Robert Neal Portwood, P.A., DAB CR6160 (2022)

DECISION

Respondent, the Centers for Medicare & Medicaid Services (CMS), acting through its administrative contractor, Novitas Solutions, Inc. (Novitas), revoked the Medicare enrollment and billing privileges of Petitioner, Robert Neal Portwood, Physician Assistant (P.A.), pursuant to 42 C.F.R. § 424.535(a)(3), (a)(4), and (a)(9).  CMS subsequently placed Petitioner on its preclusion list.  Petitioner, through counsel, challenges both the revocation of his enrollment and billing privileges and his placement on CMS’s preclusion list.  For the reasons discussed below, CMS’s revocation of Petitioner’s Medicare enrollment and billing privileges and Petitioner’s placement on CMS’s preclusion list are affirmed.

I.   Background

Petitioner timely requested a hearing (Hearing Request) before an Administrative Law Judge (ALJ) in the Civil Remedies Division.  On October 28, 2021, the Civil Remedies

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Division issued an Acknowledgment and Standing Prehearing Order (Standing Order) setting forth deadlines for the parties to submit arguments and proposed exhibits.  CMS filed a motion for summary judgment and brief (CMS Br.), as well as seven proposed exhibits (CMS Exs. 1-7), on January 3, 2022.  On February 2, 2022, Petitioner filed a brief opposing summary judgment (P. Br.) and a separate pre-hearing brief (P. Phrg. Br.).  Petitioner  identified three witnesses and submitted sixteen¹ proposed exhibits (P. Exs. 1-16) on February 8, 2022.

CMS filed objections to Petitioner’s exhibits on February 23, 2022.  Petitioner filed a response to CMS’s objections on February 24, 2022.

II.   Admission of Exhibits and Decision on the Record

CMS objected to Petitioner’s Exhibits 1-12 due to Petitioner’s failure to conform with the pagination and marking requirements in the Standing Order and Civil Remedies Division Procedures (CRDP).  CMS’s objection is overruled.  ALJs have discretion whether to accept or reject noncompliant exhibits.  CRDP § 14(d).

CMS objects to the relevance of the opinions regarding Petitioner’s work quality in Petitioner’s Exhibits 2-3, and to the relevance of Petitioner’s professional experience in Petitioner’s Exhibits 8-10, 12, and Petitioner’s Attachments 2-4 (considered as Petitioner’s Exhibits 14-16).  Petitioner argues that the exhibits are relevant because the information counters CMS’s assertions about Petitioner being detrimental to the Medicare program and its beneficiaries.  Therefore, CMS’s objections are overruled.  Further, CMS’s request to reject or strike portions of Petitioner’s Exhibits 2-3 is denied. 

ALJs are not bound by the Federal Rules of Evidence and may receive evidence that may otherwise be inadmissible.  42 C.F.R. § 498.61.  The ALJ determines admissibility and may choose to “apply the Federal Rules of Evidence where appropriate, for example, to exclude unreliable evidence.”  CRDP § 20.

Although “unduly repetitious evidence” should be excluded under 5 U.S.C. § 556(d), minor duplicative documents do not rise to this standard.  As a result, CMS’s objection to Petitioner’s Exhibit 11 is overruled.

P. Exs. 1-16 are admitted into the record.  Petitioner did not object to CMS’s proposed exhibits.  Therefore, CMS Exs. 1-7 are admitted into the record.

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Petitioner identified three witnesses, but did not offer written direct testimony.  Petitioner requested that this matter be set for a hearing in response to CMS’s objections to his proposed exhibits.  CMS did not request to cross-examine Petitioner’s witnesses.  Consequently, there will not be an in-person hearing in this matter, and this decision will be issued based on the written record.²  CRDP § 19(d).

III.   Issues

Whether CMS had a legitimate basis to revoke Petitioner’s Medicare privileges under 42 C.F.R. § 424.535(a)(3);

Whether CMS had a legitimate basis to revoke Petitioner’s Medicare privileges under 42 C.F.R. § 424.535(a)(4) for submitting false or misleading information on his revalidation enrollment applications;

Whether CMS had a legitimate basis to revoke Petitioner’s Medicare privileges under 42 C.F.R. § 424.535(a)(9) for failing to report a felony conviction on his revalidation enrollment applications; and

Whether CMS had a legitimate basis to place Petitioner on its preclusion list.

IV.   Jurisdiction

This tribunal has jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(17), (20), 498.5(l)(2), (n)(2); see also 42 U.S.C. § 1395cc(j)(8).

V.   Statutory and Regulatory Framework

Petitioner, a physician assistant, is considered a supplier of health care services under the Medicare program.  See 42 U.S.C. § 1395x(d); 42 C.F.R. §§ 400.202 (definition of supplier), 410.74 (requirements for coverage of physician’s assistant services), 498.2.  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.

