Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
Farah Divanbeigi, D.D.S.,
(OI File No. H-18-41557-4),
Petitioner,
v.
The Inspector General,
Respondent.
Docket No. C-19-431
Decision No. CR5474
DECISION
The Inspector General of the United States Department of Health and Human Services (the IG) excluded Petitioner, Farah Divanbeigi, D.D.S., from participation in Medicare, Medicaid, and all other federal health care programs for her failure to repay a health education loan or enter into a repayment agreement. Petitioner sought review of the exclusion. For the reasons stated below, I overturn the IG’s exclusion determination.
I. Procedural History
By letter dated November 30, 2018, the IG notified Petitioner she was being excluded from participation in Medicare, Medicaid, and all federal health care programs under section 1128(b)(14) of the Social Security Act (Act), 42 U.S.C. § 1320a-7(b)(14), because she had defaulted on a health education loan and made no arrangement to repay
Page 2
the debt. IG Ex. 1 at 1.
Petitioner timely requested a hearing before an administrative law judge. I held a pre-hearing telephone conference attended by the parties on March 14, 2019, the substance of which is summarized in my March 15, 2019 Order Summarizing Pre-hearing Conference and Setting Schedule for Filing Briefs and Documentary Evidence (Summary Order). Among other things, I directed the parties to file pre-hearing briefs articulating their respective arguments as well as identifying witnesses and exhibits in support thereof. Summary Order at 3-4.
The IG filed a brief (IG Br.) and thirteen proposed exhibits (IG Exs. 1 to 13), while Petitioner filed a short-form brief (P. Br.)
II. Exhibits and Decision on the Record
The IG objects to Petitioner’s exhibits which demonstrate her employment at two Federally Qualified Health Clinics (FQHCs) as irrelevant. IG Reply at 2-3. I overrule the IG’s objection and admit P. Exs. A and B to the record. Petitioner’s brief includes a number of “responses” to the IG’s exhibits, some of which appear to be objections; as the IG notes, it appears Petitioner has misunderstood legal citation convention, in which a citation follows the statement it is meant to support. See IG Reply at 4, citing Rebuttal Resp. at 3-4. Any such objections by Petitioner are meritless and are overruled. I therefore admit IG Exs. 1 through 13 into the record.
The IG did not request an in-person hearing. IG Br. at 11. Petitioner did request an in-person hearing and identified herself as the sole witness. P. Br. at 3-4. Petitioner asserts a hearing is necessary because she wishes to “face [her] accuser.” Id. However, there is no right to confront accusers in the context of these proceedings. Moreover, Petitioner has failed to provide her written direct testimony or even a description thereof, and her responses do not otherwise indicate she would present any additional facts through her testimony that I would need to decide this case. Id. at 4. Therefore, a hearing is unnecessary, and I will decide this case on the written record. See Civ. Remedies Div. P. § 19(d).
Page 3
III. Issue
Whether the IG had a basis to exclude Petitioner from participating in Medicare,
Medicaid, and all other federal health care programs under 42 U.S.C. § 1320a-7(b)(14).
IV. Applicable Law
Section 1128(f) of the Act (42 U.S.C. § 1320a-7(f)) provides Petitioner with rights to an administrative hearing and judicial review of the final action of the Secretary of Health and Human Services (Secretary). The right to a hearing before an ALJ is set forth in 42 C.F.R. §§ 1001.2007(a) and 1005.2, and the rights of both the sanctioned party and the IG to participate in a hearing are specified by 42 C.F.R. § 1005.3.
The Act permits the Secretary to exclude
(14) DEFAULT ON HEALTH EDUCATION LOAN OR SCHOLARSHIP OBLIGATIONS. –Any individual who the Secretary determines is in default on repayments of scholarship obligations or loans in connection with health professions education made or secured, in whole or in part, by the Secretary and with respect to whom the Secretary has taken all reasonable steps available to the Secretary to secure repayment of such obligations or loans . . . .
Act § 1128(b)(14); see also 42 C.F.R. § 1001.1501(a)(1).
The IG must ensure that the administrator of the loan has taken reasonable steps to secure repayment of the loan or obligation. 42 C.F.R. § 1001.1501(a)(2). The IG must also take into account to what extent exclusion would affect beneficiary access to physician
Page 4
services for which payment could be made under Medicare, Medicaid, or other federal health care programs. Id. at § 1001.1501(a)(3). Finally, the IG may not exclude a physician if he or she is the “sole community physician” or the only source of “essential specialized services” in a community, if a state requests that individual not be excluded. Id. at § 1001.1501(a)(4).
