David Lee Smith, M.D., DAB CR5566 (2020)

DECISION

The Centers for Medicare & Medicaid Services (CMS), acting through its administrative contractor, Palmetto GBA (Palmetto), denied a February 2019 application to enroll in the Medicare program submitted by Petitioner, David Lee Smith, M.D. (herein "Petitioner").  Palmetto denied the enrollment application based on Petitioner's July 2014 felony conviction for reckless homicide.  Petitioner timely requested a hearing before an administrative law judge (ALJ).  For the reasons stated below, I affirm CMS's denial of Petitioner's enrollment application on this basis.

I.  Background and Procedural History

Petitioner is a family medicine physician who practices in South Carolina.  CMS Exhibit (Ex.) 2 at 1-2.  A state criminal court record indicates that Petitioner had been arrested on January 6, 2013, and was originally charged with "Felony driving under the influence, death results, .08" on January 8, 2013.  CMS Ex. 7 at 1.  On July 17, 2014, Petitioner entered a guilty plea to the felony charge of "Reckless Homicide, death results within 3 [years], caused by injury from vehicle."  CMS Ex. 7 at 1.

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On March 29, 2017, the State Board of Medical Examiners for South Carolina (herein "medical board") issued a public order in which it accepted a memorandum of agreement (MOA) signed by Petitioner and continued a previously imposed suspension of Petitioner's medical license.  CMS Ex. 6 at 4.  In support of its actions, the medical board's order included the following factual findings:

3. On or about January 7, 2013, [Petitioner] was in a motor vehicle accident where he struck and killed a pedestrian. [Petitioner] was arrested for a Felony DUI Involving Death.

4. On or about January 16, 2013, [Petitioner] signed an agreement to temporarily surrender his medical license.

5. On or about July 17, 2014, [Petitioner's] criminal charges were resolved when he pleaded guilty to reckless homicide and received a sentence of 5 years upon service of 5 days' time served, and one year probation.

6. On or about November 24, 2015, the Board issued an Interim Order of Reinstatement returning [Petitioner] to work subject to certain conditions.

7. On or about July 13, 2016, the Board issued an Interim Order of Reinstatement removing all work related limitations.

8. On or about July 29, 2016, [Petitioner] was arrested in Georgia on the suspicion of driving under the influence.

9. On or about September 6, 2016, the Board issued an Order of Temporary Suspension.

10. No allegations were made that [Petitioner] abused alcohol or drugs, or was otherwise impaired in any way, when seeing patients.

11. Mike Kelly, Esquire, who represented the accident victim's family, testified that the [Petitioner] admitted from the beginning that he was wrong.

CMS Ex. 6 at 2.  The medical board's conclusions of law included the following:

4. In this case, first and foremost, the Board is sympathetic to the families of all involved. The Board is keenly aware of its duty to protect the citizens of South Carolina. Due to the circumstances involved in this case, the Board concludes that it is appropriate to keep [Petitioner's] license

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suspended for an additional year from the date of this hearing. After November 9, 2017, [Petitioner] may reappear before the Board to demonstrate that he is safe to practice medicine in South Carolina. [Petitioner] must make this appearance before the full Board prior to being reinstated. Finally, the Board concludes that it is appropriate to require [Petitioner] to pay the costs incurred by the Board in the investigation of this matter and to publicly reprimand the [Petitioner].

5. The sanctions imposed are consistent with the purpose of these proceedings and have been made after weighing the public interest and the need for the continuing services of qualified medical professionals against the countervailing concern that society be protected from professional ineptitude and misconduct.

6. The sanctions imposed are designed not to punish the licensee, but to protect the life, health, and welfare of the people at large.

CMS Ex. 6 at 3.

