Miguel A. Garcia, CR6442 (2024)

DECISION

Petitioner, Miguel A. Garcia, is excluded from participating in Medicare, Medicaid, and all federal health care programs pursuant to section 1128(a)(1) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(1)), effective June 20, 2022.  Petitioner’s exclusion for five years is required by section 1128(c)(3)(B) of the Act (42 U.S.C. § 1320a‑7(c)(3)(B)). 

I.     Background

I previously issued a decision in this case on January 23, 2023.  Miguel A. Garcia, DAB CR6222 (2023).  This case is before me now on remand from an appellate panel of the Departmental Appeals Board (the Board).  Miguel A. Garcia, DAB No. 3098 (2023).  The Board upheld many parts of my prior decision and remanded for additional fact- finding on a narrow issue of fact.  The Board did not specify additional record development but left it to my discretion to decide whether any development was necessary to resolve the fact issue identified by the Board.  The rulings of the Board

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upholding parts of my decision are treated as binding under the law of the case doctrine.¹  The Board did not specifically vacate any part of my prior decision.  I issue a new decision that incorporates my first decision with the additional analysis and findings required by the Board’s remand.  This decision is intended to dispose of the case completely and replace my prior decision (DAB CR6222). 

The Inspector General of the United States Department of Health and Human Services (IG) notified Petitioner by letter dated May 31, 2022, that he was excluded from participation in Medicare, Medicaid, and all federal health care programs for five years.  The IG cited section 1128(a)(1) of the Act as the basis for Petitioner’s exclusion.  The IG stated that the exclusion was based on Petitioner’s conviction in the Superior Court of Arizona, Pima County (state court), of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  IG Exhibit (IG Ex.) 1 at 1. 

Petitioner timely filed a request for hearing (RFH) on July 17, 2022.  On July 19, 2022, the case was assigned to me to hear and decide.  I convened a telephone prehearing conference on August 29, 2022, the substance of which is memorialized in my Prehearing Conference Order and Schedule for Filing Briefs and Documentary Evidence issued on August 30, 2022 (Prehearing Order).  During the prehearing conference, Petitioner waived an oral hearing and the parties agreed that this case could be resolved based upon the parties’ briefs and documentary evidence.  Prehearing Order ¶ 5.  

On October 13, 2022, the IG filed a brief (IG Br.) and IG Exs. 1 through 9.  On November 10, 2022, the IG filed an amended IG Ex. 8 (IG Ex. 8 (amended)).  On November 27, 2022, Petitioner filed a brief (P. Br.) with no exhibits.  The IG filed a reply brief (IG Reply) on December 12, 2022.  

Petitioner did not object to my consideration of IG Exs. 1, 6, and 7, and they were admitted and considered as evidence.  Petitioner objected to the admission of IG Exs. 2, 3, 4, 5, 8 (amended), and 9 on the grounds that the exhibits contained irrelevant information, hearsay, and statements of purported fact to which Petitioner had not agreed or had the opportunity to contest.  P. Br. at 1-5.  

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Pursuant to 42 C.F.R. § 1005.17, ² the administrative law judge (ALJ) determines whether evidence should be admitted to the record.  The Federal Rules of Evidence do not apply except as guidance that the ALJ may choose to apply.  Irrelevant and immaterial evidence must be excluded.  Relevant evidence may be excluded if it is unreliable or more prejudicial than probative, privileged, if the evidence is related to an offer of compromise or settlement, or related to a corrective action plan under certain circumstances.  42 C.F.R. § 1005.17.  

Petitioner is correct that IG Exs. 2 through 4, IG Ex. 8 (amended), and IG Ex. 9 all contain hearsay.  However, the fact that the documents contain hearsay is not grounds for excluding the exhibits, so long as the information contained in the exhibits is relevant, reliable, more probative than prejudicial, not privileged, and does not involve offers in compromise or settlement or a corrective action plan. 

Relevant evidence is evidence that has any tendency to make a fact of consequence more or less probable.  Fed. R. Evid. 401.  Petitioner does not deny that he ³ was convicted of criminal simulation under Arizona law.  RFH at 1-2; P. Br. at 5-7.  Petitioner argues, however, that the crime of which he was convicted was not related to the delivery of an item or service under Medicare or a state healthcare program, which is necessary to trigger mandatory exclusion pursuant to section 1128(a)(1) of the Act.  Therefore, the issue of consequence in this case is whether the criminal conduct of which Petitioner was convicted was related to the delivery of an item or service under Medicare or a state healthcare program.  Relevant evidence in this case is any evidence that has a tendency to show that it was more or less likely that the criminal conduct of which Petitioner was convicted was related to the delivery of a health care item or service under Medicare or a state healthcare program.  Fed. R. Evid. 401.  The authenticity of IG Exs. 2, 3, 4, 5, 8 (amended), and 9 was not challenged and each of the exhibits included evidence related to the alleged criminal conduct of Petitioner.  I recognized, as Petitioner argued, that not all the allegations of fact in each of the documents had been admitted or conceded by Petitioner or found as fact by the state court in Petitioner’s criminal proceeding.⁴ 

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However, that did not make the evidence in IG Exs. 2, 3, 4, 5, 8 (amended), and 9 irrelevant or inadmissible.  Rather, it was necessary to decide how much weight to give the evidence included in each document.  The fact that Petitioner had not admitted or conceded all facts alleged in the documents or that there were not specific findings of fact in the state court did not preclude my consideration of the allegations in the evidence in my fact-finding as required by 42 C.F.R. § 1005.20(a) and (b). 

As the Board also found, Petitioner’s reliance upon the decision in Travers v. Sullivan, 801 F. Supp. 394, 403 (E.D. Wash. 1992) is misplaced.  P. Br. at 2-5; Garcia, DAB No. 3098 at 9-10.  The discussion from Travers on which Petitioner relied recognizes that one excluded under section 1128(a)(1) of the Act is not permitted to collaterally attack the facts of the underlying conviction.  The district court determined it was only necessary to determine whether there was a conviction and whether the conviction was of a program-related offense.  The district court was clear that it was not for it to scrutinize the validity of the underlying conviction.  The court was also clear that in that case the program- related nature of the crime was clear based on the state’s characterization of the offense.  Travers, 801 F. Supp. at 403.  The district court in Travers did not state or suggest that it was not permissible or appropriate for the IG or an ALJ to consider facts related to the offense of which one is convicted in order to determine whether the crime was program‑related.  IG Exs. 2, 3, 4, 5, 8 (amended), and 9 contain evidence related to Petitioner’s conviction that is material to the issue of whether Petitioner was convicted of a program-related offense.  I concluded that IG Exs. 2, 3, 4, 5, 8 (amended), and 9 included relevant evidence within the meaning of Fed. R. Evid. 401.  The exhibits are not unreliable or more prejudicial than probative in this forum, which involves only a judge presumed to know the law and the weight to be given the evidence.  The exhibits do not contain privileged information and do not involve offers in compromise or settlement or a corrective action plan.  Regarding IG Ex. 8 (amended), the out-of-court declaration of Special Agent (SA) Becsey, Petitioner through counsel waived the opportunity for a hearing and to cross-examine and test the accuracy of the declaration.  IG Exs. 2 through 5, 8 (amended),⁵ and 9 were admitted and considered as evidence in my first decision.  The hearing convened after remand was a second opportunity for Petitioner to have SA Becsey produced for cross-examination, but Petitioner did not request a subpoena to compel SA Becsey to testify. 

The Board found no error in my original rulings on the evidence.  Garcia, DAB No. 3098 at 8-10.  The additional clarification and comments provided in this decision on remand are not new or different evidentiary rulings and should not cause the Board to now find error in the admission of the exhibits prior to remand. 

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The Board issued its remand on May 22, 2023, “for further fact-finding on whether Petitioner’s conviction related to the delivery of an item or service under Medicare or Medicaid.”  Garcia, DAB No. 3098 at 1.  The Board stated it expressed no opinion whether the evidence of record “is sufficient to establish the requisite nexus under section 1128(a)(1)” of the Act.  Garcia, DAB No. 3098 at 16 n.14.  The Board did not direct or prohibit the taking of any additional evidence through a hearing or otherwise. 

On May 23, 2023, I advised the parties that I had received the remand from the Board, and I set a prehearing conference to discuss further record development, including setting a hearing to receive the testimony of Petitioner and any other relevant witness.⁶  A telephone prehearing conference was convened on June 13, 2023.  The parties discussed their positions regarding whether there was a need to convene an oral hearing.  I granted the parties 30 days to review the evidence in the existing record and then file a joint status report in which they were to state their respective positions on whether an oral hearing was necessary, and if so, who they wished to examine.  I also granted the parties the opportunity to file any additional documentary evidence within 30 days.  The IG was instructed to respond to footnote 6 of the remand order in which the Board expressed the desire to have a clarification regarding the IG’s evidence.  Garcia, DAB No. 3098 at 4 n.6.  The parties filed their joint status report on July 13, 2023 (Jt. Status Rpt.).  The parties agreed that an oral hearing was not needed.  However, both parties indicated that they would like the opportunity to offer the affidavit of Frederick Sterling Struckmeyer, Senior Litigation Counsel, Criminal Division, Arizona Attorney General’s Office, who prosecuted the criminal case against Petitioner.  In response to footnote 6 of the DAB’s remand order, the IG stated that the enclosures from IG Exhibit 2 in docket C-22-654 include:  the criminal complaint charging Petitioner (submitted as IG Ex. 5), Petitioner’s plea agreement (submitted as IG Ex. 6), the sentencing documents (submitted as IG Ex. 7), the Arizona Health Care Cost Containment System (AHCCS) (Arizona Medicaid) provider information for Petitioner  (which had not been previously submitted as an exhibit), and a presentencing memo (which had not been previously submitted as an exhibit).  

