Darren Michael Martin, CR6268 (2023)

DECISION

I sustain the determination of the Inspector General (IG) to exclude Petitioner, Darren Michael Martin, from participating in Medicare, state Medicaid, and other federally funded health care programs for a minimum period of ten years. 

I.  Background

Neither the IG nor Petitioner requested an in-person hearing.  Consequently, I decide this case based on the parties’ written exchanges. 

The IG filed a brief, a reply brief, and seven exhibits, identified as I.G. Ex. 1-I.G. Ex. 7.  Petitioner filed a brief and six exhibits, identified as P. Ex. 1-P. Ex. 6.  Neither party objected to my receiving exhibits.  I receive I.G. Ex. 1-I.G. Ex. 7 and P. Ex. 1-P. Ex. 6 into evidence. 

II.  Issues, Findings of Fact and Conclusions of Law

A. Issues

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The issues are whether the IG must exclude Petitioner and whether a ten-year exclusion is reasonable. 

B. Findings of Fact and Conclusions of Law

The IG excluded Petitioner pursuant to section 1128(a)(3) of the Social Security Act (Act).  This section mandates the exclusion of any individual convicted of a crime occurring after August 21, 1996, that is related to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct in connection with the delivery of a health care item or service. 

There is no dispute, and Petitioner concedes, that he was convicted of a section 1128(a)(3) crime. 

Petitioner, a pharmacist, was indicted for the federal crime of conspiracy to commit health care fraud.  I.G. Ex. 2.  He agreed to plead guilty to the charge and a federal district court entered a judgment of conviction against him on February 23, 2021.  I.G. Ex. 3; I.G. Ex. 5. 

Petitioner’s conviction fits squarely within the elements of a section 1128(a)(3) crime.  He was charged with and pled guilty to participating in a conspiracy to submit claims to a pharmacy, CVS, for compounded medications that were filled without the requisite collection of copayments and to conceal the failure to collect copayments.  I.G. Ex. 2 at 5.  The essence of the conspiracy was fraud committed in connection with the delivery of health care items or services. 

Conviction of a crime falling under the purview of section 1128(a)(3) mandates an exclusion of a minimum of five years.  Act § 1128(c)(3)(B).  In this case the IG opted to exclude Petitioner for a minimum of ten years.  Petitioner challenges this determination. 

My authority is limited when deciding the reasonableness of the length of exclusion.  I may not second-guess the IG, nor may I substitute my judgment for that of the IG.  Juan de Leon Jr., DAB No. 2533 at 4-5 (2013); Craig Richard Wilder, DAB No. 2416 at 8 (2011). Rather, I must decide whether an exclusion falls within a reasonable range, based on evidence relating to defined regulatory factors.  42 C.F.R. § 1001.102(b), (c); 57 Fed. Reg. 3298, 3321 (Jan. 29, 1992). 

The regulation governing exclusions for more than the statutory minimum period sets forth both aggravating and mitigating factors that may be considered.  42 C.F.R. § 1001.102(b), (c).  These factors function as rules of evidence.  As is the case with rules of evidence, the factors describe what is relevant to deciding the length of an exclusion.  They do not state a formula for deciding what length of exclusion is appropriate.  Instead, they operate as guidelines for taking into consideration evidence that is relevant to the

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question of what is needed to protect federally financed health care programs and program beneficiaries and recipients from individuals who have been established to be untrustworthy to provide care or to deal with program assets. 

Here, the IG cites evidence relating to factors described at 42 C.F.R. § 1001.102(b)(1), (2), and (6) as justifying the ten-year minimum exclusion imposed against Petitioner. 

First, the IG contends that the acts resulting in Petitioner’s conviction caused financial loss to a government program of $50,000 or more.  42 C.F.R. § 1001.102(b)(1).  As support, the IG points to Petitioner’s judgment of conviction and sentence, which required that he pay restitution to the TRICARE program in the amount of $273.862.04.  I take notice that TRICARE is a government-run health care program for members of the United States military and their families.  https://www.tricare.mil/Plans/New. 

Second, the IG asserts that Petitioner’s criminal conduct occurred over a period lasting a year or more.  42 C.F.R. § 1001.102(b)(2).  The IG relies on Petitioner’s indictment, which charges Petitioner with having conspired to commit health care fraud during a time frame beginning around June 2014 and continuing to around June 2015, and Petitioner’s agreement to plead guilty to that indictment.  I.G. Ex. 2 at 4; I.G. Ex. 3. 

Third, the IG avers that Petitioner has a prior criminal, civil, or administrative sanction record.  42 C.F.R. § 1001.102(b)(6).  The IG cites as supporting evidence that on February 18, 2020, Petitioner surrendered his pharmacy license and on May 27, 2020, the Louisiana Board of Pharmacy accepted Petitioner’s license surrender and ordered an indefinite suspension of his license.  I.G. Ex. 6; I.G. Ex. 7. 

The evidence offered by the IG provides ample support for the determination to exclude Petitioner for at least ten years.  It establishes that Petitioner engaged in a protracted conspiracy to commit health care fraud, a conspiracy that caused substantial financial loss to the TRICARE program.  The evidence establishes also that State authorities in Louisiana found Petitioner’s crimes to be sufficiently egregious as to justify an indefinite suspension of Petitioner’s pharmacy license.  As I have stated, I may not second-guess that determination nor substitute my judgment for it. 

Petitioner offers several arguments to challenge the duration of his exclusion.  I have considered each argument and find it to be unavailing. 