To maintain Medicare billing privileges, suppliers must revalidate their enrollment information at least every five years; however, CMS reserves the right to require revalidation at any time.  42 C.F.R. § 424.515.  When CMS notifies suppliers that it is time to revalidate, the suppliers must submit the appropriate enrollment application,

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accurate information, and supporting documents within 60 calendar days of CMS’s notification.  42 C.F.R. § 424.515(a)(2).

CMS may revoke a supplier’s Medicare enrollment and billing privileges for any reason stated in 42 C.F.R § 424.535(a), which includes felony convictions and providing false or misleading information:

(3)  Felonies.

(i)  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.

(ii)  Offenses include, but are not limited in scope or 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.

* * * *

(4)  False or misleading information.  The provider or supplier certified as “true” misleading or false information on the enrollment application to be enrolled or maintain enrollment in the Medicare program.  (Offenders may be subject to either fines or imprisonment, or both, in accordance with current law and regulations.)

* * * *

(9)  Failure to report.  The provider or supplier did not comply with the reporting requirements specified in § 424.516(d) or (e), § 410.33(g)(2) of this chapter, or § 424.57(c)(2).  In determining whether a revocation under this paragraph (a)(9) is appropriate, CMS considers the following factors:

(i)  Whether the data in question was reported.

(ii)  If the data was reported, how belatedly.

(iii)  The materiality of the data in question.

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(iv)  Any other information that CMS deems relevant to its determination.

42 C.F.R. § 424.535(a)(3)-(4), (9).

Furthermore, CMS may place on the preclusion list any “individual or entity, regardless of whether they are or were enrolled in Medicare, [that] has been convicted of a felony under Federal or State law within the previous 10 years that CMS deems detrimental to the best interests of the Medicare program.”  42 C.F.R. §§ 422.2, 423.100 (definitions of “Preclusion list”).  Medicare Advantage organizations and Medicare Part D plan sponsors may not provide reimbursement for any items or services furnished by an individual or entity on CMS’s preclusion list, or for prescriptions the individuals write.  42 C.F.R. §§ 422.2, 422.222, 422.224, 423.100, and 423.120(c)(6).  In determining whether a felony conviction is detrimental to the best interests of the Medicare program, CMS considers:

(i)  The severity of the offense;

(ii)  When the offense occurred; and

(iii)  Any other information that CMS deems relevant to its determination.

42 C.F.R. § 422.2, 423.100 (definitions of “Preclusion list”).

If CMS places an individual on the preclusion list based on a felony conviction, the individual will remain on the preclusion list for a ten-year period, beginning on the date of the conviction, unless CMS determines that a shorter length of time is warranted.  In deciding whether a shorter term of preclusion is appropriate, CMS considers:

(i)  The severity of the offense;

(ii)  When the offense occurred; and

(iii)  Any other information that CMS deems relevant to its determination.

42 C.F.R. §§ 422.222(a)(5)(iii), 423.120(c)(6)(vii)(C).

Finally, in the case of preclusion from ordering Medicare Advantage items or services, CMS has the discretion not to include a particular individual or entity on the preclusion

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list should CMS determine that exceptional circumstances exist regarding beneficiary access to items, services, or drugs.  In making such a determination, CMS considers:

(i)  The degree to which beneficiary access to Medicare Advantage items, services, or drugs would be impaired; and

(ii)  Any other evidence that CMS deems relevant to its determination.

42 C.F.R. § 422.222(a)(6).

VI.   Findings of Fact

Petitioner has worked in the healthcare industry for over 20 years, most recently as a physician assistant licensed to practice in Texas.  P. Phrg Br. at 6.  On August 29, 2014, the 137th District Court of Lubbock County, Texas (District Court) accepted Petitioner’s guilty plea for a single count of aggravated assault with a deadly weapon threat in violation of Texas Penal Code § 22.02(a)(2) (Aggravated Assault), a second-degree felony.  CMS Ex. 2 at 4-6.  The district court entered a suspended confinement order, sentencing Petitioner to probation for a period of ten years.  CMS Ex. 2 at 7-9.  Petitioner was ordered to complete community service, undergo a drug and alcohol evaluation, abstain from using narcotics and alcohol, comply with a curfew, write a letter of apology to the victim, and not possess or carry firearms during his probationary period.  CMS Ex. 2.

On February 2, 2015, Petitioner submitted a reenrollment revalidation application as a non-physician participant in the Medicare program.  CMS Ex. 3.  Section 3 of the application requires applicants to disclose final adverse legal actions.  CMS Ex. 3.  However, Petitioner made no mention of his 2014 felony conviction for assault with a deadly weapon threat on his reenrollment application.  CMS Ex. 3.  Petitioner electronically signed the certification statement for individual practitioners and was the authorized signer for the revalidation application.  CMS Ex. 3 at 1.

