Asim A. Hameedi, M.D., DAB No. 3087 (2023)

FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE DECISION

Asim A. Hameedi, M.D. (Petitioner) and the Inspector General (I.G.) each appeals the September 30, 2022 decision by an Administrative Law Judge (ALJ) affirming the I.G.’s exclusion of Petitioner from participation in all federal health care programs based on Petitioner’s federal felony conviction of conspiracy to commit health care fraud, but decreasing the total exclusion period from 11 to 8 years.  Asim A. Hameedi, M.D., DAB CR6171 (2022) (ALJ Decision); Social Security Act (Act) § 1128(a)(3).  Petitioner concedes the basis for the exclusion and the two regulatory aggravating factors the I.G. applied, and the absence of regulatory mitigating factors, but argues they did not warrant any increase in the exclusion period beyond the mandatory five-year minimum (Docket No. A-23-9), while the I.G. argues that the ALJ erred in decreasing the exclusion period from 11 to 8 years (Docket No. A‑23‑10). 

The Board consolidates the two appeals for the purposes of this decision and addresses both in the single analysis below.  As explained below, we affirm the ALJ’s unchallenged conclusions that the I.G. established the basis for the exclusion and the presence of two aggravating factors authorizing the I.G. to increase the exclusion period and that Petitioner established no mitigating factors that could reduce it, but we reverse, as not supported by substantial evidence, the ALJ’s determination to shorten the exclusion period.  We also determine that the 11-year exclusion period the I.G. imposed is not unreasonable and reinstate that period.

Legal Background

Section 1128(a) of the Act mandates the exclusion of individuals or entities who have been convicted of certain types of criminal offenses from participating in Medicare, Medicaid, and other federal health programs.  As relevant here, section 1128(a)(3), titled “Felony conviction relating to health care fraud,” requires the exclusion of “[a]ny individual or entity that has been convicted . . . under Federal or State law, in connection with the delivery of a health care item or service . . . of a criminal offense consisting of a felony relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other

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financial misconduct.”  Act § 1128(a)(3) (42 U.S.C. § 1320a–7(a)(3)); accord 42 C.F.R. § 1001.101(c)(1).¹

The mandatory minimum period of an exclusion imposed under section 1128(a) is five years.  Act § 1128(c)(3)(B); 42 C.F.R. § 1001.102(a).  The I.G. may extend the exclusion period beyond the statutory minimum in the presence of any of nine aggravating factors provided in the regulations including, as relevant here: 

(1) The acts resulting in the conviction, or similar acts, caused, or were intended to cause, a financial loss to a government agency or program or to one or more other entities of $50,000 or more.  (The entire amount of financial loss to such government agencies or programs or to other entities, including any amounts resulting from similar acts not adjudicated, will be considered regardless of whether full or partial restitution has been made);

*    *    *

(5) The sentence imposed by the court included incarceration;

42 C.F.R. § 1001.102(b)(1), (5); id.§ 1001.102(b) (“Any of the following factors may be considered to be aggravating and a basis for lengthening the period of exclusion.”).  An exclusion period that has been extended beyond the five-year minimum based on aggravating factors may be reduced by application of one or more of three mitigating factors also specified in the regulation, but not to below five years.  Id. § 1001.102(c).

If the I.G. determines exclusion is warranted, the I.G. will send written notice to the excluded individual or entity identifying, among other things, the basis for the exclusion, the length of the exclusion, and the factors, if any, that the I.G. considered in determining the length of the exclusion period.  42 C.F.R. § 1001.2002(a), (c).

An excluded individual may request a hearing before an ALJ, but only on the issues of: (i) whether the I.G. had a basis for the exclusion; and (ii) whether an exclusion longer than the required minimum period is “unreasonable.”  42 C.F.R. §§ 1001.2007(a)(1), 1005.2(a).  When, as here, the exclusion is based on the existence of a criminal conviction (or a civil judgment imposing liability by Federal, State or local court, or “other prior determination where the facts were adjudicated and a final decision was made”), the basis for the conviction, judgment, or determination “is not reviewable” and the individual “may not collaterally attack it either on substantive or procedural grounds in this appeal.”  Id. § 1001.2007(d).

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The ALJ issues an “initial decision” based on the record developed before the ALJ.  42 C.F.R. § 1005.20(a).  A party dissatisfied with the ALJ’s “initial decision” may appeal that decision to the Board.  Id. § 1005.21(a).  The Board “will not consider any issue not raised in the parties’ briefs, nor any issue in the briefs that could have been raised before the ALJ but was not.”  Id. § 1005.21(e).

Case Background²

Petitioner is a physician specializing in interventional cardiology who maintained a medical practice in Queens, New York, City Medical Associates (CMA).  P. Ex. 1, at 4 (Plea Hearing Transcript); P. Ex. 3, at 38, 40 (Sentencing Transcript). 

On February 9, 2018, Petitioner pleaded and was adjudicated guilty of one count of conspiracy to commit health care fraud.  I.G. Ex. 4 (Plea Agreement); P. Ex. 1.  Petitioner pleaded guilty to Count One of a “Superseding Information” charging that “[f]rom in or about 2003 up to and including in or about November 2015,” Petitioner and others:

willfully and knowingly would and did execute, and attempt to execute, a scheme and artifice to defraud a health care benefit program, and to obtain, by means of false and fraudulent pretenses, representations, and promises, money and property owned by, and under the custody and control of, a health care benefit program, in connection with the delivery of and payment for health care benefits, items, and services, to wit, [Petitioner] participated in a scheme to defraud insurance providers by making materially false statements in requests for preauthorization for medical tests and procedures and in claims for payment for the provision of medical services and drug items, in violation of [18 U.S.C. §] 1347.

