Court Opinion

ID: 3198906
Source: CourtListenerOpinion
Date Created: 2016-04-28 17:01:04.021424+00
Date Added: 2024-06-11T09:21:28.211220
License: Public Domain

FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

UNITED STATES OF AMERICA,             No. 14-10303
                Plaintiff-Appellee,
                                         D.C. No.
                v.                    4:12-cr-00054-
                                          JSW-2
ADEBOLA ADEFUNKE ADEBIMPE,
            Defendant-Appellant.

UNITED STATES OF AMERICA,             No. 14-10324
                Plaintiff-Appellee,
                                         D.C. No.
                v.                    4:12-cr-00054-
                                          JSW-1
PATRICK ADEBOWALE SOGBEIN,
             Defendant-Appellant.

UNITED STATES OF AMERICA,             No. 14-10325
                Plaintiff-Appellee,
                                         D.C. No.
                v.                    4:12-cr-00054-
                                          JSW-4
EDUARDO ABAD,
           Defendant-Appellant.         OPINION
2                 UNITED STATES V. ADEBIMPE

         Appeal from the United States District Court
            for the Northern District of California
          Jeffrey S. White, District Judge, Presiding

                  Argued and Submitted
        October 20, 2015—San Francisco, California

                       Filed April 28, 2016

         Before: Richard A. Paez, Mary H. Murguia,
          and Andrew D. Hurwitz, Circuit Judges.

                   Opinion by Judge Murguia;
                     Dissent by Judge Paez

                           SUMMARY*

                          Criminal Law

    The panel affirmed the district court’s application of a
sentence enhancement pursuant to U.S.S.G. § 3B1.3 for abuse
of a position of trust, in a case in which Patrick Sogbein ran
a conspiracy to defraud Medicare by providing power
wheelchairs to people who did not need them, and his wife,
Adebola Adebimpe, participated in the conspiracy by
supplying many of the wheelchairs through a medical
equipment company that she owned.

  *
    This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
                UNITED STATES V. ADEBIMPE                     3

    The panel held that medical equipment suppliers can have
the requisite “professional or managerial discretion” for the
abuse-of-trust enhancement to apply, if they are responsible
for determining the need for the equipment they provide and
personally certify the validity of their claims to Medicare.

    The panel addressed the defendants’ other challenges, and
those of a co-defendant, in a separate memorandum
disposition.

    Dissenting, Judge Paez wrote that durable medical
equipment suppliers do not exercise substantial professional
or managerial discretion within Medicare’s reimbursement
scheme because Medicare’s rules and regulations confine
them to a ministerial role and leave all critical determinations
of medical need to the beneficiary’s physician.

                         COUNSEL

Mark D. Eibert (argued), Half Moon Bay, California, for
Defendant-Appellant Adebola Adebimpe.

Amitai Schwartz (argued), Law Offices of Amitai Schwartz,
Emeryville, California, for Defendant-Appellant Patrick
Sogbein.

Christopher J. Cannon (argued) and Matthew A. Laws,
Sugarman & Cannon, San Francisco, California, for
Defendant-Appellant Eduardo Abad.
4                UNITED STATES V. ADEBIMPE

Meredith B. Osborn (argued) and Owen P. Martikan,
Assistant United States Attorneys; Melinda Haag, United
States Attorney, United States Attorney’s Office, San
Francisco, California, for Plaintiff-Appellee.

                             OPINION

MURGUIA, Circuit Judge:

    Patrick Sogbein ran a conspiracy to defraud Medicare by
providing power wheelchairs to people who did not need
them. Sogbein’s wife, Adebola Adebimpe, participated in the
conspiracy by supplying many of the wheelchairs through a
medical equipment company that she owned. Sogbein and
Adebimpe challenge the district court’s application of a two-
level upward adjustment under section 3B1.3 of the
Sentencing Guidelines, after finding the defendants abused a
position of trust with respect to Medicare. We hold that
medical equipment suppliers can have the requisite
“professional or managerial discretion” for the abuse-of-trust
adjustment to apply, if they are responsible for determining
the need for the equipment they provide and personally
certify the validity of their claims to Medicare. See U.S.
Sentencing Guidelines Manual § 3B1.3 cmt. n.1 (U.S.
Sentencing Comm’n 2014). We affirm the district court’s
application of the abuse-of-trust enhancement in this case.1

    1
   We address the defendants’ other challenges to their convictions and
sentences, and those of co-defendant Eduardo Abad, in a separate
memorandum disposition.
               UNITED STATES V. ADEBIMPE                     5

                               I

    Patrick Sogbein owned Debs Medical Distributor
(“Debs”), a medical equipment supply company. In order to
enroll Debs in Medicare’s reimbursement program, Sogbein
certified that he knew Medicare’s standards, that he would
follow the relevant laws and regulations, and that he would
not submit fraudulent claims. Sogbein spent a significant
amount of time learning Medicare’s rules, from attending
conferences and training sessions as well as studying the rules
on his own time. Sogbein also obtained a state license to
operate a Home Medical Device Retail Facility in California.

    Since 1995, Sogbein has been married to Adebola
Adebimpe. Adebimpe also owned a medical equipment
supply company, called Dignity Medical Equipment
(“Dignity”). In order to enroll Dignity in Medicare’s
reimbursement program, Adebimpe was also required to
certify that Dignity would only submit valid claims.

    In 2006, Sogbein and Dr. Edna Calaustro entered into a
conspiracy to defraud Medicare by submitting claims for
fraudulent power-wheelchair prescriptions. Dr. Calaustro
agreed to prescribe power wheelchairs for Medicare-eligible
individuals in San Francisco’s Tenderloin neighborhood
without performing the medical examinations required to
determine whether they needed the wheelchairs. Dr.
Calaustro sent the prescriptions to Sogbein, who paid Dr.
Calaustro $100 for each prescription. Debs delivered the
wheelchairs, and then submitted claims to Medicare through
an intermediary, Noridian Healthcare Solutions, L.L.C.
(“Noridian”). Sogbein received approximately $3000 from
Medicare for each wheelchair, which cost him about $800.
All told, Sogbein billed Medicare more than $2.8 million, and
6               UNITED STATES V. ADEBIMPE

received over $1.5 million from Medicare, before the
conspiracy stopped in 2011.

   In 2010, Debs’ billing practices came under scrutiny from
Medicare. Sogbein subsequently sent Dr. Calaustro’s
wheelchair prescriptions to Adebimpe’s company Dignity.
Dignity billed Medicare approximately $1.5 million for
wheelchairs prescribed by Dr. Calaustro.

    Sogbein and Adebimpe were charged in an indictment in
2012 with one count of conspiracy to commit health care
fraud under 18 U.S.C. § 1349, and ten counts of health care
fraud and aiding and abetting at various dates within the span
of the conspiracy under §§ 1347 and 2. A superseding
indictment in 2013 added one count against Sogbein for
conspiracy to pay and receive kickbacks from a federal health
program under §§ 371 and 2.