On August 2, 2023, I issued an order setting an oral hearing for September 21, 2023, to receive the testimony of Mr. Struckmeyer and Petitioner.  I advised the parties that, pursuant to my July 18, 2023 order, the IG filed two documents, an “AHCCCS – Provider” report (Departmental Appeals Board Electronic Filing System (DAB E-File)

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# 11a) and an October 22, 2021 presentence report by the Adult Probation Department of the Superior Court, Pima County (DAB E-File # 11b).  I advised the parties that based on my in camera inspection, the AHCCCS – Provider report (DAB E-File # 11a) contained no material evidence and was not relevant and, subject to any objection at hearing, that document would not be admitted as evidence.  However, I found that the presentence report (DAB E-File # 11b) did contain relevant evidence; it would be treated as if marked Court Exhibit 1; and subject to objection at hearing, it would be admitted and considered as evidence. 

A hearing was convened on September 21, 2023, and a transcript (Tr.) of the proceedings was prepared and provided to the parties.  Mr. Struckmeyer and Petitioner testified.  Tr. 23-56, 57-61.  Ct. Ex. 1 was admitted as evidence.  Tr. 17-18.  Petitioner objected at hearing to my receiving additional evidence, arguing that it exceeded the mandate of the Board.  Petitioner also objected to my receiving any evidence not directly based on Petitioner’s conviction.  I deferred ruling on Petitioner’s objection until the parties had the opportunity to address the issue in post-hearing briefs.  Tr. 8-10, 13-14, 20-22, 56.  Petitioner’s objections are overruled as explained hereafter.  

Petitioner filed a post-hearing brief (P. PHB) on December 29, 2023.  The IG filed a post-hearing brief (IG PHB) on January 5, 2024.  The IG filed a post-hearing reply brief (IG PHR) on February 1, 2024.  Petitioner filed a post-hearing reply brief (P. PHR) on February 4, 2024. 

II.     Discussion

A.  Applicable Law

Section 1128(f) of the Act (42 U.S.C. § 1320a-7(f)) establishes Petitioner’s right to a hearing by an ALJ and judicial review of the final action of the Secretary of Health and Human Services (the Secretary). 

Pursuant to section 1128(a) of the Act, the Secretary must exclude from participation in any federal health care program any individual convicted under federal or state law of, among other things, a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  Act § 1128(a)(1).  The Secretary has promulgated regulations implementing these provisions of the Act.  42 C.F.R. pt. 1001.  Conviction of a criminal offense related to the delivery of an item or service under Medicare or a state health care program is required by 42 C.F.R. § 1001.101(a).  

Pursuant to section 1128(i) of the Act (42 U.S.C. § 1320a-7(i)), an individual is convicted of a criminal offense when:  (1) a judgment of conviction has been entered against him or her by a court (federal, state, or local) 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

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contest is accepted by a court; or (4) the individual has entered into any arrangement or program where judgment of conviction is withheld.  42 C.F.R. § 1001.2. 

Whether a conviction is related to the delivery of an item or service under Medicare or Medicaid is a factual determination.  Scott D. Augustine, DAB No. 2043 at 10 (2006), 2006 WL 2751080 at *5 (Sept. 14, 2006).  The Board has found the required nexus in many different fact situations and provides a convenient list of examples in its decision in Augustine:  

Section 1128(a)(1) requires merely that an offense be “related to” the delivery of an item or service under a covered program.  It does not require that the offense result in a delivery and therefore does not require an actual delivery of an item or service.  Based on the plain meaning of the word “related,” the Board has repeatedly held that an offense is “related to” the delivery of an item or service under a covered program if there is a common sense connection or nexus between the offense and the delivery of an item or service under the program.  See, e.g., Berton Siegel, D.O., DAB No. 1467 (1994); Thelma Walley, DAB No. 1367 (1992); Niranjana B. Parikh, M.D., DAB No. 1334 (1992). Therefore, the Board has determined that an offense committed by someone providing billing or accounting services was related, Jack W. Greene, DAB No. 1078 (1989), aff’d, Green v. Sullivan, 731 F. Supp. 835 (E.D. Tenn. 1990); Michael Travers, M.D., DAB No. 1237 (1991), aff’d, Travers v. Sullivan, 791 F. Supp. 1471, 1481 (E.D. Wash. 1992) and Travers v. Shalala, 20 F.3d 993 (9th Cir. 1994); that no showing of harm to a protected program was necessary in order for an offense to be related, Neil R. Hirsch, M.D., DAB No. 1550 (1995), aff’d, Hirsch v. Shalala, No. 96-4008 (C.D. Ill. Nov. 4, 1996); Paul R. Scollo, D.P.M., DAB No. 1498 (1994); that an offense could be related even if the services were actually provided by an entity different from the individual being excluded, Napoleon S. Maminta, M.D., DAB No. 1135 at 7 (1990); that an offense could be related even if no service or item was actually delivered, Francis Shaenboen, R.Ph., DAB No. 1249 at 4 (1991); that an offense could be related even if it did not directly involve the delivery of items or services, Salvacion Lee, M.D., DAB No. 1850 ( 2002); and that an offense could be related even if the individual did not personally engage in the scheme or was not aware of the scheme that resulted in the delivery of the mislabeled

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pharmaceuticals under a covered program, Lyle Kai, R.Ph., DAB No. 1979 (2005), aff’d, Kai v. Leavitt, Civ. No. 05-00514 BMK (D. Haw. 2006).  i

2006 WL 2751080 at *3. 

Section 1128(c)(3)(B) of the Act provides that an exclusion imposed under section 1128(a) of the Act will be for a period of not less than five years.  42 C.F.R. § 1001.102(a).  The Secretary has published regulations that establish aggravating factors that the IG may consider to extend the period of exclusion beyond the minimum five-year period, as well as mitigating factors that may be considered only if the minimum five‑year period is extended.  42 C.F.R. § 1001.102(b), (c).  The IG imposed the minimum authorized five-year exclusion in this case and aggravating and mitigating factors are not relevant.  IG Ex. 1 at 1.  

One excluded under section 1128(a) of the Act has the right to reasonable notice and an opportunity for hearing by an ALJ and to judicial review.  Act § 1128(f); 42 C.F.R. §§ 1001.2007, 1005.2(a).  The Board has characterized ALJ review as follows: 

The ALJ conducts a de novo review “as to the evidence and factual determinations” relevant to the scope of the ALJ’s review.  See Edwin L. Fuentes, DAB No. 2988 at 10 (2020), aff’d, No. 4:20-cv-00026, 2021 WL 4341115 (W.D. Va. Sept. 23, 2021); see also Joann Fletcher Cash, DAB No. 1725 at 17 n.9 (2000).  “In conducting this de novo review, the ALJ may consider information and evidence not considered or relied on by the I.G. in making its determination.”  Olufemi Okonuren, M.D., DAB No. 1319 at 14 (1992).  An ALJ has the authority to schedule a hearing; examine witnesses; and receive, rule on, and exclude or limit evidence.  42 C.F.R. § 1005.4(b).  The ALJ issues an “initial decision” based on the record developed before the ALJ.  Id. § 1005.20(a). 

Shaun Thaxter, DAB No. 3053 at 3 (2021). 

In this proceeding, the standard of proof, i.e., the burden of persuasion, is a preponderance of the evidence.  42 C.F.R. §§ 1001.2007(c) (standard of proof is a preponderance of evidence); 1005.15(d) (burden of persuasion judged by preponderance of evidence).  The parties were advised by the prehearing order, consistent with my authority under 42 C.F.R. § 1005.15(c), that Petitioner bears the burden of proof and the burden of persuasion on any affirmative defenses or mitigating factors, and the IG bears the burden on all other issues.  42 C.F.R. § 1005.15(b), (c); Prehearing Order ¶ 4. 

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If an exclusion is based on a criminal conviction or civil judgment by a court (federal, state, or local), or a determination by another government agency where facts were adjudicated and a final decision made, the basis for the exclusion is not reviewable and may not be collaterally attacked on procedural or substantive grounds by one subject to the exclusion based on the conviction, civil judgment, or agency determination.  42 C.F.R. § 1001.2007(d). 

B.  Issues

The Secretary has by regulation limited my scope of review to two issues: 

Whether the IG has a basis for excluding an individual or entity from participating in Medicare, Medicaid, and all other federal health care programs; and

Whether the length of the exclusion is unreasonable. 

42 C.F.R. § 1001.2007(a)(1). 

When, as in this case, the IG imposes the minimum authorized five-year exclusion under section 1128(a) of the Act, there is no issue as to whether the period of exclusion is unreasonable.  42 C.F.R. § 1001.2007(a)(2). 

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

The Board characterized my error in my first decision as follows: 

While we largely reject Petitioner’s arguments, we find that the ALJ erred by not determining whether the specific offense of which Petitioner was convicted related to the delivery of glucose test strips under Medicare or Medicaid. 

Garcia, DAB No. 3098 at 8. 

In this case, the ALJ needed to determine whether the record evidence established a common-sense nexus between Petitioner’s conviction and the delivery of glucose test strips under Medicare or Medicaid and to support that conclusion with findings of fact.  The ALJ did not fully address this issue and, therefore, remand is appropriate.  See 42 C.F.R. § 1005.21(g) (authorizing Board remand to the ALJ).  

Garcia, DAB No. 3098 at 16. 

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I disagree that I failed to determine in my first decision whether Petitioner was convicted of an offense related to the delivery of glucose test strips under Medicare or Medicaid.  I agree that my explanation in my first decision was inadequate for the Board to recognize that I had made the required conclusion of law based on sufficient findings of fact.  In this decision, I endeavor to more clearly explain my conclusion of law that Petitioner’s conviction was related to the delivery of an item or service, in this case glucose test strips, under Medicare or Medicaid and further elaborate the findings of fact upon which that conclusion of law was based.  I also discuss in this decision the additional evidence received after remand and how that evidence is consistent with and supportive of my prior findings of fact as well as the bases for additional findings of fact that support my conclusion of law. 

My conclusions of law are set forth in bold text followed by my findings of fact and analysis. 

1. Petitioner timely filed his hearing request and I have jurisdiction on remand from the Board to render a new order and decision. 

2. The first decision in this case was based on the documentary evidence and the parties’ pleadings as the parties waived appearance at an oral hearing, but an oral hearing was appropriate following remand. 