I.G. Ex. 3, at 1-2 (¶¶ 1-2) (Superseding Information); P. Ex. 1, at 11-14; see I.G. Ex. 4.  The Superseding Information alleged that Petitioner committed the following “overt act, among others,” in furtherance of the conspiracy “and to effect the illegal object thereof”:

On or about July 11, 2013, [Petitioner], the defendant, falsely represented himself as another individual, who was a doctor, on a phone call in which [Petitioner] sought preauthorization from a health-care benefits management company for a nuclear stress test on behalf of a particular patient.

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I.G. Ex. 3,at 2 (¶ 3.a).  At the hearing during which the District Court accepted the guilty plea, Petitioner stated:

I agreed with others to tell insurance providers that one other doctor had requested the pre-authorization for medical tests when I knew that he had not.  And specifically, on July 11, 2013, I falsely represented myself as another physician in seeking pre-authorization for a nucleus [sic] stress test to be performed on my patients.  While I believe based on my review of patient charts that these tests were absolutely medically necessary I intentionally represented that another doctor recommended these tests.  I knew at the time that this was wrong and that the pre-authorization would be used to facilitate payment for their procedure.

P. Ex. 1, at 1, 22, 27; ALJ Decision at 4-5.

On May 20, 2021, the District Court imposed a sentence of 20 months imprisonment, two years of supervised release, and “criminal monetary penalties” comprising a fine of $100,000 and payment of $554,331 in restitution to the victims of the offense charged, with payment to be made to the Centers for Medicare & Medicaid Services (CMS), which administers the federal Medicare and Medicaid programs.  P. Ex. 3, at 1, 51-55; I.G. Ex. 5 (Judgment); I.G. Ex. 6, at 3 (Restitution Order).

On February 28, 2022, the I.G. notified Petitioner of the exclusion from participation in Medicare, Medicaid, and all federal health care programs for 11 years under section 1128(a)(3) of the Act, based on Petitioner’s felony conviction in United States District Court.  I.G. Ex. 1, at 1 (Notice Letter).  The letter stated that the I.G. was increasing the exclusion period beyond the five-year minimum based on the two aggravating factors at 42 C.F.R. § 1001.102(b)(1) and (5), because “[t]he court ordered you to pay approximately $554,300 in restitution” and “sentenced you to 20 months of incarceration.”  Id. at 2.

ALJ Decision

Petitioner requested an ALJ hearing only “on the issue of whether the length of exclusion is unreasonable.”  P. ALJ Br. at 2.  As Petitioner did not propose any witnesses for a hearing and the I.G. contended that a hearing was not necessary, the ALJ issued a decision on the written record.  ALJ Decision at 3 (citing Standing Prehearing Order at § 6; I.G. ALJ Br. at 10).  

The ALJ affirmed the exclusion and the presence of two aggravating and no mitigating factors, but determined that the 11-year exclusion “is not within a reasonable range and is reduced to a period of eight years.”  ALJ Decision at 6-7, 12.  The ALJ concluded that the I.G. established a basis for Petitioner’s exclusion under section 1128(a)(3) of the Act

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because “Petitioner was convicted of a felony relating to fraud, theft, embezzlement, breach of fiduciary responsibility or other financial misconduct that was committed in connection with the delivery of a health care item or service” from 2003 through approximately November 2015, and because Petitioner “concedes that the IG had a basis to exclude him pursuant to section 1128(a)(3).”³  Id. at 4-5 (citing I.G. Exs. 3-5; P. ALJ Br. at 3).  The ALJ quoted Petitioner’s plea-hearing admission of his conduct and the “overt act” in furtherance of the conspiracy as described in the Superseding Information and the Plea Transcript.  Id. (quoting I.G. Ex. 3, at 1-2; P. Ex. 1, at 21-22).  The ALJ further concluded that because a basis existed to exclude Petitioner under section 1128(a)(3), “he must be excluded for a minimum of five years.”  Id. at 6.

The ALJ next concluded that the I.G. established two aggravating factors permitting an increase of the exclusion period beyond the five-year statutory minimum:  “Petitioner’s sentence imposed incarceration as required by 42 C.F.R. § 1001.102(b)(5)” and “the acts resulting in Petitioner’s conviction caused a financial loss to a government program of $50,000 or more under 42 C.F.R. § 1001.102(b)(1).”  ALJ Decision at 6.  The ALJ noted that “the District Court sentenced Petitioner to 20 months in jail” and ordered Petitioner “to pay restitution totaling the amount of $554,331 to the victims of his offense.”⁴ Id. at 6-7 (citing I.G. Ex. 5; I.G. Ex. 6).  The ALJ dismissed, as “without supporting evidence,” the contentions that Petitioner was actually incarcerated for only four months and “ultimately paid $388,031.55.”  Id. (citing P. ALJ Br. at 9, 11).