The medical board also concluded that Petitioner's "conduct in this matter constitutes sufficient grounds for disciplinary or corrective action" under S.C. Code Ann. § 40-47-110(B)(2), (4).1   CMS Ex. 6 at 3.  Section 40-47-110(B)(2) applies when a health care professional has been convicted of a "felony or other crime involving moral turpitude or drugs," and section 40-47-110(B)(4) applies in the case of "habitual or excessive use or abuse of drugs, alcohol, or other substances that impair ability."  S.C. Code Ann. § 40-47-110(B)(2), (4).

The medical board ordered, inter alia, that Petitioner be publicly reprimanded and that his suspension would continue until November 9, 2017, at which time it required him to reappear before the Board prior to being eligible for reinstatement.  CMS Ex. 6 at 4.

On February 20, 2019, Petitioner submitted a Medicare enrollment application.  CMS Ex. 2.  In section three of the application pertaining to final adverse legal actions, Petitioner reported that his medical license had been suspended on June 30, 2013.  CMS Ex. 2 at 4.  Petitioner did not report that he had been convicted of felony reckless homicide.  CMS Ex. 2.

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As part of its review of Petitioner's application, Palmetto accessed and/or reviewed databases and public records.  CMS Ex. 2 at 9-23.  A CMS "screening report" reported an "[e]xclusion," a voluntary medical license surrender and a license suspension, a Medicaid termination, and "pending" criminal charges for misdemeanor and felony drug charges and felony driving under the influence, with death resulting.2   CMS Ex. 2 at 9, 12-13.

On June 19, 2019, Palmetto issued an initial determination in which it denied Petitioner's enrollment application because he had a felony conviction within the preceding 10 years that was detrimental to the best interests of the Medicare program and its beneficiaries.  CMS Ex. 3 at 1; see 42 C.F.R. § 424.530(a)(3).  Palmetto also denied enrollment based on its determination that Petitioner had provided false or misleading information on his application because he did not report the adverse legal action of a felony conviction for reckless homicide.  CMS Ex. 3 at 1; see 42 C.F.R. § 424.530(a)(4).

On July 10, 2019, Petitioner submitted a request for reconsideration in which he argued that he was not under the influence of alcohol or drugs at the time of the accident.  Petitioner (P.) Ex. 1.  Petitioner explained that he had experienced "an unusual neurologic event" while driving a motor vehicle several days prior to the accident, and that he had "another one of those episodes" when he swerved off the road and fatally struck the victim.  P. Ex. 1 at 1.  Without submitting any supporting evidence or medical opinions, Petitioner explained that he was later diagnosed with a seizure disorder and inferred that the accident was the result of a seizure.  P. Ex. 1 at 1.  Petitioner also explained that a subsequent July 2016 DUI charge that is referenced in his enrollment file occurred when he "was pulled for suspicion of DUI because [he] rolled through a red light" but did not result in a criminal conviction.  P. Ex. 1 at 1.  Petitioner explained that he thereafter "reported [him]self to the South Carolina Medical Board, and they decided to suspend [his] license for a year as [he] needed to get help for [another medical condition]."  P. Ex. 1 at 1.  Petitioner acknowledged that he was "well aware that a felony conviction carries significant weight," but that his felony conviction is not detrimental to the best interests of the Medicare program and its beneficiaries.  P. Ex. 1 at 2.  Petitioner claimed that his offense "is not considered a violent crime or a crime of moral turpitude."  P. Ex. 1 at 2.  Petitioner alleged that he did not report the felony conviction on his enrollment application because his billing company completed the application on his behalf.3

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On July 23, 2019, Petitioner submitted an addendum to his request for reconsideration in which he addressed information contained in his enrollment file.  CMS Ex. 4 at 1-2; see CMS Ex. 2 at 12.  Petitioner alleged that the pending criminal charges referenced in CMS Ex. 2 were "the result of overzealous prosecution and inaccurate information."  CMS Ex. 4 at 1.  Petitioner submitted documentation showing that on November 21, 2014, a state court expunged criminal charges that had been filed on October 22, 2014, relating to possession of controlled substances.  CMS Ex. 4 at 3.

