Discussion
A. Applicable Law

Section 1862 of the Social Security Act (the Act) (42 U.S.C. § 1395y), which is
applicable to both Medicare Part A and Part B, provides that no payment may be made
for items or services “which . . . are not reasonable and necessary for the diagnosis or
treatment of illnesses or injury or to improve the function of a malformed body
member... .” The Secretary of the Department of Health and Human Services (the
Secretary) has provided by regulation that any services not reasonable and necessary for
one of the purposes listed in the regulations are excluded from coverage under Medicare.
42 C.F.R. § 411.15(k). The Medicare Benefit Policy Manual, CMS pub. 100-02, ch.16,
§§ 10 and 20, provides that no payment may be made for items and services that are not
reasonable and necessary for the diagnosis or treatment of illness or injury or to improve
the functioning of a malformed body member.

The Centers for Medicare and Medicaid Services (CMS) administers the Medicare
program (Act §§ 1102, 1871, 1874) and contracts with carriers and intermediaries
(Medicare contractors) to act on its behalf in determining and making payments to
providers and suppliers of Medicare items and services. Act §§ 1816, 1842. The Act
provides for both National Coverage Determinations (NCDs) and LCDs. Act

§ 1869(f)(1)(B) and (2)(B) (42 U.S.C. §1395ff(f)(1)(B) and (2)(B)). A LCD, as defined
by the Act, is “a determination by a fiscal intermediary or a carrier . . . respecting whether
or not a particular item or service is covered” within the area covered by the contractor.
Act § 1869(f)(2)(B) (42 U.S.C. § 1395ff(f)(2)(B)); 42 C.F.R. § 400.202. In the absence
of a NCD or a LCD, individual claims determinations are made based upon an individual
beneficiary’s particular factual situation. 68 Fed. Reg. 63,691, 63,693 (2003), citing
Heckler v. Ringer, 466 U.S. 602, 617 (1984) (recognizing that the Secretary has
discretion to either establish a generally applicable rule or to allow individual
adjudication); 42 C.F.R. §§ 426.420(a), (b), (e)(1), 426.460(b)(1), 426.488(b).

An aggrieved Medicare beneficiary who has been denied coverage for an item or service
based on a LCD may challenge that LCD before an administrative law judge (ALJ). The
aggrieved party initiates the review by filing a written complaint that meets the criteria
specified in the governing regulations. 42 C.F.R. §§ 426.400; 426.410(b)(2). If an ALJ
determines that the complaint is unacceptable, the ALJ must provide the aggrieved party

one opportunity to amend the unacceptable complaint. 42 C.F.R. § 426.410(c)(2). Ifthe
aggrieved party fails to submit an acceptable amended complaint within a reasonable
timeframe as determined by the ALJ, the ALJ must issue a decision dismissing the
unacceptable complaint. 42 C.F.R. § 426.410(c)(2). If a complaint is determined
unacceptable after one amendment, the beneficiary is precluded from filing again for six
months after being informed that it is unacceptable. 42 C.F.R. § 426.410(c)(3).

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

1. Complainant failed to file an amended complaint within the
allotted timeframe and dismissal is required by 42 C.F.R.
§ 426.410(c)(2).

In my letter to Complainant dated May 6, 2013, I advised him that although he submitted
a physician’s statement that he needed two cushions per month, he failed to submit
documents showing that a Medicare contractor denied coverage or would deny coverage
for the necessary equipment based on a LCD within the 120 days preceding his LCD
complaint. Therefore, it is not possible to determine that Complainant is actually an
aggrieved party within the meaning of 42 C.F.R. § 426.110 and eligible to file a LCD
complaint. I advised Complainant that his complaint was unacceptable because he had
not identified or provided a copy of any LCD or NCD that was cited by a Medicare
contractor as a basis for denying his claim for Medicare payment. I also advised him that
he failed to submit any clinical or scientific evidence that supports his position that a
determination not to provide coverage for more than one mask cushion per month is
unreasonable for most cases, other than his physician’s statement. 42 C.F.R.

§ 426.400(c)(6).

I gave Complainant a reasonable time - until June 3, 2013 - to amend his complaint. I
advised Complainant that his amended complaint must satisfy all the requirements for an
acceptable complaint specified at 42 C.F.R. § 426.400. I advised him that if the amended
complaint did not contain all the required information, I would dismiss his case.

No amended complaint has been received and dismissal is mandated by 42 C.F.R.
§ 426.410(c)(2).

2. Appeal rights. 42 C.F.R. §§ 426.462, 426.465.

Pursuant to 42 C.F.R. § 426.465(a), an aggrieved party may request review by the Board.
Except upon a showing of good cause, a request for review by the Board must be filed
within 30 days of the date of this decision (42 C.F.R. § 426.465(e)) and must comply
with the requirements of 42 C.F.R. § 426.465(f).
II. Conclusion

For the foregoing reasons, the complaint is dismissed.

/s/

Keith W. Sickendick
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Center for Tobacco Products,
Complainant
v.

Surma Petroleum LLC
d/b/a Hanley Mobil,

Respondent.

Docket No. C-13-677
FDA Docket No. FDA-2013-H-0468

Decision No. CR2819

Date: June 13, 2013

INITIAL DECISION AND DEFAULT JUDGMENT

The Center for Tobacco Products (CTP) filed an administrative complaint
(Complaint) against Respondent, Surma Petroleum LLC d/b/a Hanley Mobil, that
alleges facts and legal authority sufficient to justify imposing a $250 civil money
penalty. Respondent did not timely answer the Complaint, nor did Respondent
request an extension of time within which to file an answer. Therefore, I enter a
default judgment against Respondent and assess a civil money penalty of $250.

CTP began this case by filing a copy of the Complaint with the Food and Drug
Administration’s (FDA) Division of Dockets Management and serving the
Complaint on Respondent. The Complaint alleges that Respondent unlawfully
sold tobacco products to minors and failed to verify that the purchaser of tobacco
products was of sufficient age, thereby violating the Federal Food, Drug, and
Cosmetic Act (Act), codified at 21 U.S.C. §§ 301-399d, and its implementing
regulations found at 21 C.F.R. Part 1140. CTP seeks a civil monetary penalty of
$250 for these violations.

On April 25, 2013, CTP served the Complaint on Respondent by United Parcel
Service, pursuant to 21 C.F.R. §§ 17.5 and 17.7. In the Complaint and
accompanying cover letter, CTP explained that, within 30 days, Respondent
should pay the penalty, file an answer, or request an extension of time within
which to file an answer. CTP warned Respondent that, if it failed to take one of
these actions within 30 days, an Administrative Law Judge could issue an initial
decision ordering Respondent to pay the full amount of the proposed penalty,
pursuant to 21 C.F.R. § 17.11.

Respondent has not filed an answer within the time provided by regulation or
timely requested an extension. Pursuant to 21 C.F.R. § 17.11(a), 1am required to
“assume the facts alleged in the complaint to be true, and, if such facts establish
liability under [the Act],” issue a default judgment and impose a civil monetary
penalty. Accordingly, I must determine whether the allegations in the Complaint
establish violations of the Act.

Specifically, CTP alleges that:

e Respondent owns Hanley Mobil, an establishment that sells tobacco
products and is located at 6800 North Hanley Road, Berkeley, Missouri
63134. Complaint § 3.

e¢ On June 5, 2012, an FDA-commissioned inspector observed a violation of
21 C.F.R. § 1140.14(a) for “[s]elling tobacco products to a minor” and a
violation of 21 C.F.R. § 1140.14(b)(1) for “[fJailing to verify the age of a
person purchasing tobacco products by means of photographic
identification containing the bearer’s date of birth[.]” Complaint ¥ 10.

e ‘“[O]n August 2, 2012, CTP issued a Warning Letter to Mobil.” Complaint
410. The letter noted the violations the FDA-commissioned inspector had
observed on June 5, 2012, and explained that Respondent could face a civil
money penalty or other regulatory action it failed to correct the violations.
Complaint § 10. Moreover, CTP explained that the Warning Letter was not
intended to provide an exhaustive list of violations and that Mobil was
responsible for complying with the law. Complaint § 10.

e The manager of Hanley Mobil responded to CTP by telephone on behalf of
Respondent on August 3, 2012. Complaint J 11. The manager informed
CTP that “he would have a meeting to ensure that all employees check
identification carefully.” Complaint J 11. He further explained that “he
would try to ensure that employees are not selling to minors.” Complaint J
ll.

¢ On November 6, 2012, CTP acknowledged in writing that it had received
Respondent’s response and reminded Mobil that it had a continuing duty to
comply with the law. Complaint § 11.

e During a subsequent inspection, FDA-commissioned inspectors
documented an additional violation. Complaint § 1. “Specifically, a person
younger than 18 years of age was able to purchase a package of Newport
Box cigarettes on November 21, 2012, at approximately 4:32 PM CT.”
Complaint § 1.

e CTP informed Respondent on November 30, 2012, of the November 21,
2012, inspection and documented violation through a Notice of Compliance
Check Inspection. Complaint § 2. The Notice warned “that other potential
violations of federal tobacco law may have been observed,” and, if
violations had occurred, FDA could notify Respondent further. Complaint

q2.

Taking these facts as true, I must find, pursuant to 21 C.F.R. § 17.11(a), that
Respondent is liable 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,
codified at 21 U.S.C. § 387f(d). 21 U.S.C. § 387c(a)(7)(B); 21 C.F.R § 1140.1(b).
Those regulations prohibit the sale of “cigarettes or smokeless tobacco to any
person younger than 18 years of age[.]” 21 C.F.R. § 1140.14(a). Those
regulations also require a retailer to “verify by means of photographic
identification containing the bearer’s date of birth that no person purchasing the
[tobacco] product is younger than 18 years of age[.]” 21 C.F.R. § 1140.14(b)(1).