The ALJ also noted that Petitioner had been held jointly and severally liable for the entire $554,331, and that, “[i]n any event,” both amounts are in excess of $50,000,” the threshold for the aggravating factor.  ALJ Decision at 6-7 (citing I.G. Ex. 6, at 1-2).  The ALJ thus found that the I.G. had “established by a preponderance of the evidence . . . the existence of the aggravating factor set forth at 42 C.F.R. § 1001.102(b)(1),” and that “$554,331 is the most accurate proxy of the financial loss Petitioner caused to a government program.”  Id. at 7.  That amount, the ALJ found, “is the portion of the NSTs [nuclear stress tests] that the District Court found were billed but not performed, and the

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District Court Judge ruled as such in the underlying sentencing hearing.”  Id. at 11 (citing P. Ex. 3, at 51).

The ALJ also found that Petitioner had not met the “burden to show the existence of any regulatorily permissible mitigating factor(s)” because the mitigating circumstances Petitioner alleged are “not mitigating factors that I am authorized to consider to reduce the period of exclusion imposed by the IG.”  ALJ Decision at 9 (citing 42 C.F.R. § 1001.102(c)).  Those factors included Petitioner’s “aid in combatting the COVID-19 pandemic and his work ethic”; Petitioner’s “remedial actions . . . to ensure that similar conduct does not occur in the future”; CMS’s determination to impose only a three-year Medicare re‑enrollment bar; and the state medical licensing authorities’ imposition of only a 15‑month license suspension followed by automatic reinstatement.  Id. at 8-9.

The ALJ further concluded, however, that “it appears that the weight assigned to the financial loss aggravating factor was based upon a financial loss amount greater than that determined by the District Court,” i.e., $554,331.  ALJ Decision at 10.  Citing the I.G.’s brief, the ALJ found that the I.G. had instead based that factor on the larger losses alleged in an earlier grand jury indictment issued on February 28, 2017, against Petitioner and five other individuals who worked at CMA, charging Petitioner with nine counts including health care fraud, wire fraud, conspiracy to commit health care and wire fraud, and aggravated identity theft, and alleging “a massive scheme to defraud the Insurance Providers of tens of millions of dollars.”⁵  Id. at 10-11; I.G. Ex. 2, at 1-32.  The ALJ thus found that “the IG assigned a greater weight – potentially by many multiples – than warranted, to the financial loss aggravating factor.”  ALJ Decision at 11. 

The ALJ then found, absent any I.G. statement of “how much of the six-year exclusionary period increase was attributed to the financial loss aggravating factor and how much was attributed to the incarceration aggravating factor,” that a three-year lengthening of the exclusionary period “falls within a reasonable range” and “is in line with the reasonable range determined by the Board in Jason Hollady, M.D.,” DAB No. 1855 (2002).  ALJ Decision at 11.  That case, the ALJ noted, “contained a similar restitution amount and incarceration length” and found “that an eight-year exclusionary period was reasonable with a nine-month period of incarceration and $347,463 in restitution.”  Id.  The ALJ “therefore reduce[d] the length of the exclusion to eight years.”  Id. at 9.

Finally, the ALJ denied, as outside an ALJ’s authority to grant, Petitioner’s request that the exclusion begin on February 9, 2018, “the last date that Petitioner was able to participate in the Federal healthcare program due to the underlying adjudication,” instead

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of March 20, 2022, the date the I.G. selected.  ALJ Decision at 12 (citing I.G. Ex. 1; P. Ex. 6, at 4; P. ALJ Br. at 12-13).

Board Proceedings and the Parties’ Arguments

Petitioner (Docket No. A-23-9) and the I.G. (Docket No. A-23-10) each timely appealed the ALJ’s decision and filed a brief in each appeal.⁶  As before the ALJ, Petitioner “conceded that the IG had a valid basis to exclude him from participation in federal health care programs under Section 1128(a)(3) of the Act” and that “the only issue before the ALJ was whether increasing the 5-year base exclusion period by 120% was reasonable.”  P. Br. at 4; P. ALJ Br. at 3.  Petitioner also does not dispute the existence of the two aggravating factors the I.G. applied, or assert that any of the three mitigating factors at 42 C.F.R. § 1001.102(c) applied (or are present), but argues that “the ALJ’s decision to only reduce the exclusion to a period of 8 years, instead of the 5-year base exclusion period . . . is based on incorrect legal findings and erroneous.”  P. Br. at 1, 5-6. 

Regarding the financial loss factor, Petitioner argues that the criminal conviction “involved conduct that did not cause any harm to his patients or any financial loss to the government” because the I.G. relied on allegations in the initial indictment that “bear extraordinarily little resemblance to the eventual findings in the case” and “grossly overstated [Petitioner’s] conviction and the misconduct for which he was ultimately held responsible.”  P. Br. at 7, 9.  That misconduct, Petitioner contends, consisted of “a very narrow factual allocution to participation in the fraud on a single date and for a small fraction (less than 1%) of what was initially alleged,” while medical services “billed under non-rendering physicians’ names were actually performed and were medically necessary,” and any billing for portions of nuclear stress tests not conducted were coding errors by CMA employees and were not medically necessary for the patients involved.  Id. at 7-12.  Petitioner again asserts having “ultimately paid” only $388,031.55 of the total restitution, on behalf of both Petitioner and “the CMA employee who did not have the financial means to pay any restitution.”  Id. at 11.   

Regarding the incarceration factor, Petitioner asserts having “ultimately served only 4 months of actual incarceration.”  P. Br. at 13.  Finally, Petitioner argues that the six-year increase in exclusion length is “unreasonably punitive” and “an extreme outlier when compared to other actions taken by CMS and the New York State Licensing Board arising out of the exact same underlying facts.”  Id. at 14.