On October 22, 2019, Palmetto denied Petitioner's request for reconsideration and upheld the denial of his enrollment application pursuant to 42 C.F.R. § 424.530(a)(3)4 based on his felony conviction for reckless homicide.  CMS Ex. 1 at 1.

Petitioner, through counsel, filed a request for hearing on December 13, 2019.  On December 18, 2019, the Civil Remedies Division acknowledged receipt of Petitioner's request for hearing and issued my Standing Pre-Hearing Order (Pre-Hearing Order).  The Pre-Hearing Order directed the parties to file pre-hearing exchanges, consisting of a brief by CMS and a response brief by Petitioner, along with supporting evidence, in accordance with specific requirements and deadlines.

CMS filed a combined brief and motion for summary judgment (CMS Br.), along with seven proposed exhibits (CMS Exs. 1-7).  Petitioner submitted a pre-hearing brief and motion for summary judgment (P. Br.) and two proposed exhibits (P. Exs. 1-2).  CMS filed an opposition to Petitioner's motion for summary judgment.  In the absence of any objections, I admit CMS Exs. 1-7 and P. Exs. 1-2 into the evidentiary record.

Neither party has identified any witnesses or submitted the sworn and written direct testimony of any witnesses, and therefore, a hearing is unnecessary for the purpose of cross-examination of any witnesses.  Pre-Hearing Order §§ 12-14.  Because an in-person hearing is unnecessary, I need not rule on the parties' motions for summary judgment.  I issue this decision on the merits.

II.  Issue

Whether CMS has a legitimate basis to deny Petitioner's Medicare enrollment application pursuant to 42 C.F.R. § 424.530(a)(3) based on his July 2014 felony conviction.

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III.  Jurisdiction

I have jurisdiction to decide this issue.  42 C.F.R. §§ 498.3(b)(17), 498.5(l)(2); see also 42 U.S.C. § 1395cc(j)(8).

IV.  Findings of Fact, Conclusions of Law, and Analysis5

As a physician, Petitioner is a supplier of health care services for purposes of the Medicare program.  See 42 U.S.C. § 1395x(d); 42 C.F.R. §§ 400.202, 410.20(b)(1).  In order to participate in the Medicare program as a supplier, an individual must meet certain criteria to enroll and receive billing privileges.  42 C.F.R. §§ 424.505, 424.510.  CMS may deny a supplier's enrollment for any reason stated in, inter alia, 42 C.F.R. § 424.530.

A supplier's enrollment application for Medicare billing privileges can be denied based on the existence of a felony conviction, as is set forth in 42 C.F.R. § 424.530(a)(3):

(3) Felonies.  The provider, supplier, or any owner or managing employee of the provider or supplier was, within the preceding 10 years, convicted (as that term is defined in 42 [C.F.R. §] 1001.2) of a Federal or State felony offense that CMS determines is detrimental to the best interests of the Medicare program and its beneficiaries.

(1)     Offenses include, but are not limited in scope and severity to—

(A)  Felony crimes against persons, such as murder, rape, assault, and other similar crimes for which the individual was convicted, including guilty pleas and adjudicated pretrial diversions.

42 C.F.R. § 424.530(a)(3).

Suppliers of health care services who have been denied enrollment have a statutory right to a hearing to dispute the denial.  42 U.S.C. § 1395cc(j)(8).  CMS may exercise its discretion to deny enrollment when it determines that a felony offense committed by a supplier is detrimental to the best interests of the program and its beneficiaries.  See Fady Fayad, M.D., DAB No. 2266 at 16 (2009), aff'd sub nom. Fayad v. Sebelius, 803 F.Supp. 2d. 699, 704 (E.D. Mich. 2011).  A supplier who has been denied enrollment has a right to an ALJ hearing and Departmental Appeals Board (DAB) review.  42 C.F.R. §§ 498.3(b)(17), 498.5(l)(2)-(3).

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1. On or about July 14, 2014, Petitioner pleaded guilty to reckless homicide.