Exclusion on this basis persists until the administrator of the loan program notifies the IG that the default has been cured or that the debt is no longer outstanding, at which time the IG will notify the excluded individual of the right to apply for reinstatement. Id. at § 1001.1501(b).
The standard of proof I apply in this proceeding is a preponderance of the evidence. 42 C.F.R. § 1001.2007(c). Petitioner bears the burden of proof and the burden of persuasion on any affirmative defenses or mitigating factors; the IG bears the burden on all other issues. 42 C.F.R. § 1005.15(c).
V. Findings of Fact, Conclusions of Law, and Analysis
My conclusions of law are set forth in bold and followed by pertinent findings of fact and analysis.
A. I have jurisdiction to hear this case.
Petitioner timely requested a hearing. I therefore have jurisdiction to hear and decide this case. See 42 C.F.R. §§ 1001.2007(a)(1)-(2), 1005.2(a); see also 42 U.S.C. § 1320a-7(f)(1).
B. The IG did not establish a basis for Petitioner’s exclusion pursuant to section 1128(b)(14) of the Act.
Exclusion from participation in Medicare, Medicaid, and all federal health care programs is permitted by section 1128(b)(14) of the Act where: (1) an individual is in default on repayments of scholarship obligations or loans in connection with health professions education made or secured, in whole or in part, by the Secretary; (2) the Secretary has taken all reasonable steps to secure repayment of such obligations or loans; (3) the IG has taken into account the effect exclusion would have on beneficiary access to physician services for which payment could be made under Medicare, Medicaid, or other federal health care programs; and (4) the individual in question is not the “sole community physician” or the only source of “essential specialized services” in a community on whose behalf a state has requested exclusion be withheld. 42 C.F.R. § 1001.1501(a). As I discuss below, the IG did not establish by a preponderance of the evidence that she took into account the effect Petitioner’s exclusion would have on beneficiary access to physician services.
Page 5
1. Petitioner was in default on repayment of a health education loan that was secured in whole or in part by the Secretary.
Petitioner applied for a Health Education Assistance Loan (HEAL) in December 1994, seeking to consolidate pre-existing loans, including another HEAL, after completing dental school. IG Ex. 2 at 1-2. In May 1995, Petitioner executed a promissory note concerning her HEAL, promising to repay the note holder, Household Bank; the balance at that time was $85,887.51. IG Ex. 3, Att. 1 at 1. On June 15, 2004, a Nevada state court entered judgment in favor of Pennsylvania Higher Education Assistance Agency (PHEAA) against Petitioner for the amount she had failed to pay, which by that time had increased to $123,070.29 in principal, $8,777.90 in interest, and $40 in late fees. IG Ex. 4 at 1. Accordingly, I have no difficulty concluding Petitioner’s loan was in default.
I also conclude that Petitioner’s defaulted loan was a health education loan secured by the Secretary. A HEAL is by definition made in connection with a health professional’s education – from 1978 through 1998, under the auspices of the HEAL program, the Department of Health and Human Services (HHS) insured loans made by participating lenders to graduate students in schools of medicine and other health care fields, including dentistry. See U.S. Dep’t of Ed., Federal Student Aid, Health Education Assistance Loan (HEAL) Information, available at https://ifap.ed.gov/HEALInfo/HEALInfo.html (last visited Sep. 12, 2019). Petitioner obtained this loan to finance her dental education, and her loan was insured by HHS. The loan at issue here was therefore made in connection with Petitioner’s health education and was secured by the Secretary.
Petitioner does not deny she sought this loan in connection with her dental education or that she did not make payments sufficient to avoid default. Instead, she argues that her work at two Federally Qualified Health Centers (FQHCs)
Page 6
2. The Secretary has taken all reasonable steps to secure repayment of Petitioner’s loan.
The IG has established by preponderance of the evidence that the Secretary has taken all reasonable steps to secure repayment by Petitioner prior to making the decision to exclude her. Upon obtaining a default judgment against Petitioner, PHEAA assigned her loan to the U.S. government for purposes of recovery. IG Ex. 4 at 3; IG Ex. 5.
By letter dated August 31, 2004, HHS’ Debt Management Branch attempted to contact Petitioner to recover the default amount or establish a repayment agreement. IG Ex. 6. HHS notified Petitioner her defaulted loan had been assigned to the U.S. government and that it had consolidated her loan using the lowest interest rate available. Id. HHS also provided her instructions to enter into a repayment agreement if she could not pay the entire amount due of $132,086 and warned her that failing to pay the debt or enter into a repayment agreement would result in referral to a collection agency or the Department of Justice for enforcement. Id.