As a result of his felony conviction, Petitioner entered into an agreed order with the Texas Physician Assistant Board (Medical Board).  The Medical Board publicly reprimanded Petitioner and imposed several conditions to allow Petitioner to continue providing health care services in Texas.  CMS Ex. 1.  The Medical Board terminated the order on March 24, 2017, because Petitioner complied with all terms of the order.  CMS Ex. 1.

On July 31, 2020, Petitioner submitted a Medicare reenrollment revalidation application to Novitas.  CMS Ex. 4.  In Section 3 of the application, entitled “FINAL ADVERSE LEGAL ACTIONS,” Petitioner again failed to report his 2014 felony conviction.  CMS

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Ex. 4.  Petitioner electronically signed the certification statement for individual practitioners and was the authorized signer for the revalidation application.  Id.  Petitioner submitted a second reenrollment revalidation application to Novitas on July 31, 2020.  CMS Ex. 5.  Petitioner was again listed as the authorized signer for the revalidation application.  Id. at 1.  Section 3 of the application, entitled “FINAL ADVERSE LEGAL ACTIONS,” asks “has a final adverse legal action ever been imposed against [the] applicant under any current or former name or business entity?”  CMS Ex. 5 at 3.  Petitioner responded “No.”  CMS Ex. 5 at 3.

By letter dated May 26, 2021, Novitas notified Petitioner that his Medicare privileges were revoked, effective August 29, 2014.  CMS Ex. 6.  Novitas explained that Petitioner’s Medicare privileges were revoked pursuant to 42 C.F.R. § 424.535(a)(3) due to his felony conviction.  Id. at 1.  Novitas also revoked Petitioner’s Medicare privileges pursuant to 42 C.F.R. § 424.535(a)(9) because Petitioner failed to report the August 29, 2014 felony conviction for aggravated assault with a deadly weapon threat.  Id.  Finally, Novitas revoked Petitioner’s Medicare privileges pursuant to 42 C.F.R. § 424.535(a)(4) because he provided false or misleading information on the July 31, 2020, revalidation enrollment application by responding “No” when asked whether an adverse legal action had been imposed against him.  Id.  Novitas informed Petitioner that he would be added to the CMS preclusion list, effective either the date of an unsuccessful reconsidered decision or, if Petitioner did not request reconsideration, 65 days from the date of the notice letter.  Id. at 2.  Petitioner timely requested reconsideration.  P. Ex. 11.  On October 1, 2021, CMS issued a reconsidered determination, affirming the revocation action and Petitioner’s inclusion on the preclusion list, effective the date of the reconsidered determination.  CMS Ex. 7 at 9-10.

VII.   Analysis and Conclusions of Law

1. The evidence establishes that CMS had a legal basis to revoke Petitioner’s Medicare privileges pursuant to 42 C.F.R. § 424.535(a)(3) because, within the ten years prior to his application, Petitioner was convicted of a felony offense that CMS has determined to be detrimental to the best interests of the Medicare program and its beneficiaries.³

It is undisputed that on August 29, 2014, Petitioner pleaded guilty to felony Aggravated Assault with a Deadly Weapon Threat and entered into a deferred adjudication agreement.  However, Petitioner argues that the deferred adjudication agreement “means there will not be any judgment for a felony conviction ‘so long as [Petitioner] abides by and does not violate the terms and conditions of community supervision.’”  P. Br. at 4;

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P. Phrg. Br. at 4.  The regulations provide that CMS may revoke a supplier’s billing privileges and participation agreement if the supplier –

was, within the preceding 10 years, convicted (as that term is defined in 42 CFR 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.

42 C.F.R. § 424.535(a)(3)(i).

Under the applicable regulations, “convicted” is defined as —

(c) A Federal, State or local court has accepted a plea of guilty . . . by an individual or entity; or

(d) An individual or entity has entered into participation in a first offender, deferred adjudication or other program or arrangement where judgment of conviction has been withheld.

42 C.F.R. § 1001.2.

The evidence shows that Petitioner has been convicted of a felony offense as defined by the regulation.  In addition, the Departmental Appeals Board (the Board) has ruled that an order of deferred adjudication on a felony crime against a person provides a basis for concluding that a petitioner was convicted of the underlying felony offense.  See Kimberly Shipper, P.A., DAB No. 2804 (2017) (finding a deferred adjudication on a first-degree felony aggravated assault against a public servant constituted a “conviction” sufficient to trigger reporting requirements); Lorrie Laurel, PT, DAB No. 2524 (2013) (whether Petitioner was “convicted” of a felony is a matter of federal and not State law).