Here, Respondent violated both 21 C.F.R. § 1140.14(a) and (b)(1). First, on June
5, 2012, Respondent unlawfully sold cigarettes to a minor and failed to verify that
the purchaser was of sufficient age. Then, most recently, on November 21, 2012,
Respondent again unlawfully sold cigarettes to a minor. Although the Complaint
alleges that the June 5, 2012, violation occurred at “Mobil,” not at “Hanley
Mobil,” I infer that the two names refer to the same retail outlet. Therefore,
Respondent’s actions and omissions on two separate occasions at the same retail
outlet constitute violations of law for which a civil money penalty is merited.

The regulations require me to impose a civil money penalty in the amount that is
either the maximum provided for by law or the amount sought in the Complaint,
whichever is smaller. 21 C.F.R. § 17.11(a). Respondent has committed a third
violation within a 24-month period, the maximum penalty for which is $500. 21
C.F.R. § 17.2. CTP, however, requested a civil money penalty in the amount of
$250. 21 C.F.R. § 17.2. Therefore, I impose a civil money penalty in the amount
of $250.

/s/
Steven T. Kessel
Administrative Law Judge


Department of Health and Human Services

DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Jaswinder Rai Ch

hibber, M.D.,

(OI File No. 5-09-41058-9),

Petitioner,

Vv.

The Inspector General.

Docket No. C-13-169

Decision No.

Date: June

CR2816

1, 2013

DECISION

Petitioner, Jaswinder Rai Chhibber, M.D., is a

physician, licensed to practice in the State

of Illinois. He was convicted on multiple counts of health care fraud and making false

statements related to health care matters. Base
(L.G.) has excluded him for ten years from part

d on his convictions, the Inspector General
icipating in Medicare, Medicaid, and all

federal health care programs, as provided for in sections 1128(a)(1) and 1128(a)(3) of the

Social Security Act (Act). Petitioner now chal

enges the length of the exclusion. For the

reasons discussed below, I find that the I.G. properly excluded Petitioner and that the ten-

year exclusion falls within a reasonable range.

I. Background

By letter dated October 31, 2012, the LG. notified Petitioner that he was excluded from
participating in Medicare, Medicaid, and all federal health care programs for a period of
ten years, because he had been convicted of criminal offenses related to: 1) the delivery
of an item or service under the Medicare or state health care program; and 2) fraud, theft,
embezzlement, breach of fiduciary responsibility, or other financial misconduct in
connection with the delivery of a health care item or service. The letter explained that
sections 1128(a)(1) and 1128(a)(3) of the Act authorize the exclusion. I.G. Exhibit
(Ex.) 1.

Petitioner concedes that he was convicted and is subject to exclusion under sections
1128(a)(1) and 1128(a)(3). Order and Schedule for Filing Briefs and Documentary
Evidence at 2 (January 28, 2013); P. Brief (Br.) at 1, 3.

Each party submitted a written argument (I.G. Br.; P. Br.). The I.G. also submitted four
exhibits (I.G. Exs. 1-4) and a reply brief (I.G. Reply). Petitioner submitted 124 exhibits
(P. Exs. 1-124). In the absence of an objection, I admit into evidence I.G. Exs. 1-4 and P.
Exs. 1-124.

I directed the parties to indicate in their briefs whether an in-person hearing would be
necessary. Order and Schedule for Filing Briefs and Documentary Evidence (Informal
Brief of Petitioner § IV) and (Informal Brief of I.G. § II). Neither party has indicated
that an in-person hearing is necessary.’

II. Issue

Because the parties agree that the I.G. has a basis upon which to exclude Petitioner from
program participation, the sole issue before me is whether the length of the exclusion (ten
years) is reasonable. 42 C.F.R. § 1001.2007.

III. Discussion

Section 1128(a)(1) of the Act mandates that the Secretary of Health and Human Services
exclude an individual who has been convicted under federal or state law of a criminal
offense related to the delivery of an item or service under Medicare or a state health care
program. 42 C.F.R. § 1001.101(a).

'T directed the parties to answer questions included in “informal” briefs that we provided
to them. Among those questions, we asked whether an in-person hearing is necessary,
and, if so, directed the party to name his witnesses, describe their proposed testimony,
and explain how that testimony relates to the party’s arguments and does not duplicate
other evidence submitted. Petitioner did not answer the question. He titled his
submission “Petitioner’s Response in Support of Hearing,” which suggests that he thinks
an in-person hearing might be necessary. However, he did not otherwise claim that an in-
person hearing is necessary; he did not list any witnesses of his own, and did not ask to
cross-examine Special Agent Ed Leitelt, who submitted the only written declaration in
support of the I.G.’s case. LG. Ex. 3.
Section 1128(a)(3) says that an individual or entity convicted of felony fraud, theft,
embezzlement, breach of fiduciary responsibility, or other financial misconduct in
connection with the delivery of a health care item or service must also be excluded from
participation in federal health care programs. 42 C.F.R. § 1001.101(c).

In this case, Petitioner was a Medicare provider who owned and operated a medical clinic
in Chicago, Illinois. I.G. Ex. 2 at 1-2; I.G. Ex. 3 at 3. He was also an enrolled provider
of services to Blue Cross Blue Shield of Illinois, a private health insurance company,
which meant that Blue Cross agreed to pay him for the covered services he provided.

LG. Ex. 2 at 2; 1.G. Ex. 3 at 4.

Petitioner was found guilty in federal district court on nine counts of health care fraud (5
counts), in violation of 18 U.S.C. § 1347, and making false statements (4 counts), in
violation of 18 U.S.C. § 1035(a)(2). IG. Ex. 4 at 1. Specifically, he billed Medicare and
Blue Cross for procedures that he did not perform; he ordered and billed for medically-
unnecessary tests; he ordered tests without first seeing the patients or knowing why they
sought treatment; he billed for tests without reviewing their results; and, to justify
unnecessary tests, he wrote phony diagnoses codes in patient charts, and he and his staff
falsified patient medical records. I.G. Ex. 2.

The court sentenced him to 30 months in prison, followed by one year of supervised
release, and fined him $15,900. I.G. Ex. 4 at 2-3, 5.

A. Based on the aggravating factors, the 10-year exclusion
falls within a reasonable range.”

An exclusion under either section 1128(a)(1) or 1128(a)(3) must be for a minimum
period of five years. Act § 1128(c)(3)(B); 42 C.F.R. §§ 1001.102(a), 1001.2007(a)(2).
Federal regulations set forth criteria for lengthening exclusions beyond the five-year
minimum. 42 C.F.R. § 1001.102(b). Among the factors that may serve as bases for
lengthening the period of exclusion are the two that the I.G. cites to justify the period of
exclusion in this case: 1) the acts resulting in the conviction, or similar acts, were
committed over a period of one year or more; and 2) the sentence imposed by the court
included incarceration. 42 C.F.R. § 1001.102(b)(2) and (5).

Duration of crime (42 C.F.R. § 1001.102(b)(2)). The parties agree that Petitioner’s
criminal acts were committed over a period longer than one year, although they disagree
over exactly how long that period was. Citing Count One of the indictment — one of the
counts on which Petitioner was convicted — the I.G. maintains that Petitioner’s criminal

° My findings of fact and conclusions of law are set forth, in italics and bold, in the
discussion captions of this opinion.

scheme lasted for three years, seven months. LG. Br. at 3; 1.G. Reply at 2-3; LG. Ex. 2 at
3. Petitioner, on the other hand, points to the remaining counts, especially Counts Two
and Six (on which Petitioner was not convicted), and argues that, even accepting as true
every allegation of the indictment, Petitioner’s criminal acts spanned “only” one and a
half years. P. Br. at 1; 1.G. Ex. 2 at 11, 15. In making this argument, Petitioner has not
considered every allegation of the indictment, but relies solely on the counts that describe
specific instances of Petitioner’s misconduct. Count One describes the entire criminal
scheme and alleges that Petitioner “knowingly and willfully devised, intended to devise,
and participated in a scheme to defraud health care benefit programs. .. .” His criminal
activities began “no later than in or about January 2007, and continu[ed] through in or
about July 2010... .” (emphasis added) L.G. Ex. 2 at 3. Thus, based on the explicit
language of Count One, Petitioner’s conduct lasted for about 3 years.

Petitioner was convicted on Count One, but even if he were not, the I.G. might have been
able to rely on the allegation. The scope of the regulation is not limited to the acts that
resulted in the conviction, but also includes “similar acts.”

Finally, even if I accepted Petitioner’s argument (which I do not), I would still find the
duration of Petitioner’s crime an aggravating factor that justifies increasing the period of
exclusion. The Departmental Appeals Board has “accorded weight sufficient to sustain a
15-year exclusion to the fact that wrongful acts were committed for ‘slightly more’ than
the one-year minimum standard.” Jeremy Robinson, DAB No. 1905 at 12 (2004), citing
Donald A. Burstein, Ph.D., DAB No. 1865 at 12 (2003).

Incarceration (42 C.F.R. § 1001.102(b)(5)). The sentence imposed by the criminal court
included a significant prison sentence — 30 months. I.G. Ex. 3 at 3. See Jeremy
Robinson, DAB No. 1905 at 12 (2004) (characterizing a nine-month incarceration as
“relatively substantial.”’), citing Jason Hollady, M.D., DAB No. 1855 at 12 (2002).

Thus, for more than three years, Petitioner Chhibber engaged in a criminal scheme to
defraud the Medicare program and Blue Cross. The federal court sentenced him to
significant jail time. These factors demonstrate the risk he poses to health care programs.
The L.G. could therefore reasonably impose a period of exclusion considerably greater
than the mandatory five-year minimum.

B. No mitigating factors justify decreasing the period of
exclusion.

A mitigating factor or factors may offset aggravating factors. However, the regulations
consider mitigating just three factors: 1) a petitioner was convicted of three or fewer
misdemeanor offenses and the resulting financial loss to the program was less than
$1,500; 2) the record in the criminal proceedings demonstrates that a petitioner had a
mental, physical, or emotional condition that reduced his culpability; and 3) a petitioner’s
cooperation with federal or state officials resulted in others being convicted or excluded,
or additional cases being investigated, or a civil money penalty being imposed. 42 C.F.R.
§ 1001.102(c). Characterizing the mitigating factor as “in the nature of an affirmative
defense,” the Departmental Appeals Board has ruled that a petitioner has the burden of
proving any mitigating factor by a preponderance of the evidence. Barry D. Garfinkel,
M.D., DAB No. 1572 at 8 (1996).

