Shaunta Lesae Whiting, DAB CR6312 (2023)

DECISION

The Inspector General (IG) of the Department of Health and Human Services excluded Petitioner, Shaunta Lesae Whiting, from participating in all federal health care programs for a minimum period of six years under 42 U.S.C. § 1320a‑7(a)(1).  Petitioner requested a hearing before an administrative law judge (ALJ) to dispute the exclusion.  For the reasons explained below, I conclude that the IG has a basis for excluding Petitioner and that the six-year exclusion period is not unreasonable in light of the aggravating factor present in this case.

I.  Case Background and Procedural History

In a January 31, 2023 notice, the IG informed Petitioner that she was excluding Petitioner from participation in all federal health care programs under section 1128(a)(1) of the Social Security Act (42 U.S.C. § 1320a-7(a)(1)) for a period of six years due to her conviction in the Superior Court of California (Superior Court), County of Los Angeles, of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  IG Ex. 1 at 1.  The IG cited the following aggravating factor as the basis for increasing the exclusion period from the minimum period of five years to six years:

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The acts resulting in the conviction, or similar acts, 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. . . . The court ordered [Petitioner] to pay approximately $77,700 in restitution.

IG Ex. 1 at 1.

Petitioner requested an ALJ hearing to challenge the exclusion.  On April 4, 2023, the Civil Remedies Division (CRD) issued an Acknowledgment Letter along with my Standing Prehearing Order (Prehearing Order).  These documents provided notice of a prehearing conference and the procedures that govern this case.

On April 20, 2023, I held a prehearing conference by telephone, the substance of which is summarized in my April 20, 2023 Order Following Prehearing Conference and Setting Schedule for Prehearing Submissions (Prehearing Conference Order).  At the conference, Petitioner confirmed that she was appealing both the imposition of the exclusion and the length of the exclusion.  Prehearing Conference Order at 2.  With the agreement of the parties, I also established a prehearing submission schedule.  Prehearing Conference Order at 2.  I advised the parties that any request for an extension of time to submit a prehearing exchange had to be made before the deadline for submission had passed and that a failure to comply with the submission deadlines could result in sanctions.  Prehearing Conference Order at 2.

In conformance with the Prehearing Order and the Prehearing Conference Order, the IG filed a brief (IG Br.) and three exhibits (IG Exs. 1-3).  Petitioner did not file a prehearing exchange.

On June 16, 2023, CRD sent Petitioner an email advising that no prehearing exchange had been received by the June 15, 2023 deadline and that, if Petitioner still intended to file an exchange, Petitioner must do so by June 23, 2023.  Further, the email provided Petitioner with the opportunity to request an additional extension of time.  Finally, the email warned that a failure to file a prehearing exchange or an extension request could result in the issuance of a decision in this matter based on the filings that the parties have made so far.  Electronic Filing (E-File) Document No. 6.

Petitioner neither filed an exchange nor requested an extension of time.

II.  Issues

1. Whether the IG has a basis for excluding Petitioner from participating in all federal health care programs under 42 U.S.C. § 1320a-7(a)(1).

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2. If there is a basis for exclusion, whether a six-year exclusion period is unreasonable.

III.  Admission of Evidence and Decision on the Written Record

Petitioner did not object to the IG's proposed exhibits.  Therefore, I admit IG Exhibits 1 through 3 into the record.  Prehearing Order ¶ 12; see also 42 C.F.R. § 1005.8(c); Civil Remedies Division Procedures (CRDP) § 14(e).

I directed the parties to submit written direct testimony for any witnesses that they wanted to present in this case (except for expert witnesses).  Prehearing Order ¶ 10.  I also directed the parties to file a request if either party wanted to cross-examine any witness from whom written direct testimony had been submitted.  Prehearing Order ¶ 11.  Finally, I stated that:

Except for proposed expert witness testimony, I will not conduct a hearing in this case unless a party files admissible, written direct testimony, and the opposing party asks to cross-examine one or more witnesses.  If I do not conduct a hearing, then I will issue based on the written record. 

Prehearing Order ¶ 11 (emphasis added).  In addition, CRD's June 16, 2023 email stated that if Petitioner did not file a prehearing exchange by June 23, 2023, then I "may issue a decision in this matter based on the filings that the parties have made so far." E-File Document No. 6.