Receiving no response from Petitioner, HHS issued a letter on November 1, 2004 informing her that her debt had been referred to its own collection agency. IG Ex. 7. Again receiving no response from Petitioner, HHS issued another letter on December 23, 2004 advising Petitioner that the debt from her “seriously delinquent” account would be referred to other federal agencies for administrative offset. IG Ex. 8. HHS reiterated Petitioner could pay the debt or enter into a repayment agreement. Id. HHS sought to contact Petitioner on two more occasions, in May 2005 and June 2017,
Based on these efforts, it is difficult to see what other steps the Secretary could have undertaken to secure repayment from Petitioner. Other judges in this division have consistently found repeated efforts by the Secretary to communicate with the debtor and obtain full satisfaction have been considered ample evidence of the Secretary’s reasonable efforts to recover the debt. See, e.g., Michael J. Rosen, M.D., DAB CR1566 (2007); Aloysius C. Maduford, M.D., DAB CR905 (2002); Michael D. Lawton, M.D., DAB CR771 (2001); Georgia Goldfarb, M.D., DAB CR670 (2000); Yolanda Crespo Capo Fernandez, D.O., DAB CR606 (1999); Mohammad H. Azarpira, D.D.S., DAB CR372 (1995).
Page 7
In response, Petitioner asserts only that she either had not seen notices contained at Exs. 6 through 9 prior to this litigation or simply had no contact or communication with a debt collector. Rebuttal Resp. at 5-6. However, Petitioner does not assert the address used by HHS, P.O. Box 35835, Las Vegas, NV 89133, was incorrect. Indeed, her hearing request filed before me after she received the IG’s notice of exclusion bore the same address on the mailing envelope. DAB E-file Dkt. No. C-19-431, Doc. No. 1 at 2. HHS also issued the June 2017 notice to 2508 Ocean Front Drive, Las Vegas, NV 89128, the same address provided by Petitioner in the header to her request for hearing. Id. at 1; IG Ex. 10. Both addresses therefore appear to be valid and still used by Petitioner in 2019. I find it highly unlikely that none of the notices described above were successfully delivered to Petitioner. As such, her claim that she did not receive the notices is incredible.
In sum, I find the IG has demonstrated the Secretary took all reasonable measures to collect the debt owed by Petitioner prior to her exclusion.
3. Petitioner is a “physician” within the meaning of section 1128(b)(14) of the Act.
The Act permits the IG to exclude any “individual” who defaults on a health education loan made or secured in whole or in part by the Secretary if the Secretary has taken “all reasonable steps” to secure repayment of that obligation. Act § 1128(b)(14); 42 C.F.R. § 1001.1501(a)(1). However, Congress imposed two additional strictures where that individual is a “physician” – first, the Secretary must take into account the impact exclusion of a physician would have on beneficiary access to physician services for which payment could be made under Medicare, Medicaid, or other federal health care programs. Act § 1128(b)(14); 42 C.F.R. § 1001.1501(a)(3). Second, the Act altogether precludes exclusion if the physician is a “sole community physician” or “sole source of essential specialized services in a community” and a state requests that physician not be excluded. Act § 1128(b)(14); 42 C.F.R. § 1001.1501(a)(4).
Because the Act and the regulations clearly contemplate these latter two requirements be imposed only on physicians, I ordered the IG to provide supplemental briefing and indicate whether she believes Petitioner is a “physician” within the meaning of section 1128(b)(14) of the Act and 42 C.F.R. §§ 1001.1501(a)(3) and (a)(4). The IG filed her supplemental brief on September 25, 2019 and clarified that she interpreted the Act to define Petitioner as a “physician” for purposes of exclusion under section 1128(b)(14) of the Act. IG Supp. Br. at 2-3, citing 42 U.S.C. § 1395x(r)(2); 42 C.F.R. § 410.20.
The IG’s argument is persuasive. The provision at issue here requires the Secretary to consider the impact of exclusion on “access of beneficiaries to physician services for which payment may be made under title XVIII or XIX.” Act § 1128(b)(14). 42 U.S.C. § 1395x(r)(2) specifically defines the term “physician” to include “[doctors] of dental surgery or of dental medicine” for the purposes of the subchapter in which it is
Page 8
incorporated, Subchapter XVIII, which pertains to Medicare; see also 42 C.F.R. § 410.20(b)(2) (providing “Physicians’ services” for which Medicare Part B will provide payment to include those provided by “[a] doctor of dental surgery or dental medicine”).