There is no dispute that Petitioner timely requested a hearing and that I had jurisdiction pursuant to section 1128(f) of the Act and 42 C.F.R. pt. 1005, to render my first decision.  The Board has remanded the case to me for further fact-finding.  Garcia, DAB No. 3098 at 1, 17.  Accordingly, this case is properly before me for a new decision. 

Pursuant to section 1128(f) of the Act, a person subject to exclusion has a right to reasonable notice and an opportunity for a hearing.  The Secretary has provided by regulation that a sanctioned party has the right to a hearing before an ALJ and both the sanctioned party and the IG have a right to participate in the hearing.  42 C.F.R. §§ 1005.2‑.3.  Either or both parties may choose to waive appearance at an oral hearing and to submit only documentary evidence and written argument for my consideration.  42 C.F.R. § 1005.6(b)(5).  In this case, Petitioner waived an oral hearing during the initial prehearing conference and the IG agreed that this case could be decided on the documentary evidence and the parties’ pleadings.  Prehearing Order ¶ 5d. 

In his brief, Petitioner requested “summary adjudication in his favor.” P. Br. at 1, 8.  I did not construe Petitioner’s request for summary adjudication to be a request for summary judgment or a withdrawal of his waiver of an oral hearing.  Rather, I construed Petitioner’s request for “summary adjudication” to be Petitioner’s request for a decision on the merits without the need to convene an oral hearing to receive testimony. 

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Following the remand, I convened a second prehearing conference with the parties to discuss whether further record development was necessary, including an oral hearing.  I gave the parties the opportunity to consider their options and required that they subsequently file a joint status report advising of their respective positions.  The parties state in their joint status report that both wanted to obtain an affidavit from Sterling Struckmeyer, the prosecutor in Petitioner’s criminal case.  Jt. Status Rpt.  Affidavits are a poor substitute for receiving direct testimony subject to cross-examination, with little benefit in either saving the parties or the Board costs or saving time for counsel or the affiant.  An oral hearing also includes the benefit of the ALJ having the opportunity to ask questions.  Therefore, an oral hearing was ordered.  Because Petitioner is also likely the best and perhaps only source of information for what he thinks he pleaded guilty to, Petitioner was also ordered to testify.  Order Setting Hearing Date (Aug. 2, 2023). 

Petitioner takes the position that no further record development is permitted following the remand.  Petitioner objected during the June 13, 2023 prehearing conference to my receiving additional evidence to address the issue raised by the Board on remand.  During the oral hearing, Petitioner argued that the Board directed that I make additional findings of fact but the Board did not authorize taking additional evidence in order to make the findings of fact.  Petitioner also argues that the nexus required under section 1128(a)(1) of the Act must be apparent from the charge to which one pleads guilty.  Petitioner was invited to set forth his argument more fully in post-hearing briefing.  Tr. at 8-10.  In his post-hearing brief, Petitioner states that he “made and preserved an objection to expanding the record.”  P. PHB at 1 n.1.  However, Petitioner did not elaborate on his objection, asserting only that because no additional evidence had been presented to establish that “Petitioner’s conviction related to delivery of an item or service under Medicare or Medicaid, Petitioner maintains his objection but will address the merits.”  P. PHB at 1 n.1. 

I conclude that Petitioner’s objection is without merit.  The Board stated in a footnote that it expressed no opinion as to whether the evidence already in the record was sufficient to establish that there was the required nexus.  Garcia, DAB No. 3098 at 16 n.14.  The Board stated in the conclusion of its decision that the case was remanded for me “to determine whether Petitioner’s conviction . . . related to the delivery of an item or service under Medicare or Medicaid.”  Garcia, DAB No. 3098 at 17.  The Board’s mandate was for “further fact-finding on whether Petitioner’s conviction related to the delivery of an item or service under Medicare or Medicaid.”  Garcia, DAB No. 3098 at 1.  The Board did not preclude the taking of additional evidence to support my additional fact-finding.  Garcia, DAB No. 3098. 

Although the parties told me in their joint status report that they did not think an oral hearing was necessary, they both indicated the desire to have testimony of Mr. Struckmeyer, albeit in the form of an affidavit rather than through testimony at a hearing subject to cross-examination and my examination.  Jt. Status Rpt.   I am required to

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“conduct a fair and impartial hearing . . . and assure that a record of the proceeding is made.”  42 C.F.R. § 1005.4(a).  I have the authority to order a hearing upon reasonable notice to the parties and require the production of documents and the testimony of witnesses.  42 C.F.R. § 1005.4(b)(1), (5), (8), (9).  Petitioner cites no authority for the proposition that he can preclude my full inquiry into a matter before me by waiving attendance at an oral hearing or objecting to my ordering and receiving additional evidence not offered by the parties.  It was reasonable to believe that Mr. Struckmeyer, who prosecuted Petitioner, and Petitioner were in the best positions to answer the Board’s question of whether Petitioner was convicted of an offense related to the delivery of an item or service under Medicare or Medicaid, or more specifically as the Board seems to be focused, whether Petitioner was convicted of an offense related to the delivery of glucose test strips under Medicare or Medicaid.  Garcia, DAB No. 3098 at 8.  I conclude receiving additional relevant evidence was within my authority and reasonable.  The same rationale applies to Ct. Ex. 1, Petitioner’s presentence report, which contains evidence related to Petitioner’s conviction, that was in the possession of but not produced by the IG as an exhibit prior to my first decision.  

3.  Section 1128(a)(1) of the Act requires Petitioner’s exclusion from participation in Medicare, Medicaid, and all other federal health care programs. 

Petitioner conceded before me and the Board that he was convicted by the state court of a criminal offense, specifically, criminal simulation in violation of Arizona law.  RFH at 1-2; P. Br. at 5; Garcia, DAB No. 3098 at 8.  However, Petitioner’s defense is that the IG cannot show that the offense of which he was convicted was “program-related,” i.e., his conviction was not related to the delivery of an item or service under Medicare or a state health care program and does not trigger exclusion under section 1128(a)(1) of the Act.  RFH at 2; P. Br. at 5-7, P. PHB at 1, 4-7; P. PHR.  In his post-hearing reply, Petitioner argues that it is “only relevant what [his] conviction reflects.”  P. PHR at 1.  Petitioner uses language from the Board’s decision in support of his defense.  Petitioner cites passages from the Board decision that show that the Board recognized the evidence shows that Petitioner engaged in non-program-related misconduct based on forging prescriptions and prescription transfer requests in his name, his wife’s name, and the name of another individual, none of whom are Medicare or Medicaid beneficiaries.  Petitioner points out that the Board also indicated that, even if the IG’s allegation that Petitioner also created a fraudulent prescription or prescription transfer request using the identity of a Medicaid beneficiary is true, I did not determine the specific conduct for which Petitioner was convicted, i.e. whether the conviction was for the non-program-related misconduct of forging prescriptions or prescription requests using the identities of those who were not program beneficiaries or for the program-related misconduct of forging such documents using the identity of a Medicaid program beneficiary.  Petitioner’s argument, which had not changed since when the case was originally before me, is that it is not possible to determine whether Petitioner pleaded guilty to program-

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related misconduct or non-program-related misconduct.  P. PHR at 2.  The major fallacy is the suggestion, unsupported by any evidence, that Petitioner may have pleaded guilty to one type of misconduct but not the other.  The fallacy exists because at the time of my first decision there was no evidence, such as the language of the plea agreement (IG Ex. 6), or in the form of a plea inquiry or sentencing inquiry, that showed that Petitioner’s guilty plea was to only part of the misconduct alleged in the prosecution memorandum (IG Ex. 3), which was the basis for the original three-count complaint (IG Ex. 5) and the basis for the amended charge of criminal simulation to which Petitioner pleaded guilty (IG Exs. 6, 7).  Why would one infer that the prosecutor or state court permitted Petitioner to plead guilty or that he pleaded guilty to less than all the alleged misconduct?  How can one support such an inference in the absence of any evidence that Petitioner limited his plea to some of the misconduct and avoided pleading guilty to the program-related misconduct?  Petitioner has not been deterred at any stage in this case by the absence of facts.  Indeed, as discussed hereafter, the Board’s decision effectively relieved Petitioner of any burden to establish his defense.  In my initial decision and in this decision, I draw no inference that is unsupported by any evidence and based only on Petitioner’s arguments, that Petitioner could and did plead guilty to less than all the misconduct identified and alleged by the Health Care Fraud and Abuse Section of the Office of the Arizona Attorney General (Arizona Medicaid fraud control unit) as the basis for the charges against Petitioner and the charge to which he pleaded guilty and was convicted. 

The issue the Board has remanded to me to resolve is whether the preponderance of the evidence demonstrates that Petitioner’s offense was related to the delivery of an item or service under Medicare or a state health care program triggering mandatory exclusion pursuant to section 1128(a)(1) of the Act.  Contrary to the conclusion of the Board (Garcia, DAB No. 3098 at 8), I determined as fact that Petitioner’s conviction was related to the delivery of an item or service under Medicaid as explained in more detail hereafter.⁷  Considering the evidence received after remand, I find that it is even more

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clear that Petitioner pleaded guilty to all misconduct alleged to be the basis for the charges against him and the offense to which he pleaded guilty and was convicted.  Petitioner has presented no evidence – documentary or testimonial – that shows he pleaded guilty to only the non-program-related misconduct alleged by the Medicaid fraud control unit. 

I conclude, as I did in my first decision, that Petitioner’s criminal offense was program- related and exclusion is mandatory. 

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a.  Facts

On January 12, 2021, Petitioner was charged by a three-count felony criminal complaint filed in the state court.  Petitioner was charged with one count of fraudulent schemes and artifices, one count of aggravated taking of the identity of another person or entity, and one count of forgery.  Count one alleged that between May 2019 and April 2020, Petitioner engaged in a scheme to defraud and knowingly obtained a benefit, specifically glucose test strips, by means of false or fraudulent pretenses, representations, promises, or material omissions.  Count two alleged that during the same period, Petitioner knowingly took, possessed, or used personal identifying information of three or more persons without their consent and with intent to use their identities for unlawful purposes.  Count three alleged that during the same period, Petitioner offered or presented a forged instrument or one containing false information, specifically prescription transfer requests and/or prescriptions.  All counts alleged violation of Arizona statutes.  IG Ex. 5.  