CMS has determined that felony crimes against persons are per se detrimental to the Medicare program.  42 C.F.R. § 424.535(a)(3)(ii)(A) (see also 42 C.F.R. § 424.530(a)(3)(i)(A).  Section 424.535(a)(3), in effect at the time of the revocation, authorized CMS to revoke a supplier’s enrollment and billing privileges if the supplier “within the 10 years preceding enrollment or revalidation of enrollment, was convicted of a Federal or State felony offense that CMS has determined to be detrimental to the best interests of the program and its beneficiaries.”  Under section 424.535(a)(3)(i)(A), qualifying “[o]ffenses include[d] . . . [f]elony 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.”

Petitioner argues that CMS must make a case-specific determination as to whether an offense is per se detrimental.  P. Phrg. Br. at 13.  However, throughout the

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reconsideration determination, CMS makes it clear that the underlying facts surrounding Petitioner’s offense were “very severe” and specifically noted that Petitioner’s “decision to handle a handgun without a permit and assault a police officer is very concerning to CMS.”  CMS Ex. 7 at 7.

The evidence shows that Petitioner was convicted of a felony assault, a crime against a person, on August 29, 2014.  Petitioner submitted Medicare revalidation applications on July 31, 2020, within 10 years of his felony conviction.  As a result, CMS properly determined that Petitioner’s felony conviction was per se detrimental to the Medicare program, and CMS had a legal basis to revoke Petitioner’s Medicare privileges pursuant to 42 C.F.R. § 424.535(a)(3).

2. CMS had a legal basis to revoke Petitioner’s Medicare privileges pursuant to 42 C.F.R. § 424.535(a)(4) and 42 C.F.R. 424.535(a)(9) because Petitioner provided false or misleading information on his July 31, 2020 revalidation reenrollment applications by failing to report an adverse legal action against him.

CMS may revoke a Medicare supplier’s Medicare enrollment and billing privileges for providing false or misleading enrollment information, as follows:

(a)  Reasons for revocation.  CMS may revoke a currently enrolled [supplier’s] Medicare enrollment and any corresponding [supplier] agreement for the following reasons:

* * * *

(4) False or Misleading Information.  The [supplier] certified as “true” misleading or false information on the enrollment application to be enrolled or maintain enrollment in the Medicare program.

42 C.F.R. § 424.535(a)(4).

The reenrollment revalidation applications require suppliers to provide information on any final adverse legal actions imposed against the applicant under any current or former name or another business entity.  CMS Ex. 3 at 3; CMS Ex. 4 at 2; CMS Ex. 5 at 3.  Though Petitioner signed the three⁴ applications submitted to CMS in February 2015 and

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July 2020, he did not report his 2014 felony conviction on any of the forms.  On both of the July 31, 2020 applications, Petitioner affirmatively responded “No” when asked whether any final adverse legal action had been imposed on him.  CMS Ex. 4 at 2; CMS Ex. 5 at 3.

Petitioner argues that he was unaware that the felony conviction was not reported on the applications because his employer completed the applications, applied his electronic signature, and filed the applications without his review.  P. Br. at 1 n.1; P. Br. at 1; P. Br. at 12 n.12; P. Phrg. Br. at 2; P. Phrg. Br. at 12 n.13.  Petitioner states that he did not intentionally provide false or misleading information to CMS, as evidenced by him self-reporting the arrest to his employer, his supervisor, the Medical Board, and the National Commission on Certification of Physician Assistants.  P. Br. at 3; P. Phrg. Br. at 4.  However, Petitioner’s intent, or lack thereof, is irrelevant in determining whether CMS rightfully revoked his program participation.

The Board has ruled that section 424.535(a)(4) “does not require proof that [the applicant] subjectively intended to provide false information, only proof that he in fact provided misleading or false information that he certified as true.”  Sandra E. Johnson, CRNA, DAB No. 2708 at 15 (2016) (quoting Mark Koch, D.O., DAB No. 2610 at 4-5 (2014) (emphasis in original)).  The Board has also held:

To ensure that Medicare enrolls only qualified and trustworthy suppliers, the program’s regulations require a supplier:  to provide “[c]omplete, accurate, and truthful responses” to an enrollment application’s requests for information (42 C.F.R. § 424.510(d)(2)(i)); to provide those responses “on the applicable enrollment application” (id. § 424.510(a)(1)); and to certify, by a signature on the application, that the information provided therein is “accurate” (id. § 424.510(d)(3)).  Moreover, the information submitted on the enrollment application “must be such that CMS can validate it for accuracy at the time of submission.”  Id. § 424.510(d)(4) (emphasis added).

Given the affirmative duty to provide “complete, accurate, and truthful” information on the enrollment application, if a supplier submits a signed application and fails to list a final adverse legal action on the application, then the supplier will have certified as true information concerning [their] adverse legal history that is manifestly not “complete, accurate, and truthful,” but rather false or

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misleading.  In those circumstances, CMS may revoke the supplier’s Medicare billing privileges under section 424.535(a)(4).  See, e.g., Dennis McGinty, PT, DAB No. 2838, at 6, 8 (2017) (holding that the supplier was subject to revocation under section 424.535(a)(4) because he certified his enrollment application as true and complete, yet failed to report on the application a final adverse legal action), aff’d, No. 3:18-CV-359, 2019 WL 3034596 (N.D. Tex. July 19, 2019).