Petitioner contends that the duration of his crime was for less than a year.  He argues that the language in the indictment, to which he pled guilty, is vague and ambiguous – because it states that Petitioner’s criminal conduct lasted from “in or around” June 2014 and continued through “in or around” June 2015.  I.G. Ex. 2 at 4.  Petitioner asserts that this allegedly ambiguous language could mean that his criminal behavior was, in fact, for less than a year.  Further, Petitioner asserts that close review of the documents underlying

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his conviction establishes that his crimes extended over a period of only a few months in 2015 and not for a year or more. 

The IG argues that Petitioner is now seeking to retract that part of his guilty plea in which he admitted engaging in criminal conduct lasting for a year or more.  The IG asserts that this argument is impermissible, citing 42 C.F.R. § 1001.2007(d). 

That is not what Petitioner argues.  Petitioner’s assertion is that the documents that describe the crime to which he pled guilty, the indictment and a Factual Statement filed by the Department of Justice to accompany the indictment, when read closely, describe criminal behavior lasting for less than a year.  I.G. Ex. 2; I.G. Ex. 3. 

This argument is permissible.  However, I find it to be unsupported.  While the language of the indictment isn’t precise, it clearly establishes a general time frame of about a year during which Petitioner committed his crimes.  It does not suggest an inference that Petitioner’s crimes lasted for less than a year.  Furthermore, the indictment is clarified by the Factual Statement.  That document describes criminal conduct by Petitioner beginning in June 2014 at the latest, and perhaps earlier than that, and continuing at least through June 2015.  I.G. Ex. 3 at 2, 4-5. 

As support for his contention that the Factual Statement describes crime lasting for less than a year, Petitioner points to a portion of that document that discusses actions taken by Petitioner or on his behalf in February 2015 as describing the beginning of Petitioner’s crimes.  See I.G. Ex. 3 at 3-4. 

I do not find that the Factual Statement provides support for Petitioner’s assertion that the Factual Statement sets February 2015 as the inception of Petitioner’s crimes.  To the contrary, this document offers facts that arguably support a finding that Petitioner began committing crime at a much earlier date and more than a year before he ceased his criminal activity. 

The language in the Factual Statement that Petitioner relies on, which describes actions taken by the attorney for the company that Petitioner owned in February 2015 and a subsequent e-mail or e-mails from that company to Petitioner in June 2015, does not describe the entire duration of Petitioner’s criminal conduct.  See I.G. Ex. 3 at 3-4.  There are other assertions in the Factual Statement that could evidence criminal conduct beginning well before February 2015 and extending as far back as 2012. 

The Factual Statement describes conduct occurring in 2012 in which the company that Petitioner owned and controlled failed to collect required copayments for prescriptions.  I.G. Ex. 3 at 2.  It also describes actions in 2014 that appeared to be aimed at obscuring the fact that Petitioner’s company was not collecting copayments.  Id. at 2-3. 

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Petitioner argues that the restitution that he was ordered to pay, more than $270,000, does not describe the actual financial impact of his crime.  According to Petitioner, the financial impact of the criminal conspiracy that is attributed to him is $91,915.88.  As support, Petitioner cites to a pre-sentencing memorandum filed by his then-attorney.  P. Ex. 1 at 1-2. 

The pre-sentencing memorandum is advocacy and not a finding of actual impact by the judge who sentenced Petitioner.  The restitution amount of more than $270,000 constitutes the judge’s decision of the financial impact of Petitioner’s crime and of Petitioner’s responsibility for that financial impact.  I.G. Ex. 5 at 5.  Moreover, even if Petitioner’s crime deprived TRICARE of $91,000, that is still a very substantial sum and highly indicative of Petitioner’s untrustworthiness. 

Petitioner acknowledges that the indefinite suspension of his pharmacy license is a prior adverse administrative action within the meaning of 42 C.F.R. § 1001.102(b)(6).  He argues that this adverse action adds nothing meaningful to the evidence addressing his trustworthiness to provide care as it relates to the identical conduct as was the basis for his indictment and guilty plea. 

Petitioner’s argument misses the point.  His license suspension is evidence that another administrative agency reviewed the facts of his case and found him to be highly untrustworthy.  That plainly is relevant to the IG’s duty to evaluate Petitioner’s trustworthiness and to determine what would be reasonable to protect federally funded programs, their beneficiaries, and recipients of program funds. 

Finally, Petitioner argues that there is mitigating evidence in this case, citing 42 C.F.R. § 1001.102(c)(3).  He contends that he cooperated with prosecuting authorities and that this cooperation supports reducing the duration of his exclusion. 

Mitigation may exist where an individual cooperates with federal or state authorities with that cooperation resulting in others being convicted or excluded, additional cases being investigated or reports being issued, or the imposition of a civil money penalty or assessment.  42 C.F.R. § 1001.102(c)(3).  Petitioner failed to prove that his cooperation led to any of the consequences described in the regulation. 

In the pre-sentencing memorandum that his then-attorney filed on Petitioner’s behalf, the attorney advocated that Petitioner’s cooperation provided “helpful information about the compounding pharmacy industry to assist the government with current and future cases.”  P. Ex. 1 at 2.  Petitioner notes also that the statement of reasons justifying Petitioner’s sentence states that Petitioner provided “substantial assistance” to prosecuting authorities.  P. Ex. 4 at 2.  But being helpful and providing assistance – even substantial assistance – isn’t enough to satisfy the regulatory condition for the presence of a mitigating factor.  The regulation explicitly requires that cooperation produce results:  others being

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convicted or excluded, additional cases being investigated, or reports being issued, or imposition of a civil money penalty or assessment.  Petitioner did not prove that any of these results occurred thanks to his cooperation.