Sarah Lynn Martin, DAB CR5751 (2020)

DECISION

The Inspector General for the United States Department of Health and Human Services (the IG) excluded Petitioner, Sarah Lynn Martin, from participation in Medicare, Medicaid, and all other federal health care programs for five years based on her conviction for a criminal offense related to the delivery of an item or service under the Medicare or a state health care program.  Petitioner sought review of the exclusion.  For the reasons stated below, I affirm the IG’s exclusion determination.

I.  Procedural History

By letter dated February 28, 2020, the IG notified Petitioner she was being excluded, effective 20 days from the date of the letter, from participation in Medicare, Medicaid, and all federal health programs under section 1128(a)(1) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(1)) for the minimum statutory period of five years.  IG Exhibit

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(Ex.) 1.1   A reviewing official in the IG’s Health Care Program Exclusions office explained the IG took this action based on Petitioner’s conviction in the Superior Court for the State of Alaska at Ketchikan (state court) of a criminal offense related to the delivery of an item or service under the Medicare or a state health care program, including the performance of management or administrative services relating to the delivery of items or services, under any such program.  Id. at 1.

Petitioner timely sought hearing before an administrative law judge in the Civil Remedies Division, and I was designated to hear and decide this case.  I held a pre-hearing telephone conference on May 20, 2020, the substance of which is summarized in my May 20, 2020 Order Summarizing Pre-hearing Conference and Setting Briefing Schedule (Summary Order).  See 42 C.F.R. § 1005.6.  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 five exhibits (IG Exs. 1-5), while Petitioner filed a narrative response (P. Br.) with multiple documents embedded within. 2  The IG subsequently filed a reply brief (IG Reply).

II.  Admission of Exhibits and Decision on the Record

Neither party objected to the opposing party’s proposed exhibits.  I therefore enter IG Exs. 1 through 5 and the documents embedded within P. Br. into the record.  Similarly, neither party requested a hearing or offered witnesses.  IG Br. at 10; P. Br.  Accordingly, I decide this case on the briefs submitted and the exhibits of record.  Civ. Remedies Div. P. § 19(d).

III.  Issue

Whether the IG had a basis to exclude Petitioner from participating in Medicare, Medicaid, and all other federal health care programs for five years under 42 U.S.C. § 1320a-7(a)(1).  See 42 C.F.R. § 1001.2007(a)(1).

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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 Secretary must exclude from participation in federal health care programs “[a]ny individual or entity that has been convicted of a criminal offense related to the delivery of an item or service under subchapter XVIII or under any State health care program.”  42 U.S.C. § 1320a-7(a)(1); see also 42 C.F.R. § 1001.101(a).

An individual is convicted of a criminal offense within the meaning of the Act when:  (1) a judgment of conviction has been entered against him or her in a federal, state, or local court whether an appeal is pending or the record of the conviction is expunged; (2) there is a finding of guilt by a court; (3) a plea of guilty or no contest is accepted by a court; or (4) the individual has entered into any arrangement or program where judgment of conviction is withheld.  Section 1128(i) of the Act (42 U.S.C. § 1320a-7(i)).  The Act does not distinguish between misdemeanor and felony convictions.  There may be no collateral attack of the conviction that provides the basis of the exclusion.  42 C.F.R. § 1001.2007(d).

Section 1128(c)(3)(B) of the Act (42 U.S.C. § 1320a-7(c)(3)(B)) provides that an exclusion imposed under section 1128(a) of the Act (42 U.S.C. § 1320a-7(a)) shall be for a minimum period of five years.  The exclusion is effective twenty days from the date of the notice of exclusion.  42 C.F.R. § 1001.2002(b).  The period of exclusion may be extended based on the presence of specified aggravating factors.  42 C.F.R. § 1001.102(b).  Mitigating factors are considered as a basis for reducing the period of exclusion only if aggravating factors justify an exclusion of longer than five years.  42 C.F.R. § 1001.102(c).

The standard of proof 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, while the IG bears the burden on all other issues.  42 C.F.R. § 1005.15(b).

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.

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A. Petitioner’s request for hearing was timely, and I have jurisdiction.

Petitioner timely filed her request for hearing.  I 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. There is a basis for Petitioner’s exclusion pursuant to section 1128(a)(1) of the Act.

Exclusion from participation in Medicare, Medicaid, and all federal health care programs is mandated by section 1128(a)(1) of the Act where an individual has been convicted, under Federal or State law, of a criminal offense related to the delivery of an item or service under Medicare or any state health care program.  42 U.S.C. § 1320a-7(a)(1); 42 C.F.R. § 1001.101(a).  The IG has established these elements by a preponderance of the evidence.

1. Petitioner was convicted of a criminal offense within the meaning of the Act.

Petitioner was a certified Care Coordinator enrolled to provide services for the Alaska Medicaid program.  IG Ex. 2 at 4.  Alaska’s Medicaid Fraud Unit determined that Petitioner billed the Alaska Medicaid program for care coordination services for multiple recipients, but failed to meet with those recipients in person at the frequency required by the state.  Id.  On March 11, 2019, Alaska’s Office of Special Prosecutions filed an information charging Petitioner with two counts of Medical Assistance Fraud and one count of Unsworn Falsification In The Second Degree.  Id. at 1. 