William Garner, M.D., DAB No. 3026 (2020).

Regardless of the supplier’s intent, CMS has the authority to revoke a supplier’s Medicare enrollment and billing privileges when the supplier certifies as true information on the enrollment application that is false or misleading.  Though Petitioner may not have intended to provide misleading or false information to CMS, he in fact provided false or misleading information by failing to report his adverse actions on the applications.  Petitioner signed the applications and certified that the information contained in the applications was accurate.  Therefore, CMS had a legal basis to revoke Petitioner’s Medicare privileges pursuant to 42 C.F.R. § 424.535(a)(4).

Similarly, pursuant to 42 C.F.R. § 424.535(a)(9), CMS has the authority to revoke Petitioner’s Medicare privileges because he failed to report an adverse action on his enrollment applications.  CMS may revoke enrollment and billing privileges if a supplier does not “comply with the reporting requirements specified in § 424.516(d).”  The regulations require suppliers, including non-physician practitioners and non-physician practitioner organizations, to report “[a]ny adverse legal action” within 30 days. 42 C.F.R. § 424.516(d)(1)(ii).  Adverse legal actions include a federal or state felony offense conviction within the preceding 10 years of enrollment, revalidation, or re-enrollment.  42 C.F.R. § 424.502.

It is undisputed that Petitioner self-reported the arrest to his employer, the Medical Board, and the National Commission on Certification of Physician Assistants.  Petitioner also kept his employer updated while his case was pending and included information about his conviction in his credentialing applications.  P. Br. at 3, 5; P. Phrg. Br. at 4-6.  However, the evidence shows that Petitioner failed to report an adverse legal action to CMS as required by the regulations.  Therefore, CMS had a legal basis to revoke Petitioner’s Medicare privileges under 42 C.F.R. § 424.535(a)(9).

3. CMS had a legal basis to add Petitioner to the preclusion list effective October 1, 2021, the date of the reconsidered determination, until August 29, 2024, ten years from the date of Petitioner’s felony conviction.

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The CMS preclusion list is comprised of providers and prescribers who are precluded from receiving payment for Medicare Advantage items and services or Medicare Part D drugs furnished or prescribed to Medicare beneficiaries.  CMS may place an individual or entity on the preclusion list if:

(i)   The individual or entity is currently revoked from Medicare for a reason other than that stated in [42 C.F.R.] § 424.535(a)(3).

(ii)   The individual or entity is currently under a reenrollment bar under [42 C.F.R.] § 424.535(c).

(iii)   CMS determines that the underlying conduct that led to the revocation is detrimental to the best interests of the Medicare program.

42 C.F.R. § 422.2.

In determining whether conduct is detrimental to the best interests of the Medicare program, CMS considers:  

(i)   the seriousness of the conduct underlying the revocation,

(ii)   the degree to which that conduct could affect the integrity of the Medicare program,

(iii)   and any other evidence that CMS deems relevant to its determination.

42 C.F.R. § 422.2.

When CMS made the decision to add Petitioner to the preclusion list, Petitioner was “revoked from Medicare” under 42 C.F.R. § 424.535(a)(3), (a)(4), and (a)(9).  CMS Ex. 7.  Petitioner was also subject to a three-year re-enrollment bar under 42 C.F.R. § 424.535(c).  Id.; CMS Ex. 6 at 4 (establishing the three-year re-enrollment bar).  In addition, CMS determined that the conduct underlying Petitioner’s revocation was detrimental to the best interests of the Medicare program and therefore warranted placing Petitioner on the preclusion list.  CMS Ex. 7 at 8-9. 

Specifically, CMS noted that that the agency considers Petitioner’s conviction for assault very severe and noted that his actions could have resulted in serious bodily injury or death.  CMS Ex. 7 at 12.  CMS also noted that Petitioner was arrested in 2001 for driving under the influence and failed to report that arrest on his Texas Physician Assistant license application in violation of a Texas regulation.  CMS Ex. 7 at 7.

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Petitioner does not dispute that his Medicare billing privileges were revoked or that he was under a re-enrollment bar at the time of preclusion.  P. Br. at 12; P. Phrg. Br. at 12.  However, Petitioner argues that CMS erred in determining that his conduct was detrimental to the best interests of the Medicare program.  P. Br. at 12-15; P. Phrg. Br at 13-15.  Petitioner also suggests that CMS improperly relied on Petitioner’s failure to report his 2014 conviction for its preclusion determination because he was not obligated to report it.  P. Br. at 4 (arguing that Petitioner’s deferred adjudication agreement resolved the assault charge and would only result in a conviction if Petitioner failed to comply with the terms of his probation); P. Phrg. Br. at 4 (same).