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The I.G. argues that the ALJ’s finding that the I.G. did not specifically state the amount of loss used to decide how much weight to apply to the financial loss aggravating factor and wrongly based that factor on losses of multiple millions of dollars alleged in the initial indictment was “not supported by substantial evidence on the whole record,” because it ignored the exclusion notice (I.G. Ex. 1) the I.G. sent to Petitioner.  I.G. Br. at 1, 7-9; I.G. Resp. at 2, 7-8.  The I.G. thus argues that the ALJ erred in decreasing the exclusion period the I.G. imposed but does not otherwise dispute the ALJ Decision, and asks the Board to set aside the ALJ’s decision to reduce the length of Petitioner’s exclusion and to affirm the original 11-year exclusion period as “within a reasonable range.”  I.G. Br. at 12.

Standard of Review

The Board reviews a disputed issue of fact as to whether the ALJ “decision is supported by substantial evidence on the whole record.”  42 C.F.R. § 1005.21(h).  The Board reviews a disputed issue of law as to whether the ALJ decision “is erroneous.”  Id.  The term “substantial evidence” means “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.”  Richardson v. Perales, 402 U.S. 389, 401 (1971) (quoting Consol. Edison Co. v. NLRB, 305 U.S. 197, 229 (1938)).

Analysis

1. There was a basis to exclude Petitioner for a minimum of five years under section 1128(a)(3) of the Act.

As the ALJ found, Petitioner does not dispute that the I.G. was authorized to exclude Petitioner under section 1128(a) based on the felony conviction.  ALJ Decision at 2 (“Here, the Petitioner concedes the IG has a basis to exclude him from participation in federal health care programs under section 1128(a)(3) of the Act.”); P. ALJ Br. at 3 (“[Petitioner] concedes that the IG has a valid basis to exclude him from participation in federal health care programs under section 1128(a)[(3)] of the Act.”).  Petitioner does not appeal the ALJ’s determinations that “[t]he IG established a basis for Petitioner’s exclusion pursuant to section 1128(a)(3) of the Act (42 U.S.C. § 1320a-7(a)(3)) and Petitioner does not otherwise contest this” and that “Petitioner must be excluded for a minimum of five years.”  ALJ Decision at 4-6.  As such, we summarily affirm the ALJ’s determinations that the I.G. was required to exclude Petitioner for a minimum of five years based on Petitioner’s conviction of a felony relating to fraud, theft, embezzlement, breach of fiduciary responsibility or other financial misconduct that was committed in connection with the delivery of a health care item or service.  Id.; see 42 C.F.R. § 1005.21(e) (stating the Board “will not consider any issue not raised in the parties’ briefs, nor any issue in the briefs that could have been raised before the ALJ but was not”).

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2. There are two aggravating factors under section 1001.102(b), and no mitigating factors under section 1001.102(c).

Petitioner does not dispute the ALJ’s determination that the two aggravating factors the I.G. applied – the financial loss factor and the incarceration factor – are present, although Petitioner argues that the I.G. wrongly based the former factor on amounts far greater than the court-ordered restitution, as the ALJ found.  See P. Br. at 1-2, 5, 7-13.  Below, we conclude that the ALJ’s finding (and thus Petitioner’s argument) is not based on substantial evidence and is contrary to the record.

Regarding the financial loss aggravating factor, Petitioner also asserts having “ultimately paid” only $388,031.55 of the $554,331 in court-ordered restitution, on behalf of both Petitioner and “the CMA employee who did not have the financial means to pay any restitution.”  P. Br. at 11.  The ALJ rejected this claim as “without the support of any evidence in the record,” and Petitioner does not dispute the ALJ’s finding or cite any evidence that the restitution was reduced.  ALJ Decision at 7 (citing P. ALJ Br. at 9).  Petitioner also does not dispute that, as the ALJ noted, the “Order of Restitution specifies that Petitioner is jointly and severally liable for the entire amount of $554,331.”  Id. (citing I.G. Ex. 6, at 1-2).  Petitioner’s claim, moreover, would not warrant reduction in the exclusion period, as the regulations state that “[t]he entire amount of financial loss . . . will be considered regardless of whether full or partial restitution has been made.”  42 C.F.R. § 1001.102(b)(1); see Paul W. Williams, Jr. & Grand Coteau Prescription, DAB No. 1785, at 3 (2001) (citing the quoted regulatory language in rejecting an argument that the magnitude of a theft is irrelevant if the government succeeds in recovering the loss).

Regarding the incarceration aggravating factor, Petitioner again asserts having “ultimately served only 4 months of actual incarceration” out of the 20-month imposed sentence, but does not dispute the ALJ’s dismissal of this contention as “without supporting evidence,” or cite such evidence.  P. Br. at 13; ALJ Decision at 6.  In any event, that showing would not diminish the relevance of the court’s determination to impose the 20-month sentence upon consideration of the evidence concerning Petitioner’s and CMA’s criminal conduct and what the judge determined were “substantial mitigating factors in this case.”  P. Ex. 3, at 3-7, 13-14, 48‑49.  As we discuss later, however, the circumstances the judge noted, and which Petitioner raises on appeal, are not among the mitigating factors the regulations permit ALJs and the Board to consider, and do not provide grounds for us to find that the exclusion the I.G. imposed was unreasonable.  42 C.F.R. § 1001.102(c); ALJ Decision at 9. 