On August 22, 2019, the state filed a “Notice of Rule 11 Agreement” that specified Petitioner would waive indictment and plead guilty to the first count, Medical Assistance Fraud, and in exchange receive a 36-month suspension of entry of judgment against her.  IG Ex. 3 at 1-2.   On August 23, 2019, the state court entered an “Order to Probation on Suspended Entry of Judgment,” indicating Petitioner pleaded guilty to the first count of the information filed against her.  IG Ex. 4 at 1.  The state court placed Petitioner on probation for 36 months, stating “[i]f probation is successfully completed, the court will not enter a judgment of guilt; the defendant will be discharged, and the proceedings will be dismissed pursuant to Criminal Rule 43(b)(2).”3   Id.  The court also ordered restitution and imposed conditions of probation.  Id. at 1-2. 

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Though she makes no such argument in her brief, Petitioner did contend in her hearing request that she was not convicted for exclusion purposes under section 1128(a)(1) of the Act, pointing out that the state court will dismiss proceedings against her when she successfully completes her term of probation.  P. Req. for Hearing at 1.  The IG responds that the court order resolving the criminal case against Petitioner is in fact a “conviction” within the meaning of the Act.  IG Br. at 4-5.  Petitioner’s reliance on the more prosaic definition of “conviction” is not unreasonable, but I must determine whether she was “convicted” of a crime for purposes of exclusion within the meaning of the Act.  See Ellen L. Morand, DAB No. 2436 at 5 (2012), quoting Carolyn Westin, DAB No. 1381 at 6 (1993), aff’d, Westin v. Shalala, 845 F.Supp. 1446 (D. Kan. 1994) (“Congress has defined for the ALJ and this Board what ‘convicted’ means for purposes of section 1128 and that definition is binding on us.”). 

The resolution of Petitioner’s criminal case meets the definition of a conviction within the meaning of the Act on two grounds.  First, the Act provides an individual is considered “convicted” when a judgment of conviction has been entered by a federal, state, or local court, or a plea of guilty or no contest has been accepted in a federal, state, or local court.  42 U.S.C. § 1320a-7(i)(1), (3).  Here, Petitioner entered a plea of guilty as part of the bargain she struck to avoid prosecution.  IG Ex. 3 at 1-2; IG Ex. 4 at 1.  That counts as a “conviction” within the meaning of the Act.

Second, the Act provides an individual has been “convicted” of a criminal offense “when the individual . . . has entered into participation in a first offender, deferred adjudication, or other arrangement or program where judgment of conviction has been withheld.”  42 U.S.C. § 1320a-7(i)(4) (emphasis added).  The IG contends the resolution of Petitioner’s case bears the characteristics of a deferred adjudication and meets this statutory definition.  IG Br. at 4, citing Marc Schneider, D.M.D., DAB No. 2007 (2005). 

The IG is correct.  The Board explained in Schneider that the defining feature of a deferred adjudication program was the defendant’s inability to set aside his or her plea and proceed to trial.  DAB No. 2007 at 7-8, quoting Travers v. Shalala, 20 F.3d 993, 997 (9th Cir. 1994) (“In a deferred adjudication, . . . if the defendant does not live up to the terms of his agreement, he is not free to set aside his plea or proceed to trial – the court may simply enter a judgment of conviction.  Under those circumstances, the entry of a judgment is a mere formality because the defendant has irrevocably committed himself to a plea of guilty or no contest which cannot be unilaterally withdrawn.”) (emphasis added by Board removed). 

Here, Petitioner entered a guilty plea which she may not unilaterally withdraw absent leave of the court.  Alaska R. Crim. P. 11(h).  Nothing in the plea agreement or in the state court’s order resolving the criminal case indicates Petitioner could set aside her plea and proceed to trial.  IG Exs. 3, 4.  Instead, the state court warned it would enter judgment against Petitioner if she did not successfully meet the terms of her probation.

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IG Ex. 4 at 1 (“The defendant shall appear at a hearing where the court will decide whether probation was successfully completed and the proceedings should be dismissed.  If not successfully completed, the court may revoke and terminate the probation; enter a judgment of guilt; and pronounce sentence at that time.”). 

Accordingly, the state court’s order resolving the criminal charge against Petitioner describes her entry into a “program where judgment of conviction has been withheld.”  42 U.S.C. § 1320a-7(i)(4).  I must therefore conclude that Petitioner was convicted of a criminal offense as contemplated by 42 U.S.C. § 1320a-7(a)(1).

2. Petitioner’s criminal offense is related to the delivery of an item or service under Medicare or a state health care program within the meaning of section 1128(a)(1) of the Act.