On September 7, 2021, Petitioner signed a plea agreement in which he agreed to plead guilty to an amended count three of the criminal complaint, which as amended alleged “criminal simulation” under Arizona law in violation of Ariz. Rev. Stat. § 13-2004(A).⁸  IG Ex. 6.  The amended charge alleged specifically that between May 2019 and April 2020, with the intent to defraud, Petitioner made, altered, or presented, or offered an object, specifically prescription transfer requests and/or prescriptions, so that the documents appeared to have a source or authorship that they did not possess.  Petitioner entered the plea agreement in exchange for a sentence limitation and dismissal of the other charges from the felony complaint.  The plea agreement did not identify any amount to be paid by Petitioner as restitution and the agreement shows that the prosecutor was not aware of any claim for restitution.  Petitioner agreed in the plea agreement to pay $1,000 for the cost of investigation to the Arizona Medicaid fraud control unit.  Remaining charges were to be dismissed at sentencing.  The plea agreement did not include any statement of the facts underlying the charge Petitioner agreed to plead guilty to.  The only statement of facts related to the offense included in the plea agreement was

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the language of the charge itself.  IG Ex. 6.  Petitioner admitted by his guilty plea the specific facts alleged in the charge to which he pleaded guilty.  IG Ex. 6 at 1-2, 5-6.  The specific facts admitted are:  Petitioner’s criminal conduct occurred between May 2019 and April 2020; Petitioner had the intent to defraud; Petitioner made, altered, presented, or offered prescriptions or prescription transfer requests; and Petitioner made, altered, presented, or offered the false documents in a manner so they appeared to be from a source or author the documents did not actually have.  IG Ex. 6 at 1-2. 

No transcript of a state court proceeding for examining Petitioner’s plea or sentencing was placed in evidence.  Therefore, there is no record in evidence of any guilty plea inquiry by the state court to determine the factual basis for Petitioner’s guilty plea.  The state court’s minute entry related to sentencing indicates Petitioner was advised of the charge and the determination of guilt.  The minute entry also states the court considered the facts.  However, there is no statement of the facts the state court reviewed related to the charge to which Petitioner pleaded guilty.  IG Ex. 7. 

On October 27, 2021, the state court entered judgment finding Petitioner guilty of the amended count three alleging criminal simulation during the period May 1, 2019 through April 1, 2020, that the court designated a class one misdemeanor.  Petitioner was sentenced to probation.  IG Ex. 7 at 1-2.  Petitioner was also ordered to pay various fees, including a fee of $1,000 to the “Attorney General Health Care Fraud and Abuse Section.”  IG Ex. 7 at 2.  The remaining counts of the criminal complaint were dismissed.  IG Ex. 7 at 2. 

I found in my first decision that based on the criminal complaint (IG Ex. 5), the plea agreement (IG Ex. 6), and the judgment of conviction (IG Ex. 7), it was more likely than not that the criminal offense of criminal simulation, of which Petitioner was convicted, involved prescription transfer requests and/or prescriptions for the purpose of obtaining glucose test strips between about May 1, 2019 and April 1, 2020.  I concluded that my finding was supported by the preponderance of the evidence found in IG Exs. 5, 6, and 7. 

Petitioner concedes in post-hearing briefing, that as identified by the Board, “[t]here is indeed evidence that Petitioner engaged in program-related misconduct by allegedly forging a prescription transfer request for glucose test strips in the name of a Medicaid beneficiary.  See I.G. Exs. 3, 8, 9.”  P. PHB at 5 (citing Garcia, DAB No. 3098 at 13-16).  Petitioner also admits that he “forg[ed] prescriptions and prescription transfer requests for glucose test strips in names of himself, his wife’s name, and another individual, none of whom are alleged to be Medicare or Medicaid beneficiaries.  See I.G. Exs. 3, 4.”  P. PHB at 5 (citing Garcia, DAB No. 3098 at 13-16). 

IG Ex. 3 is the prosecution memorandum on which Petitioner’s criminal charges were based.  The prosecution memorandum alleges Petitioner wrote prescriptions for glucose test strips and lancets in his name, his wife’s name, the name of a TRICARE beneficiary,

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and the name of a Medicaid beneficiary and that the total loss to the Arizona Medicaid Trust Fund related to the Medicaid beneficiary was $123.41.  IG Ex. 3 at 2.  In examining the record at the time of my initial decision, I could not find that the allegations in the prosecution memorandum satisfied the preponderance of the evidence standard as prosecution memoranda, indictments, complaints, and the like generally need be supported only by probable cause.  Tr. 30 (under Arizona law, a criminal complaint must be supported by probable cause).  In the original case, Petitioner objected to the admission and my consideration of IG Exs. 2, 3, 4, 5, 8 (amended), and 9 on grounds they contained no relevant information, contained hearsay, and contained allegations of fact that Petitioner had not admitted as part of his guilty plea and that he had not had the opportunity to contest.  P. Br. 3-5 (C-22-654).  I admitted IG Exs. 2, 3, 4, 5, 8 (amended), and 9 over Petitioner’s objection because the authenticity of the documents was not questioned, and the documents do include evidence relevant to the issue of whether Petitioner was convicted of a criminal offense related to the delivery of an item or service under Medicare or Medicaid.  However, as I noted in my original decision, the fact the exhibits were admitted does not address how much weight should be given each exhibit.  Garcia, CR6222 at 2-3.  I did not find in my original decision that IG Exs. 2, 3, 4, 5, 8 (amended), and 9 were sufficiently weighty together or alone to show Petitioner was convicted of a criminal offense related to the delivery of an item or service under Medicare or Medicaid.  However, Petitioner does not dispute or attempt to rebut the evidence at this stage of the proceedings.  Rather, Petitioner argues that it cannot be determined that Petitioner admitted by his guilty plea to the fact that his criminal conduct involved a Medicaid beneficiary or had any impact on Medicaid.  P. PHB at 5.  At the hearing, Petitioner testified that he recalled that he was convicted of criminal simulation on October 27, 2021.  Tr. 58.  He testified that he could not recall specifically using the identity of a Medicaid beneficiary as part of his criminal activity.  However, he did not deny that he may have created a prescription or prescription transfer request using the identity of a Medicaid beneficiary.  Tr. 60.  Petitioner’s concession related to what the evidence shows about the Medicaid beneficiary and the fact he had the opportunity at hearing but did not deny that he made a false prescription or prescription transfer request using the identity of a Medicaid beneficiary, give weight to the allegation in the prosecution memorandum showing it is more likely than not true that Petitioner forged a prescription transfer request for glucose strips in the name of a Medicaid beneficiary resulting in a loss to Arizona Medicaid. 

Other evidence in the record, specifically the facts alleged in IG Exs. 2, 3, and 8 (amended), is consistent with and supports my finding that the criminal offense of criminal simulation, of which Petitioner was convicted, involved prescription transfer requests and/or prescriptions for the purpose of obtaining glucose test strips.  IG Exs. 2,

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3, and 8 (amended)⁹ also allege facts that are consistent with those Petitioner admitted to in the consent agreement, facts that describe Petitioner’s conduct that was the same or very similar to the conduct during the same period for which Petitioner was convicted of criminal simulation. 

On July 6, 2020, the Arizona State Board of Pharmacy (state board) suspended Petitioner’s pharmacist license for a minimum of six months.  IG Ex. 4 at 1, 6, 9.  The suspension was not based on Petitioner’s conviction, which did not occur until October 27, 2021.  Rather, the suspension was based on the “Interim Consent Agreement for Interim Suspension of License and Psychological Evaluation” (consent agreement) that Petitioner signed on June 25, 2020.  IG Ex. 4 at 9.  As part of the consent agreement Petitioner agreed to “interim findings of fact.”  The findings of fact show that Petitioner worked as a “float pharmacist” with Bashas’ Pharmacy.  On or about April 16, 2020, Bashas’ Pharmacy reported to the state board that Petitioner had been under investigation for unprofessional conduct which involved multiple instances between February 1 and April 3, 2020, when Petitioner transferred prescriptions for glucose test strips using patient names and information for patients who were not prescribed test strips.  Petitioner also admitted to creating false prescriptions for glucose test strips.  Petitioner admitted that he fraudulently obtained roughly 15 boxes of glucose test strips and sold them online.  Petitioner also admitted that he was terminated by Bashas’ Pharmacy for prescription fraud and impersonating another pharmacist.  IG Ex. 4 at 4-5.  Petitioner acknowledged as part of the consent agreement that it is a public record of a formal action of the state board that would be reported to the National Practitioner Data Bank and the Healthcare Integrity and Protection Data Bank.  IG Ex. 4 at 3 ¶ 8.  Petitioner agreed that he voluntarily entered the consent agreement and that he would abide by its terms and conditions.  Petitioner also agreed that he voluntarily relinquished all rights to administrative or judicial review related to the consent agreement.  IG Ex. 4 at 1-2 ¶¶ 2-4.  The consent agreement also indicates that Petitioner did not intend his acceptance of the agreement to be an admission of any facts, that his intent was to compromise the pending matter with the state board, and that he did not relinquish his rights to administrative or judicial review.  IG Ex. 4 at 2 ¶ 4.  The interim consent agreement is arguably of limited evidentiary weight based on the fact that in that document Petitioner was permitted to deny that the document contains any admission of fact and based also on the provision that he did not waive any right to an administrative determination of the actual facts.  IG Ex. 4 at 2.  However, Petitioner did not deny in his testimony at the hearing after remand that, as IG Ex. 4 shows, he forged prescriptions and prescription transfer requests for glucose test strips in his name, his wife’s name, and the name of another individual, none

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of whom were Medicare or Medicaid beneficiaries.  P. PHB at 5.  Petitioner testified that he did not recall any of the names he used on the false prescriptions or prescription transfer requests, as he was focused only on whether insurance companies would pay for the glucose test strips.  Tr. 60.  Regardless of what rights Petitioner waived or preserved in the consent agreement, I find that the agreement describes conduct that was either the same as, or very similar to, the conduct during the same period for which Petitioner was convicted of criminal simulation. 

