Thomas James Carpenter, D.O., DAB CR6155 (2022)

DECISION

I sustain the determination of the Inspector General (IG) to exclude Petitioner, Thomas James Carpenter, D.O., from participating in Medicare, state Medicaid, and other federally funded health care programs for a period of at least nine years. 

I.  Background

The parties filed briefs and exhibits.  The IG filed five exhibits, identified as I.G. Ex. 1-I.G. Ex. 5.  Petitioner filed a single exhibit, identified as P. Ex. 1.  Neither party objected to the admission of exhibits.  I receive all exhibits into the record. 

Neither the IG nor Petitioner requested that I convene an in-person hearing.  I therefore decide this case based on the parties’ written submissions.

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II.  Issues, Findings of Fact and Conclusions of Law

A. Issues

The IG excluded Petitioner pursuant to section 1128(a)(1) of the Social Security Act (Act), a section that mandates the exclusion of any individual who is convicted of a criminal offense related to the delivery of an item or service under Medicare or a state health care program (Medicaid program).  The IG determined that on March 12, 2021, Petitioner pleaded guilty in federal court to one count of conspiracy to commit healthcare fraud.  I.G. Ex. 2.  The IG further determined that on September 28, 2021, Petitioner was convicted of the crime of conspiracy to commit healthcare fraud.  I.G. Ex. 3. 

Petitioner does not deny his conviction, nor does he deny that the IG must exclude him pursuant to section 1128(a)(1) of the Act.  Petitioner asserts, however, that the length of the exclusion imposed by the IG – at least nine years – is unreasonable.  Consequently, the only issue before me is whether the IG’s exclusion determination is reasonable. 

B. Findings of Fact and Conclusions of Law

Individuals who are convicted of the offenses described at section 1128(a)(1) of the Act must be excluded by the IG for a minimum of five years.  Act § 1128(c)(3)(B).  The minimum mandatory exclusion period establishes a floor for exclusions imposed pursuant to section 1128(a)(1) but it does not define a ceiling.  The IG may exclude an individual for longer than the statutory minimum period. 

Section 1128 of the Act has a remedial purpose.  It intends to protect federally funded health care programs, and beneficiaries and recipients of program funds from individuals whose conduct establishes them to be untrustworthy to provide care.  The greater the degree of an individual’s untrustworthiness, the longer the exclusion may be, including an exclusion for more than the five-year minimum period. 

The Secretary of the United States Department of Health and Human Services published regulations that serve as rules of evidence for determining the level of untrustworthiness of an excluded individual.  42 C.F.R. Part 1001.  In instances where individuals are excluded pursuant to section 1128(a)(1) of the Act, the applicable regulation is 42 C.F.R. § 1001.102.  This regulation establishes aggravating and mitigating factors.  The IG may exclude an individual for more than five years where there is evidence relating to one or more aggravating factors absent countervailing evidence relating to one or more mitigating factors.  Id. 

The regulation does not dictate a particular outcome where there exists evidence relating to aggravating factors.  In determining what exclusion period is reasonable, the IG must evaluate relevant evidence to measure an excluded individual’s lack of trustworthiness.  I,

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in turn, must evaluate that evidence to decide whether the IG’s determination is reasonable.

The IG offered evidence that relates to two aggravating factors.  First, the IG proved that Petitioner was convicted of acts that, “caused, or were intended to cause, a financial loss to a government agency or program or to one or more other entities of $50,000 or more.”  42 C.F.R. § 1001.102(b)(1).  Petitioner was sentenced to pay $166,532 in restitution to federal health care programs.  I.G. Ex. 3 at 4; I.G. Ex. 5 at 14, 32. 

Second, the IG proved that Petitioner committed the acts resulting in his conviction over the period of one year or more.  42 C.F.R. § 1001.102(b)(2).  Petitioner’s crime extended over a period of more than four years, beginning in June 2012, and continuing “through in or about” October 2016.  I.G. Ex. 4 at 11. 

Petitioner engaged in protracted fraud against Medicare during this more than four-year period.  I.G. Ex. 2 at 18-20.  Petitioner, a physician, served as the medical director of a home health agency.  Id. at 18.  He conspired with that entity’s owner to certify on multiple occasions that Medicare beneficiaries were under his care, were home bound, and needed the services of his employer.  Id. at 20.  In fact, none of these individuals were under Petitioner’s care.  Id.  Petitioner signed documents certifying that these beneficiaries needed care without regard to the truth or falsity of the information contained in the documents, and without regard to the medical necessity of the treatments described in those documents.  Id. 

Evidence relating to the aggravating factors fully justifies an exclusion of at least nine years.  Petitioner committed conscious, deliberate, substantial, and protracted fraud. 

Petitioner attempts to minimize the significance of aggravating evidence by arguing that the prosecutor characterized his crime as being more of an administrative or paperwork error rather than for some nefarious purpose.  Informal Brief of Petitioner Thomas James Carpenter, D.O. (Petitioner’s Brief) at 2.¹  But the undisputed fact is that Petitioner pled guilty to a serious and protracted crime.  He didn’t commit a mere paperwork error.  He admitted that he, “agreed to try to accomplish a common and unlawful plan to commit health care fraud . . . .”  I.G. Ex. 2 at 2.  Additionally, Petitioner, “knew the unlawful purpose of the plan and willfully joined in it.”  Id. 

Petitioner argues that there is evidence relating to a mitigating factor, and maintains that this evidence offsets the evidence of aggravation.  Petitioner contends that he cooperated with prosecuting authorities, which resulted in the conviction of another individual.  See

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42 C.F.R. § 1001.102(c)(3).  Petitioner’s argument notwithstanding, I find no cooperation by Petitioner consistent with the regulation’s definition of a mitigating factor.  The evidence establishes that Petitioner offered to cooperate, but it does not establish that his cooperation resulted in the conviction of another individual. 

Petitioner offers a statement made to the judge by the prosecuting attorney at the time of Petitioner’s sentencing, in support of his claim that he cooperated and that his cooperation resulted in another individual’s conviction: 

Judge, [Petitioner] did sit and debrief with the government on two occasions after he entered his plea of guilty.  I find it hard to believe that his co-defendant did not take into consideration [Petitioner’s] possible cooperation when she decided to accept her plea. 

I.G. Ex. 5 at 4.  However, Petitioner omits the remainder of the prosecutor’s statement, which counters Petitioner’s assertion: 

[H]is co-defendant’s plea, was driven more by the favorable terms of the plea than [Petitioner’s] possible cooperation.  And if cooperation doesn’t -- can’t materially or be shown to have led to somebody’s decision to change their plea, my office is not comfortable authorizing . . . a motion [for reduction of sentence based on cooperation].

So I do want to raise the fact for the Court that [Petitioner] attempted to cooperate, but it didn’t rise quit[e] to the level of substantial assistance warranting . . . [a motion for reduction of sentence] . . . .

I.G. Ex. 5 at 5.

Thus, while there is aggravating evidence in this case there is no mitigating evidence.  As I have explained, the aggravating evidence establishes Petitioner’s lack of trustworthiness and fully justifies the exclusion for a minimum of nine years that the IG determined to impose. 

Endnotes

¹ In his brief Petitioner cites to “I.G. Ex. 5, p. 81 of 105.”  Petitioner’s Brief at 3.  However, I.G. Ex. 5, the transcript of Petitioner’s sentencing hearing, contains only 38 pages; the citation can be found at I.G. Ex. 5, page 15.