The Act requires Petitioner be excluded from participation in federal programs if she was convicted of an offense relating to the delivery of an item or service under Medicare or a state health care program.  See 42 U.S.C. § 1320a-7(a)(1).  The term “related to” simply means that there must be a nexus or common sense connection.  See Friedman v. Sebelius, 686 F.3d 813, 820 (D.C. Cir. 2012) (describing the phrase “related to” in another part of section 1320a-7 as “deliberately expansive words,” “the ordinary meaning of [which] is a broad one,” and one that is not subject to “crabbed and formalistic interpretation”) (internal quotation marks omitted); see also Quayum v. U.S. Dep’t of Health and Human Servs., 34 F. Supp. 2d 141, 143 (E.D.N.Y. 1998).

In this case, the record clearly demonstrates a nexus between the criminal offense for which Petitioner was convicted and the delivery of an item or service under a state health care program.  Petitioner pleaded guilty to one count of Medical Assistance Fraud because she “knowingly submitted or authorized the submission of a claim to a medical assistance agency for property, services, or a benefit with reckless disregard that the claimant is not entitled to the property, services, or benefit . . . .”  IG Ex. 2 at 2. 

Petitioner improperly billed Alaska’s Medicaid program for face-to-face care coordination services for multiple recipients that she did not actually perform or did not perform at the frequency required by the state.  IG Ex. 2 at 4.  Submitting a false claim to Medicaid is by definition related to the delivery of an item or service under a state health care program.  See Travers, 20 F.3d at 998 (holding conviction for filing claims with the Medicaid program is “a program‑related offense” and “such financial misconduct is exactly what Congress sought to discourage” through imposing exclusions.).  The conduct which forms the factual basis of the charge against Petitioner to which she pleaded guilty is clearly related to the delivery of an item or service as contemplated by section 1128(a)(1) of the Act.

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Finally, court-ordered restitution to a State Medicaid program is additional evidence of a nexus between the offense and the delivery of items or services under that Medicaid program.  Berton Siegel, D.O., DAB No. 1467 at 6-7 (1994).  Here, the state court ordered Petitioner to pay $5,773.68 in restitution to the “State of Alaska – DHSS,” the state’s Department of Health and Social Services.  IG Ex. 5.  I therefore must conclude that Petitioner was convicted of a criminal offense related to the delivery of an item or service under Medicare or a state health care program as contemplated by 42 U.S.C. § 1320a-7(a)(1).

C. Petitioner must be excluded for a minimum of five years; the period of exclusion is therefore reasonable as a matter of law.

Because I have concluded that a basis exists to exclude Petitioner under 42 U.S.C. § 1320a-7(a)(1), Petitioner must be excluded for a minimum period of five years.  42 U.S.C. § 1320a-7(c)(3)(B); 42 C.F.R. §§ 1001.102(a), 1001.2007(a)(2).  The IG has no discretion to impose a lesser period of exclusion, and I may not reduce the period of exclusion below five years.

D. I have no authority to modify the effective date of Petitioner’s period of exclusion.

Petitioner requests that her effective date of exclusion be made retroactive to March 11, 2019, the date the state of Alaska suspended her ability to receive payments from the state Medicaid program because of the pending criminal investigation against her.  P. Br. at 1-4.  I am sympathetic to Petitioner’s situation, but unfortunately, I have no authority to change the IG’s selection of an effective date for exclusion.  See Thomas Edward Musial, DAB No. 1991 (2005), citing Douglas Schram, R.PH., DAB No. 1372 at 11 (1992) (“Neither the ALJ nor this Board may change the beginning date of Petitioner’s Exclusion.”); David D. DeFries, DAB No. 1317 at 6 (1992) (“The ALJ can not . . . decide when [the exclusion] is to begin.”); Richard G. Philips, D.P.M., DAB No. 1279 (1991) (An ALJ does not have “discretion . . . to adjust the effective date of an exclusion, which is set by regulation.”); Samuel W. Chang, M.D., DAB No. 1198 at 10 (1990) (“The ALJ has no power to change [an exclusion’s] beginning date.”); see also 42 C.F.R. § 1001.2002(b) (“The exclusion will be effective 20 days from the date of the notice.”). 

Because I am not empowered to provide Petitioner the relief she seeks, I must deny her request to modify the effective date of her exclusion.

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VI.  Conclusion

For the foregoing reasons, Petitioner is excluded from participation in Medicare, Medicaid, and all federal health care programs for five years pursuant to section 1128(a)(1) of the Act (42 U.S.C. § 1320a-7(a)(1)), effective March 19, 2020.

1. Document No. 5b in the official case file maintained in the DAB E-File system; for clarity and simplicity, whenever possible I will cite to the exhibits attached to the parties’ respective briefs by the exhibit numbers therein, not the document numbers assigned by the E-File system.
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2. Petitioner did not file a short-form brief as instructed, and did not separately file (or correctly label and number) her proposed exhibits.  However, it is apparent she is a pro se litigant lacking the necessary expertise to artfully plead her case.  I therefore find good cause to accept her narrative response in lieu of the short-form brief and will cite the documents within her response as pages of that document.
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3. This provision of Alaska’s criminal code governs “Dismissal and Deferred Prosecution.”  Alaska R. Crim. P. 43.
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