Petitioner concedes that there is evidence of record that he engaged in program-related misconduct because he forged a prescription transfer request using the identify of a Medicaid beneficiary that resulted in a claim to Arizona Medicaid that was paid.  P. PHB at 5 (citing Garcia, DAB No. 3098 at 13-16).  Petitioner also admits that he forged prescriptions and prescription transfer requests for glucose test strips in his name, his wife’s name, and the name of another individual, none of whom are Medicare or Medicaid beneficiaries.  P. PHB at 5.  Petitioner’s concessions support the credibility and lend weight to the affidavit of SA Becsey, who conducted the investigation of Petitioner that led to the three-count criminal complaint filed against Petitioner in Pima County Arizona Superior Court.  SA Becsey testified in his affidavit that the details of his investigation are set forth in the prosecution memorandum (IG Ex. 3).  IG Ex. 8 (amended).  He further testified that the investigation of Petitioner found that Petitioner

[I]nitiated a fraudulent prescription transfer request for Arizona Medicaid beneficiary [CV] on March 30, 2020 and that a claim was submitted to the Arizona Medicaid program for such prescription.  The total loss amount associated with the claim paid by the Medicaid program for the prescription written for [CV] is $123.41.  [SA Becsey] conducted an interview with this individual [CV] and learned that they did not request a prescription for diabetic test strips nor are they diabetic.  

IG Ex. 8 (amended).¹⁰  According to SA Becsey, IG Ex. 9 is a report from AHCCS (Arizona Medicaid) that shows that Arizona Medicaid was billed $150.43 due to the false prescription transfer request that, more likely than not, was created by Petitioner and Medicaid paid $123.41 on the claim.¹¹  IG Exs. 8 (amended), 9 at 1-2.  Out of an

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abundance of caution, I would not normally find as fact and conclude as a matter of law that an investigator’s affidavit establishes a fact by a preponderance of the evidence.  However, Petitioner’s concession supports the investigator’s findings and shows the findings may reasonably be considered to meet the preponderance of the evidence standard. 

Mr. Struckmeyer, the prosecutor in Petitioner’s case, testified that he is a Senior Litigation Counsel in the Arizona Attorney General’s Office.  He is assigned to the Arizona Medicaid fraud control unit to prosecute healthcare fraud and abuse related to Arizona Medicaid.  Tr. 23.  He correctly identified Petitioner at hearing and testified that he prosecuted Petitioner in 2020.  Mr. Struckmeyer testified that SA Becsey, who works in his office, received a complaint of possible prescription fraud at Bashas’ Pharmacy, in Tucson, Arizona (Petitioner’s employer at the time) and an investigation was initiated.  The investigation led to the prosecution of Petitioner.  Tr. 27.  A grand jury made the probable cause determination that supported the three-count felony indictment filed against Petitioner in the state court.  Mr. Struckmeyer swore to the felony criminal complaint against Petitioner.  Tr. 31; IG Ex. 5.  Mr. Struckmeyer testified that the three charges in the criminal complaint (IG Ex. 5) do not list victims as it is not required and, as a matter of practice, he does not allege a specific victim when an agency is the victim, or it is desirable to give a victim anonymity.  Tr. 34.  In Petitioner’s case, had Mr. Struckmeyer listed a victim for Count 1, it would have been Arizona Medicaid.  Under Count 2, four different individuals would have been listed as the victims, the two individuals whose identity and insurance information were used and the two doctors whose names and Drug Enforcement Administration (DEA) numbers Petitioner used in

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creating the prescriptions.  Tr. 35.  Mr. Struckmeyer explained that criminal simulation under Arizona law means that the perpetrator, with intent to defraud, simulates a specific object.  In this case, the allegation is that Petitioner, with the intent to defraud, simulated prescriptions or prescription transfer requests to be from a doctor, or for a patient, when they were not.  Tr. 36.  When the plea agreement (IG Ex. 6) was prepared, Mr. Struckmeyer elected not to list the victims in the charge of criminal simulation.  He testified that the state court judge would have inquired about the basis for the guilty plea during a change of plea hearing but no transcript would be prepared, unless it was ordered.  He testified it is not uncommon for no transcript of the inquiry to be prepared in case of a guilty plea.  While sentencing proceedings are recorded, it is not uncommon for no transcript of that proceeding to be prepared either, unless requested.  Tr. 37-40.  Mr. Struckmeyer testified that he was present when the state court judge inquired about the factual basis for the guilty plea, but he had no recollection of the content of the inquiry.  He testified that he had no independent recollection of the discussion during the sentencing proceeding.  Tr. 40.  The $1,000 payment ordered by the state court to the Arizona Medicaid fraud control unit was stipulated to as part of the plea agreement and its purpose is to recover some of the costs of investigation.  Tr. 40-41.  He testified that he knew about the Medicaid beneficiary CV and the allegation Petitioner used her information to fraudulently write a prescription for glucose test strips.  Arizona Medicaid was charged for the prescription Petitioner wrote.  The allegations regarding CV were a basis for the charging of Petitioner.  Mr. Struckmeyer also considered the allegations regarding CV to be a basis for the charge to which Petitioner pleaded guilty.  Tr. 42-43.  He testified that he could not recall the precise amount of loss to Arizona Medicaid, but he recalled it was in the range of $100 to $200.  Tr. 44.  He agreed with Petitioner’s counsel that criminal simulation can occur just by creating a prescription with the intent to defraud even if the prescription is never presented to anyone.  Tr. 45.  He also agreed that the charges were based on multiple victims and not just Arizona Medicaid or the Medicaid beneficiary CV.  He agreed that the state court had not ordered restitution and the state had indicated in the plea agreement it was aware of no victim entitled to restitution.  He testified that Arizona Medicaid was not listed as a victim to receive restitution because Arizona Medicaid had not submitted an affidavit for restitution and, for that reason, it was not included in the plea agreement.  Tr. 45-48.  He testified that the presentence report (Ct. Ex. 1) states that there were three or more victims whose personal identifying information was used by Petitioner in his scheme to defraud and obtain glucose test strips.  He agreed with Petitioner’s counsel that the presentence report does not state Petitioner presented prescriptions in exchange for money.  However, Mr. Struckmeyer pointed out that obtaining the glucose test strips rather than money was still a benefit and sufficient to prove the intent to defraud under Arizona law.  Tr. 50-54.  He reiterated that, although specific victims were not listed in the charges, Arizona Medicaid was a victim.  Tr. 55. 

The presentence report, Ct. Ex. 1, shows Petitioner was sentenced on October 27, 2021.  The presentence report shows Petitioner pleaded guilty to the amended count three and

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the remaining counts were dismissed.  The report shows Petitioner was ordered to pay $1,000 to the Medicaid fraud control unit.  Ct. Ex. 1 at 2, 6 (document page counter).  The report states that the investigation conducted by the Medicaid fraud control unit, revealed that between May 2019 and April 2020, Petitioner “forged multiple prescription transfer requests and or prescriptions using the personal identifying information of three or more persons pursuant to a scheme to defraud and obtain the benefit of glucose test strips.”  Ct. Ex. 1 at 3 (document page counter).  The report states that Petitioner agreed with the statement of the offense and accepted responsibility and expressed remorse for his actions.  Ct. Ex. 1 at 3 (document page counter). 

In summary: 

1. Petitioner was investigated by the Arizona Medicaid fraud control unit.  IG. Ex. 3; Ct. Ex. 1 at 3 (document page counter).  At sentencing Petitioner was ordered to pay the Arizona Medicaid fraud control unit a fee of $1,000 to help cover the costs of the investigation as provided by Petitioner’s plea agreement.  IG Exs. 6 at 3, 7 at 2.  
2. An Arizona grand jury, based on the investigation by the Medicaid fraud control unit, found that there was probable cause to believe that Petitioner made false or forged prescriptions or prescription transfer requests for glucose test strips and lancets, including one using the identity of a Medicaid beneficiary, which caused Arizona Medicaid to pay $123.41.  IG Ex. 3 at 2-3, 5, 6; IG Ex. 8 (amended).  The Arizona Medicaid fraud control unit recommended that Petitioner be charged under Arizona law for fraudulent schemes and artifices, theft, computer tampering, and aggravated taking the identity of another.  IG Ex. 3 at 8. 
3. Based on the prosecution memorandum, Petitioner was charged by criminal complaint filed in the state court with fraudulent schemes and artifices, aggravated taking the identity of another person or entity, and forgery.  IG Exs. 5; 8 (amended).  The charges did not allege Petitioner’s conduct regarding specific prescriptions and prescription transfer requests or victims. 
4. Petitioner pleaded guilty to an amended charge of criminal simulation pursuant to a plea agreement and the remaining charges of the criminal complaint were dismissed.  IG Exs. 6; 7.  The criminal simulation charge did not allege Petitioner’s conduct regarding specific prescriptions and prescription transfer requests or victims. 

5. It is more likely than not that the charges from the criminal complaint and the amended charge to which Petitioner pleaded guilty are based on the allegations from the prosecution memorandum prepared based on the investigation of the Arizona Medicaid fraud control unit, including the prescription or prescription

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   transfer request that used the name of a Medicaid beneficiary and resulted in payment from Arizona Medicaid of $123.41. 