2. Petitioner was convicted of a felony offense for purposes of 42 C.F.R. § 424.530(a)(3).

3. Petitioner's offense is for a crime against a person pursuant to 42 C.F.R. § 424.530(a)(3)(i)(A), and CMS has determined that a felony crime against a person is per se detrimental to the best interests of the Medicare program and its beneficiaries.

4. Palmetto properly denied Petitioner's enrollment application pursuant to 42 C.F.R. § 424.530(a)(3)(i)(A) because he has a felony conviction for a crime against a person within the 10 years preceding the submission of his enrollment application.

The South Carolina Code defines reckless homicide as follows:

When the death of a person ensues within three years as a proximate result of injury received by the driving of a vehicle in reckless disregard of the safety of others, the person operating the vehicle is guilty of reckless vehicular homicide.

S.C. Code Ann. § 56-5-2910(A) (2013).  The offense of reckless homicide is a felony, as shown by the maximum period of incarceration of 10 years.  Id.

Petitioner argues that the January 6, 2013 accident in which he struck and killed a pedestrian with his vehicle was the result of a "neurological event."  P. Br. at 2.  However, Petitioner does not cite to any evidence of such, but rather, cites to a self-serving unsworn statement in which he inferred that the fatal accident was due to a seizure disorder.  P. Br. at 2, citing P. Ex. 1 at 1.6   Petitioner did not avail himself of the opportunity to submit evidence in support of this allegation when he was offered the opportunity to do so.  CMS Ex. 3 (initial determination informing Petitioner that if he had additional information for a hearing officer or ALJ to consider, he "must submit that information with [his] request for reconsideration"); see 42 C.F.R. § 498.56(e) (requiring good cause for the submission of new evidence to an ALJ).  Nor did Petitioner avail himself of the opportunity to submit sworn testimony that would be subject to cross-examination at a hearing.  See Pre-Hearing Order § 12 (explaining that direct testimony should be submitted through sworn written direct testimony).  Petitioner has not provided

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any basis to dispute that he has a felony conviction for reckless homicide resulting from his operation of a motor vehicle with "reckless disregard of the safety of others" that caused another person's death.  See S.C. Code Ann. § 56-5-2910(A).

CMS has determined that offenses involving "[f]elony crimes against persons, such as murder, rape, assault, and other similar crimes" warrant a denial of enrollment for not less than 10 years from the date of the conviction.  42 C.F.R. § 424.530(a)(3)(i)(A), (ii) (emphasis added); see 68 Fed. Reg. 22,064, 22,070 (Apr. 25, 2003) (stating that felony "crimes against persons, such as rape, murder, kidnapping, assault and battery, robbery, and other similar crimes" are detrimental and are grounds for CMS to "question the ability of the individual . . . with such a history to respect the life and property of program beneficiaries.").  The DAB has held that CMS "may revoke a . . . supplier's billing privileges based solely on a qualifying felony conviction, without regard to equitable or other factors."  Stanley Beekman, D.P.M., DAB No. 2650 at 3 (2015).  The DAB further explained that CMS may revoke billing privileges "based solely on a qualifying felony conviction" it has determined in a regulation to be detrimental to the best interests of the Medicare program and its beneficiaries.  See Fayad, DAB No. 2266 at 16. The DAB's analysis is applicable to both enrollment denial and enrollment revocation cases under sections 424.530 and 424.535.  See, e.g., Brian K. Ellefsen, D.O., DAB No. 2626 at 9-10 (2015).