     The case went to trial in October 2013. Jody Whitten, a
representative from Noridian, testified as an expert witness
about the process of prescribing and submitting claims for
power wheelchairs. Whitten testified that, in order to qualify
for a particular treatment under Medicare, a patient must meet
Medicare’s eligibility criteria for the treatment, called “local
coverage determinations,” or “LCDs.” Among other things,
the local coverage determinations for the power wheelchairs
at issue in this case required that the patient actually have a
mobility-related medical issue, and that the patient’s
residence have doorways and rooms that are large enough for
the wheelchairs to pass through. The local coverage
determinations thus required that medical equipment
suppliers perform home assessments.
                UNITED STATES V. ADEBIMPE                     7

    Ordinarily, the process of prescribing a power wheelchair
starts when a physician determines that a patient needs a
mobility device and sends an “order” to a medical equipment
supplier. Whitten explained that the medical equipment
supplier then “will assess that patient, and determine what is
the best type of mobility . . . equipment that beneficiary
needs.” After a medical equipment supplier has assessed the
patient, the supplier recommends particular equipment in a
“Detailed Product Description” document, which is sent back
to the physician. If the physician agrees with the supplier’s
recommendation, she will sign the Detailed Product
Description and return it to the supplier. Then the supplier
will “need to do a complete assessment of the beneficiary’s
home, either before or at the time of delivery, to make sure
that that chair is going to be able to complete those activities
within that beneficiary’s home.”

    Whitten stated that medical equipment suppliers have a
responsibility to determine the medical necessity of power
wheelchairs, because

       [t]he supplier has to know whether the
       beneficiary meets the coverage criteria in
       order to bill it appropriately. So they have to
       verify and collect medical records, verify all
       of the orders and the Detailed Product
       Descriptions are received in a timely manner,
       and verify that the home provides enough
       room.

Equipment suppliers have these responsibilities “[b]ecause
they’re the ones that are going to get reimbursed” for the
equipment.
8              UNITED STATES V. ADEBIMPE

    After a wheelchair has been delivered, the supplier
submits a claim to Medicare. In Medicare’s claim
submission system, suppliers select “modifiers” on the claim
to communicate information to Medicare, such as the type of
equipment provided or whether the equipment was rented or
sold. Suppliers select the “KX modifier” to inform Medicare
that the beneficiary meets all of the medical and home
environment requirements for the equipment.

    Medical equipment suppliers ordinarily submit claims to
Medicare without supporting paperwork, such as the doctor’s
prescription or the supplier’s home assessment. Rather than
scrutinize the documentation for every claim, Medicare
performs random audits. Whitten described this process as an
“honor system,” explaining that Medicare

       tr[ies] to streamline claim processing as much
       as possible, because . . . there’s thousands and
       thousands of claims a day that come into our
       system. So that’s where the KX modifier
       comes into play. If the KX modifier’s on the
       claim, that tells us that the supplier has all of
       those documents, and that they should be paid
       appropriately.

With the KX modifier, “that claim can go straight through the
system, and process, and pay.” The medical equipment
supplier, not the doctor, decides whether to put the KX
modifier on the claim.

    Dr. John Fullerton also testified for the government as a
Medicare expert. Dr. Fullerton explained that equipment
suppliers perform home assessments, and that the “main goal
[of the home assessment] is establishing that that home
                UNITED STATES V. ADEBIMPE                      9

environment is safe for the patient to use that assistive device,
and . . . has the ability to allow that assistive device to help
the patient with their medically related Activities of Daily
Living sufficiently.” Both the physician and the equipment
supplier have responsibility to ensure the patient receives the
appropriate equipment; each of them “needs to be able to
demonstrate a sufficient packet of information, including the
medical information, to support the prescription and the
procurement and the delivery of a power wheelchair.” Dr.
Fullerton emphasized that medical equipment suppliers
“absolutely” have the authority to disagree with a physician’s
prescription, because under this particular framework,
“there’s an independent responsibility for each side to get it
right.”

    Dr. Fullerton also testified that, after reviewing over 400
files of documents prepared by Dr. Calaustro, Debs, and
Dignity for power wheelchair claims, none of the documents
indicated that adequate home assessments had been
performed.      In Dr. Fullerton’s opinion, the medical
documentation provided by Dr. Calaustro was “woefully
inadequate” to support orders for power wheelchairs. Dr.
Fullerton stated that, if a medical equipment supplier received
documentation as sparse as that provided by Dr. Calaustro,
the supplier should not deliver a wheelchair, but rather obtain
additional documentation from the physician.

     Dr. Calaustro and Mele Saavedra, another of the co-
conspirators, cooperated with the government and testified at
trial. Dr. Calaustro testified that she asked Sogbein if she
should prescribe less expensive treatments for the wheelchair
recipients, such as canes or walkers. Sogbein told Dr.
Calaustro that she should only prescribe wheelchairs, because
Medicare would not pay for canes or walkers. Saavedra, who
10                 UNITED STATES V. ADEBIMPE

received $50 each time she recruited a Medicare-eligible
individual to receive a wheelchair, testified that Sogbein
would only pay her if she referred patients who wanted power
wheelchairs—not walkers, manual wheelchairs, or scooters—
because Medicare paid Sogbein less for those other devices.

    Several people who received power wheelchairs through
the conspiracy testified at trial that they did not need or use
them. The recipients testified that nobody had assessed their
homes to determine whether their homes could accommodate
the wheelchairs. One individual testified that his bathroom
was not big enough to accommodate the wheelchair he
received.

    After a month-long trial, the jury convicted Sogbein and
Adebimpe on all counts. The district court sentenced Sogbein
to a term of incarceration of 144 months, which was 23
months above his Guidelines range of 97 to 121 months. The
court sentenced Adebimpe to 51 months of incarceration,
which was the low end of her Guidelines range of 51 to 63
months. In calculating the Guidelines ranges, the district
court applied a two-level enhancement to both defendants for
their abuse of a position of trust under Sentencing Guidelines
section 3B1.3.2 The court reasoned that Sogbein and
Adebimpe “are owners of Debs and Dignity respectively, and
thus occupied positions involving substantial managerial
[authority] and in a trust position, vis-a-vis the Medicare
program.” Reviewing trial testimony and exhibits, the district
court found that “Medicare operates on an honor system,” and

  2
    “If the defendant abused a position of public or private trust, or used
a special skill, in a manner that significantly facilitated the commission or
concealment of the offense, increase by 2 levels.” U.S. Sentencing
Guidelines Manual § 3B1.3.
                UNITED STATES V. ADEBIMPE                    11

that Sogbein and Adebimpe “understood their obligations to
this by virtue of the certifications that they signed.”

                               II

    “We review a district court’s application of an abuse-of-
trust enhancement under a two-step analysis.” United States
v. Aubrey, 800 F.3d 1115, 1134 (9th Cir. 2015). First, we
review the legal question whether a defendant occupied a
position of trust as defined by the Guidelines de novo. Id.
“Then, if we decide that the defendant held a position of trust,
we review for clear error the district court’s decision whether
the defendant’s abuse of his position significantly facilitated
the offense.” Id. (internal quotation marks and alterations
omitted).