Petitioner was convicted of nine felony offenses, which he concedes cost health care
programs more than $1,500. See P. Ex. 123 (Orman Decl. { 2). He does not claim that
any mental, physical, or emotional condition reduced his culpability. He does not claim
to have cooperated with law enforcement.

Instead, Petitioner characterizes as “trivial” the dollar amount “involved in the 9 guilty
counts.” P. Br. at 2; See P. Ex. 123 (Orman Deel. §2).’ He also points out that “only”
four patients, not one of them a Medicare beneficiary, testified against him at trial; that he
practiced in a dangerous and medically underserved neighborhood in Chicago; that his
services are “irreplaceable”; and that neighborhood residents want him back.

These are not mitigating factors. By his own admission, the costs of Petitioner’s crimes
exceeded the threshold for mitigation. I find wholly irrelevant the number of former

patients who testified against him at trial. (In any event, their testimony was apparently
sufficient to lead to his conviction.)

With respect to the purported harm his exclusion will cause his former patients and the
neighborhood in which he worked, the I.G. may grant a state health care program’s
request to waive an exclusion “if the individual or entity is the sole community physician
or the sole source of essential specialized services in a community.” However, “[t]he
decision to grant, deny, or rescind a request for a waiver is not subject to administrative
or judicial review.” 42 C.F.R. § 1001.1801(f); Act § 1128(c)(3)(B). Thus, any such
request for waiver must be made directly to the I.G. by the state health care program, not
by Petitioner, and the I.G.’s determination with respect to any waiver is not reviewable in
this or any other forum.

IV. Conclusion

So long as the period of exclusion is within a reasonable range, based on demonstrated
criteria, I have no authority to change it. Jeremy Robinson, DAB No. 1905 at 5; Joann
Fletcher Cash, DAB No. 1725 at 7 (2000), citing 57 Fed. Reg. 3298, 3321 (1992). In this
case, Petitioner’s crimes demonstrate that he presents a significant risk to the integrity of

* According to Petitioner, the dollar amount was $1,639.40. This figure is set forth in the
declaration of counsel, who does not explain how he arrived at it nor offer any underlying
evidence to support it.
health care programs. He billed the health care programs for tests that were unnecessary
and for tests that were not even performed. Even more reprehensible, to cover his tracks,
he falsified patient records. He continued this illegal conduct for a significant period of
time, more than three years. His conduct was such that the sentencing judge sent him to
prison for 22 years. Based on these aggravating circumstances, and the absence of any
mitigating circumstances, a ten-year exclusion falls within a reasonable range.

/s/
Carolyn Cozad Hughes
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Sandra McElwain,
(OI File No. 3-08-40524-9)),

Petitioner,
v.
The Inspector General.
Docket No. C-13-153
Decision No. CR2813

Date: June 7, 2013

DECISION

Petitioner, Sandra McElwain, appeals the determination of the Inspector General for the
U.S. Department of Health and Human Services (1.G.) to exclude her from participating
in Medicare, Medicaid, and all federal health care programs pursuant to section
1128(a)(1) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(1)) for the minimum
mandatory period of five years. For the reasons discussed below, I find the I.G. was
authorized to exclude Petitioner. I further find that the five year exclusion is mandatory
pursuant to section 1128(c)(3)(B) of the Act (42 U.S.C. § 1320a-7(c)(3)(B)).

I. Background

The LG. notified Petitioner, by letter dated October 31, 2012, that she was being
excluded pursuant to section 1128(a)(1) of the Act from participation in Medicare,
Medicaid and all federal health care programs for the minimum period of five years. The
1.G. advised Petitioner that the exclusion was based on her conviction in the United States
District Court for the Western District of Virginia, of a criminal offense related to the
delivery of an item or service under Medicare or state health care programs. I.G. Ex. 1.
Petitioner timely filed her request for hearing. I convened a prehearing telephone
conference with the parties, which I summarized in my Order and Schedule for Filing
Briefs and Documentary Evidence dated January 7, 2013. During the prehearing
conference, I explained to Petitioner that she is entitled to representation by counsel but
that I cannot appoint or pay for counsel for her. I also told her that if she should choose
later to be represented by counsel, she need only have her attorney submit a Notice of
Appearance to my office as soon as possible. Petitioner proceeded to represent herself.

Pursuant to my scheduling order, I asked the parties to answer the questions on the short-
form briefs sent to them, together with any additional arguments and supporting
documents. The I.G. filed the short-form brief together with exhibits (I.G. Exs.) 1
through 5. Absent objection, I admit I.G. Exs. 1 through 5. Petitioner submitted a
handwritten brief (P. Br.) consisting of eight pages, six exhibits (P. Exs. 1-2, 4-7), and the
last two pages of her short-form brief, Sections II-IV.' The LG. then submitted a reply
brief (IG. Reply). Petitioner’s exhibits were offered in support of an attack of her
underlying conviction. Such collateral attacks are impermissible. 42 C.F.R.
§1001.2007(d). Therefore, these documents are irrelevant, and I must exclude them from
the record. 42 C.F.R. §1005.17(c).

Petitioner indicated that she wanted to present testimony of several witnesses. P. Br. The
1.G. objected to an in-person hearing because the material facts in this case are not in
dispute and Petitioner’s witnesses, and their expected testimony, were proposed for the
purpose of challenging and attempting to re-litigate Petitioner’s conviction. I.G. Reply at
6. Lagree that there are no material facts in dispute. I further agree that the testimony
that Petitioner wishes to present is not relevant to these proceedings as they amount to a
collateral attack of the offense to which Petitioner voluntarily pled guilty. 42 C.F.R. §
1001.2007(d). Therefore, the record is now closed, and I decide this case based on the
written record.

II. Discussion
A. Issue

The scope of my review here is limited. 42 C.F.R. § 1001.2007(a)(1) and (2). The only
issue before me is whether the I.G. has a basis for excluding Petitioner from participating
in Medicare, Medicaid, and all other federal health care programs pursuant to section
1128(a)(1) of the Act. If I find that the I.G. was authorized to exclude Petitioner then I
must uphold the I.G.’s exclusion because it is for the minimum mandatory period of five
years pursuant to the statute. Act § 1128 (c)(3)(B); 42 C.F.R. § 1001.2007(a)(2).

' Petitioner’s submission did not include an Exhibit 3 and an Exhibit 8 although she
described an Exhibit 8 in her submission as statements and letters pertaining to her
underlying conviction, which she does not deny.
B. Findings of Fact and Conclusions of Law

1. Petitioner pled guilty to one count of False Statements Relating to Health
Care Matters in violation of 18 U.S.C. § 1035(a)(2) in the United States
District Court for the Western District of Virginia.

Petitioner, through her company, Health Care Virginia, LLC (HCVA), provided personal
care and respite services to Virginia Medicaid beneficiaries.” I.G. Ex. 4, at 2. Petitioner
served as HCVA’s Executive Director and Registered Nurse (R.N.). I.G. Ex. 4, at 2, 3.
The Virginia Department of Medical Assistance (DMAS), which administers the
Medicaid program in Virginia, requires that personal care aides (PCAs), who provide
personal care services to Medicaid beneficiaries, receive a minimum of 40 hours of
training prior to their employment. Such training must be supervised and taught by an
RN. licensed in Virginia. 1.G. Ex. 4, at 3-4.

On March 10, 2011, Petitioner was indicted on one count of False Statements Relating to
Health Care Matters pursuant to 18 U.S.C. § 1035. LG. Ex. 4, at 21. On that same date,
Petitioner voluntarily agreed to enter a plea of guilty to this one count, understanding that
by doing so she was subject to a maximum statutory penalty of $250,000 as well as
imprisonment. I.G. Ex. 2. She also agreed to assist her co-defendant and company,
HCVA, to pay restitution in the amount of $323,420.20 to DMAS. I.G. Ex. 2, at 1, 4-5.
On February 6, 2012, the court entered a judgment against Petitioner based on her guilty
plea. Petitioner was sentenced to 16 months incarceration. I.G. Ex. 3.

2. Petitioner was convicted of a criminal offense for purposes of section
1128(a)(1) of the Act.

The Secretary of the U.S. Department of Health and Human Services must exclude from
participation in the Medicare and Medicaid programs any individual convicted of a
criminal offense related to the delivery of an item or service under Medicare or a state
health care program. Act § 1128(a)(1) (42 U.S.C. § 1320a-7(a)(1)); see also 42 C.F.R.

§ 1001.101(a). An individual is considered convicted of a criminal offense when: (1) a
judgment of conviction has been entered against him or her in a federal, state, or local
court whether an appeal is pending or the record of the conviction is expunged; (2) there
is a finding of guilt by a court; (3) a plea of guilty or no contest is accepted by a court; or
(4) when the individual has entered into any arrangement or program where judgment of
conviction is withheld. Act § 1128(i) (42 U.S.C § 1320a-7(i)(3)); see also 42 C.F.R. §
1001.2.

> Petitioner owned 49 percent of HCVA and her husband owned 49 percent. Petitioner’s
daughter owned the other two percent. LG. Ex. 4, at 1.
Petitioner, with advice of her counsel, voluntarily agreed to enter into a plea agreement
with the United States for the criminal offense of making false statements and entries in
connection with the payment for health care services. I.G. Ex. 2; 1.G. Ex. 3. I therefore
find that her plea of guilty and the acceptance of that plea by the court establish that
Petitioner was convicted of a criminal offense within the meaning of the exclusion
statute.

3. Petitioner’s conviction requires exclusion under section 1128(a)(1)
because her criminal conduct related to the delivery of an item or service
under Medicaid.