In the present case, the IG has no witnesses to present and indicated that a hearing is unnecessary.  IG Br. at 8.  Petitioner did not submit written direct testimony from any witnesses.  As a result, a hearing is not necessary, and I may issue a decision based on the written record.  Anil Hanuman, D.O., DAB No. 3080 at 12 (2022) (concluding that a decision on the record may be issued when a party fails to file a prehearing exchange); Vandalia Park, DAB No. 1940 (2004); CRDP §§ 16(b), 19(b), (d).

IV.  Jurisdiction

I have jurisdiction to adjudicate this case.  42 U.S.C. § 1320a-7(f)(1); 42 C.F.R. §§ 1001.2007, 1005.2.

V.  Findings of Fact, Conclusions of Law, and Analysis

1. On August 19, 2022, Petitioner pleaded nolo contendere to the crime of Grand Theft based on taking money from the Medi-Cal Program in excess of

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$950. ¹ Also on August 19, 2022, the Superior Court accepted Petitioner's plea, found Petitioner guilty, sentenced Petitioner to summary probation, and ordered Petitioner to pay restitution in the amount of $30,412.14 to the California Medical Health Care Deposit Fund and $47,348.23 to the Federal Office of Worker's Compensation Programs.

In January 2021, the California Attorney General charged Petitioner with multiple criminal offenses.  Petitioner pleaded not guilty to those charges.  IG Ex. 2 at 1-2.

On February 10, 2022, the California Attorney General filed an Amended Felony Complaint that added Count 6 to the charges pending against Petitioner.  IG Ex. 2 at 3; IG Ex. 3.  The Amended Felony Complaint alleged in Count 6 that Petitioner committed Grand Theft based on the following:

From on or about May 2, 2019, to on or about December 11, 2019, in the County of Los Angeles, State of California, [Petitioner], unlawfully took from the State of California's Medi-Cal Program money and property of a value in excess of nine hundred fifty dollars ($950), in violation of subdivision (a), of section 487, of the Penal Code, a felony.

IG Ex. 3 at 4.  Petitioner pleaded not guilty to Count 6.  IG Ex. 2 at 3.

On August 19, 2022, the Superior Court did the following:  granted a motion to lower the charge in Count 6 to a misdemeanor; approved Petitioner's nolo contendere plea to Count 6; found that there was a factual basis for Petitioner's plea; accepted Petitioner's plea; and found Petitioner guilty.  IG Ex. 2 at 5.  As to the sentence for Petitioner's crime, the Superior Court stated:  "Imposition of sentence suspended[.]  [Petitioner] placed on summary probation." IG Ex. 2 at 5.  Further, the Superior Court ordered Petitioner to complete 300 hours of community service but found Petitioner had already completed that requirement.  IG Ex. 2 at 5.  In addition, the Superior Court ordered Petitioner "to make restitution to the victim pursuant to Penal Code section 1202.4(F), in the amount of $30,412.14 to Medical Health Care Deposit Fund and $47,348.23 to the Federal Office of Worker's Compensation Programs, Division of Federal Employees Compensation." IG Ex. 2 at 5.

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Also on August 19, 2022, pursuant to California Penal Code section 1203.4/1203.4A, the Superior Court set aside Petitioner's plea and the court's finding of guilt and dismissed Count 6 of the Amended Felony Complaint.  I.G. Ex. 2 at 6.

2. Petitioner was convicted of a criminal offense related to the delivery of a health care item or service under a state health care program;² therefore, exclusion is required under 42 U.S.C. § 1320a‑7(a)(1).

The IG must exclude an individual from participation in any federal health care program if that individual was convicted under federal or state law of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  42 U.S.C. § 1320a‑7(a)(1).  The facts in this case show that Petitioner meets this standard for exclusion.