Petitioner also does not dispute the ALJ’s determination that Petitioner “failed to meet [the] burden to show the existence of any regulatorily permissible mitigating factor(s)” that an ALJ (and the Board) is “authorized to consider to reduce the period of exclusion imposed by the IG.”  ALJ Decision at 9.  Specifically, Petitioner does not dispute the ALJ’s determination that the equitable considerations Petitioner cited, including

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Petitioner’s “laudable” work ethic and aid in combatting the COVID-19 pandemic, as well as remedial actions by Petitioner and CMA to prevent similar conduct in the future, and actions by CMS and state authorities to restore Petitioner’s billing privileges and license, are not among the limited mitigating factors the regulations authorize ALJs and the Board to consider.  Id. at 8-9.  We thus adopt the ALJ’s determinations that there are two aggravating factors and no mitigating factors.  Below, we conclude that the equitable considerations Petitioner alleges also do not show that the exclusion period is unreasonable.  First, however, we conclude that the ALJ’s conclusion that the 11-year exclusion period is unreasonable is not supported by substantial evidence.

3. Substantial evidence does not support the ALJ’s finding that the I.G. applied the financial loss aggravating factor based on amounts in excess of the court-ordered restitution.

The ALJ found that “the IG assigned a greater weight – potentially by many multiples – than warranted, to the financial loss aggravating factor” because “the weight . . . was based upon a financial loss amount greater than that determined by the District Court.”  ALJ Decision at 10-11.  We agree with the I.G. that this finding is not supported by substantial evidence.  The record instead shows that the I.G. applied the financial loss aggravating factor based on the amount of restitution that the court ordered Petitioner to pay to the victims of the offense.

The ALJ relied on the statement in the I.G.’s brief that “[h]ere, the conspiracy scheme that Petitioner participated in led to fraudulent gains of millions of dollars, and an order of restitution amounting to approximately $554,300, [which] support the imposition of the first aggravating factor,” and found that the I.G. “does not otherwise specifically state the amount of loss it used when deciding how much weight to apply to this aggravating factor.”  ALJ Decision at 10-11; I.G. ALJ Br. at 10.  The ALJ thus found that the I.G. based the financial loss factor on the initial indictment of Petitioner and five other people alleging millions of dollars in fraud losses, instead of the amount of the court-ordered restitution following Petitioner’s conviction on the charge in the Superseding Information.  ALJ Decision at 10-11.

In so finding, however, the ALJ did not cite, or address, the content of I.G. Exhibit 1, the I.G.’s February 28, 2022 Notice Letter informing Petitioner of the exclusion, its basis and length, and the right to request an ALJ hearing to contest the exclusion.  See ALJ Decision at 10-11.  That letter, digitally signed by the Reviewing Official of the Exclusions Branch of the Office of the I.G. (OIG), states that the exclusion period was greater than the five-year minimum because of the two aggravating factors; regarding the financial loss factor, the Notice Letter states only that:

The acts resulting in the conviction, or similar acts, caused, or were intended to cause, a financial loss to a government agency or program or to

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one or more other entities of $50,000 or more.  (The entire amount of financial loss to such government agencies or programs or to other entities, including any amounts resulting from similar acts not adjudicated, will be considered regardless of whether full or partial restitution has been made.)  The court ordered you to pay approximately $554,300 in restitution.

I.G. Ex. 1, at 1-2 (emphasis added).⁷  The letter contains no other statement concerning that aggravating factor and no reference to any loss amount other than the “approximately $554,300” the court ordered Petitioner to pay in restitution.  Id.  It does not refer to the initial grand jury indictment or to the multi-million dollar figures the indictment alleged resulted from the fraudulent acts of Petitioner and the other individuals charged in the indictment.  Id.; I.G. Ex. 2, at 8-10, 14-15.

The February 28, 2022 Notice Letter issued by the Reviewing Official is the official notice that the regulations require the I.G. to send to any excluded individual or entity; such notice must state, among other information, the basis for the exclusion, its length and “where applicable, the factors considered in setting the length,” and the excluded individual’s or entity’s appeal rights.  42 C.F.R. § 1001.2002.  Although the ALJ Decision cites the February 28, 2022 Notice Letter as evidence of the exclusion’s length and effective date, it does not cite or otherwise note its content regarding the financial loss aggravating factor.  ALJ Decision at 2, 12.  That omission is error.

The regulations direct the Board to determine whether the ALJ’s decision “is supported by substantial evidence on the whole record.”  42 C.F.R. § 1005.21(h) (emphasis added).  As the Board has noted, 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 evidence relied on in the decision below.”  W. Scott Harkonen, M.D., DAB No. 2485, at 5 (2012) (citing Universal Camera Corp. v. NLRB, 340 U.S. 474, 488 (1951)), aff’d, No. C 13–0071 PJH, 2013 WL 5734918 (N.D. Cal. Oct. 22, 2013); see also Ellen L. Morand, DAB No. 2436, at 3-4 (2012) (internal citations omitted); Stacy Ann Battle, D.D.S., DAB No. 1843, at 3 (2002). 