A conviction is related to the delivery of a health care item or service under Medicare or
a state health care program if there is a “common-sense connection or nexus between the
offense and the delivery of an item or service under the program.” Scott D. Augustine,
DAB No. 2043, at 5-6 (2006)(citations omitted).

Here, Petitioner pled guilty to failing to provide the required DMAS training, issuing
false training certifications to PCAs hired and employed by her and HCVA, and
generating false training class sign-in sheets and skills review checklists to cover up for
the lack of training of PCAs assigned to provide services to Medicaid beneficiaries. I.G.
Ex. 4, at 4-5. Petitioner also prepared false Nursing Assessments for Medicaid recipients
to document their need for continued PCA services. I.G. Ex. 4, at 5. Asa result, from
October 2007 through June 2010, Petitioner’s company HCVA billed and was paid over
$980,000 in Medicaid funds for non-certified, untrained, PCAs who provided personal
and respite care services to Medicaid beneficiaries. I.G. Ex. 4, at 5.

Petitioner’s guilty plea to Count | of her indictment directly related to Petitioner’s failure
to follow Virginia Medicaid requirements for employee training, nursing assessments,
and certifications. In addition, Petitioner’s guilty plea is predicated upon her false
statements and entries in connection with the payment for health care services in
violation of 18 U.S.C. § 1035. As a result, the Virginia Medicaid program paid for
services provided by Petitioner’s company to Medicaid beneficiaries based on
Petitioner’s false representations. I.G. Ex. 4. Thus, I conclude that Petitioner’s
conviction here is directly related to the delivery of an item or service under the Medicaid
program in Virginia within the meaning of section 1128(a)(1) of the Act and find the
requisite “nexus or common-sense connection” between the conduct giving rise to
Petitioner’s offense and the delivery of Medicaid services.

Also, Petitioner acknowledged that the offense to which she pled guilty, “making false
statements concerning health care matters” under title 18 of the United States Code, is
correct in nature and that the acts underlying her conviction “did occur.” P. Br. at 3. Yet,
Petitioner sets forth numerous arguments which amount to collateral attacks on the
accuracy of the charges underlying her conviction. The applicable regulation explicitly
precludes any collateral attack on Petitioner’s conviction:

When the exclusion is based on the existence of a criminal conviction .. . where
the facts were adjudicated and a final decision was made, the basis for the
underlying conviction . . . is not reviewable and the individual or entity may not
collaterally attack it either on substantive or procedural grounds in this appeal.

42 C.F.R. § 1001.2007(d). Statutory and regulatory authority require exclusion under the
circumstances here if the elements of section 1128(a)(1) are met. Thus, I must uphold the
exclusion and may not consider Petitioner’s collateral attacks.

4. Petitioner must be excluded for the statutory minimum period of five
years.

An exclusion imposed under section 1128(a) of the Act shall be for a minimum period of
five years. Act § 1128(c)(3)(B) (42 U.S.C. § 1320a-7(c)(3)(B)); 42 C.F.R. § 1001.102(a).
The period of exclusion may be extended based on the presence of specified aggravating
factors. 42 C.F.R. § 1001.102(b). Only if the aggravating factors justify an exclusion of
longer than five years are mitigating factors considered as a basis for reducing the period
of exclusion to no less than five years. 42 C.F.R. § 1001.102(c). The I.G. does not cite
any aggravating factors in this case and does not propose to exclude Petitioner for more
than the minimum period of five years. Therefore, I have no authority here to consider
any mitigating factors despite Petitioner’s contentions that I should do so.*

Because I conclude that that a basis exists to exclude Petitioner pursuant to section
1128(a)(1), then exclusion of Petitioner for the minimum period of five years is
mandatory and is reasonable as a matter of law.

5. Iam not authorized to grant relief based on Petitioner’s
equitable arguments.

Petitioner asks that I consider certain equitable arguments and use discretion to allow her
to continue to work as a nurse and lift the exclusion imposed against her. P. Br. at 7. She
requests that I consider that an appellate court granted her an appeal, even though she
states that she voluntarily withdrew that appeal. I am without discretion or any authority
to provide Petitioner equitable relief based on her ability to appeal her underlying
conviction or for any other reasons outside the applicable statute and regulations, to
which I am bound.

> Even if I were authorized to consider them, Petitioner failed to allege the elements of
any of the type of mitigating factors that the I.G. could consider. 42 C.F.R.
§ 1001.102(c).
Petitioner also explains that she is unfamiliar with the law and asks that, if I find that her
brief was “inaccurately filed,” I continue this matter for 6 months to allow Petitioner time
to obtain counsel. At an initial stage of this proceeding, I informed Petitioner that she
was entitled to representation by counsel but that I could not appoint one for her. See
Order and Schedule for Filing Briefs dated January 7, 2013 at 2. She indicated she
understood this and that she would proceed to represent herself. I also indicated that if
she later chose to retain counsel, she should do so as soon as possible and have counsel
file a notice of appearance. Considering Petitioner was aware of her right to
representation and that her incarceration did not preclude her from seeking counsel, I find
no basis for continuing this matter.

III. Conclusion

For the foregoing reasons, I sustain the I.G.’s determination to exclude Petitioner from
participating in Medicare, Medicaid, and all federal health care programs for the statutory
five-year period pursuant to section 1128(a)(1) and (c)(3)(b).

/s/
Joseph Grow
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Center for Tobacco Products,
(FDA No. FDA-2013-H-0454)

Complainant
v.

Buchanan Energy (N) LLC
d/b/a Bucky’s Express #420/Mobil,

Respondent.
Docket No. C-13-660
Decision No. CR2811

Date: June 4, 2013

INITIAL DECISION AND DEFAULT JUDGMENT

The Center for Tobacco Products (CTP) began this matter by serving an
administrative complaint on Respondent, Buchanan Energy (N) LLC d/b/a
Bucky’s Express #420/Mobil, at 1490 North Quentin Road, Palatine, Illinois,
60067, and by filing a copy of the complaint with the Food and Drug
Administration's (FDA) Division of Dockets Management. The complaint alleges
that Bucky’s Express #420 impermissibly sold cigarettes or smokeless tobacco to
minors and failed to verify purchasers’ ages by means of photo identification
containing a date of birth, violating the Federal Food, Drug, and Cosmetic Act
(Act), 21 U.S.C. § 301 ef seq., and its implementing regulations, 21 C.F.R. Part
1140. CTP seeks to impose a $500 civil money penalty against Respondent
Bucky’s Express #420.

As provided for in 21 C.F.R. §§ 17.5 and 17.7, on April 22, 2013, CTP served the
complaint on Respondent Bucky’s Express #420 by United Parcel Service. In the
complaint and accompanying cover letter, CTP explained that, within 30 days,
Respondent should pay the penalty, file an answer, or request an extension of time
in which to file an answer. CTP warned Respondent that, if it failed to take one of
these actions within 30 days, the Administrative Law Judge could, pursuant to 21
C.F.R. § 17.11, issue an initial decision ordering it to pay the full amount of the
proposed penalty.

Respondent Bucky’s Express #420 has neither filed an answer within the time
prescribed, nor requested an extension of time within which to file an answer.
Pursuant to 21 C.F.R. § 17.11, Lassume that the facts alleged in the complaint (but
not its conclusory statements) are true. Specifically:

e At Respondent's business establishment, 1490 North Quentin Road,
Palatine, Illinois, 60067, on August 4, 2011, an FDA-commissioned
inspector observed staff sell tobacco products to a person younger than 18
years of age;

e At Respondent's business establishment, 1490 North Quentin Road,
Palatine, Illinois, 60067, on August 4, 2011, an FDA-commissioned
inspector observed that staff failed to verify, by means of photo
identification containing the bearer's date of birth, that a purchaser of
tobacco products was 18 years of age or older;

e Ina warning letter dated October 27, 2011, CTP informed Respondent of
the inspector's August 4, 2011 observations, and that such actions violate
federal law, 21 C.F.R. §§ 1140.14(a) and 1140.14(b)(1). The letter further
warned Respondent that the FDA may initiate a civil money penalty action
or take other regulatory action against Respondent if Respondent failed to
correct the violations;

e At approximately 4:56 p.m. on December 4, 2012, at Respondent's business
establishment, 1490 North Quentin Road, Palatine, Illinois, 60067, an
FDA-commissioned inspector observed staff sell a package of Parliament
cigarettes to a person younger than 18 years of age; staff also failed to
verify, by means of photo identification containing the bearer's date of
birth, the purchaser’s age.

These facts establish Respondent Bucky’s Express #420'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 issued the regulations at 21
C.F.R. Part 1140 under section 906(d) of the Act. 21 U.S.C. 387(a); see 21 U.S.C.
§ 387£(d)(1); 75 Fed. Reg. 13,229 (Mar. 10, 2010). Under 21 C.F.R. § 1140.14(a),
no retailer may sell cigarettes or smokeless tobacco to any person younger than 18
years of age. Under 21 C.F.R. § 1140.14(b)(1), a retailer must verify, by means of
photo identification containing the bearer's date of birth, that no person purchasing
cigarettes or smokeless tobacco is younger than 18 years of age.

A $500 civil money penalty is permissible under 21 C.F.R. § 17.2.
Order

For these reasons, I enter default judgment in the amount of $500 against
Respondent Buchanan Energy (N) LLC d/b/a Bucky’s Express #420/Mobil.
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/
Carolyn Cozad Hughes
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Gilberto Acosta Podiatrist, Inc.,
(NPI: 1891781332)

Petitioner,
v.
Centers for Medicare and Medicaid Services.
Docket No. C-12-523
Decision No. CR2807

Date: May 30, 2013

DECISION

Petitioner Gilberto Acosta Podiatrist, Inc. appeals the determination by the Centers for
Medicare & Medicaid Services (CMS) to revoke his Medicare enrollment and Medicare
billing privileges. After reviewing the written record in this case, I sustain CMS’s
determination to revoke Petitioner’s enrollment in the Medicare program.