Petitioner was convicted of a criminal offense.  For purposes of exclusion, individuals are deemed "convicted" of an offense if any of the following are met:

(1) when a judgment of conviction has been entered against the individual or entity by a Federal, State, or local court, regardless of whether there is an appeal pending or whether the judgment of conviction or other record relating to criminal conduct has been expunged;

(2) when there has been a finding of guilt against the individual or entity by a Federal, State, or local court;

(3) when a plea of guilty or nolo contendere by the individual or entity has been accepted by a Federal, State, or local court; or

(4) when the individual or entity 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)(1)-(4).  In the present case, all of these definitions for the term "convicted" are met.  Petitioner pleaded nolo contendere to Count 6, and the Superior Court accepted that plea.  IG Ex. 2 at 5.  The Superior Court also found there was a

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factual basis for Count 6 and found Petitioner guilty of that charge.  IG Ex. 2 at 5.  Further, the Superior Court entered a judgment of conviction against Petitioner.  IG Ex. 2 at 5 ("Count (06) : Disposition:  Convicted.").  Finally, Petitioner entered into an arrangement or program that resulted in Count 6 being dismissed after pleading nolo contendere to that charge following completion of 300 hours of community service.  IG Ex. 2 at 5-6; Cal. Penal Code § 1203.4(a) (providing courts with discretion to permit a defendant to withdraw a nolo contendere plea and dismiss the matter if the defendant completes the requirements of probation; however, such individuals still may have various legal restrictions based on the original conviction, such as losing the right to possess a firearm).

Further, Petitioner's criminal offense was "related to" the delivery of a health care item or service under a state health care program.  For purposes of exclusion, the term "related to" simply means that there must be a nexus or common-sense connection.  See Quayum v. U.S. Dep't of Health & Human Servs., 34 F. Supp. 2d 141, 143 (E.D.N.Y. 1998); see also Friedman v. Sebelius, 686 F.3d 813, 820 (D.C. Cir. 2012) (describing the phrase "relating 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).

While Petitioner pleaded nolo contendere to Grand Theft, the facts alleged in the Amended Felony Complaint make it clear that the theft was based on multiple claims that Petitioner filed with Medi-Cal in which Petitioner claimed to have provided home health services to an individual who was either working or leaving home at the time the alleged services were provided.  IG Ex. 3 at 2-3.  Further, the specific allegations in Count 6 involve theft of money from Medi-Cal.  IG Ex. 3 at 4.  I conclude that there is a clear nexus between Petitioner's conviction and the delivery of an item or service under Medicaid.  Submitting a false claim to Medicaid is "related to" the delivery of an item or service under a state health care program.  See Travers v. Shalala, 20 F.3d 993, 998 (9th Cir. 1994) (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.); Kahn v. Inspector Gen. of the U.S. Dep't of Health & Human Servs., 848 F. Supp. 432, 434, 436 (S.D.N.Y. 1994) (concluding that a podiatrist's conviction for attempted grand larceny was program related for purposes of an exclusion because it was related to the filing of false Medicaid claims); Greene v. Sullivan, 731 F. Supp. 835, 838 (E.D. Tenn. 1990) ("There is no question that Mr. Greene's crime [of filing false claims] resulted in a Medicaid overpayment and was a program-related crime triggering the mandatory exclusion under Section 1320a‑7(a).").

Further, the Superior Court's order for Petitioner to pay restitution to the California Medical Health Care Deposit Fund, which the Superior Court labeled as a "victim," also shows the required nexus in this case.  IG Ex. 2 at 5.

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The [Departmental Appeals] Board has also recognized that a criminal offense resulting in financial loss to a State Medicaid program is "related to" the delivery of items or services under that Medicaid program because it results "in less funds being available to pay for covered services" delivered to Medicaid patients.

Summit S. Shah, M.D., DAB No. 2836 at 8-9 (2017).

In the request for hearing, Petitioner argued that she had "been erroneously placed on the HHS Exclusion list. . . ." E-file Document No. 1.  However, there is no evidence in the record that Petitioner was not convicted of the crime discussed above.  The record does not support the argument that the IG erroneously excluded Petitioner.

Accordingly, I conclude that the criminal conduct for which Petitioner was convicted was related to the delivery of a health care item or service under a state health care program.  See 42 U.S.C. § 1320a‑7(a)(1).  Therefore, the record fully supports Petitioner's mandatory exclusion.

3. Petitioner must be excluded for a minimum of five years. 

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 of five years.  42 U.S.C. § 1320a‑7(c)(3)(B).

4. The IG established that an aggravating factor, i.e., a financial loss to government programs of $50,000 or more, exists in this case.  Petitioner did not allege that any regulatorily recognized mitigating factors exist in this case.  As a result, the IG's decision to impose an exclusion for one year longer than the five‑year statutory minimum is not unreasonable. 