                              III

                               A

    Under section 3B1.3 of the Sentencing Guidelines, a
district court may apply a two-level upward adjustment “[i]f
the defendant abused a position of public or private trust . . .
in a manner that significantly facilitated the commission or
concealment of the offense.” “‘Public or private trust’ refers
to a position of public or private trust characterized by
professional or managerial discretion (i.e., substantial
discretionary judgment that is ordinarily given considerable
deference).” U.S. Sentencing Guidelines Manual § 3B1.3
cmt. n.1. The Guidelines give the following examples where
the adjustment applies: “embezzlement of a client’s funds by
an attorney serving as a guardian, a bank executive’s
fraudulent loan scheme, or the criminal sexual abuse of a
patient by a physician under the guise of an examination.” Id.
12              UNITED STATES V. ADEBIMPE

The Guidelines provide, however, that “[t]his adjustment
does not apply in the case of an embezzlement or theft by an
ordinary bank teller or hotel clerk because such positions are
not characterized by the above-described factors.” Id.

    Although we have not previously had the occasion to
consider the application of the abuse-of-trust enhancement to
a Medicare equipment supplier, we do not write today on a
clean slate. In United States v. Laurienti, we affirmed the
enhancement for a stock broker who sold securities to clients
at an inflated price. 731 F.3d 967, 970 (9th Cir. 2013). We
explained that “the presence or lack of ‘professional or
managerial discretion’ represents the decisive factor in
deciding whether a defendant occupied a position of trust,”
and that “[a] defendant has this discretion when, because of
his or her special knowledge, expertise, or managerial
authority, [he or she] is trusted to exercise substantial
discretionary judgment that is ordinarily given considerable
deference.” Id. at 973 (second alteration in original) (internal
quotation marks omitted). We held that, as a stock broker,
Laurienti had sufficient professional discretion for the
enhancement to apply, because his clients relied on his
recommendations to purchase particular securities. Id. at 974.

    In Aubrey, we applied Laurienti and affirmed the
application of the enhancement for a construction contractor
who misappropriated funds from the U.S. Department of
Housing and Urban Development. 800 F.3d at 1134. The
funds were intended for the construction of affordable
housing units in the Navajo Nation, and were distributed
through the Fort Defiance Housing Commission (“FDHC”),
a non-profit organization with a fiduciary duty to manage the
funds. Id. at 1119–20. The FDHC had entered into a series
of development and consulting agreements with Aubrey, the
               UNITED STATES V. ADEBIMPE                    13

contractor, which resulted in Aubrey having practical control
over the FDHC’s finances. Id. at 1120. Reviewing Aubrey’s
challenge to the abuse-of-trust enhancement, we rejected his
argument that he only had managerial authority with respect
to his construction company, because “[t]rial evidence
supported the conclusion that FDHC delegated financial
management of the . . . project to Aubrey’s company, that his
company then stepped into the shoes of FDHC, and that
Aubrey had ‘the real authority’ at FDHC, because he
‘handle[d] all of the finances.’” Id. at 1134.

    In United States v. Rutgard, we upheld the application of
an abuse-of-trust enhancement to the sentence of an
ophthalmologist convicted of Medicare fraud for submitting
claims for eye examinations and surgeries that were not
medically necessary. 116 F.3d 1270, 1293 (9th Cir. 1997).
In doing so, we reasoned that “the government as insurer
depends upon the honesty of the doctor and is easily taken
advantage of if the doctor is not honest.” Id. at 1293.

    On the other hand, the enhancement is inappropriate
where the defendant does not possess the kind of professional
discretion on which victims would reasonably rely. For
example, in United States v. Contreras, we rejected the
abuse-of-trust enhancement as applied to a prison cook
convicted of smuggling drugs into the prison. 581 F.3d 1163,
1168 (9th Cir. 2009), opinion adopted in part, vacated in part
on other grounds, 593 F.3d 1135, 1136 (9th Cir. 2010) (en
banc). Even though her position as a cook allowed her to
commit a difficult-to-detect crime, the cook “held no
significant position of authority at [the prison] and exercised
no ‘professional or managerial discretion.’” Id. at 1168.
14             UNITED STATES V. ADEBIMPE

    Other circuits have addressed whether the owners of
health care companies occupy positions of trust with respect
to Medicare. The Fifth Circuit has repeatedly affirmed the
application of the enhancement to owners of medical
equipment supply companies convicted of health care fraud.
United States v. Willett, 751 F.3d 335, 344–45 (5th Cir.
2014); United States v. Miller, 607 F.3d 144, 150 (5th Cir.
2010). In Willett, the defendant defrauded Medicare by
“upcoding,” or seeking reimbursements for more money than
he was entitled to for the equipment provided. 751 F.3d at
338. The Probation Office recommended applying the abuse-
of-trust enhancement “based on Willett’s position as a co-
owner of a [medical equipment] distributor and his
responsibility to submit legitimate and genuine claims to
Medicare.” Id. at 344. “Willett acknowledged that he
probably occupied a position of trust,” but challenged the
district court’s factual finding that his abuse of his position
substantially facilitated the offense. Id. The Fifth Circuit
upheld the application of the enhancement, reaffirming a
prior holding that “a [medical equipment] provider occupies
a position of trust because, in order to provide
reimbursements, Medicare relies on the honesty and
forthrightness of [medical equipment] providers in their claim
submissions.” Id. at 344–45 (citing Miller, 607 F.3d at 150).

    However, the Eleventh Circuit has rejected the application
of the enhancement for the owner of a health care company
that submitted claims for non-allowable expenses to Medicare
via an intermediary, Aetna. United States v. Garrison,
133 F.3d 831, 841–43 (11th Cir. 1998). The defendant,
Garrison, was the owner and chief executive of a health care
company that provided in-home nursing services. Id. at
833–34. Garrison’s company would submit cost reports to
Aetna, which reviewed the reports on behalf of Medicare. Id.
                 UNITED STATES V. ADEBIMPE                          15

at 834. Medicare would then reimburse the company for the
services it provided that were covered by Medicare. Id.
However, Garrison instructed her employees to submit cost
reports that included expenses that were not reimbursable,
such as political contributions and personal vacations. Id. at
834–35. Garrison ultimately pled guilty to submitting
fraudulent cost reports for Medicare reimbursement.3 Id. at
835.

    The district court applied the abuse-of-trust enhancement
to Garrison. Id. at 837. The Eleventh Circuit reversed. Id. at
841–42. The Eleventh Circuit distinguished “arm’s-length
business relationships,” where the enhancement is not
available, from cases where “the defendant has abused
discretionary authority entrusted to the defendant by the
victim,” and where the enhancement properly applies. Id. at
839 (citation omitted). The Eleventh Circuit held that the
relationship between Garrison and Medicare lacked the
sufficient element of “trust,” for two reasons. First, Aetna
was a “fiscal intermediary whose specific responsibility was
to review and to approve requests for Medicare
reimbursement before submitting those claims to Medicare
for payment.” Id. at 841. Second, as a high-level executive,
Garrison was removed from the process of preparing and
submitting the cost reports. Id. “Garrison lacked the
discretion and ability to conceal the false cost reports
submitted for Medicare reimbursement and relied on others
to accomplish this deception,” for example by retaining

  3
    Like Sogbein, Garrison was charged with conspiracy to defraud the
United States under 18 U.S.C. § 371. 133 F.3d at 835 n.8. However,
unlike Sogbein, Garrison was charged with making false statements under
§ 1001, rather than health care fraud under § 1347. Id.
16             UNITED STATES V. ADEBIMPE

financial and legal experts who could hide the improper costs.
Id. at 841 & n.19.