Here, the ALJ Decision was not based on the evidence in “the whole record” or the “record as a whole” as required, because it does not address or acknowledge the OIG Reviewing Official’s unambiguous statement in the Notice Letter that the financial loss factor was applied based on the restitution amount that, it is not disputed, the District Court ordered Petitioner to pay.  The ALJ Decision does not explain why the Reviewing Official’s statement about the losses considered in applying the aggravating factor, in the operative official notice required by regulation, is less probative or material on that

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question than arguments the I.G.’s counsel later made in its brief for the purposes of this litigation.  See 42 C.F.R § 1005.21(h); see, e.g., Steven Getchell, Recommended Decision, Docket No. A‑08-111, at 6 n.2 (Sept. 30, 2008) (“A position asserted by an attorney in litigation does not necessarily reflect an official interpretation by the agency.”); Hawaii Dep’t of Hum. Servs., Ruling on Request for Reconsideration of DAB No. 1981, Ruling No. 2006-1, at 6 (Feb. 22, 2006) (stating that “the degree of deference [to agency interpretation] appropriate varies according to the circumstances, including how (if at all) the interpretation was issued (with the least deference given to a litigating position)”).

The Board has found it appropriate to give “some analytical weight” to representations in the I.G.’s briefing, provided that they are consistent with the record.  Waleed Khan, DAB No. 3083, at 12 (2023) (crediting, as “consistent with the contents of the Notice Letter in evidence,” the I.G.’s representations to the Board that it had applied a mitigating factor, where the I.G.’s ALJ brief stated that no mitigating factors should be considered) (citing Kailash C. Singhvi, M.D., DAB No. 2138, at 9-10 (2007) (recognizing and discussing I.G.’s assertion “in its brief” that the I.G. considered a mitigating factor when setting the exclusion period, where ALJ had not ruled on existence of mitigating factors), aff’d,No. 2:08-cv-00659-SJF (E.D.N.Y. Sept. 21, 2009)).  As the I.G. represents to the Board, the record evidence here indicates that the I.G. based the financial loss factor on the restitution amount, notwithstanding the references in its ALJ brief to the losses alleged in the initial indictment.  I.G. Resp. at 2-3, 7-8; I.G. Br. at 2-3, 6-9.

The ALJ Decision also mischaracterizes the I.G.’s argument on the financial loss factor as attributing to Petitioner alone the entire $57 million fraud alleged in the initial indictment of Petitioner and five other people.  The decision quotes the I.G.’s brief as “asserting that Petitioner ‘defrauded insurance providers of approximately $57,000,000,’” whereas the brief states, “Petitioner’s conviction was based on his involvement in a health care fraud conspiracy that defrauded insurance providers of approximately $57,000,000 over a 12-year period.”  Compare ALJ Decision at 11 (quoting I.G. ALJ Br. at 7) with I.G. ALJ Br. at 7 (emphasis added).  In the next sentence the I.G. brief accurately notes that Petitioner had been “ordered to pay approximately $554,300 in restitution to the victims of his offending acts,” and it then states that “restitution is an appropriate measure to demonstrate program loss.”  I.G. ALJ Br. at 7-8 (citing Summit S. Shah, M.D., DAB No. 2836, at 8 (2017)). The ALJ’s failure to acknowledge these statements in finding that “[t]he IG does not otherwise specifically state the amount of loss it used when deciding how much weight to apply to this aggravating factor” is error.  Id. at 8; I.G. Br. at 8-9; ALJ Decision at 11.

This mischaracterization of the I.G.’s argument in the ALJ’s finding that the I.G. “assigned a greater weight – potentially by many multiples – than warranted, to the financial loss aggravating factor” is also erroneous.  ALJ Decision at 11; cf. Roji Esha, DAB No. 3076, at 17-20 (2022) (reversing the ALJ’s reduction of the exclusion period as

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“based on a legally erroneous interpretation” of an aggravating factor that omitted relevant language from preamble text and inserted a “new phrase” that “is not supported by the quoted preamble passage,” resulting in “discerned intent [that] is not reflected in the preamble’s actual text”).⁸

Petitioner on appeal similarly ignores the Reviewing Official’s statement in the Notice Letter, as well as the statements in the I.G.’s ALJ brief noting that Petitioner had been ordered to pay approximately $554,300 in restitution and that restitution is an appropriate measure to demonstrate program loss.  I.G. ALJ Br. at 7-8.  Petitioner also misrepresents by omission the content of the Notice Letter:  Petitioner cites it as explaining that the exclusion was increased to 11 years based on the two aggravating factors, but in the next sentence states, “Significantly, in applying these factors, the IG cited an alleged $57,000,000 fraud even though [Petitioner] was only found to have participated in less than 1% of that cited amount.”  P. Br. at 3 (citing I.G. Ex. 1, at 2).  As noted above, the Notice Letter does not cite an alleged $57,000,000 fraud; it cites only the approximately $554,300 in court-ordered restitution, and makes no reference to any other amount of alleged loss.

Finally, the record of the exclusion prior to the I.G.’s brief contains no indication that the I.G. based the financial aggravation factor on the multi-million dollar figures alleged in the initial indictment, or on any amounts other that the “approximately $554,300” in court-ordered restitution cited in the I.G.’s Notice Letter.  Notably, “approximately $554,000” is how Petitioner, in a letter to the I.G. prior to the exclusion, described what Petitioner called “an overpayment” for services that CMA billed but did not provide (i.e., the portions of the nuclear stress tests not performed), leading to Petitioner’s conviction for conspiracy to commit health care fraud.  I.G. Ex. 7, at 2, 8 (Petitioner’s Dec. 8, 2021 letter requesting reconsideration of the Reviewing Official’s Nov. 10, 2021 notice of intent to exclude Petitioner); see 42 C.F.R. § 1001.2001 (“Notice of intent to exclude”).