6. Petitioner’s plea agreement does not recite the facts underlying the charge of criminal simulation that Petitioner agreed to.  There is no transcript of an inquiry by the state court regarding the facts underlying his offense that Petitioner agreed was the basis for his charge.  Petitioner did not deny at the hearing in this case following remand that his criminal conduct included using the name of an Arizona Medicaid beneficiary, CV, to make, alter, present, or offer a false prescription or prescription transfer request with intent to defraud. 
7. The preponderance of the evidence shows that Petitioner was investigated for Medicaid fraud by the Arizona Medicaid fraud control unit.  He was charged with fraud schemes and artifices based on the investigation.  Petitioner testified he cannot remember and he does not deny that he used the identity of an Arizona Medicaid beneficiary, CV, to make, alter, present, or offer a false prescription or prescription transfer request, with intent to defraud, that caused Arizona Medicaid to pay $123.41 as alleged by the Medicaid fraud control unit.  Petitioner’s plea agreement does not list the specific prescriptions or prescription transfer requests that Petitioner agreed are the bases for the charge to which he pleaded guilty and there is no evidence of the state court’s determination regarding any specific conduct.  Therefore, Petitioner has presented no evidence to show that, contrary to the evidence of the IG, the conduct to which he pleaded guilty did not involve an Arizona Medicaid beneficiary or cause a payment by Arizona Medicaid of $123.41. 

b.  Analysis

The IG cites section 1128(a)(1) of the Act as the basis for Petitioner’s mandatory exclusion.  The statute provides in relevant part: 

(a) MANDATORY EXCLUSION. – The Secretary shall exclude the following individuals and entities from participation in any Federal health care program (as defined in section 1128B(f)): 

(1) CONVICTION OF PROGRAM-RELATED CRIMES. – Any individual or entity that has been convicted of a criminal offense related to the delivery of an item or service under title XVIII or under any State health care program. 

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Act § 1128(a)(1) (42 U.S.C. § 1320a-7(a)(1)).  Congress has, by the plain language of section 1128(a)(1) of the Act, required the Secretary to exclude from participation in Medicare, Medicaid, and all federal health care programs any individual or entity:  (1) convicted of a criminal offense, whether a misdemeanor or felony; (2) where the offense is related to the delivery of an item or service; and (3) the delivery of the item or service was under Medicare or a state health care program. 

Petitioner does not dispute that he was “convicted” of a criminal offense within the meaning of section 1128(i) of the Act.  P. Br. at 5; P. PHG; P. PHR.  An individual or entity is considered to have been “convicted” of an offense if, among other things, “a plea of guilty or nolo contendere by the individual or entity has been accepted by a Federal, State, or local court.”  Act § 1128(i)(3) (42 U.S.C. § 1320a-7(i)(3)).  The state court accepted Petitioner’s guilty plea to the amended count three which alleged criminal simulation in violation of Ariz. Rev. Stat. § 13-2004(A).  IG Ex. 7 at 1.  Therefore, Petitioner was convicted within the meaning of section 1128(i)(3) of the Act – the first element required to trigger an exclusion under section 1128(a)(1) of the Act.  Petitioner also conceded before the Board that he was convicted of criminal simulation.  Garcia, DAB No. 3098 at 8. 

Petitioner disputes that the offense of which he was convicted was related to the delivery of an item or service under Medicare or a state health care program – the second element required to trigger an exclusion under section 1128(a)(1) of the Act.  RFH; P. Br. at 5-7.  Petitioner does not dispute that his conviction is related to making, altering, presenting, or offering prescription transfer requests and/or prescriptions.  P. Br. at 6.  However, Petitioner argues that the IG has not established by the preponderance of the evidence that his conviction of criminal simulation is a program-related offense because “[n]othing in the elements of the crime of conviction nor the factual basis for conviction require anything to be done with the form after it is made.  No delivery of any item is necessary for the crime to be committed nor was delivery of an item ever alleged or established.”  P. Br. at 6-7.  Petitioner states in briefing following the hearing on remand that “the operative question is; is there substantial evidence Petitioner’s guilty plea referenced a prescription or transfer request for a Medicaid beneficiary.”  P. PHB at 5.  I recognize that it is insufficient for me to find that substantial evidence supports a finding that Petitioner’s guilty plea referenced a prescription or prescription transfer request using the name of a Medicaid beneficiary.  Rather, I must find that the preponderance of the evidence supports a finding that Petitioner pleaded guilty to making a prescription or prescription transfer request using the identity of a Medicaid beneficiary, i.e., it is more likely than not that he did so.  But the evidence I may consider is not limited to Petitioner’s plea agreement or the wording of the charge; rather, I am tasked to consider all the evidence. 

The Board has long held that the statutory terms describing an offense do not control whether that offense is “related to” the delivery of a health care item or service under

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Medicare or a state health care program for purposes of exclusion pursuant to section 1128(a) of the Act.  E.g., Dewayne Franzen, DAB No. 1165 (1990) (inquiry is whether conviction is related to Medicaid fraud, not whether the petitioner was convicted of Medicaid fraud).  Rather, an ALJ must examine whether there is a “common sense connection or nexus between the offense and the delivery of an item or service under the program.”  Scott D. Augustine, DAB No. 2043 at 5-6 (2006) (citations omitted). 

To determine whether there is such a nexus or common-sense connection, “evidence as to the nature of an offense may be considered,” such as the “facts upon which the conviction was predicated.”  Robert C. Hartnett,DAB No. 2740 at 7 (2016) (quoting Berton Siegel, D.O., DAB No. 1467 at 6-7 (1994)).  The bar to a petitioner collaterally attacking the conviction underlying an exclusion does not preclude review of the facts and circumstances on which the conviction was based.  An ALJ may consider extrinsic evidence to determine the events which formed the basis for the offense.  Narendra M. Patel, M.D., DAB No. 1736 (2000).  The terms “related to” and “relating to” in 42 U.S.C. § 1320a-7 simply mean that there must be a nexus or common-sense connection.  Friedman v. Sebelius, 686 F.3d 813, 820 (D.C. Cir. 2012) (describing the phrase “relating to” 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 quotes omitted); Quayum v. U.S. Dep’t of Health & Human Servs., 34 F.Supp.2d 141, 143 (E.D.N.Y. 1998). 

The Board in this case acted consistently with prior Board decisions.  The Board rejected Petitioner’s argument that evidence other than the plea agreement and criminal judgment should not be considered in determining whether there is a nexus.  The Board pointed out that exclusion under section 1128(a)(1) of the Act does not require a finding of the actual delivery of an item or service from a program-related provider, rejecting Petitioner’s argument that actual delivery is required to trigger exclusion under section 1128(a)(1) of the Act.  The Board affirmed my finding that Petitioner’s conviction was related to the delivery of glucose test strips.  Garcia, DAB No. 3098 at 8-13.  However, the Board sent this case back to me because the Board concluded that I did not determine whether Petitioner’s conviction for criminal simulation was related to the delivery of glucose test strips under Medicare or Medicaid.  The Board concluded it was legal error that I did not make a specific factual finding that the delivery of glucose test strips was under Medicare or Medicaid.  Garcia, DAB No. 3098 at 8.  However, as the Board noted, no actual delivery is required under section 1128(a)(1) of the Act.  Garcia, DAB No. 3098 at 8.  A criminal conviction need only be related to the delivery of an item or service under Medicare or Medicaid.  Therefore, based on the prior Board decisions previously discussed, attempts, conspiracies, and other criminal offenses that do not involve actual delivery may trigger exclusion under section 1128(a)(1) of the Act.  The plain language of the Act is actually subject to a much broader interpretation, because a purchase, sale, theft, destruction, and many other overt acts could be found to be related to the delivery of an item or service under Medicare or Medicaid.  Thus, “delivery” under section

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1128(a)(1) of the Act may be properly construed to include acts like those for which Petitioner was convicted, i.e., falsely and fraudulently making, altering, presenting, or offering prescription transfer requests or prescriptions for whatever items or services payable by insurance coverage may be the subject of the prescription or prescription transfer request.  Petitioner is correct that, in this case, the IG must show as part of its prima facie case that Petitioner’s guilty plea was related to Medicaid because the conduct that was the basis for his guilty plea included using the identity of a Medicaid beneficiary.  However, actual delivery or actual harm to Arizona Medicaid need not be shown. 

In my original decision, I concluded that there was a nexus between Petitioner’s offense and the delivery of a health care item or service under Arizona Medicaid.  Petitioner was convicted of criminal simulation which involved fraudulent prescription transfer requests and/or prescriptions.  The preponderance of the evidence when I made my original decision showed that the purpose of Petitioner’s criminal simulation was to obtain the delivery of glucose test strips to himself.  The preponderance of the evidence showed that Petitioner used his status as a pharmacist to facilitate his illegal activity.  Furthermore, the judgment of conviction entered by the state court on October 27, 2021, showed that the court ordered that Petitioner pay $1,000 to the Arizona Medicaid fraud control unit.  Garcia, DAB CR6222 at 10.  Unfortunately, I failed to clearly explain my rationale for concluding these findings were sufficient to establish the required nexus. 

First, under paragraph 4 of the Prehearing Order, the IG has the burden of proof (including the burdens of production and persuasion) on all issues other than Petitioner’s affirmative defenses or mitigating factors for which Petitioner has the burden of proof.  Therefore, the IG had to make a prima facie showing, i.e., that it was more likely than not that the elements that trigger exclusion under section 1128(a)(1) of the Act are satisfied.  The first element was satisfied by the fact Petitioner has not disputed that he was convicted by the state court of criminal simulation.  The second element was also satisfied because Petitioner never denied that the criminal simulation related to his making, altering, presenting, or offering false and fraudulent prescriptions or prescription transfer requests.  My conclusion is that the third element under section 1128(a)(1) of the Act is satisfied based on the finding that the underlying criminal action that is the basis for conviction was related to Medicare or Medicaid, even though that is not specifically stated in the state court’s documents and Petitioner’s plea agreement.  The IG’s evidence shows, and it is undisputed, that Petitioner was a pharmacist with access to Medicaid beneficiary information as well as information for other patients in other insurance programs.  The IG’s evidence at the time of my initial decision showed that the investigation of Petitioner was by the Arizona Medicaid fraud control unit.  Under the terms of his plea agreement, Petitioner agreed to pay a $1,000 fee to the Arizona Medicaid fraud control unit to cover some of the costs of the investigation of Petitioner by that unit.  The state court required Petitioner to pay the $1,000 fee in its judgment.  I made the factual determination that the IG’s evidence constituted a prima facie showing

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of a basis for Petitioner’s exclusion pursuant to section 1128(a)(1) of the Act as all elements were satisfied by the IG’s evidence.  Therefore, the burden of proof shifted to Petitioner to rebut the IG’s prima facie showing or establish an affirmative defense.  Petitioner failed to meet his burden because he presented no evidence as to what facts underlying his criminal offense he admitted to by his guilty plea.  Given the evidence before me at the time of the original decision, Petitioner was in a much better position to know what he pleaded guilty to than the IG.  Petitioner’s plea agreement does not provide a detailed factual statement of the basis for the charge to which he pleaded guilty.  If Petitioner did not intend to plead guilty to criminal simulation based on all the conduct alleged in the prosecution memorandum and the original charges, it is reasonable to expect Petitioner would have ensured that there was a factual basis stated in his plea agreement to clarify what criminal acts he did admit to. 