                              B

    In the case before us, the district court correctly
determined that, as medical equipment suppliers, Sogbein and
Adebimpe were in positions of trust with respect to Medicare.
Medicare entrusted the defendants with “substantial
discretionary judgment” in selecting the proper equipment,
and gave them “considerable deference” in submitting claims
that accurately reflected patients’ medical needs through an
automated reimbursement system. See U.S. Sentencing
Guidelines Manual § 3B1.3 cmt. n.1.

    The testimony of Noridian representative Jody Whitten
and Medicare expert Dr. John Fullerton established that
medical equipment suppliers have professional obligations
separate from those of a physician. Both witnesses testified
that equipment suppliers must determine that a particular
piece of equipment is medically appropriate for a beneficiary
and that the beneficiary’s home is compatible with the
equipment. Although the physician ultimately approves the
equipment, the supplier must still be able to justify the
medical necessity for the equipment, or risk repaying
Medicare in the event of an audit. Dr. Fullerton testified that
equipment suppliers “absolutely” have authority to disagree
with a physician’s prescription, and that a supplier who
receives inadequate documentation from a physician should
contact the physician, rather than deliver the requested
equipment.

   Other witnesses’ testimony established that, within this
conspiracy, Sogbein had the discretion to direct the provision
                UNITED STATES V. ADEBIMPE                    17

of particular equipment without regard for medical need. Dr.
Calaustro, the physician who prescribed the power
wheelchairs, testified that Sogbein instructed her to write
prescriptions for power wheelchairs instead of canes or
walkers, because Medicare would not pay him for canes or
walkers. Similarly, Mele Saavedra, one of Sogbein’s
recruiters, testified that Sogbein instructed her to find people
who would accept power wheelchairs, and not canes, walkers,
or manual wheelchairs, because Medicare would pay him less
for those. Sogbein was not merely processing prescriptions
written by Dr. Calaustro; rather, he was affirmatively
instructing his co-conspirators to help him deliver a specific,
high-cost piece of equipment he selected.

    Medicare’s electronic claims submission system relies on
the supplier’s obligation to provide medically appropriate
equipment. Whitten testified that Medicare operates on an
honor system because of the thousands of claims it receives
every day. To enroll in this honor system, a medical
equipment supplier must certify that it will not submit
fraudulent claims. Claims for reimbursement are processed
automatically if a supplier selects the KX modifier on the
claim form, indicating that the supplier has determined that
the beneficiary meets the requirements for the equipment.

    In this case, the automatic nature of the claims submission
process, and the limited review performed by the
intermediary, Noridian, demonstrate that Sogbein and
Adebimpe had primary responsibility for ensuring the validity
of the claims they submitted. Noridian automatically
processed claims for payment unless required codes were
missing, such as the KX modifier. As with the construction
contractor in Aubrey, the mere presence of an intermediary
here does not destroy the defendants’ position of trust with
18              UNITED STATES V. ADEBIMPE

respect to Medicare, because Medicare trusted Sogbein and
Adebimpe to ensure the validity of the claims they submitted.
See Aubrey, 800 F.3d at 1134.

    In Rutgard, we explained that “the government as insurer
depends upon the honesty of the doctor and is easily taken
advantage of if the doctor is not honest.” 116 F.3d at 1293.
The same reasoning applies here. The testimony established
that Sogbein and Adebimpe occupied a position of trust with
respect to Medicare because they had independent obligations
to determine that the equipment was appropriate, and they—
not Dr. Calaustro—submitted claims to Medicare that they
had personally certified to be valid.

    This case thus differs from Garrison, in which the
Eleventh Circuit held that the presence of Aetna as a fiscal
intermediary that reviewed the validity of Medicare claims
prevented the defendant healthcare executive from occupying
a position of trust. 133 F.3d at 841. Here, by contrast,
Noridian processed Debs’ and Dignity’s certified claims as a
matter of course, rather than scrutinizing their validity. Also,
Garrison, an executive removed from the cost reporting
process, relied on others, including financial and legal
experts, to conceal improper expenses in the cost reports
submitted to Aetna and Medicare. Id. at 841 & n.19. Here,
Sogbein and Adebimpe personally certified the validity of
their claims, and knowingly submitted claims falsely
indicating that the beneficiaries met all of the requirements
for power wheelchairs.

    A contractor does not occupy a position of trust merely by
doing business with the government. But here there is more.
Medicare trusted Sogbein and Adebimpe to exercise their
professional discretion in providing appropriate medical
               UNITED STATES V. ADEBIMPE                   19

equipment to individuals who actually needed it and could
use it in their homes. Medicare also created a payment
mechanism—an honor system—through which equipment
suppliers that certified the validity of their claims could
receive streamlined reimbursement, and Sogbein and
Adebimpe enrolled in and used that system. The defendants’
role in this case qualified as a position of trust under
Guidelines section 3B1.3.

                              C

    The dissent views the record differently. In concluding
the equipment suppliers here lacked the requisite professional
discretion for the enhancement to apply, the dissent argues
that a supplier’s role in determining medical need is limited
to verifying that the physician has completed a face-to-face
evaluation and seven-element order, and measuring the
beneficiary’s home—tasks the dissent describes as
“ministerial.” Dissent at 31–32. According to the dissent,
“[i]n essence, the supplier compares the physician’s order
with the detailed checklist laid out in the LCD.” Dissent at
30. The dissent characterizes the supplier’s role as merely
“reporting” to Medicare that the physician has checked all of
the procedural boxes, without independently reviewing the
substance of the physician’s medical need determination.
Dissent at 35–36.

    The record demonstrates that the role of the suppliers in
this case was not so limited. Both the structure and substance
of the local coverage determinations for a power wheelchair
require the supplier to exercise discretion. The “LCD
Information” section explains that a power wheelchair is only
covered by Medicare if the “basic coverage criteria” are met.
The first basic criterion is that “[t]he beneficiary has a
20              UNITED STATES V. ADEBIMPE

mobility limitation that significantly impairs his/her ability to
participate in one or more mobility-related activities of daily
living.” The question for the power wheelchair supplier is
whether the coverage criteria are met, not merely whether the
physician has provided a seven-element order and
examination report.

    Other coverage criteria require the power wheelchair
supplier to exercise judgment regarding the beneficiary’s use
of the wheelchair in the home. A power wheelchair is only
covered if “[t]he beneficiary’s home provides adequate access
between rooms, maneuvering space, and surfaces for the
operation of the power wheelchair that is provided.” The
LCD does not define how much space is “adequate.” Another
criterion is that “[u]se of a power wheelchair will
significantly improve the beneficiary’s ability to participate
in [certain mobility-related activities] and the beneficiary will
use it in the home.” Whether the coverage criteria are met for
a particular beneficiary requires a determination that the
power wheelchair will actually help the beneficiary in the
home—not whether a physician has decided that it will.