Based on this record, we find that the I.G. appropriately applied the financial loss aggravating factor on the amount of restitution the court imposed, the approximately $554,000 that Petitioner reported to the I.G. as the amount billed for services not performed.  As the ALJ noted, the Board “has long recognized that restitution is an appropriate measure to demonstrate loss to a government program.”  ALJ Decision at 7 (citing Shah, M.D. at 8).  That principle applies here, where Petitioner, at the sentencing hearing, agreed that $554,331 was “the value of the medical procedures for which [Petitioner] were [sic] responsible and that were charged to Medicare or Medicaid and

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that were for services that were not actually performed,” and the sentencing judge noted, moreover, that this loss figure had been provided by Petitioner.  P. Ex. 3, at 3, 5-7.

4. We reverse the ALJ’s conclusion that the 11-year exclusion the I.G. imposed was unreasonable.

While the ALJ noted that the I.G. “did not state how much of the six-year exclusionary period increase was attributed to the financial loss aggravating factor and how much was attributed to the incarceration aggravating factor,” the ALJ clearly based the determination that the increase was unreasonable on the erroneous finding that the I.G. applied the financial loss factor using amounts far in excess of the actual amount of loss as shown by the record evidence – the “approximately $554,300” cited in the Notice Letter from the Reviewing Official.  ALJ Decision at 11.  In contrast, the ALJ found neither error in the I.G.s application of the incarceration aggravating factor nor that the I.G. had assigned a greater weight than warranted to that factor.  The ALJ Decision provides no further analysis of the reasonableness of the exclusion period the I.G. imposed other than to cite a Board decision as “finding that an eight-year exclusionary period was reasonable with a nine-month period of incarceration and $347,463 in restitution,” which amount, the ALJ observed, “is approximately equivalent to $580,000 presently” when adjusted for inflation since 2002.  Id. at 11, 11 n.2 (citing Jason Hollady, M.D., a/k/a Jason Lynn Hollady, DAB No. 1855 (2002)).

We note that the nine-month sentence in that case is less than half of the 20 months the judge imposed here, even after the judge recognized “substantial mitigating factors.”  P. Ex. 3, at 48‑50.  Hollady is also distinguishable in that the I.G. failed to prove one of the three aggravating factors the I.G. cited in imposing the 10-year exclusion, leading the Board to conclude that “some reduction in the 10-year exclusion imposed by the I.G. was required”; no analogous failure to prove an aggravating factor is present here.  DAB No. 1855, at 4, 10-11.  In any event, as the I.G. notes, the exclusion period in this case is consistent with the decisions of the Board in Shaun Thaxter, DAB No. 3053 (2021) (10-year exclusion under section 1128(a) with two aggravating factors, $500,000 financial loss and sentence of six months of incarceration) and Devon Rambert-Hairston, DAB No. 3069 (2022) (13-year exclusion under section 1128(a) with two aggravating factors, financial loss of $813,000 and sentence of 12 months and one day of incarceration), though we recognize that case comparisons “are of limited value.”  See, e.g., Eugene Goldman, M.D., a/k/a Yevgeniy Goldman, M.D., DAB No. 2635, at 11 (2015) (internal citation omitted); I.G. Br. at 11.

The Board has held that when the I.G. imposes an exclusion longer than the mandatory minimum, an ALJ reviews the record de novo “to determine what the evidence establishes as to the ‘demonstrated criteria,’ i.e., the aggravating and mitigating factors” applied to extend the exclusion.  Edwin L. Fuentes, DAB No. 2988, at 9 (2020) (citing Rosa Velia Serrano, DAB No. 2923, at 8-9 (2019), recon. denied, DAB Ruling No. 2019-

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2 (Apr. 25, 2019)), aff’d, No. 4:20-cv-00026, 2021 WL 4341115 (W.D. Va. Sept. 23, 2021); see 57 Fed. Reg. 3,298, 3,321 (Jan. 29, 1992) (“So long as the amount of time chosen by the OIG is within a reasonable range, based on demonstrated criteria, the ALJ has no authority to change it.”).  As the ALJ’s finding that the I.G. based the financial loss aggravating factor on amounts far in excess of the restitution amount was not based on substantial evidence in the record, the ALJ’s reduction of the exclusion period was not based on “demonstrated criteria,” as required.  We thus reverse the ALJ’s conclusion and consequent substitution of a shorter exclusion period.

5. Petitioner’s argument that the ALJ’s reduction of the exclusion period was insufficient provides no basis to reduce the exclusion period the I.G. imposed.

As we reverse the ALJ’s finding that the I.G. applied the financial loss aggravating factor based on amounts alleged in the initial indictment that were many multiples of the amount of the court-ordered restitution, we similarly reject Petitioner’s argument that the reduced exclusion the ALJ selected was unreasonable.  P. Br. at 11 (“The weight assigned by the ALJ to the actual amount of restitution $554,331 . . . is entirely out of line to the weight assigned to $57,000,000 which the IG used to calculate its proposed 11-year revocation.”).  According to Petitioner, it was “unreasonable for the ALJ to correct the underlying facts relating to the actual financial loss to government programs in a way that so significantly reduces the amount relating to that factor, but then only reduce the resulting exclusionary period, calculated based on that amount, by 3 years.”  Id.  As discussed above, however, the ALJ’s finding was not based on substantial evidence in the record, which shows instead that the I.G. correctly applied the financial loss aggravating factor using the amount of the court-ordered restitution. 