In reviewing CMS’s decision to place a provider or supplier on the preclusion list, an ALJ is not permitted to re-weigh the factors set forth in 42 C.F.R. §§ 422.2 and 423.100.  Where the regulations have granted CMS discretion to determine whether a provider or supplier’s underlying conduct is detrimental to the Medicare program, the ALJ may not substitute their own judgment as to whether CMS properly exercised that discretion.  Brian K. Ellefsen, D.O., DAB No. 2626 at 7 (2015); see also Pa. Physicians, P.C., DAB No. 2980 at 13 (2019).

Here, CMS met its regulatory obligation to consider whether the conduct underlying Petitioner’s revocation was detrimental to the best interests of the Medicare program by assessing the seriousness of that conduct, the degree to which that conduct could affect the integrity of the Medicare program, and any other information CMS deemed relevant to its determination.  42 C.F.R. § 422.2, Preclusion list.  In its reconsidered determination, CMS explicitly determined the basis for Petitioner’s revocation under section 424.535(a)(3) was detrimental to the best interests of the Medicare program, observing that:

Regarding factor (i), [Petitioner’s] offense was very severe and could have resulted in serious bodily injury or death.  In his reconsideration request, [Petitioner] admits his poor decision to handle a handgun without a concealed carry permit, which was required in Texas, and to assault a police officer (see Exhibit 1).  While, [Petitioner] argues that he did not intentionally assault a police officer and did not cause serious harm to the police officer, his actions could have easily led to serious harm or injury to the police officer.  [Petitioner’s] decision to handle a handgun without a permit and assault a police officer is very concerning to CMS.  After considering these factors, CMS finds that [Petitioner’s] offense was very severe.

Regarding factor (ii), the incident that led to [Petitioner’s] conviction occurred on July 6, 2013.  When this is weighed against the severity

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of the Medicare program given the severity of the offense, this timeframe justifies his inclusion on the Preclusion List.

Regarding factor (iii), CMS finds it relevant that [Petitioner] has a history of substance abuse and was arrested in 2001 for driving under the influence (see Exhibit 16).  [Petitioner] failed to disclose his 2001 arrest on his Texas Physician Assistant license application in violation of Texas Occupations Code §[ ]204.302(a)(1) (see Exhibit 16).  In his reconsideration request, [Petitioner] argues that his August 29, 2014 conviction was an isolated event but his criminal history seems to suggest that his conviction was not an isolated event.  [Petitioner’s] longstanding criminal record and history of failing to report is concerning to CMS and demonstrates a history of poor decisions.  Therefore, CMS upholds [Petitioner’s] placement on the CMS Preclusion List.

Furthermore, effective January 1, 2020, under § 422.222(a)(5)(iii) and § 423.120(c)(6)(vii)(c), an individual, regardless of whether they are or were enrolled in Medicare, that is included on the CMS Preclusion List because of a felony conviction will remain on the CMS Preclusion List for a 10-year period, beginning on the date of the felony conviction.  This authority allows CMS to include [Petitioner] on the CMS Preclusion List for 10 years from the date of his conviction.  Therefore, CMS upholds [Petitioner’s] inclusion on the CMS Preclusion List, effective the date of this decision.

CMS Ex. 7 at 7-8 (emphasis in original).  CMS also weighed these factors for 42 C.F.R. § 424.535(a)(4), observing that:

Regarding factor (A), CMS finds [Petitioner’s] conduct to be very serious.  The Medicare program relies on providers and suppliers to accurately self-report data on their enrollment applications.  CMS has stated:  “[w]e must have complete and accurate data on each provider and supplier to help confirm that the provider or supplier still meets all Medicare requirements and that Medicare payments are made correctly.  Inaccurate or outdated information puts the Medicare Trust Funds at risk” (see 84 Fed. Reg. at 47,829).

Regarding factor (B), CMS has long held that “submission of false information or the withholding of information relevant to the provider’s or supplier’s enrollment eligibility represents a significant program integrity risk” (84 Fed. Reg. at 47,826).  [Petitioner] argues that he should not be added to the CMS Preclusion List because he

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did not intend to withhold the information about his felony conviction.  However, the integrity of the program is at risk regardless of a supplier’s intent (or lack thereof) to withhold the information.

Regarding factor (C), CMS also finds relevant that [Petitioner’s] history of failing to disclose and report information.  In violation of Texas Occupations Code § 204.302(a)(l), [Petitioner] failed to report his arrest for driving under the influence to the Texas Physician Assistant Board (see Exhibit 16).  CMS cannot reasonably rely on [Petitioner] to fulfill his obligation to report updated information, as required under § 424.516, or any other requirement of his participation in the Medicare program as a supplier based on his history of failing to comply with legal requirements to report information.