    In a later section, “General Information,” the LCD
explains that “[i]t is expected that the beneficiary’s medical
records will reflect the need for the care provided.” Among
other things, the supplier is supposed to collect the
physician’s seven-element order and the report from the
physician’s face-to-face examination with the patient. The
LCD provides a list of details that the examination report
“should provide,” but also notes that the report “may include
other details,” and that “[e]ach element would not have to be
addressed in every situation”—without explaining when
particular elements are or are not required. Instead of setting
forth a hard-and-fast checklist of required content, the LCD
                UNITED STATES V. ADEBIMPE                    21

provides that “[t]he [physician’s] evaluation should be
tailored to the individual beneficiary’s conditions. The
history should paint a picture of the beneficiary’s functional
abilities and limitations on a typical day.”

    Separate from the examination report, the LCD also says
that “[p]hysicians shall also provide reports of pertinent
laboratory tests, x-rays, and/or other diagnostic tests,” but it
does not specify which tests are required for which diagnoses.
The LCD also requires that, “[u]pon request, suppliers shall
provide notes from prior visits to give a historical perspective
of the progression of disease over time and to corroborate the
information in the face-to-face examination,” but it does not
specify how much information is sufficient to corroborate the
face-to-face examination.

    In short, the LCD for a power wheelchair puts the
essential question the supplier must answer—are the coverage
criteria met—in a separate, earlier section from the question
of what supporting documents are required. The LCD does
not say anywhere that the coverage criteria are met simply
because supporting documents are provided; rather, the
criteria are met if the beneficiary actually “has a mobility
limitation,” among other things. (Emphasis added.) And
even the decision whether the supporting documentation is
adequate requires an exercise of discretion, since the LCD
allows that “[e]ach element would not have to be addressed
in every evaluation.” While the LCD provides significant
guidance to the power wheelchair supplier, it does not
provide a simple checklist that eliminates the supplier’s
discretion.

  The dissent asserts that the supplier’s use of the KX
modifier, which indicates that all of the LCD coverage
22              UNITED STATES V. ADEBIMPE

criteria have been met, is not discretionary because the
supplier must use the code to obtain reimbursement. Dissent
at 31. The dissent fails to recognize the possibility that the
supplier has the discretion to not deliver equipment or not
seek reimbursement where the coverage criteria have not
been satisfied. Moreover, as the dissent acknowledges, the
supplier has the choice of using the GA or GY modifiers
instead of the KX modifier when the supplier expects that
medical necessity has not been shown. Dissent at 29. The
fact that suppliers have an incentive to seek reimbursement
does not mean that they lack the discretion to decline to file
an inadequately supported claim, or decline to represent to
Medicare that the coverage criteria have been met.

     Our conclusion is supported by the witnesses’ testimony
at trial. Jody Whitten, the Noridian representative, was asked
“does the supplier have any responsibility for determining
medical necessity for that power wheelchair?” Whitten
responded, “The supplier has to know whether the beneficiary
meets the coverage criteria in order to bill it correctly. They
need to verify and collect medical records . . . . So, yes, they
do.” Whitten did not say the supplier has to know that the
physician has determined medical need; rather, she said the
supplier has to “know” whether the beneficiary “meets” the
criteria, indicating the supplier must use judgment. The fact
that this determination is made by “verifying” medical
records does not mean that the supplier lacks discretion.

    Whitten also described power wheelchair suppliers’
obligation to perform a Home Assessment to ensure that the
beneficiary’s home provides adequate space. She indicated
that Medicare would not pay a claim for a power wheelchair
for which a Home Assessment had not been performed. She
explained that it is important that the device provided to the
                  UNITED STATES V. ADEBIMPE                           23

beneficiary be “appropriate,” both for the beneficiary’s home
and for the beneficiary’s size and weight—and she noted that
there was some “wiggle room” in this latter determination.
Whitten explained that the supplier (not the physician)
initially selects the appropriate equipment: suppliers are
“pretty knowledgeable on their equipment, [they] will assess
that patient, and determine what is the best type of mobility
. . . equipment that beneficiary needs.” The assessments,
evaluations and determinations described by Whitten require
professional judgment; they are not “ministerial” activities.

    Dr. Fullerton also described the supplier’s role in ways
that are inconsistent with the dissent’s “ministerial” label.
Dr. Fullerton repeatedly described the process of justifying
the medical need for a piece of equipment as a
“collaboration” between the physician and the supplier, where
“there’s an independent responsibility for each side to get it
right.”4 Indeed, Dr. Fullerton testified that a supplier would
request more documentation from a physician if the supplier
“felt” that the documentation was inadequate, describing an
exercise of judgment, not adherence to a checklist.

 4
   The dissent discounts Dr. Fullerton’s testimony because Dr. Fullerton
said that suppliers base their decision on the physician’s records and
physicians have the ultimate responsibility to sign off on the equipment.
Dissent at 31–32. But there is no evidence that the physician’s ultimate
approval of equipment eliminates the supplier’s independent responsibility
to determine the coverage criteria have been met. Again, suppliers have
this responsibility because “they’re the ones that are going to get
reimbursed” by Medicare for the equipment. The facts of this case
demonstrate that Medicare’s trust can be abused where both the physician
and the power equipment supplier fail to satisfy their independent
obligations.
24              UNITED STATES V. ADEBIMPE

     We agree with the dissent that Medicare assigns the
physician both the initial and the final responsibility for
determining the medical need for a power wheelchair.
Moreover, it is clear that power wheelchair suppliers
generally rely on medical records prepared by the physician.
But that does not mean power wheelchair suppliers lack an
obligation to ensure the need for the equipment they provide,
or that they do not exercise discretion in meeting that
obligation. Medicare expects the power wheelchair supplier
to determine a power wheelchair is appropriate for the
beneficiary’s home and personal circumstances, and to verify
medical records actually support a determination of medical
need for the equipment. If the equipment is not appropriate
or the records do not provide enough support—perhaps
because they lack sufficient detail for the supplier to
determine medical need, or because inconsistencies in the
records raise red flags—the power wheelchair supplier is
expected to exercise discretion by not completing the order
until enough documentation is provided, or at least by
selecting the GA or GZ modifier (indicating that medical
necessity has not been shown), instead of KX (indicating that
all of the coverage criteria are satisfied).

    Finally, the dissent argues that our decision will greatly
expand the reach of the enhancement, potentially including
individuals convicted of tax fraud. Dissent at 37. If the
record were as the dissent reads it, this may be a valid
concern.      However, as we have emphasized, power
wheelchair suppliers do not merely “report” to Medicare that
physicians have filled out the proper paperwork. Instead,
power wheelchair suppliers are only supposed to submit a
claim for equipment with the KX modifier if they are
satisfied that the claim is appropriate and adequately justified
by medical need. The power wheelchair supplier’s decision
               UNITED STATES V. ADEBIMPE                    25

requires professional judgment, distinguishing this case from
that of the ordinary taxpayer.