I. Background

Petitioner submitted a Medicare enrollment application (form CMS-8551) dated January
14, 2009. CMS Exhibit (Ex.) 14. In the enrollment application, Petitioner listed one
practice location, 801 West 48" Street, Suite B, Hileah, Florida 33012. CMS Ex. 14, at
13. On March 16, 2011, SafeGuard Services LLC, a Medicare contractor, conducted an
unannounced site visit of Petitioner’s practice location. During this site visit, Petitioner
admitted that approximately 60% of his patients are seen outside of this practice location
in day care centers, assisted living facilities, rehabilitation facilities, skilled nursing
facilities, and private homes. CMS Exs. 1, 9, 10, 13. The majority of Petitioner’s
patients receive Medicare benefits, and for that reason Petitioner should have previously
disclosed these additional locations to CMS. See CMS Exs. 9, 10, 13, 14.
On April 13, 2011, CMS, through its contractor First Coast Service Options (FCSO),
determined that Petitioner’s Medicare enrollment should be revoked effective March 16,
2011, based upon Petitioner’s failure to report additional practice locations. CMS Ex. 1.
FCSO also informed Petitioner that he could submit a corrective action plan (CAP)
within thirty days, and include all supporting documentation.

On May 13, 2011, Petitioner’s attorney, Michael Lowe,! sent a letter to FCSO indicating
that the letter was a CAP. In the CAP, Petitioner did not contend that he notified CMS of
all his practice locations prior to the site visit and subsequent revocation. CMS Ex. 2.
Instead, the letter stated that Petitioner was still unable to disclose all of Petitioner’s
practice locations to CMS. CMS Ex. 2, at 2.

Then, in a letter dated May 17, 2011, Mr. Lowe stated that “[Petitioner] needs to update a
significant number of locations of service on his provider enrollment information and
profile with FCSO.” CMS Ex. 3. FCSO allowed for additional time to complete the
process of updating Petitioner’s enrollment application.

In a subsequent letter dated June 17, 2011, Mr. Lowe indicated that Petitioner still had
not completed the process of updating his enrollment application to include all the
locations where Petitioner saw patients. CMS Ex. 4.

Finally, in a letter dated August 9, 2011, Mr. Lowe indicated that he was submitting
additional documentation in support of Petitioner’s CAP and provided another CMS-8551
form listing many practice locations. CMS Ex. 5. Nevertheless, Mr. Lowe stated that
“we are not certain that the locations of service for which [Petitioner] and the Corporation
have provided updated provider enrollment information on the enclosed pages and forms
constitute a complete set of all of those locations of service at which Dr. Acosta has
provided podiatric medical services to Medicare program beneficiaries since his initial
enrollment with the program.” CMS Ex. 5, at 2. The letter also provided that “for many
of the locations of service [Petitioner] has had to estimate the add or delete date for those
locations of service as he is not able to completely reconstruct those exact dates for each
location of service.” CMS Ex. 5, at 3.

FCSO notified Petitioner by letter dated August 31, 2011 that Petitioner could not be
enrolled in the Medicare program based upon the CAP. CMS Ex. 7. Petitioner requested
reconsideration and on February 2, 2012, CMS issued a reconsideration decision finding
that the revocation of Petitioner’s Medicare enrollment was authorized. CMS Ex. 8.

On March 29, 2012, Petitioner filed a hearing request (HR), challenging the CMS
determination to revoke Petitioner’s Medicare enrollment and billing privileges. In

' Mr. Lowe is not representing Petitioner in this appeal.
accordance with my Order Establishing Procedures and Schedule for Pre-Hearing
Exchanges dated May 11, 2012, the parties filed proposed exhibits (CMS Exs. 1-13 and
P. Exs. 1-16) and pre-hearing memoranda. After review of the materials submitted, I
convened a pre-hearing conference in order to determine if a hearing would be necessary
in this matter. At the pre-hearing conference, the parties stated that this case may be
amenable to resolution without the need for a full evidentiary hearing and they believed
that the merits of the case may be best addressed through the summary-disposition
mechanism. Accordingly, I set a schedule for the filing of briefs and CMS timely
submitted a Motion for Summary Disposition and a brief in support of its motion (CMS
Br.) on October 12, 2012. Petitioner filed Petitioner’s Opposition to the CMS Motion
and a Cross Motion for Summary Disposition (P. Br.) on November 7, 2012.

The first attempt at resolving the case by summary disposition was unsuccessful: on
December 21, 2012, I issued a Ruling Denying Cross Motions for Summary Disposition
and Order Establishing Procedures and Schedule for Pre-Hearing Exchanges. This Order
established new deadlines for any supplements or amendments to the exhibit lists,
witness lists, and pre-hearing memoranda previously submitted, in light of my ruling
denying the cross motions for summary disposition. On February 8, 2013, CMS
submitted an amended exhibit list with a supplemental exhibit (CMS Ex. 14) and on
March 1, 2013, CMS submitted an amended pre-hearing brief (CMS Am. Br.). Petitioner
did not submit an amended pre-hearing brief or respond to the CMS amended pre-hearing
brief and supplemental exhibit.

On March 20, 2013, a letter was issued at my direction stating that when I considered the
supplemented evidentiary record, the case did not at that point reflect any genuine
disputes as to any material facts and I would proceed to evaluate the case sua sponte for
decision. I provided until April 5, 2013 for the parties to submit written comments,
objections, or additional arguments. Neither party responded. Thus, as I indicated, I
have evaluated the written record in this matter and have determined that it would be
appropriate to render a written decision based upon the documentary evidence submitted
by the parties. In the absence of objection, I admit CMS Exs. 1-14 and P. Exs. 1-16 into
the record.

Il. Applicable Law

Section 1831 of the Social Security Act (the Act) (42 U.S.C. § 1395j) establishes the
supplementary medical insurance benefits program for the aged and disabled known as
Medicare Part B. Payment under the program for services rendered to Medicare-eligible
beneficiaries may only be made to eligible providers of services and suppliers.” When

> A “supplier” furnishes services under Medicare and the term supplier applies to
physicians and other non-physician practitioners and facilities that are not included
within the definition of the phrase “‘provider of services.” Act § 1861(d) (42 U.S.C.
applying for enrollment in the Medicare program, a supplier is required to provide
complete, accurate, and truthful responses to all information requested within each
section on the enrollment application applicable to the supplier type. 42 C.F.R. §
424.510 (d)(2)(i). Also, a supplier is obligated to report within 30 days any changes in
the supplier’s practice location and other changes to the supplier’s enrollment must be
reported within 90 days. 42 C.F.R. § 424.516(d).

CMS has a right to perform on-site inspections to verify the accuracy of a supplier’s
enrollment information and to determine the provider’s compliance with Medicare
enrollment requirements. 42 C.F.R. § 424.510(d)(8); see also 42 C.F.R. § 424.517(a)(1).
CMS may revoke a supplier’s enrollment if the supplier “is determined not to be in
compliance with the enrollment requirements described in this section, or in the
enrollment application applicable for its provider or supplier type... .” 42 C.F.R.

§ 424.535(a)(1).

III. Issue

The issue in this case is whether CMS had a legitimate basis to revoke Petitioner’s
Medicare enrollment and billing privileges.

IV. Analysis

My findings of fact and conclusions of law are set forth in italics and bold in the
discussion captions of this decision.

1. This case is appropriate for summary judgment
The Departmental Appeals Board (Board) stated the standard for summary judgment:

Summary judgment is appropriate when the record shows that there is no
genuine issue as to any material fact, and the moving party is entitled to
judgment as a matter of law.... The party moving for summary judgment
bears the initial burden of showing that there are no genuine issues of
material fact for trial and that it is entitled to judgment as a matter of law
.... To defeat an adequately supported summary judgment motion, the
non-moving party may not rely on the denials in its pleadings or briefs, but

§ 1395x(d)). The term “physician,” includes a doctor of podiatric medicine, but only
with respect to functions he is legally authorized to perform by the State in which he
performs them. Act § 1861(r) (42 U.S.C. § 1395(x)(r)); 42 C.F.R. § 410.20(b)(3).
Podiatrists and other practitioners are considered suppliers under the relevant regulations.
See 42 C.F.R. § 400.202; 42 C.F.R. § 424.502.
must furnish evidence of a dispute concerning a material fact — a fact that, if
proven, would affect the outcome of the case under governing law .... In
determining whether there are genuine issues of material fact for trial, the
reviewer must view the evidence in the light most favorable to the non-
moving party, drawing all reasonable inferences in that party’s favor.

Senior Rehabilitation & Skilled Nursing Center, DAB No. 2300, at 3 (2010) (citations
omitted).

The Board has further explained that the role of an Administrative Law Judge (ALJ) in
deciding a summary judgment motion differs from its role in resolving a case after a
hearing. The ALJ should not assess credibility or evaluate the weight of conflicting
evidence. Holy Cross Village at Notre Dame, Inc., DAB No. 2291, at 5 (2009).

I have accepted all of Petitioner’s factual assertions as true and drawn all reasonable
inferences in Petitioner’s favor. Therefore, I accept Petitioner’s claim that after the
unannounced site visit in 2011, Petitioner attempted to update his enrollment information
on file with CMS. HR; P. Br. I further accept Petitioner’s assertion that he submitted a
CAP to the CMS contractor dated May 13, 2011, disclosing all of Petitioner’s current
practice locations to the best of his knowledge and belief. P. Br. at 2-3. Finally, I accept
Petitioner’s assertion that he timely provided all information to the CMS contractor in
support of his CAP. For the purposes of summary judgment, I accept Petitioner’s
description and chronology of these events as true. However, this depiction remains
unsupportive of a favorable outcome for Petitioner. Petitioner has not disputed any fact
material to my resolution of the case. Accordingly, summary judgment is appropriate in
this case.