CMS Ex. 7 at 8-9.  CMS also weighed these factors for 42 C.F.R. § 424.535(a)(9), observing that:

Regarding factor (A), [Petitioner’s] failure to report the felony conviction to CMS in a timely manner as required under § 424.516(d) is serious.  CMS relies on updated information included in supplier disclosures to screen them for continued enrollment in the Medicare program.

Regarding factor (B), because of his failure to timely report his felony conviction, [Petitioner] continued to be enrolled in the program though CMS would have exercised our discretion to revoke him if his felony conviction had been timely reported. This failure represents a significant negative effect on the integrity of the program.  [Petitioner] failed to take the affirmative actions required to maintain his enrollment in the Medicare program.  CMS has found that “submission of false information or the withholding of information relevant to the provider’s or supplier’s enrollment eligibility represents a significant program integrity risk” (see 84 Fed. Reg. at 47,826).

CMS Ex. 7 at 9. 

Petitioner argues that CMS improperly determined that the circumstances surrounding his felony conviction constituted a threat to the interests of the Medicare program and its beneficiaries.  P. Br. at 11-15; P. Phrg. Br. at 8-15.  In this case, CMS specifically determined Petitioner’s offense was severe because Petitioner’s decision to handle a

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handgun without a permit could have led to serious harm or injury to the police officer involved.  CMS Ex. 7 at 7.  CMS acknowledged that the incident related to Petitioner’s conviction occurred back in July 2013, but determined that the severity of the offense still justified Petitioner’s placement on the preclusion list.  CMS Ex. 7 at 7.

Petitioner argues that he is an asset to the community, that he made an isolated mistake completely unrelated to his position as a physician’s assistant, and that neither his conviction nor his subsequent conduct poses a risk to the Medicare program or its beneficiaries.  P. Br. at 11-15; P. Phrg. Br. at 8-15.  Based on the performance evaluations provided by Petitioner, and the statements from Petitioner’s colleagues, it appears that Petitioner has attempted to make amends since his felony conviction.  However, an ALJ cannot substitute their discretion for CMS’s to find that Petitioner just made a mistake or had a serious lapse in judgment for which he has paid the consequences.  The evidence shows that CMS considered the seriousness of Petitioner’s conduct and the degree to which Petitioner’s conduct could impact the integrity of the Medicare program.  42 C.F.R. § 422.2, Preclusion list; see also 42 C.F.R. § 423.100.

Petitioner’s equitable arguments are discussed in section (VII)(4), infra.  However, it is important to address Petitioner’s argument regarding CMS’s use of his 2001 conviction for driving under the influence. In consideration of the preclusion list factors for Petitioner’s revocation under § 424.535(a)(4), CMS determined that Petitioner had a history of substance abuse because he was arrested in 2001 for driving under the influence.  CMS Ex. 7 at 7.  CMS does not specify whether the charge was a felony, and CMS does not provide any evidence that Petitioner was found to be a threat to the integrity of the Medicare program, or its beneficiaries based on his 2001 conviction.  See CMS Ex. 7.  Petitioner correctly points out that “a single 2001 DUI offense does not reflect any pattern of criminal conduct or a struggle with substance abuse.”  P. Br. at 11; P. Phrg. Br. at 11.  Regardless of whether an ALJ would find a charge for driving under the influence relevant in any way to a determination to include Petitioner on the preclusion list because of a conviction for assault with a deadly weapon, and regardless of whether an ALJ would describe two incidents nearly 13 years apart as a “longstanding criminal record,” CMS has concluded that Petitioner’s conduct in that regard was a threat to the integrity of and a detriment to the Medicare program.  CMS Ex. 7 at 7.  An ALJ cannot reverse this determination.  CMS’s decision to preclude Petitioner because of his revocation under § 424.535(a)(4) is articulated and justified with respect to the seriousness of the underlying conduct and the degree to which the conduct could affect the integrity of the Medicare program.

Petitioner’s arguments regarding whether he was required to report the deferred adjudication order as a final adverse legal action and his arguments about being held responsible for the inadvertent omission by his employer’s credentialing agent are discussed at length in this decision.  However, CMS found its reliance on inaccurate information in Petitioner’s applications resulted in Petitioner continuing to be enrolled in

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the program.  CMS Ex. 7 at 9.  CMS argued that Petitioner would have been revoked if he had timely reported his conviction and that Petitioner has never affirmatively reported his felony conviction.  CMS Br. at 14; CMS Ex. 7 at 6, 9.  CMS concluded that Petitioner’s failure to report his conviction was also detrimental to the integrity of the Medicare program and its beneficiaries because when suppliers provide false information or omit information relevant to their enrollment eligibility, it has a direct impact on the program’s integrity.  CMS Ex. 7 at 9 (citing 84 Fed. Reg. at 47,826).  CMS’s decision to preclude Petitioner because of his revocation under § 424.535(a)(9) is articulated and justified with respect to the seriousness of the underlying conduct and the degree to which the conduct could affect the integrity of the Medicare program.