I concluded in my original decision that the prima facie showing of the elements that trigger exclusion under section 1128(a)(1) of the Act were satisfied and exclusion was required.  I did not explain that, though Petitioner had the burden and opportunity to rebut the prima facie case, he presented no evidence and, therefore, failed in his burden of proof.¹² 

The Board analogized the situation in this case as reflected by my first decision to the situation in Catherine L. Dodd, R.N., DAB No. 1345 (1992).  The Board states that in Dodd it affirmed the ALJ decision vacating an exclusion of a nurse under section 1128(a)(1) of the Act because extrinsic evidence showed program-related misconduct but did not show the necessary link between the program related misconduct and Dodd’s conviction.  The Board further elaborated that in Dodd it concluded that “the requisite nexus under section 1128(a)(1) was not established because the I.G. did not establish that any of the patients referenced in the guilty plea were beneficiaries of Medicare or Medicaid or that either program was a victim of the nurse’s crime.”  Garcia, DAB No. 3098 at 14 (citing Dodd at 6-11).  The Board indicates that in Dodd the IG failed to show any financial impact to Medicare because the evidence did not show that Dodd’s conviction related to a Medicare or Medicaid beneficiary receiving services at the relevant time.  Garcia, DAB No. 3098 at 15 (citing Dodd at 10-11).  Finally, relying again on Dodd, the Board states the fact Petitioner in this case was required to pay $1,000 to the Arizona Medicaid fraud control unit is “insufficient to establish that Petitioner’s conviction was program-related.”  Garcia, DAB No. 3098 at 16 (citing Dodd at 11).  The Board did not explain why Petitioner’s agreement to pay the $1,000 was insufficient to

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establish the nexus between Petitioner’s misconduct and Arizona Medicaid.  The Board seems to treat this as a bright-line rule of law rather than the case-specific factual issue that it really is under Dodd. 

Like the situation in Dodd, the charge of criminal simulation to which Petitioner pleaded guilty in this case did not list specific victims.  Also like Dodd, the evidence shows that some of the victims were not Medicare or Medicaid beneficiaries or Medicare or Medicaid.  The Board’s decision in Dodd may be easily read to suggest that in cases where there are multiple victims, some Medicare or Medicaid beneficiaries and some not, it is fatal to the IG’s prima facie case if no Medicare or Medicaid beneficiary is specifically named in the charge to which the guilty plea was entered and accepted.  Dodd, 1992 WL 685255 at *4-*5.  If that is the Board’s intent, despite the fact that approach is at odds with protecting federal and state health care programs and their funds, then Petitioner may prevail before the Board in this case.  However, if that was what the Board intended, there was no need to remand the case to me for further fact- finding as no amount of fact finding by me will change the fact that victims’ names were omitted from the charge to which Petitioner pleaded guilty. 

This case should be distinguished from the situation in Dodd for several reasons.  In this case, there was evidence in the record at the time of my initial decision that showed that the Arizona Medicaid fraud control unit conducted the investigation and found there was probable cause to believe that Petitioner used the personal information of a Medicaid beneficiary, CV, and other non-beneficiaries to create fraudulent prescriptions or prescription transfer requests.  Unlike the situation in Dodd, the investigation also established probable cause to believe that Arizona Medicaid suffered an actual loss, even though that was never alleged in any charge and there was no restitution request.  The criminal complaint shows that the prosecutor concluded that there was probable cause to charge Petitioner with crimes based on the Medicaid fraud control unit investigation, including the probable cause determination that Petitioner fraudulently used both Medicaid beneficiary and non-beneficiary evidence to obtain glucose test strips.  Petitioner’s plea agreement and state court documents related to the guilty plea, conviction, and sentencing do not specifically state Petitioner used Medicaid beneficiary information or that Medicaid suffered any loss.  However, there is no evidence that Petitioner limited his guilty plea to less than all the alleged misconduct for which the Medicaid fraud control unit found there was probable cause.  This evidence did not establish there was more than probable cause that Petitioner used Medicaid beneficiary CV’s identity to create a false prescription or prescription request.  However, there was no dispute when I issued my first decision that the Medicaid fraud control unit did the investigation, and the state court imposed the $1,000 fee Petitioner agreed to as part of his plea agreement to help defray the cost of the Medicaid fraud control unit investigation.  Therefore, I found as fact in my first decision that Petitioner’s criminal conduct for which he was convicted was related to the delivery of an item under Arizona Medicaid. 

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Dodd should also be distinguished because the ALJ decided the case on summary judgment with no waiver of oral hearing by either party and without an oral hearing being conducted.  Petitioner prevailed on summary judgment even though Petitioner did not move for summary judgment.  The Board indicated that the ALJ should have conducted a hearing, but the Board elected not to remand the case, noting that the IG had his chance to present evidence of the required nexus but had failed to do so.  Dodd, DAB No. 1345, 1992 WL 685255 at *7.  As a result, the burden of proof was not a deciding factor, as on summary judgment, an ALJ draws all inferences in favor of the nonmovant.  In this case there was a waiver of oral hearing by both parties and my initial decision was on the merits and based on the allocation of the burden of proof as specified in my Prehearing Order.  After the remand, an oral hearing was conducted and again the burden of proof is applied to determine whether the IG made a prima facie case, and whether Petitioner presented sufficient evidence to rebut the IG prima facie case.  

The Board’s remand decision, citing Dodd, suggests that evidence establishing the involvement of the Arizona Medicaid fraud control unit is insufficient to establish the nexus to Medicaid that triggers exclusion under section 1128(a)(1) of the Act.  The Board’s discussion in this case seems to indicate that the Board’s prior decision in Dodd established a bright-line rule that the involvement of a Medicaid fraud control unit is never sufficient to establish the required nexus.  However, the Board’s decision in Dodd shows the determination in that case was based on a detailed factual analysis rather than the creation and application of a bright-line rule of law.  The Board said in Dodd that the IG cannot rely on the mere presence of an investigation by a Medicaid fraud control unit to establish the required nexus.  Dodd, 1992 WL 685255 at *6.  The Board did not say that investigation by a Medicaid fraud control unit is not good evidence of the required nexus though in some instances it may be insufficient standing alone.  I failed to provide the Board in my first decision a thorough enough analysis of why the facts at the time of my initial decision were sufficient to establish the required nexus based on the Arizona Medicaid fraud control unit involvement as recognized by the state court’s approval of the fee of $1,000 to help defray the cost of the investigation. 

In my first decision, I concluded that there was a nexus between Petitioner’s offense and the delivery of a health care item or service under Medicare or Arizona Medicaid based on four facts:  

Petitioner was convicted by the state court of criminal simulation related to fraudulent prescriptions or prescription transfer requests;

Petitioner’s criminal conduct was for the purpose of obtaining delivery of glucose test strips to himself;

Petitioner used his status as a pharmacist to facilitate his illegal activity; and

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Petitioner was ordered to pay a $1,000 fee to the Arizona Medicaid fraud control unit. 

Garcia, DAB CR6222 at 10.  Based on my findings, I concluded that there was at least a loose nexus to the delivery of an item or service under Arizona Medicaid.  A clearer statement of the logic underlying this loose nexus is: 

There was an allegation, for which investigation by the Arizona Medicaid fraud control unit showed there was probable cause to believe that Petitioner used his position as pharmacist to obtain insurance information, including that of Medicaid beneficiary CV, which was used to make fraudulent prescription or prescription transfer requests.¹³

Petitioner was charged in the state court based on the Arizona Medicaid fraud control unit’s investigation and the probable cause established by that investigation. 

Petitioner pleaded guilty to an amended count three of the criminal complaint.  

Petitioner was convicted pursuant to his guilty plea. 

My conclusion that the preponderance of the evidence showed there was the required nexus is also the conclusion that the IG satisfied her burden of proof.  Petitioner denied in pleadings the existence of any nexus.  But the record at the time of my first decision included no evidence that Petitioner pleaded guilty to less than all the conduct that was cited by the Arizona Medicaid fraud control unit as the basis for the original charges.  Petitioner waived oral hearing and offered no affidavit or declaration in support of his position that his guilty plea did not admit to the use of the identify of Medicaid beneficiary CV.  Therefore, Petitioner made no effort to rebut the IG’s prima facie showing. 

The evidence I received following remand establishes a firmer nexus that Petitioner’s criminal conduct related to the delivery of an item or service under Medicaid.  Specifically:

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Mr. Struckmeyer explained that the Arizona Medicaid fraud control unit conducted the investigation of Petitioner based on an allegation of possible Medicaid fraud. 

Mr. Struckmeyer explained that the Medicaid fraud control unit’s investigation was found by a grand jury to establish probable cause to support the criminal complaint Mr. Struckmeyer swore to in the state court. 

Mr. Struckmeyer’s testimony shows that when Petitioner agreed to plead guilty and the plea agreement was executed, Mr. Struckmeyer was under the impression that Petitioner pleaded guilty to and admitted to all the criminal misconduct identified by the Medicaid fraud control unit, which was accepted by the grand jury as the probable cause necessary for charging Petitioner.  