With respect to whether a particular crime is per se detrimental to the best interests of the Medicare program and its beneficiaries, the DAB has explained that the examples of crimes that preclude enrollment for a period of 10 years following the date of the conviction are not comprehensive, stating:

The regulation then indicates that crimes detrimental to Medicare "include" those specified in subparagraphs (A) through (D) of section 424.535(a)(3)(i).  The words "include" or "including" are not terms of limitation or exhaustion.  When followed by a list of items, those words are reasonably read as signifying that the list contains merely illustrative examples of a general proposition or category that precedes the word and is not intended to preclude unmentioned items from being considered supportive or part of the general proposition or category.  Puerto Rico Maritime Shipping Auth. v. ICC, 645 F.2d 1102, 1112 n. 26 (D.C. Cir. 1981) ("It is hornbook law that the use of the word 'including' indicates that the specified list ... that follows is illustrative, not exclusive.").  Hence, section 424.535(a)(3)(i) is reasonably read as setting out a non-exhaustive list of crimes that may constitute a basis for revocation.

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Fayad, DAB No. 2266 at 8.  Significant to this case, the DAB has unambiguously stated, with respect to section 424.530(a)(3)(i)(A), that the "core, fundamental question . . . is whether [the] crime is a crime against a person."  Mark A. Kabat, D.O., DAB No. 2875 at 6 (2018).  The DAB held, quite simply, that "CMS may revoke . . . enrollment and billing privileges . . . if [a suppler] was convicted of a felony crime against a person."  Id. at 7.

Petitioner does not dispute that he was convicted of the felony offense of reckless homicide.  See 42 C.F.R. § 1001.2 (definition of "convicted" that is incorporated by section 424.530(a)(3)). Petitioner argues that reckless homicide is "not specifically listed in Section 424.530(a)(3)" and "must be shown to be similar to enumerated crimes."  P. Br. at 6 (bold font omitted).  Petitioner is mistaken.  As previously stated, section 424.530(a)(3)(i)(A) applies to all felony "crimes against persons."  Kabat, DAB No. 2875 at 6-7.  The victim of Petitioner's felony crime was a person who was killed due to Petitioner's reckless disregard for that person's safety.  This is a felony conviction for a crime against a person, and therefore, Petitioner has been convicted of a crime against a person as contemplated by 42 C.F.R. § 424.530(a)(3)(i)(A).7   Kabat, DAB No. 2875 at 6-7; see Fayad, DAB No. 2266 at 8.

Petitioner pleaded guilty to felony reckless homicide in July 2014.  Petitioner committed a felony crime against a person, and CMS has determined that such an offense, per se, warrants the denial of enrollment in the Medicare program for a period of ten years following the date of the conviction.  42 C.F.R. § 424.530(a)(3).  CMS properly denied Petitioner's February 20, 2019 enrollment application because he had been convicted of a felony crime against a person within the preceding 10 years.

V.  Conclusion

I affirm CMS's denial of Petitioner's enrollment application.

1. That provision specifically addresses misconduct that constitutes grounds for disciplinary action.  S.C. Code Ann. § 40-47-110(B)(2), (4).  See https://www.scstatehouse.gov/code/t40c047.php (last visited Mar. 13, 2020).
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2. The documents found at pgs. 9-23 of CMS Ex. 2 do not reference a felony conviction for reckless homicide.
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3. Regardless of who completed Petitioner's application, Petitioner was required to sign the enrollment application and certify that the information contained therein was accurate.  42 C.F.R. § 424.510(d)(3)(i)(A).  Further, Petitioner,as an applicant, was also required to provide "[c]omplete, accurate, and truthful responses."  42 C.F.R. § 424.510(d)(2)(i).
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4. The reconsidered determination inexplicably did not address the basis previously cited under 42 C.F.R. § 424.530(a)(4) for Petitioner's failure to report his felony conviction on the application.
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5. My findings of fact and conclusions of law are in bold and italics.
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6. Petitioner did not provide pinpoint citations in his brief, and I have added the pinpoint citation.
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7. With respect to Petitioner's arguments that reckless homicide is unlike the examples of felony offenses listed in section 424.530(a)(3)(i)(A), I note that it is clear that acting with such reckless disregard for the safety of another person that results in homicide (i.e., the unlawful killing of another person) is, at a minimum, on par with a crime such as felony assault.
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