Similarly, provisions of Title XIX that pertain to payments for medical assistance made under the Medicaid program explicitly use the same definition of the term “physician.” See 42 U.S.C. § 1396d(a)(5)(B) (incorporating by reference 42 U.S.C. § 1395x(r)(2)). I am therefore satisfied that Congress intended the Secretary to consider Petitioner a “physician” for purposes of exclusion under section 1128(b)(14) of the Act, meaning I must consider whether the IG has satisfied the additional two elements to exclude a physician under section 1128(b)(14) of the Act.
4. Petitioner is not a “sole community physician” or the only source of “essential specialized services” in a community on whose behalf a state has requested exclusion be withheld.
The latter of the two additional elements easily resolves in favor of the IG. Petitioner does not contend she is a “sole community physician” or a source of “essential specialized services” as either of those terms are used in the Secretary’s regulations. Nor has she presented any evidence a state has requested that she not be excluded for either reason.
5. The IG has not shown she took into account the effect Petitioner’s exclusion would have on beneficiary access to services for which payment could be made under Medicare, Medicaid, or other federal health care programs.
The record before me does not establish the IG has taken into account the impact of Petitioner’s exclusion on Medicare beneficiaries. Here, the entirety of the IG’s efforts to do so are outlined in a sworn declaration from Investigations Analyst Tamara Johnson outlining her efforts to assess the effect Petitioner’s exclusion would have on federal health care program beneficiaries, after HHS initiated the process to exclude Petitioner in February 2018. IG Ex. 12.
Ms. Johnson first used Petitioner’s National Provider Identifier (NPI) and Nevada dental license to determine her practice location
Page 9
license was in both a Medically Underserved Area (MUA) and in a Health Professional Shortage Area (HPSA). Id. at Att. C. She utilized an online tool created by the Health Resources & Services Administration to calculate a Dental Health HPSA score, in this case 19 out of 26.
To advise Petitioner that the IG was contemplating her exclusion and to provide Petitioner an opportunity to provide further information regarding the nature of her practice, Ms. Johnson issued the IG’s Notice of Intent to Exclude on September 6, 2018. IG Exs. 11, 12. The Notice of Intent advised Petitioner – in bold font – that the IG was aware she possibly worked in a medically underserved area, and stated “[if] you have evidence that beneficiary access to physician services would be affected by your exclusion, it is extremely important that you provide such information to our office.” IG Ex. 11 at 2. This notice was issued to Petitioner at the Ocean Front address she used in her hearing request, as well as the P.O. Box address she used, and in addition, a third address. Id. Despite the IG’s pointed request for more information, however, Petitioner did not respond. IG Ex. 12 at 2.
The IG implicitly reasons that Petitioner’s failure to respond to her demand to provide additional information satisfies the IG’s burden to take into account the impact of Petitioner’s exclusion. IG Br. at 6. But the IG fails to cite any authority for her implied argument that she could simply shift the burden of proof to make such a showing to Petitioner.
In response, Petitioner simply claims she never received the IG’s Notice of Intent to Exclude. Rebuttal Resp. at 7. This particular correspondence was directed to Petitioner’s home and P.O. Box addresses listed on her own hearing request, as well as an address the IG believed to be her last known practice address. IG Reply at 6 n.3. I find it highly unlikely Petitioner has never received any of the IG’s correspondence, as she generally claims. I find it far more likely Petitioner received the notice (as well as all the other collection letters and notices HHS and the IG sent to those same addresses), and simply chose to ignore them.
Nevertheless, even if Petitioner received this notice and declined to cooperate, the IG has not explained how she was relieved of the burden placed on her by Congress to take into account the impact of Petitioner’s exclusion on beneficiary access to the services Petitioner could provide and be paid for under federal health care programs.
In fact, the limited efforts the IG did make only serve to militate towards concluding Petitioner’s exclusion would indeed have a significant impact. The IG established that Petitioner practiced in both a MUA and a HPSA. IG Ex. 12 at Att. C. The IG also
Page 10
calculated a Dental Health HPSA score of 19 for Petitioner’s practice address. The IG submitted this score to me without providing any context, but I observe that according to the Health Resources & Services Administration, whose website the IG relied upon to calculate the score, “HPSA Scores are developed for use by the National Health Services Corps to determine priorities for the assignment of clinicians. Scores range from . . . 1 to 26 for dental health. The higher the score, the greater the priority.” Health Resources & Servs. Admin., Health Professional Shortage Areas (HPSA) – Dental Health, available at https://data.hrsa.gov/ExportedMaps/HPSAs/HGDWMapGallery_BHPR_HPSAs_DC.pdf (last rev. Nov. 14, 2019). Petitioner’s score of 19 thus suggests that her particular area was deemed a higher priority for the assignment of clinicians to address the shortage of dentists in her practice area.