                              IV

    We also hold that the district court did not clearly err in
finding that Sogbein’s and Adebimpe’s abuse of their position
of trust “significantly facilitated the commission or
concealment of the offense.” See U.S. Sentencing Guidelines
Manual § 3B1.3; see also Aubrey, 800 F.3d at 1134 (district
court did not clearly err in finding contractor’s abuse of his
position of trust significantly facilitated his offense of
misappropriating construction funds, where the contractor
shifted the funds among various accounts with little
oversight). Sogbein provided individuals with expensive and
unnecessary medical equipment without performing the
required home assessments. Medicare reimbursed Sogbein at
more than three times his out-of-pocket cost for the
wheelchairs, totaling payments to Sogbein of more than $1.5
million.      And Sogbein was able to obtain these
reimbursements with hardly any oversight by enrolling in
Medicare’s electronic payment system and certifying the
validity of his claims.

    Once Sogbein’s company came under scrutiny from
Medicare, he sent Dr. Calaustro’s wheelchair referrals to
Adebimpe’s company, Dignity. Like Sogbein, Adebimpe
enrolled her company in Medicare’s electronic payment
system by certifying the validity of Dignity’s claims,
allowing the claims to be reimbursed automatically.
Adebimpe’s abuse of her position of trust allowed Dignity to
submit approximately $1.5 million in fraudulent claims to
Medicare, again with virtually no oversight.
26              UNITED STATES V. ADEBIMPE

    In light of these facts, the district court’s conclusion that
Sogbein and Adebimpe’s abuse of their positions of trust
significantly furthered the offense was not clearly erroneous.
See Aubrey, 800 F.3d at 1134.

     AFFIRMED.

PAEZ, Circuit Judge, dissenting:

    I do not agree with the majority that the enhancement for
abuse of trust under United States Sentencing Guideline
§ 3B1.3 applies to Adebimpe and Sogbein’s (“defendants”)
position as durable medical equipment (“DME”) suppliers in
the Medicare program. In my view, DME suppliers do not
exercise substantial professional or managerial discretion
within Medicare’s reimbursement scheme because
Medicare’s rules and regulations confine them to a ministerial
role and leave all critical determinations of medical need to
the beneficiary’s physician. I recognize that our sister
circuits are divided on this issue, compare United States v.
Willett, 751 F.3d 335 (5th Cir. 2014) (upholding application
of abuse-of-trust enhancement to DME supplier) with United
States v. Garrison, 133 F.3d 831 (11th Cir. 1998) (rejecting
application of the enhancement to a supplier), but I find the
Eleventh Circuit’s approach most persuasive. Therefore, I
respectfully dissent from the majority’s decision to affirm the
district court’s application of the abuse-of-trust enhancement.

                               I.

    In United States v. Contreras, we reevaluated our
precedent on the abuse-of-trust enhancement in light of the
                   UNITED STATES V. ADEBIMPE                        27

U.S. Sentencing Commission’s revisions to the commentary
accompanying section 3B1.3. 581 F.3d 1163 (9th Cir. 2009),
opinion adopted in part, vacated in part on other grounds,
593 F.3d 1135 (9th Cir. 2010) (en banc). In Contreras, we
held that the Ninth Circuit’s prior emphasis on a defendant’s
“freedom to commit a difficult-to-detect wrong” was
“incompatible” with section 3B1.1’s revised commentary,
which made the presence of substantial “professional or
managerial discretion” the key inquiry. Id. at 1165–66. In so
concluding, we rejected the district court’s application of the
enhancement to Contreras, a prison cook who took advantage
of the fact that she “could enter the prison without being
searched” to smuggle drugs to inmates. Id. at 1168. This fact
alone “did not demonstrate the necessary discretion” to
justify the enhancement, and the court expressed concern that
“to hold otherwise would extend § 3B1.3 to virtually every
employment situation.” Id. (internal quotation marks and
alterations omitted). As detailed below, the evidence at trial
outlining the role of DME suppliers does not demonstrate that
they exercise the type of discretion the abuse-of-trust
enhancement seeks to capture as interpreted by our opinion
in Contreras.

                                  II.

     The process by which Medicare reimburses a DME
supplier for a power wheelchair is carefully outlined in a
document known as the Power Mobility Device Local
Coverage Determination (LCD).1 According to the LCD, the
first step is the completion of a “face-to-face examination”
between the physician and patient. The physician must
document the results of the examination in a detailed report,

 1
     The Power Mobility Device LCD was admitted at trial as Exhibit 55.
28             UNITED STATES V. ADEBIMPE

which “should be tailored to the individual beneficiary’s
condition,” “paint a picture of the beneficiary’s functional
abilities and limitations on a typical day,” and generally
“contain as much objective data as possible.”

    If, after the examination, the physician believes that the
patient requires a power mobility device, she must complete
a “7-Element Order.” As the name suggests, these orders
have seven specific requirements:

1. Beneficiary’s name
2. Description of the item that is ordered. []
3. Date of the face-to-face examination
4. Pertinent diagnoses/conditions that relate to the need for
   the POV or power wheelchair
5. Length of need
6. Physician’s signature
7. Date of physician signature

Although the DME supplier “may provide a template order
listing the seven required elements,” the supplier is expressly
“prohibited from completing any part of it.” Only the
physician who conducted the examination may prepare the
order, which the supplier must receive within forty-five days
of the face-to-face examination.

    Relying on the physician’s order, the supplier prepares a
“detailed product description.” Although the supplier selects
the “specific power mobility device that is appropriate” based
on the order, the options are narrowly confined by specific
medical requirements. For example, a separate “Wheelchair
Seating” LCD provides that a “skin protection seat cushion”
is covered only if the beneficiary has one of several specific
medical conditions (e.g., a “current pressure ulcer”) that the
                   UNITED STATES V. ADEBIMPE                           29

physician diagnosed.2 Moreover, final approval of the
specific device selected rests with the physician, who “must
sign and date the detailed product description and the supplier
must receive it prior to delivery.”

    As a final step, “[p]rior to or at the time of delivery” of
the power mobility device, “the supplier or practitioner must
perform an onsite evaluation of the beneficiary’s home to
verify that the beneficiary can adequately maneuver the
device that is provided considering physical layout, doorway
width, doorway thresholds, and surfaces.” In other words,
Medicare requires confirmation that the device is compatible
with the beneficiary’s home.

    Once this process is complete, the DME supplier submits
the claim to Medicare for payment. The supplier must add
one of four “modifier” codes to the claim submission: KX,
GA, GY, and GZ. The GA and GZ modifiers are used where
there is “an expectation of a medical necessity denial,” while
the GY modifier is required when the power mobility device
is “only needed for mobility outside the home.” This leaves
the KX modifier as the only option when the DME supplier
seeks reimbursement for a power wheelchair used within the
home and “all of the coverage criteria specified in [the] LCD
have been met.”

                                  III.

    Unlike the majority, I do not view the DME supplier’s
role in this process as “characterized by professional or
managerial discretion (i.e., substantial discretionary judgment
that is ordinarily given considerable deference).” U.S.S.G.