The regulations establish aggravating factors that the IG may consider to lengthen the period of exclusion beyond the five‑year minimum for a mandatory exclusion.  42 C.F.R. § 1001.102(b).  Only if an aggravating factor justifies an exclusion longer than five years may mitigating factors be considered as a basis for reducing the period of exclusion to no less than five years.  42 C.F.R. § 1001.102(c).

In this case, the IG advised Petitioner in the exclusion notice that there was an aggravating factor that justified excluding her for more than five years.  Specifically, the IG stated that acts resulting in Petitioner's conviction, or similar acts, caused, or were intended to cause, a financial loss to a government agency or program or to one or more entities of $50,000 or more.  The IG cited, as proof that such a loss occurred, the Superior Court's order for Petitioner to pay approximately $77,700 in restitution.  IG Ex. 1 at 1.

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The IG has provided evidence that demonstrates the acts resulting in Petitioner's criminal conviction caused a financial loss to government programs of $50,000 or more.  See 42 C.F.R. § 1001.102(b)(1).  Petitioner pleaded nolo contendere to a charge of Grand Theft that involved improperly taking money from the Medi-Cal program.  The record shows that the Superior Court ordered Petitioner "to make restitution . . . in the amount of $30,412.14 to Medical Health Care Deposit Fund and $47,348.23 to the Federal Office of Worker's Compensation Programs, Division of Federal Employees Compensation." IG Ex. 2 at 5.

It is well‑established that an amount ordered as restitution constitutes proof of the amount of financial loss to a government program.  See, e.g., Juan de Leon, Jr., DAB No. 2533 at 5 (2013); Jason Hollady, M.D., DAB No. 1855 (2002).  Therefore, the IG has sustained its burden of proving financial loss to government programs of $50,000 or more.

Because I found that an aggravating factor is present in this case, I next consider whether there are any mitigating factors under 42 C.F.R. § 1001.102(c) to offset the aggravating factors.  In the hearing request, Petitioner asserted that the exclusion has caused her to lose one job and potentially to lose a second job.  She stated the exclusion affects her career and her ability to serve the vulnerable homeless population in Los Angeles County.  E-File Document No. 1.

Although Petitioner asserts reasons to mitigate her exclusion, she did not assert reasons that I may consider.  The regulations specifically outline what factors may be considered mitigating and none of Petitioner's arguments relate to any of those mitigating factors.  See 42 C.F.R. § 1001.102(c).  Accordingly, I find that Petitioner has not met her burden to establish that any mitigating factors would justify reducing the period of exclusion.

I must uphold the IG's determination as to the length of the exclusion if it is not unreasonable.  42 C.F.R. § 1001.2007(a)(1)(ii).  Therefore, so long as the exclusion period falls within a reasonable range, my role is not to second-guess the IG's judgment.  Jeremy Robinson, DAB No. 1905 at 5 (2004).  A "‘reasonable range' refers to a range of exclusion periods that is more limited than the full range authorized by the statute[, i.e., from a minimum of five years to a maximum of permanent,] and that is tied to the circumstances of the individual case." Joseph M. Rukse, Jr., R.Ph., DAB No. 1851 at 11 (2002) (citing Gary Alan Katz, R.Ph., DAB No. 1842 at 8 n.4 (2002)).

Based on the Superior Court's acceptance of Petitioner's nolo contendere plea, Petitioner stole money from the California Medicaid program.  The order of restitution indicates that Petitioner owed more than $77,000 to two government programs.  The underlying facts to Petitioner's crime show that Petitioner filed false claims with Medi-Cal in order to improperly obtain the money from Medi-Cal.  Because Petitioner's offense involved a significant amount of money taken from a Medicaid program as well as a significant

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amount from a federal program, the IG's decision to add a single additional year to the length of exclusion is not unreasonable.

VI.  Conclusion

For the foregoing reasons, I affirm the IG's determination to exclude Petitioner for six years from participating in Medicare, Medicaid, and all federal health care programs pursuant to 42 U.S.C. § 1320a‑7(a)(1).

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Endnotes

¹  Medi-Cal is California's Medicaid program.  See Jesusa N. Romero, M.D., DAB CR380 at 1 n.1 (1995).

²  A "State health care program" means "a State plan approved under title XIX" of the Social Security Act.  42 U.S.C. § 1320a-7(h)(1).  Medicaid is a state plan approved under Title XIX of the Social Security Act.  42 C.F.R. § 1000.10 (definition of Medicaid).