Petitioner’s enrollment is revoked, under the provisions of 42 C.F.R. § 424.535(a)(3), (a)(4), and (a)(9), and Petitioner is subject to a three-year reenrollment bar.  CMS determined Petitioner’s conviction was per se detrimental to the Medicare program and its beneficiaries.  In considering the remaining criteria, the failure to report the conviction within the specified time period and the certification of false or misleading information demonstrate disregard for the integrity of the Medicare program.  Therefore, in concluding that Petitioner’s conduct was detrimental to the best interests of the Medicare program, CMS had a legitimate basis for placing Petitioner on the preclusion list effective October 1, 2021, the date of the reconsidered determination, until August 29, 2024, ten years from the date of Petitioner’s felony conviction.

4. Petitioner’s equitable arguments are not a basis to reverse CMS’s decision to revoke Petitioner’s Medicare privileges or to place him on the preclusion list.

Petitioner argues that his conduct constituted a lapse in judgment and he has worked diligently since the day of his sentence to demonstrate that he does not pose a risk to the Medicare program or its beneficiaries.  P. Br. at 5, 8-10.  Petitioner notes that he completed the requirements of his probation, resolved matters with the Medical Board, and is highly regarded by his colleagues.  P. Br. 8-10.  Petitioner also argues that denying him enrollment in Medicare and placing him on the preclusion list has the potential to put Medicare beneficiaries at risk because he provides necessary services in an underserved community in Texas where access to such services is limited and there is a chronic healthcare worker shortage.  Id. at 11, 15.

Petitioner’s argument about providing health care in a severely under-resourced area is construed as an attempt to demonstrate “that exceptional circumstances exist regarding beneficiary access to items, services, or drugs” within the meaning of 42 C.F.R. § 422.222(a)(6) (84 Fed. Reg. at 15,832).  The regulation provides that CMS has discretion not to include an individual on the preclusion list if such circumstances exist.  However, the determination of exceptional circumstances falls within CMS’s

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purview.  Petitioner’s argument is not persuasive and does not support reversal of CMS’s decision to include on the preclusion list.

In this case, CMS presumably conducted the required analysis and determined that “exceptional circumstances” did not justify excepting Petitioner from placement on the preclusion list.  See, e.g., Brian K. Ellefsen, DAB No. 2626 at 7 (2015) (citing U.S. Postal Serv. v. Gregory, 534 U.S. 1, 10 (2001) (“a presumption of regularity attaches to the actions of Government agencies”)); see also U.S. v. Chemical Found., Inc., 272 U.S. 1, 1415 (1926) (a “presumption of regularity supports the official acts of public officers,” so “in the absence of clear evidence to the contrary, courts presume that they have properly discharged their official duties”).  CMS’s exercise of its discretion to waive or not to waive placement on the preclusion list based on beneficiary access issues is not reviewable by an ALJ.  In another context, an appellate panel of the DAB observed:  “Even assuming CMS had discretion to refrain from [taking an official action] in these circumstances, it chose not to do so, and we have no authority to review that choice.”  Sugarland, DAB No. 2719 at 8.  The reasoning of the Sugarland decision is persuasive authority supporting a conclusion that CMS’s determination declining to apply 42 C.F.R. § 422.222(a)(6) in Petitioner’s case is not reviewable here.

VIII.   Conclusion

CMS has established a legal basis to revoke Petitioner’s Medicare privileges and to include Petitioner on its preclusion list.  Therefore, the revocation of Petitioner’s Medicare privileges under 42 C.F.R. § 424.535(a)(3), (a)(4), and (a)(9), and the inclusion of Petitioner on the CMS Preclusion List, effective October 1, 2021, are affirmed.

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Endnotes

¹ Petitioner filed twelve exhibits and four “attachments.”  The Standing Order and Civil Remedies Division Procedures instruct the parties on how to identify and mark their proposed exhibits.  For ease of reference to the record, the attachments are included with Petitioner’s total number of proposed exhibits.

² CMS’s motion for summary judgment is denied as moot.

³ My conclusions of law appear as headings in bold italic type.  My findings of fact and analysis appear in the supporting text.

⁴ Petitioner objects to CMS’s inclusion of the 2015 revalidation application because the only forms included in the revocation for providing false or misleading information under § 424.535(a)(4) were the July 31, 2020 applications.  P. Br. at 12 n.11; P. Phrg. Br. at 12 n.12.  Petitioner’s objection is noted, and the applications which form the basis for the revocation are included in the bolded conclusions of law.