Of course, the established shortage of dentists in Petitioner’s practice area does not necessarily mean her exclusion would result in an undue impact on program beneficiaries. Moreover, nothing in Section 1128(b)(14) of the Act or its corresponding regulation suggests that Congress intended to exempt from exclusion all health care professionals working in MUAs or HPSAs. But in this case, there is simply no basis to reach any conclusion at all, because the IG took no further steps beyond establishing Petitioner worked in an underserved area. While it is true Petitioner did not provide additional data for the IG to make her impact assessment, neither the regulations nor the Act required Petitioner to do so. Instead, it was the IG’s burden to meet the statutory and regulatory elements for exclusion and therefore to gather any information necessary to make that assessment. 42 C.F.R. § 1005.15(c).
The clear implication of the IG’s attempt to shift her burden of production to Petitioner is that Petitioner had sole control of the information needed for the IG to assess the impact of her exclusion. But the IG could have sought data controlled by the government itself, in particular the Medicare and Medicaid programs. For example, the IG could have:
- determined the number of dentists in the MUA or HPSA in which Petitioner’s practice was located that were enrolled as suppliers in the Medicare or Medicaid programs;
- determined the number of Medicare and Medicaid beneficiaries in the MUA or HPSA where Petitioner’s practice was located on whose behalf claims were made or could have been made;
- determined the number of claims made by dentists on behalf of beneficiaries to the Medicare or Medicaid programs in the MUA or HPSA where Petitioner’s practice was located;
Page 11
- determined the number of claims paid out to dentists by Medicare, Medicaid, or other federal health care programs in the MUA or HPSA where Petitioner’s practice was located; or
- determined the number of claims made by Petitioner herself to the Medicare, Medicaid, or other federal health care programs, and the number of her claims that were actually paid.
This is a non-exhaustive list of relevant points of data the IG could have considered in order to make a good-faith assessment of the impact of Petitioner’s exclusion. Critically, acquisition of this data did not require Petitioner’s cooperation at all and would have served to provide the IG (and myself) a sense of how deeply Petitioner’s exclusion would impact program beneficiaries in the medically underserved area where she practiced.
Instead, the IG established only that Petitioner appeared to work as a dentist in an underserved area, and then ceased to make any further efforts at assessment after Petitioner declined to cooperate in the effort to exclude her. Therefore, I cannot say based on the facts before me that the IG has adequately taken into account – or even tried to assess – the impact of Petitioner’s exclusion on program beneficiaries in her area. Congress clearly required the Secretary to take that factor into account when exercising the discretion to exclude a physician for defaulting on a health education loan. As such, I cannot affirm the IG’s exclusion effort in this instance.
C. The IG’s exclusion notice does not comport with the language of 42 C.F.R. § 1001.1501(b).
While I overturn the IG’s exclusion determination in this matter, I note for the record that the IG’s notice of exclusion in this case incorrectly states Petitioner’s exclusion will continue “until the entire judgment amount and all accrued interest have been paid in full. If you pay your entire debt, you may be eligible for reinstatement . . . .” IG Ex. 1 at 2. The notice also stated “[i]f you enter into an agreement to repay your debt, you may be eligible to obtain a stay of your exclusion.” Id.
This language misstates the legal standard by which Petitioner may seek reinstatement.
Page 12
Should the IG issue another notice of exclusion to Petitioner in the future, it should correctly reflect that once the administrator of Petitioner’s loan notifies the IG that Petitioner has either repaid her debt in full or cured her default status by entering into a repayment agreement, the IG is obliged to inform Petitioner of her right to apply for reinstatement. 42 C.F.R. § 1001.1501(b).
VI. Conclusion
The IG has convincingly demonstrated a rationale to exclude Petitioner, who has consistently ignored all efforts made by the Secretary to communicate with her concerning the student loan debt she promised to repay. I advise Petitioner to enter into a repayment plan with the Secretary. While I have ruled in Petitioner’s favor owing to a legal requirement the IG did not technically meet, the IG can remedy that defect and again attempt to exclude her. If Petitioner has in fact participated in a loan forgiveness program, as she claims, then she need only submit documentation of that agreement to the Secretary. In either case, Petitioner should no longer simply ignore her debt to the government.
For the foregoing reasons, I reverse the IG’s determination to exclude Petitioner from participation in Medicare, Medicaid, and all federal health care programs pursuant to section 1128(b)(14) of the Act (42 U.S.C. § 1320a-7(b)(14)). I order the IG to reinstate Petitioner as a participating supplier in Medicare, Medicaid, and all other federal health care programs forthwith. 42 C.F.R. § 1001.3005(a)(3).
/s/
Bill Thomas Administrative Law Judge