 2
     The Wheelchair Seating LCD was admitted at trial as Exhibit 57.
30                 UNITED STATES V. ADEBIMPE

§ 3B1.3 cmt. n.1. Most importantly, the supplier is not
responsible for “determining the need for the equipment they
provide.” Majority Opinion (“Maj. Op.”) at 4. Rather, the
supplier verifies that the physician has followed the LCD
process by conducting the face-to-face-evaluation and
completing the 7-Element Order. In essence, the supplier
compares the physician’s order with the detailed checklist
laid out in the LCD. This does not reflect substantial
professional or managerial discretion.3 Furthermore, any add-
ons the supplier might suggest for the device must fit within
the parameters of the medically-specific LCD and must be
approved for medical need by the physician. Although the
supplier may have “some ‘wiggle room’” when matching the
device to the beneficiary’s size and weight, Maj. Op. at
22–23, wiggle room does not rise to the level of the
substantial discretion envisioned by the Guidelines. Nor does
the supplier’s performance of a home visit confer the type of
substantial discretion envisioned by the Guidelines. Although
some experience with the power mobility devices’ sizes and
functionality may be helpful, verifying “that the beneficiary
can adequately maneuver the device that is provided
considering physical layout, doorway width, doorway
thresholds, and surfaces” is not a decision that requires
“professional or managerial discretion,” let alone substantial

 3
    The majority is correct that, in addition to verifying the physician’s 7-
Element Order, the supplier determines that the “basic coverage criteria”
are met. Maj. Op. at 19–20. The coverage criteria, however, are largely
duplicative of the 7-Element Order, and thus do not require the exercise
of substantial discretion. For example, the majority notes that the first
criterion is whether the “beneficiary has a mobility limitation that
significantly impairs his/her ability to participate in one or more mobility-
related activities of daily living.” But this criterion largely mirrors the
fourth element in the 7-Element Order: “Pertinent diagnoses/conditions
that relate to the need for the POV or power wheelchair.”
                UNITED STATES V. ADEBIMPE                     31

discretion. Finally, the fact that suppliers must “personally
certify the validity of their claims to Medicare” is not a
discretionary decision when the supplier has to select the KX
modifier in order to receive reimbursement. Although
Medicare may rely on the honesty of DME suppliers who
enter KX on their claims, such reliance does not transform the
decision to enter that code into a discretionary one. A
decision not to seek reimbursement because the coverage
criteria are not satisfied is not discretionary; it is the only
decision allowed under the LCD.

    The majority’s attempts to magnify the role of a DME
supplier do not accurately reflect the LCD requirements or
the testimony at trial. For example, the majority describes
Jody Whitten, the Noridian representative, as testifying that
“medical equipment suppliers have a responsibility to
determine the medical necessity of power wheelchairs[.]”
Maj. Op. at 7. But Whitten never said that the supplier
determines medical need; rather, she testified that the supplier
has to “verify and collect medical records, verify all the orders
and Detailed Product Descriptions are received in a timely
manner, and verify that the home provides enough room.”
This verification is important, but it is ministerial in nature—
only the physician is entrusted with the discretionary medical
need determination under the LCD regulations. Nor does the
supplier exercise professional discretion by sometimes
producing, upon Medicare’s request, physician notes to
corroborate laboratory results, diagnostic tests, or the findings
of the physician’s face-to-face examination. Maj. Op. at 21.

    Similarly, the majority points to the testimony of Dr. John
Fullerton, the government’s Medicare expert, who stated that
a supplier can “absolutely” question a physician’s order
because both have an “independent responsibility . . . to get
32             UNITED STATES V. ADEBIMPE

it right.” When pressed, however, on the supplier’s so-called
“independent responsibility,” Dr. Fullerton stated only that
the supplier must “look[] back at the physician and get[]
physician records.” He acknowledged that “ultimately, it’s
the physician who’s responsible for signing off on the type
and the accessories” for a power wheelchair.

    The majority’s analysis is also flawed because it relies on
the defendants’ fraudulent behavior to establish that they
occupied a position of trust. For example, the majority
explains that “Sogbein was not merely processing
prescriptions written by Dr. Calaustro; rather, he was
affirmatively instructing his co-conspirators to help him
deliver a specific, high-cost piece of equipment he selected.”
Maj. Op. at 17. But the fact that Sogbein directed Dr.
Calaustro to write prescriptions regardless of medical need is
the fraudulent conduct for which he was convicted. By
instructing Dr. Calaustro, he went beyond his authority as a
supplier and usurped the discretion that Medicare gives to
physicians. This is grounds for a fraud conviction, but not for
the enhancement. Similarly, as further evidence of supplier
discretion, the majority points to Dr. Fullerton’s testimony
that if a DME supplier receives the kind of “woefully
inadequate” documentation for an order that Dr. Calaustro
provided, the supplier should request more documentation
rather than deliver the order. Maj. Op. at 9. Again, however,
defendants’ failure to request additional documentation was
part of the underlying fraud in this case, rather than a
legitimate exercise of discretion approved of by Medicare.

    To apply the abuse-of-trust enhancement, there must be
more than a modicum of discretion—there must be
substantial professional or managerial discretion inherent in
the role occupied by the defendant. See Contreras, 581 F.3d
                UNITED STATES V. ADEBIMPE                     33

at 1168. That discretion is absent here. Medicare has
carefully circumscribed DME suppliers’ role in the supplying
of power mobility devices, entrusting the critical,
discretionary decisions to physicians that have the
professional skill and training to determine a beneficiary’s
medical need. Verifying the physician’s order, confirming
the device is usable in the beneficiary’s home, and applying
the KX modifier to indicate that all Medicare criteria have
been met, while important tasks for the processing of power
mobility device claims, are ministerial in nature and do not
require substantial discretionary judgment as required by
section 3B1.3.

                              IV.

                               A.

    Every Ninth Circuit case that has affirmed the application
of the enhancement involved a defendant with substantial
discretion that went well beyond the ministerial tasks that
Medicare delegates to suppliers. In United States v. Laurenti,
we affirmed the enhancement as applied to a stock broker
based on the “professional discretion Laurenti exercised in
selecting which securities to recommend, and the deference
his recommendations received in light of his special
knowledge and expertise” in the field. 731 F.3d 967, 974 (9th
Cir. 2013). Laurenti’s provision of “investment advice” and
ability to “identify securities that would further his [client’s]
objectives,” id., is a far cry from defendants’ obligation to
verify that each physician report contains Medicare’s seven
required elements and that each beneficiary’s home is large
enough to accommodate a power wheelchair.
34                UNITED STATES V. ADEBIMPE

    Nor is the supplier’s role comparable to the defendant’s
in United States v. Aubrey, 800 F.3d 1115 (9th Cir. 2015). In
that case, the defendant “controll[ed] the entire operations of
a non-profit” that constructed housing projects on the Navajo
Nation Reservation.4 Id. at 1134. While managing those
projects, he improperly “shifted” HUD funds “among the
various accounts he controlled” with “little oversight” by
FDHC, the sub-grantee that supervised Aubrey’s work and
reimbursed his expenses. Id. Given those facts, we
concluded that Aubrey occupied a position of trust with
FDHC. Id. Here, by contrast, Medicare exercises significant
“oversight” over DME suppliers through the LCD rules,
which dictate every step the supplier must take to obtain
reimbursement. DME suppliers simply do not exercise the
type of freedom in processing power mobility device claims
that Aubrey enjoyed over the management of the affordable
housing developments. Further, the discretion vested in
defendants over the internal operations of their businesses
“carr[ies] no special weight” because that discretion is
unrelated to the Medicare claims reimbursement process
governed by the LCD. United States v. West, 56 F.3d 216,
221 (D.C. Cir. 1995)