2 CMS was authorized to revoke Petitioner’s Medicare enrollment and
billing privileges because Petitioner did not supply complete and accurate
information on Petitioner’s Medicare enrollment application

CMS contends that Petitioner failed to file a complete and accurate Medicare enrollment
application and failed to notify CMS in a timely manner of additional practice locations.
CMS argues it was therefore authorized to revoke Petitioner’s Medicare enrollment after
an unannounced site visit revealed that Petitioner was not in compliance with the
applicable regulations. Petitioner was required to provide practice location information
“for each location” in Section 4C of his CMS-855I enrollment application. CMS Ex. 14,
at 13. The enrollment application form provides spaces to provide such information as
the practice location name, practice location address, telephone number, Medicare
identification number, the date the first Medicare patient was seen at this location, and the
type of practice location. CMS Ex. 14, at 13. Petitioner does not dispute that his
Medicare enrollment application submitted in 2009 contained information for only one
practice location under Section 4C. CMS Ex. 14, at 13; CMS Exs. 1-5. Also, Petitioner
6

does not dispute that under Section 4D of the Medicare enrollment application, a section
designated for information regarding “Rendering Services in Patients’ Homes,” Petitioner
indicated that the section was “N/A” [not applicable] . CMS Ex. 14, at 14.

On March 16, 2011, a Medicare contractor conducted a site visit at the practice location
named on Petitioner’s Medicare enrollment application. CMS Ex. 11. During this site
visit, Petitioner stated that he saw 60% of his patients at locations other than his private
office. CMS Ex. 10, at 2. Petitioner stated that he saw patients at adult day care centers,
alternative living facilities, rehabilitation facilities, skilled nursing facilities, and private
homes. CMS Ex. 10, at 1-2. Petitioner estimated a patient population of 1700, 90% of
which were Medicare patients. CMS Ex. 10, at 2; CMS Ex. 13, at 2. After the March 16,
2011 site visit, in the spring and summer of 2011, Petitioner provided a CAP and
supporting documentation. P. Exs. 5, 6, 9. During this time period, Petitioner attempted
to disclose all additional practice locations to CMS and provide updated supplier
enrollment information regarding Petitioner’s enrollment with the Medicare program. P.
Exs. 5, 6, 9, 11. On August 31, 2011, CMS determined that Petitioner could not be
enrolled in the Medicare program based upon Petitioner’s CAP.

Petitioner does not dispute the facts as recited above and does not argue that Petitioner
notified CMS of all additional practice locations or changes to Petitioner’s enrollment
information prior to the March 16, 2011 site visit. Instead, Petitioner states that all
oversights and failures to provide complete and accurate information were corrected by
providing this information to the CMS contractor after the March 16, 2011 site visit, in
Petitioner’s attempts to file documentation in support of a CAP. P. Br. at 2-3; P. Ex. 9.
Clearly, Petitioner argues that he corrected his noncompliance after CMS issued the
notice of revocation, not before, and his attempts to update his Medicare enrollment
information were made during the CAP process. See P. Br. at 2-4. Thus, it is undisputed
that Petitioner failed to provide complete information in a timely fashion and was not in
compliance with 42 C.F.R. § 424.510 (d)(2)(i) and 42 C.F.R. § 424.516(d) at the time of
the revocation.

I do not have the authority to review CMS’s discretionary act to revoke a supplier’s
Medicare status. Letantia Bussell, DAB No. 2196, at 13 (2008). I must sustain CMS’s
revocation determination if a legitimate basis exists for that determination and where the
facts established noncompliance with one or more of the relevant regulations.
18661CPayday.com, DAB No. 2289, at 13 (2009). As the Board has stated, “the right to
review of CMS’s determination by an ALJ serves to determine whether CMS had the
authority to revoke [the supplier’s] Medicare billing privileges, not to substitute the
ALJ’s discretion about whether to revoke.” Bussell, DAB No. 2196, at 13. Based upon
the undisputed facts, I find that CMS has established a legitimate basis for its
determination and CMS had the authority to revoke Petitioner after the March 16, 2011
site visit revealed Petitioner’s noncompliance with Medicare regulations. Therefore, the
revocation of Petitioner’s Medicare enrollment and billing privileges was authorized. 42
CER. § 424.535(a)(1).

3. Petitioner’s CAP is not reviewable in this forum

Petitioner contends that he disclosed all current practice locations, to the best of his
knowledge and belief, and made full disclosure of all current facilities where he rendered
medical services in his CAP. P. Br. at 2-3. Petitioner also states that all information
requested by the CMS contractor in the CAP denial was in fact timely provided by
Petitioner to the CMS contractor. P. Br. at 3. Essentially, Petitioner asks me to set aside
the revocation because Petitioner eventually identified, to the best of his knowledge, all
of Petitioner’s practice locations through the CAP process. Petitioner suggests I should
review Petitioner’s CAP and decide at what time Petitioner corrected Petitioner’s
deficient compliance. See P. Br. at 2-4.

However, I lack the authority to review Petitioner’s CAP and the CMS contractor’s
refusal to reinstate Petitioner’s Medicare billing privileges. Revocation of enrollment is a
discretionary act by CMS, see 42 C.F.R. § 424.535(a), and through the reconsideration
process, CMS can decide to exercise its discretion not to revoke a supplier should the
circumstances warrant such action. See 42 C.F.R. § 498.24. Further, suppliers subject to
revocation may submit a CAP and CMS may accept that CAP and reinstate a provider.
42 C.F.R. § 405.809; 42 C.F.R. § 405.874(e) (2011). However, I do not have authority to
review CMS’s decision to deny a CAP. CAP decisions are not initial determinations
subject to appeal under 42 C.F.R. Part 498. 42 C.F.R. § 405.874(e) (2011); Pepper Hill
Nursing & Rehab. Ctr., DAB No. 2395, at 9-10 (2011); DMS Imaging, Inc., DAB No.
2313, at 5-10 (2010).

Therefore, I have no authority to decide whether Petitioner corrected his deficiencies
through the CAP process. DMS Imaging, Inc., DAB No. 2313, at 8. The undisputed
evidence shows that as of March 16, 2011, Petitioner had only notified CMS of one
practice location when he had been seeing patients at numerous practice locations. See P.
Br. at 2-3; P. Exs. 5 and 6. In fact, Petitioner never stated why he disagreed with the
revocation, but instead promised to provide updated information regarding his practice
locations in the near future. P. Ex. 5, at 3. I have no authority to review CMS’s decision
to reject Petitioner’s CAP based on the subsequent information Petitioner provided to
CMS and CMS contractors. My authority is limited to determining whether a basis
existed to revoke Petitioner’s enrollment in the Medicare program as of the date of the
revocation, March 16, 2011.

V. Conclusion

Petitioner has not shown a genuine issue of material fact exists with regard to the basis
for Petitioner’s revocation. As a result, I must sustain CMS’s determination to revoke
Petitioner’s Medicare enrollment and billing privileges because the undisputed evidence
shows that Petitioner did not supply complete and truthful responses to all information
requested on Petitioner’s Medicare enrollment application. Therefore, I find CMS acted
within its regulatory authority to revoke Petitioner’s Medicare enrollment and billing
privileges.

/s/
Richard J. Smith
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Bakul Desai, M.D.
(O.L. File No. 2-06-40580-9),

Petitioner,
v.
The Inspector General.
Docket No. C-13-34
Decision No. CR2806

Date: May 30, 2013

DECISION

The Inspector General (1.G.) of the Department of Health and Human Services (HHS)
notified Bakul Desai, M.D. (Petitioner) that he was being excluded from participation in
Medicare, Medicaid, and all other federal health care programs for the statutory minimum
mandatory period of five years. Petitioner appealed. For the reasons stated below, I
affirm the five-year exclusion imposed on Petitioner.

I. Background

In an August 31, 2012 letter, the I.G. notified Petitioner that he was being excluded from
Medicare, Medicaid, and all federal health care programs for a period of five years under
42 U.S.C. § 1320a-7(a)(3). The I.G. stated that the basis for exclusion was Petitioner’s
conviction in the United States District Court, District of New Jersey (District Court) of a
criminal offense related to fraud, theft, embezzlement, breach of fiduciary responsibility,
or other financial misconduct in connection with the delivery of a health care item or
service. I.G. Exhibit (Ex.) 1.

Petitioner, through counsel, timely filed a request for hearing (RFH) before an
administrative law judge. On November 7, 2012, I held a telephonic prehearing
2
conference, the substance of which I summarized in my November 8, 2012 Order and
Schedule for Filing Briefs and Documentary Evidence (Order). Pursuant to the Order,
the L.G. filed a brief (I.G. Br.) and four exhibits (1.G. Exs. 1-4), and Petitioner filed a brief
(P. Br.) and two exhibits (P. Exs. 1, 2). The I.G. also filed a reply brief (IG. Reply).

II. Evidentiary Rulings

Both parties filed evidentiary objections. For the reasons stated below, I overrule all of
the objections and admit into the record I.G. Exs. 1 — 4 and P. Exs. 1, 2.

The L.G. objected to P. Ex. 2 on grounds of relevancy. I.G. Reply at 4. That exhibit is a
letter from National Government Services (NGS), a contractor for the Centers for
Medicare and Medicaid Services (CMS), advising Petitioner that his national provider
identifier (NPI) was being revoked under 42 C.F.R. § 424.535(a)(3). I conclude that the
exhibit is relevant to Petitioner’s argument concerning the effective date of his exclusion.

Petitioner objects to I.G. Ex. 3 (the Information in Petitioner’s criminal case) and I.G. Ex.
4 (the plea agreement in Petitioner’s criminal case, which Petitioner signed on January
31, 2008), arguing that these two exhibits “‘are not reliable indicators of the exact
conduct or omission which formed the factual basis for acceptance of petitioner’s guilty
plea.” P. Br. at 10. However, extrinsic evidence, such as information found in an
indictment or a plea agreement, is probative to determine the circumstances that form the
basis for the criminal offense underlying a conviction. See e.g., Emem Dominic Ukpong,
DAB No. 2220, at 2-3 (2008).” Therefore, I will not exclude these exhibits.