Mr. Struckmeyer explained credibly why victims were not specifically identified in the original charges and the amended charge in the plea agreement. 

Mr. Struckmeyer explained credibly the reason why Arizona Medicaid was not identified by the government as entitled to restitution was because no victim restitution affidavit was filed by Arizona Medicaid. 

Unlike the situation in Dodd, there is evidence in the original prosecution memorandum (IG Ex. 3) and SA Becsey’s declaration (IG Exs. 8 (amended), 9), and confirmed by Mr. Struckmeyer in testimony, that Arizona paid a claim for $123.41 based on a fraudulent prescription or prescription transfer request made by Petitioner.

Petitioner testified at hearing that he could not recall whose information he used in making the fraudulent prescription or prescription transfer requests.  

Petitioner has not denied that he used the identity of Medicaid beneficiary CV in making fraudulent prescription or prescription transfer requests. 

Petitioner did not deny that Arizona Medicaid paid a claim based on a fraudulent prescription or prescription transfer request that used the identity of Medicaid beneficiary CV. 

The evidence received after the remand shows it was more likely than not that Petitioner’s conviction was based, at least in part, upon the evidence that Petitioner used the identity of Medicaid beneficiary CV to make a fraudulent prescription or prescription request that resulted in payment of a claim by Medicaid.  Therefore, there is a firm nexus that Petitioner’s criminal conviction was related to a delivery of an item or service under Arizona Medicaid. 

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When this case was before me the first time, Petitioner argued that in Arizona prescriptions are issued for medical marijuana, medication for animals, compounds, weight loss or weight gain drugs, hair growth drugs, fertility drugs, sexual or erectile dysfunction drugs, cosmetics, and cough and cold drugs.  Petitioner asserted that such prescriptions are not covered by the Act.  P. Br. at 7.  However, Petitioner has offered no evidence in support of the implication that the prescription transfer requests and/or prescriptions that were the basis for his conviction of criminal simulation were for any item or service other than glucose test strips that were for the humans listed on the prescriptions involved. 

The elements necessary to trigger mandatory exclusion pursuant to section 1128(a)(1) of the Act are satisfied in this case.  The evidence shows Petitioner was convicted of a criminal offense and the conduct that was the basis of his conviction was related to the delivery of a health care item under Arizona Medicaid.  Accordingly, I conclude that there is a basis for Petitioner’s exclusion pursuant to section 1128(a)(1) of the Act. 

4.  Section 1128(c)(3)(B) of the Act requires a minimum exclusion of five years for an exclusion pursuant to section 1128(a) of the Act. 

I have concluded that there is a basis to exclude Petitioner pursuant to section 1128(a)(1) of the Act.  Therefore, the minimum period of exclusion authorized by Congress in section 1128(c)(3)(B) of the Act is five years.  Nenice Marie Andrews, DAB No. 2656 at 5 (2015); Scott D. Augustine, DAB No. 2043 at 13-14 (2006).  

5.  Petitioner’s exclusion for five years is not unreasonable as a matter of law. 

Congress has established a five-year minimum period of exclusion for exclusions pursuant to section 1128(a) of the Act.  Act § 1128(c)(3)(B).  Pursuant to 42 C.F.R. § 1001.2007(a)(2), when the IG imposes an exclusion in accordance with section 1128(a) of the Act for the statutory minimum period of five years, there is no issue of whether the period of exclusion is unreasonable. 

Accordingly, I conclude that Petitioner’s exclusion for a period of five years is not unreasonable as a matter of law.  Petitioner’s exclusion is effective June 20, 2022, 20 days from the date of the May 31, 2022 IG notice of exclusion to Petitioner.  42 C.F.R. § 1001.2002(b).  

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III.     Conclusion

For the foregoing reasons, Petitioner is excluded from participation in Medicare, Medicaid, and all other federal health care programs for a minimum of five years, effective June 20, 2022. 

Endnotes

¹  The United States Court of Appeals for the Ninth Circuit, which has jurisdiction where Petitioner’s case arose, recognizes that the law of the case doctrine applies to cases under the Act.  The doctrine generally prevents a court from considering an issue that has already been decided by the court or on appeal in the same case, unless evidence on remand is substantially different or applying the doctrine would be unjust.  Stacy v. Colvin, 825 F.3d 563, 567 (9th Cir. 2016).

²  Citations are to the 2021 revision of the Code of Federal Regulations, unless otherwise stated.

³  The pronouns he, him, and his are used in this decision as Petitioner expressed no preference.

⁴  There is no requirement that a party admit or concede that evidence is true for the evidence to be admissible.  Fact-finding in this forum requires determining which allegations of fact are more likely true than not based on the evidence presented.  42 C.F.R. § 1005.15(d)

⁵  IG Ex. 8 as originally filed is not admitted or considered as evidence.

⁶  The parties had previously waived an oral hearing.  Pursuant to 42 C.F.R. § 1005.6(b)(5), a party may waive appearance at an oral hearing and submit only documentary evidence and written argument.  However, even if both parties waive an oral hearing, their waiver does not prevent a hearing from being convened to examine witnesses called by the ALJ.  42 C.F.R. § 1005.4(b)(1), (5), (8), (9).

⁷  The Board states I erred by not deciding whether the specific offense of which Petitioner was convicted was program-related.  Garcia, DAB No. 3098 at 8.  Exclusion is triggered under section 1128(a)(1) of the Act only for a conviction related to the delivery of an item or service under Medicare or Medicaid.  I made specific findings and a conclusion of law that Petitioner’s conviction was related to Medicare or Medicaid.  I did not fail to discuss this essential element necessary to trigger exclusion.  The Board’s decision actually shows that the Board disagreed with my findings of fact and whether they were sufficient to support my conclusion.  Garcia, DAB No. 3098 at 8.  The Board does not point to any conflicting evidence but rather bases its decision on a paucity of evidence and really nothing more than Petitioner’s arguments about what the evidence does not show.  On appellate review under 42 C.F.R. pt. 1005, the Board is limited to determining whether an ALJ’s factual finding on a disputed issue of fact is supported by substantial evidence on the whole record.  42 C.F.R. § 1005.21(h).  The “substantial evidence” standard considers whether a reasonable mind might accept a particular evidentiary record as adequate to support a conclusion.  Consol. Edison Co. of NY v. NLRB, 305 U.S. 197, 229 (1938); Dickinson v. Zurko, 527 U.S. 150, 162 (1999).  Substantial evidence is less than a preponderance of the evidence.  Giha v. Garland, 12 F.4th 922, 930 (9th Cir. 2021).  The standard of review for an ALJ decision on a disputed issue of fact  

is whether the ALJ decision is supported by substantial evidence in the whole record.  42 C.F.R. § 1005.21(h).  Under the substantial evidence standard, the reviewer must examine the record as a whole and take into account whatever in the record fairly detracts from the weight of the decision below. The reviewer does not, however, reweigh the evidence nor substitute his or her judgment for that of the initial decision-maker.  John (Juan) Urquijo, DAB No. 1735 at 4 (2000). 

Stacy Ann Battle, D.D.S., DAB No. 1843, 2002 WL 2031576 at *2 (Aug. 22, 2002); Emerald Oaks, DAB No. 1800, 2001 WL 1688390 at *9 (Nov. 30, 2001).  An ALJ makes a finding of a disputed fact by applying the preponderance of the evidence standard.  42 C.F.R. § 1005.15(d).  The preponderance of the evidence standard requires that the trier-of-fact believe that the existence of a fact is more probable than not before finding in favor of the party that had the burden to persuade the judge of the fact’s existence.  In re Winship, 397 U.S. 358, 371-72 (1970); Concrete Pipe & Prods. of Cal., Inc. v. Constr. Laborers Pension Tr. for Southern CA, 508 U.S. 602, 622 (1993); Emerald Oaks, 2001 WL 1688390 at *9.

⁸  Ariz. Rev. Stat. § 13-2004(A) provides: 

A person commits criminal simulation if, with intent to defraud, such person makes, alters, or presents or offers, whether accepted or not, any object so that it appears to have an antiquity, rarity, source, authorship or value that it does not in fact possess. 

Available at https://www.azleg.gov. 

⁹  Petitioner waived the right to cross-examine the authors or creators of these three documents by waiving an oral hearing.  Petitioner did not request that the authors be called at the hearing convened after the remand.

¹⁰  Diabetic test strips and glucose test strips are considered to refer to the same item in this decision.

¹¹  In its remand decision the Board noted that evidence in the record was inconsistent on whether Arizona incurred any loss based on a prescription or prescription transfer request for Medicaid beneficiary CV.  The Board indicates that the prosecution memorandum (IG Ex. 3) shows that CV was contacted by the pharmacy that received the fraudulent prescription or prescription transfer request, CV stated it was not her prescription and was advised the “transaction would be reversed.”  Garcia, DAB No. 3098 at 7 n.9 (citing IG Ex. 3 at 5).  The Board requested that I consider whether this potentially conflicting evidence has any impact.  I have considered that there may be a conflict in the evidence about whether Arizona Medicaid suffered a loss of $123.41, and resolved there is not.  According to the prosecution memorandum, it was CV who told SA Becsey that the pharmacist at Walgreens told her that “the transaction would be reversed.”  There is no explanation for what that third-party hearsay statement from the Walgreens pharmacist means and it is entitled to little or no weight in comparison to IG Ex. 9, which shows that Arizona Medicaid was billed $150.43 on Medicaid beneficiary CV’s account and paid $123.41.  IG Exs. 8 (amended), 9 at 1-2.  Furthermore, as discussed in detail elsewhere in this decision, exclusion under section 1128(a)(1) of the Act does not require any financial loss to Medicare or Medicaid.

¹²  Though I think my complete analysis was implicit in the language of my initial decision, I do not believe the Board was required to make any inference that would uphold my decision and a remand out of an abundance of caution was appropriate for clarification.

¹³  The specific allegations related to Medicaid beneficiary CV and the fact that Petitioner pleaded guilty to the amended count three without ensuring his plea agreement limited the criminal conduct he admitted by his plea, distinguish this case from Dodd.