  4
     The funding process for such projects as outlined in Aubrey was
complex. First, the Department of Housing and Urban Development
(“HUD”) allocated federal money to Indian tribes, there, the Navajo
Nation, to fund affordable housing construction. Id. at 1119. The Navajo
Nation’s Housing Authority, the recipient of the funds, delegated
responsibility for disbursing HUD funds for construction work to a series
of sub-grantees. The Fort Defiance Housing Corporation (“FDHC”) was
one of the relevant sub-grantees. FDHC entered into several development
agreements with defendant and his corporations that gave him the
authority to manage a number of housing construction projects. Id. at
1121.
                UNITED STATES V. ADEBIMPE                     35

    In the Medicare fraud context, we have determined that
physicians occupy a position of trust. United States v.
Rutgard, 116 F.3d 1270 (9th Cir. 1997). This result is
unsurprising given that physicians are explicitly listed in the
Guidelines commentary as having the requisite professional
discretion to justify the enhancement. Both the patient and
Medicare are “easily taken advantage of if the doctor is not
honest,” id. at 1293, because a physician’s specialized
knowledge allows for obfuscation of wrongdoing. Absent
hiring government physicians to re-examine beneficiaries,
Medicare has no way to verify that the determinations of
medical need are accurate. DME suppliers, by contrast, have
the opportunity to commit fraud not because of any
professional discretion or expertise, but because the volume
of claims submitted to Medicare means the government must
rely on supplier certifications and random audits as a check
on fraudulent billing.

                               B.

    Other circuits have recognized that specific statutory
obligations do not confer substantial discretion. In United
States v. Garrison, the Eleventh Circuit refused to apply the
enhancement to a DME supplier convicted of Medicare fraud.
133 F.3d 831 (11th Cir. 1998). The court held that
Medicare’s “statutory reporting requirements do not create a
position of trust” in the supplier, id. at 841, and distinguished
Garrison’s lack of discretion from the hypothetical “physician
who possesses the expertise to create erroneous medical
records and, consequently, fraudulent Medicare reports that
are difficult to detect and to question,” id. at 842. The
majority holds that Garrison is distinguishable from this case
because there the defendant submitted claims to a “fiscal
intermediary whose specific responsibility was to review and
36              UNITED STATES V. ADEBIMPE

approve requests for Medicare reimbursement.” Id. at 841;
Maj. Op. at 14–15, 18. But even if the fiscal intermediary in
Garrison had a larger role than Noridian did here, that still
leaves the Eleventh Circuit’s persuasive reasoning that
suppliers simply follow “statutory reporting requirements,”
id. at 842, while “physicians exercise enormous discretion,”
id. (quoting United States v. Adam, 70 F.3d 776, 782 (4th
Cir. 1995)).

    The Second Circuit similarly rejected an abuse-of-trust
enhancement based on statutory reporting requirements.
United States v. Broderson, 67 F.3d 452 (2d Cir. 1995). The
court held that the defendant’s failure to comply with
“specific legal obligations,” including the “duty to . . . certify
that [] information had been accurately provided” did not
mean he occupied a position of trust. Id. at 455. The court
emphasized that “whatever ‘trust’ [the government] placed in
Broderson was based strictly on the explicit commands” of
two statutes. Id. at 456. Here, too, defendants’ “trust” stems
from Medicare’s LCD rules, not from any professional or
managerial discretion.

    Contrary to the majority, I do not find persuasive the Fifth
Circuit’s contrary conclusion. As the majority explains, that
court in United States v. Willett, upheld the application of the
enhancement to a DME supplier, reasoning that “Medicare
relies on the honesty and forthrightness of DME providers in
their claim submissions.” 751 F.3d 335, 344 (5th Cir. 2014);
see also United States v. Miller, 607 F.3d 144, 150 (5th Cir.
2010) (upholding application of the enhancement to a
supplier because the government “entrusted her to provide
good faith, accurate information in seeking reimbursement,”
thus giving her the “freedom to commit a difficult-to detect
wrong, which is the primary trait of one who holds a position
               UNITED STATES V. ADEBIMPE                   37

of trust”) (internal quotation marks omitted). The Fifth
Circuit ignores that the presence or absence of substantial
professional or managerial discretion, conferred by the
victim, is now the critical inquiry under section 3B1.3. As
Contreras recognized, honesty and the difficulty of detecting
wrongdoing are no longer the primary considerations after the
commentary revisions to section 3B1.3. 581 F.3d at 1166.

                             V.

    The majority attempts to cabin its expansion of the abuse-
of-trust enhancement by stating that “[a] contractor does not
occupy a position of trust merely by doing business with the
government.” Maj. Op. at 18. The majority’s reasoning,
however, can easily be interpreted to lead to that conclusion.
The majority says that “here there is more” than in the
average contractor case because “Medicare trusted
[defendants] to exercise their professional discretion in
providing appropriate medical equipment to individuals who
actually needed it and could use it in their homes.” Id. But
using the key words “professional discretion” does not make
it so. As described above, Medicare entrusts the physician
with the discretion to determine medical need and reserves to
the supplier only the responsibility to verify that the
physician’s order complies with its regulations.

    The majority also relies on the fact that Medicare uses an
“honor system” that depends on suppliers’ forthrightness. Id.
As an initial matter, this conclusion erroneously flows from
the old interpretation of the Guidelines rejected by Contreras
and fails to account for the commentary revisions that make
substantial discretion the key factor. More importantly,
Medicare is far from the only government agency that relies
on an honor system backed up by audits to provide
38              UNITED STATES V. ADEBIMPE

reimbursements. “All taxpayers who file false tax returns, for
example, might be included” under the majority’s approach
because it seems to subject “virtually anyone who is
commanded by statute to make an accurate report to the
government to be subject to a Section 3B1.3 enhancement.”
Garrison, 133 F.3d at 840 (quoting Broderson, 67 F.3d at
455). Thus, in my view, the court’s opinion will lead to a
substantial expansion of this enhancement in contravention of
the commentary revisions, which purposefully “place[d] a
significant limit on the types of positions subject to the abuse-
of-trust enhancement.” Contreras, 581 F.3d at 1166 (quoting
United States v. West, 56 F.3d 216, 220 (D.C. Cir. 1995)).

                              ***

    The majority’s decision to affirm the application of the
abuse-of-trust enhancement to defendants relies on a
mischaracterization of the DME supplier’s role in the
Medicare reimbursement process. Moreover, it represents a
significant expansion of section 3B1.3’s applicability beyond
the narrow situations in which this court has previously
approved of the enhancement’s application. Because I do not
believe Medicare vests substantial professional or managerial
discretion in DME suppliers, I respectfully dissent.