III. Decision on the Record

In his brief, Petitioner indicated that he wanted to testify in this proceeding. P. Br. at 8-9.
I ordered Petitioner to submit written testimony. See 42 C.F.R. § 1005.16(b). On March
20, 2013, Petitioner filed an affidavit (P. Aff.), which I admit into the record. Because
the I.G. indicated that he will not seek to cross-examine Petitioner, I issue this decision
based on the written record.

IV. Issue

The only issue in this case is whether the I.G. has a basis for excluding Petitioner from
participating in Medicare, Medicaid, and all other federal health care programs for five

' Petitioner previously submitted a copy of the documents in I.G. Ex. 4. RFH at 16-23.

> The decisions of HHS’s Departmental Appeals Board may be found at
http://www.hhs.gov/dab/decisions/index.html.
3
years under 42 U.S.C. § 1320a-7(a)(3). If I decide that the I.G. has a basis to exclude
Petitioner, then I must uphold the length of the exclusion because it is the minimum
period of exclusion mandated by law. 42 U.S.C. § 1320a-7(c)(3)(B); 42 C.F.R.
§§ 1001.102(a), 1001.2007(a)(1)-(2).

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

The Social Security Act requires HHS to exclude from participation in Medicare,
Medicaid, and all other federal health care programs:

alny individual or entity that has been convicted for an offense which
occurred [after August 21, 1996,] under Federal or State law, in connection
with the delivery of a health care item or service or with respect to any act
or omission in a health care program (other than those specifically
described in [section 1320a-7(a)(1)]) operated by or financed in whole or in
part by any Federal, State, or local government agency, of a criminal
offense consisting of a felony relating to fraud, theft, embezzlement, breach
of fiduciary responsibility, or other financial misconduct.

42 U.S.C. § 1320a-7(a)(3). The I.G. argues that he excluded Petitioner under this
statute based on Petitioner’s conviction of a criminal offense relating to fraudulent
conduct, occurring after 1996, which is in connection with the delivery of a health
care item or service. I.G. Br. at 2-4. Petitioner primarily disputes that his crime
was in connection with the delivery of health care items or services. P. Br. at 4-6.

A, Petitioner was convicted of one count of felonious conduct, which occurred
from January 2003 through November 2006, and involved obtaining
approximately $590,000 through theft, embezzlement, or fraud from an
organization receiving federal funds.

The District Court convicted Petitioner of violating 18 U.S.C. § 666, an offense that the
District Court described as “THEFT KNOWINGLY AND INTENTIONALLY
EMBEZZLED, STOLE, OBTAINED BY FRAUD-CONCERNING PROGRAMS
RECEIVING FEDERAL FUNDS.” LG. Ex. 2, at 1; P. Ex. 1, at 1. Based on this
description, Petitioner’s offense was a violation of 18 U.S.C. § 666(a)(1)(A). Petitioner
was convicted as a principal in the crime under 18 U.S.C. § 2. LG. Ex. 2, at 1; P. Ex. 1,
at 1. This conviction was based on a plea agreement that Petitioner signed on January 31,
2008, in which Petitioner agreed to plead guilty to:

> My findings of fact and conclusions of law are set forth in italics and bold font.
4
a one-count Information, which will charge that from in or around January
2003 to in or around November 22, 2006, [Petitioner] knowingly and
intentionally embezzled, stole, obtained by fraud, and misapplied property
under the custody and control of University of Medicine and Dentistry of
New Jersey, in violation Title 18, United States Code, Section 666, and
Title 18, United States Code, Section 2.

CMS Ex. 4, at 1, 5.
The Information that Petitioner pled guilty to provides the following details related to
Petitioner’s criminal offense. Petitioner is a physician specializing in internal medicine
and cardiology, and owns the Heart Center of New Jersey, P.A., LLC. I.G. Ex. 3, at 1. In
or about January 2003, Petitioner entered into an employment contract with the
University of Medicine and Dentistry of New Jersey (UMDNJ) to serve as a faculty
cardiologist in the Clinical Assistant Professor program. The employment contract
provided that Petitioner would serve as an Assistant Clinical Professor, be paid
approximately $150,000 per year, and would commit 48% of his time (approximately 20
hours a week) to performing teaching, research and patient care activities, which were to
include:

1. Providing on-call coverage 13 weeks a year for certain diagnostic procedures;

2. Teaching fellows in the cardiac catheterization lab;

3. Interpreting hospital electrocardiograms;

4. Attending weekly cardiology conferences;

5. Conducting a physical diagnosis course for second year medical students;

6. Providing office-based teaching;

7. Lecturing in areas of special expertise;

8. Supporting research efforts; and

9. Completing Medicare time studies and other forms to document the services

provided under the contract to ensure appropriate Medicare payments were made

to UMDNJ.

1G. Ex. 3, at 5-6.
5
The Information stated that UMDNJ had an accredited cardiology fellowship program
and UMDNJ’s hospital had a Level I Trauma Center license. L.G. Ex. 3, at 2. However,
from at least 1995, UMDNJ failed to perform the requisite number of cardiac procedures
to satisfy the requirements for a Level I Trauma Center license. In order to increase the
number of cardiac patients, UMDNJ established a program to enter into part-time
employment contracts with community cardiologists who had “significant numbers of
patients they could refer to [UMDNJ].” I.G. Ex. 3, at 4. It is this program that Petitioner
joined when he became an Assistant Clinical Professor at UMDNJ.

The Information charges, however, that from in or about January 2003 through
November 2006, Petitioner failed to perform the services enumerated in the employment
contract. The only service he performed for UMDNJ was to refer patients from his
private cardiology practice to UMDNJ’s hospital for cardiac-related procedures. I.G. Ex.
3, at 6. UMDNJ’s hospital was a Medicare provider and billed Medicare for more than
$10,000 a year for services rendered to Medicare beneficiaries. I.G. Ex. 3, at 3. UMDNJ
paid Petitioner approximately $590,000. I.G. Ex. 3, at 6.

Petitioner provided testimony that is in agreement with I.G. Exs. 2-4. P. Aff. §§ 1-3.
However, Petitioner indicated that he had a relationship with UMDNJ’s hospital before
is part-time clinical professorship, that he did not refer patients there based on the part-
time professorship, that his agreement with UMDNJ was only to teach, and that he was
never charged with kickbacks, health care fraud, or providing deficient care. P. Aff. 95,
6, 8-9, 11, 16-18. Petitioner’s testimony does not detract from the finding of fact made
above and is addressed further below.

B. Petitioner was convicted of a felony for the purposes of 42 U.S.C. § 1320a-
7(a)(3).

Under 42 U.S.C. § 1320a-7(a)(3), Petitioner must be “convicted . . . of a criminal offense
consisting of a felony . . .” before he can be excluded. The statute defines “convicted” to
include “when a judgment of conviction has been entered against the individual .. . by a
Federal, State, or local court, regardless of whether there is an appeal pending or whether
the judgment of conviction or other record relating to criminal conduct has been
expunged.” 42 U.S.C. § 1320a-7(i)(1). Here, the U.S. District Court entered a Judgment
in a Criminal Case in which that court “adjudicated that the defendant is guilty” of
violating 18 U.S.C. § 666. LG. Ex. 2, at 1. Petitioner concedes that he was convicted of
a criminal offense that was committed after August 21, 1996. P. Br. at 1.

Further, because 18 U.S.C. § 666 provides for a ten-year maximum term of
imprisonment, Petitioner’s offense is a Class C felony. See 18 U.S.C. § 3559(a)(3).
Petitioner concedes that he was convicted of a felony. P. Br. at 2. Therefore, I conclude
that Petitioner was convicted of a felony for purposes of 42 U.S.C. § 1320a-7(a)(3).
6
C. Petitioner’s felony conviction requires exclusion under 42 U.S.C. § 1320a-
7(a)(3) because it involves theft, embezzlement, or fraud in connection with
the delivery of a health care item or service.

In order for Petitioner to be excluded under section 1320a-7(a)(3), his conviction must
involve fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial
misconduct “in connection with the delivery of a health care item or service.” Fora
variety of reasons, Petitioner disputes that his criminal conduct had any connection to the
delivery of a health care item or service. Petitioner also argues that the IG. seeks to give
the phrase “in connection with the delivery of a health care item or service” as broad an
interpretation as possible, which is a “‘slippery slope” because such an expanded
definition renders the phrase “unconstitutional vague and overbroad.” P. Br. at 6

Although Petitioner urges a narrow interpretation of the statute, this is not consistent with
previous cases. Rather, “the conduct underlying the criminal offense does not necessarily
have to involve actual delivery (or the interruption of same) of a health care item or
service to the patient or beneficiary.” Ellen L. Morand, DAB No. 2436, at 9 (2012). This
is because section 1320a-7(a)(3) “broadly covers offenses ‘in connection with the
delivery of a health care item or service.” Charice D. Curtis, DAB No. 2430, at 5
(2011) (emphasis in original). Thus, there only needs to be a nexus “between the offense
of which a petitioner was convicted and the delivery of a health care item or service.”
Kenneth M. Behr, DAB No. 1997 (2005).

In the present case, Petitioner was convicted of theft for knowingly and intentionally
embezzling, stealing, and obtaining by fraud $590,000 for services he did not perform as
a Clinical Assistant Professor. 1.G. Exs. 2,3. According to the Information that
Petitioner pled guilty to, the services Petitioner failed to perform involved cardiology
services, which included providing on-call coverage for diagnostic procedures,
interpreting electrocardiograms, attending weekly cardiology conferences, conducting a
physical diagnosis course, providing office-based teaching, and completing Medicare
paperwork to ensure appropriate payments were made to UMDNJ. LG. Ex. 3, at 5-6.
Despite the detailed list of medical services he was to provide as part of his agreement
with UMDNJ, Petitioner testified that the only duties he agreed to perform at UMDNJ
involved teaching. P. Aff. § 8-9.

Petitioner’s argument that he was only convicted for the failure to perform teaching
services in a way that is unrelated to health care services is not convincing and is
inconsistent with both his guilty plea to the Information and his other testimony.
Petitioner testified that UMDNJ’s hospital is “a teaching hospital” and that his position
was a “part-time clinical associate professorship.” P. Aff. 5, 15 (emphasis added).
Petitioner’s clinical teaching duties clearly involved care related to actual patients, as
described in the Information. Accordingly, I find that the required nexus exists between

7
Petitioner’s conviction for theft, embezzlement, or fraud and his failure to deliver his
cardiology services to UMDNJ.*

Petitioner also argues that his guilty plea was not for embezzling from a federal health
care program, for health care fraud, or for a violation of any health care statute or the
anti-kickback statute. P. Br. at 4, 5; P. Aff. §§ 17, 18. However, section 1320a-7(a)(3)
does not require a conviction for health care fraud. Morand, DAB No. 2436, at 7.

* The Information asserts that UMDNJ paid Petitioner to provide patient referrals to its
hospital. 1.G. Ex. 3, at 4, 6. Petitioner denies this. Petitioner states that he had a
relationship with UMDNJ’s hospital before becoming a Clinical Assistant Professor
because he accepted fellows from UMDNJ into his practice. P. Aff. 6. Petitioner also
asserts that he recommended patients to UMDNJ’s hospital due to the quality of its
surgeons and its “stellar reputation,” and because its location made it accessible to his
patients. P. Aff. 5. Petitioner further states that he decided to seek the part-time
position with UMDNJ because he believed it would enhance his ability to provide the
“greatest and most convenient care possible” to his patients and that UMDNJ would help
Petitioner “develop a community healthcare program.” P. Aff. § 10. Petitioner admits
that “[a]fter I entered into the program, it became apparent that the program’s
expectations were low, that is, a teaching schedule was never established and with the
exception of one cardiologist, no one was ever scheduled to lecture or perform research.”
P. Aff. § 12. Petitioner asserts that the only duties he agreed to perform at UMDNJ
involved teaching and that his professorship did not impact his referral pattern because he
already had a relationship with UMDNJ. P. Aff. §§ 8-9, 11, 16. Despite his
protestations, Petitioner disclosed that he agreed to pay nearly 1.5 million dollars to settle
a civil law suit with the U.S Department of Justice related to this issue, noting that he did

not admit liability in the
Petitioner’s payment of a

aw suit. P. Aff. 420; RFH at 31-43. Ata minimum,
sum equal to three times his aggregate salary as a part-time

professor shows that Petitioner did not simply fail to teach some courses at an educational

institution. It could also

be viewed as another nexus between Petitioner’s conduct and

the delivery of health care services because an illegal scheme for referring patients to
UMDNJ’s hospital would necessarily result in UMDNJ providing such services. Cf:
James O. Boothe, DAB CR2770, at 9 (2013) (nexus based on conviction for a fraudulent

Medicaid marketing plan
organization (HMO) to o
Sabina E. Acquah, DAB

because submission of the plan allowed a health maintenance
btain new enrollees to bill Medicaid for items and services);
CR480 (1997) (nexus based on conviction for illegally obtaining

names of Medicaid beneficiaries with the intent to market an HMO to those beneficiaries

and thus bill Medicaid fo:
(1996) (nexus based on c
beneficiaries so that Med
delivery of items of servi

r items and services); ViNita R. Warren, DAB CR423, at 6-7
onviction for accepting a bribe to provide names of Medicaid
icaid HMO could obtain new enrollees and bill Medicaid for the
ices).
8
Petitioner further argues that the corresponding regulatory provision to section 1320a-
7(a)(3) indicates that this exclusion does not apply to him because his conviction is not in
connection with the direct delivery of a health care item or service. Petitioner asserts that
only those persons specifically engaged in the management or administration of health
care items or services are brought within the category of mandatory exclusion under
section 1320a-7(a)(3). See 42 C.F.R. § 1001.101(c)(1). Thus, a conviction that relates
only to the failure to perform teaching services, which is not the management or
administration of health care services, cannot form a basis for the mandatory exclusion.
P. Br. at 5. However, just because 42 C.F.R. § 1001.101(c)(1) interprets section 1320a-
7(a)(3) to include “the performance of management or administrative services relating to
the delivery of such items or services,” does not mean that section 1320a-7(a)(3) only
applies to management or administrative services. 42 C.F.R. § 1001.101(c)(1).

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

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

E. Ido not have the authority to change the effective date of the exclusion.

Petitioner argues that if I find a basis for his exclusion, Petitioner should be given a
“credit relating to the length of the exclusion due to the suspension of his billing
privileges.” P. Br. at 6. This argument arises from the fact that CMS revoked
Petitioner’s Medicare billing privileges following Petitioner’s guilty plea in 2008. P. Ex.
2. Petitioner argues that “[i]t is improper and unlawful to [su]spend a physician’s billing
privileges under 42 C.F.R. § 424.535(a)(3) before the actual conviction takes place.
Petitioner submits that the [administrative law judge] is not without authority to correct a
fundamental violation of governmental authority and a clear injustice.” P. Br. at 7. I
interpret this argument as a request that I change the effective date of the exclusion so
that it runs concurrently with Petitioner’s revocation of Medicare billing privileges.

The revocation of Medicare billing privileges and an exclusion from participating in all
federal health care programs are separate and distinct remedial actions that HHS may
take against individuals and entities. The revocation of Medicare billing privileges is a
discretionary act by CMS that is limited to precluding enrolled Medicare providers and
suppliers from billing Medicare for items and services provided to Medicare
beneficiaries. See 42 C.F.R. §§ 424.505, 424.535. In contrast, exclusions are
significantly broader in scope than revocations because they preclude reimbursement for
furnished items or services under all federal health care programs, including state
administered programs such as Medicaid. See 42 U.S.C. §§ 1320a-7(a), (h), 1320a-7b(f);
9
42 C.F.R. § 1001.2 (definition of Exclusion). Further, exclusions are administered by the
1.G. and, depending on the facts of a given case, may be mandatory or discretionary.
42 U.S.C. § 1320a-7(a)-(b). Finally, while an individual or entity may be subject to
revocation and exclusion based on the same set of circumstances, this is not always true
and, even when this happens, the legal standard for imposing revocations and exclusions
is usually not the same. Compare 42 U.S.C. § 1320a-7(a)-(b) with 42 C.F.R.
§ 424.535(a).

Although Petitioner requests that, as an administrative judge, I take action to ensure that
there is no injustice related to the alleged illegal revocation of Petitioner’s Medicare
billing privileges, Petitioner already had the opportunity to fully litigate the revocation of
his Medicare billing privileges before another administrative law judge. See Bakul Desai,
M.D., DAB CR1899 (2009). That administrative law judge explained that a guilty plea
was sufficient under 42 C.F.R. § 424.535(a)(3) for CMS to revoke his Medicare billing
privileges without the entry of a formal conviction. Jd. at 2-3. Because Petitioner does
not appear to have appealed that decision, it is binding. 42 C.F.R. § 498.74(b).

In any event, I am without authority to change the effective date of Petitioner’s exclusion.
The effective date for exclusion is 20 days after the date on the notice of exclusion. See
42 C.F.R. § 1001.2002(b); see also 42 U.S.C. § 1320a-7(c)(1). The statutory exceptions
to this rule are not applicable to this case. See 42 U.S.C. § 1320a-7(c)(2)(B), (£)(2).
Therefore, administrative law judges do not have the authority to alter this effective date
of an exclusion required under the regulations. See 42 C.F.R. § 1005.4(c)(4); Lisa Alice
Gantt, DAB No. 2065, at 2-3 (2007).

F. Petitioner’s other arguments are unavailing.

Petitioner testified to a number of matters not previously discussed above. Petitioner
asserts that it was UMDNJ, facing the loss of accreditation, that designed the contract
under which he was paid $590,000 for services he did not provide (although he believes
he “did perform the minimal amount necessary to meet the contractual obligations and
expectations of UMDNJ officials”). However, upon conferring with counsel, Petitioner
asserts he realized that his efforts were not enough to justify his salary and thus he
entered a guilty plea. Petitioner stresses his conduct did not impact the delivery of health
care services in his own practice or at UMDNJ. P. Aff. §§ 15, 17, 18. Petitioner states he
cooperated with the government. P. Aff. 7 19. Petitioner asserts there is no evidence that
his actions negatively impacted Medicare or any federal program and that he paid
restitution via a civil settlement of $1,478,750, including taxes and penalties, and thus the
government has been made whole. P. Aff. § 20. Petitioner states he has been an effective
cardiologist for more than 20 years and has been involved in civic and charitable
endeavors. P. Aff. {fj 21-23. Petitioner asserts he has completed his federal sentence, is
in compliance with all his obligations, and has accepted responsibility for not providing

10
“all of the bona fide services commensurate with [his] part-time professor salary.”
P. Aff. § 24. Petitioner asserts that due to the suspension of his Medicare provider
number, he has already lost a “significant” part of his practice and has been dropped by
insurance carriers and lost hospital privileges. His professional reputation and practice
have been harmed and he has suffered financially. P. Aff. 25. Petitioner asserts he will
not be able to practice cardiology if he is not allowed to treat Medicare patients. The
four-year suspension of his Medicare billing privileges, coupled with the five-year
exclusion, is the equivalent of a forcible retirement for a 61-year-old man. P. Aff. § 26.

None of this testimony is relevant as to whether there is basis to impose a statutorily
mandated five-year exclusion.

VI. Conclusion

For the foregoing reasons, I affirm the I.G.’s determination to exclude Petitioner from
participating in Medicare, Medicaid, and all federal health care programs for the
minimum mandatory five-year period under 42 U.S.C. §§ 1320a-7(a)(3) and 1320a-
7(c)(3)(B).

/s/
Scott Anderson
Administrative Law Judge