In light of that error, we do not address further Petitioner’s argument that the exclusion period the ALJ selected was unreasonable.  That is the standard that ALJs (and the Board) apply in reviewing the exclusion period the I.G. imposed.  42 C.F.R. §§ 1001.2007(a)(1)(ii) (excluded individual may seek ALJ hearing on whether the length of the exclusion “is unreasonable”).  As the Board has stated, “[i]n reviewing whether the length of exclusion is unreasonable, ‘the ALJ may not substitute his or her judgment for that of the I.G. or determine what period of exclusion would be better.’”  Serrano, DAB No. 2923, at 8 (quoting Richard E. Bohner, DAB No. 2638, at 2 (2015) (citations and internal quotation marks omitted), aff’d, No. 15-4088, 2016 WL 8716339 (E.D. Pa. Dec. 2, 2016)).  “Instead, the ALJ’s role is limited to considering whether the period of exclusion imposed by the I.G. was within a reasonable range, based on demonstrated criteria.”  Id. at 8-9 (Board’s emphasis) (quoting Craig Richard Wilder, DAB No. 2416, at 8 (2011)).  Such “deference to [the] I.G.’s ‘broad discretion’ in setting the length of an exclusion ‘is appropriate, given the [I.G.’s] vast experience in implementing exclusions.’”  Id. at 9 (quoting preamble to the I.G. exclusion and appeal regulations at 57 Fed. Reg. at 3,321); see also Fuentes, DAB No. 2988, at 7-9 (containing a similar holding).

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That degree of deference is not owed to adjudicators such as ALJs who hear appeals of exclusions.  See Fuentes at 9 (stating that the ALJ’s review authority “is not thus an unconstrained mandate to select any period of exclusion that may appear reasonable to the ALJ,” who “does not conduct an appellate-type inquiry into how the I.G. arrived at the particular length but determines whether the evidence presented before the ALJ by the I.G. and Appellant shows that that length is not unreasonable”).  In Frank A. DeLia, D.O., DAB No. 1620 (1997), the Board thus rejected the ALJ’s determination that “[t]he Secretary has given discretion to the adjudicator to weigh, on a case-by-case basis, the evidence which relates to aggravating and/or mitigating factors, and to decide, based on that evidence, whether an exclusion is reasonable,” and noted Board holdings that the regulations “vested discretion in the I.G. to determine the length of an exclusion as long as it was within a reasonable range.”  Id. at 6, 8 (emphasis omitted) (citing Barry D. Garfinkel M.D., DAB No. 1572 (1996), aff’d, No. 3:96-CV-00604 (D. Minn. June 25, 1997)).  Instead, by regulation our role is to consider whether the ALJ’s determination that the I.G. imposed an unreasonable exclusion period is supported by substantial evidence in the record and is free of legal error.  For the reasons explained above, it is not.

We next address Petitioner’s arguments that the exclusion period the I.G. imposed was unreasonable.  For the reasons discussed below, we conclude that the six-year extension of the exclusion period, based on two proven aggravating factors and in the absence of any regulatory mitigating factor, was not unreasonable, and we reinstate the exclusion period the I.G. imposed.⁹

6. Petitioner’s arguments that the exclusion period is unreasonable based on the conduct underlying the conviction are not consistent with the record.

Petitioner’s several arguments that the six-year extension of the exclusion period was unreasonable minimize the nature of, and Petitioner’s culpability for, the criminal conduct.  First, Petitioner argues that the criminal conviction “involved conduct that did not cause any harm to his patients or any financial loss to the government,” and that the I.G. relied on allegations in the initial indictment that “bear extraordinarily little resemblance to the eventual findings in the case” and “grossly overstated [Petitioner’s] conviction and the misconduct for which he was ultimately held responsible.”  P. Br. at

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7, 9.  Petitioner states that the conviction was not for “a healthcare fraud conspiracy that defrauded insurance providers of approximately $57,000,000 over a 12-year period,” but for “a single count of conspiracy to commit healthcare fraud for misrepresenting himself as another physician when seeking pre-authorizations for nuclear stress tests on July 11, 2013.”  Id. at 8. 

Petitioner states that “in resolving this matter, the Government expressly acknowledged that the services billed under non-rendering physicians’ names were actually performed and were medically necessary.”  P. Br. at 8.  Petitioner cites the statement, at the sentencing hearing, of the District Court Judge who presided over Petitioner’s criminal case, that “the government[] did not dispute that the millions of dollars charged for those services were for services that were actually performed and medically necessary,” and that “[t]herefore, Medicare and Medicaid received value for those services, and the value of those services would have to be subtracted from the losses to arrive at the actual loss.”  Id.; P. Ex. 3, at 4.

This argument does not address the allegations in the Superseding Information that Petitioner admitted in pleading guilty.  The transcript of the sentencing hearing shows that the judge’s comments about “services that were actually performed” concern the “millions of dollars” in losses alleged in the initial indictment of Petitioner and five other CMA employees, amounts in excess of and apart from the $554,331 that the judge ordered Petitioner to pay in restitution as part of the sentence for Petitioner’s conviction of conspiracy to commit health care fraud.  See generally P. Ex. 3.  Indeed, the Judge found that $554,331 “was the amount of the loss to the insurance companies for payments for services that were not performed” and that “[t]he amount of restitution is limited to the victims’ actual loss, and $554,331 is the amount of that loss.”  Id. at 51.  Petitioner’s counsel, moreover, made clear at the hearing that Petitioner’s claim that the patients had “received their medically necessary treatment” did not apply to the “one part of the nuclear stress test” that was billed but not performed, and that the evidence “indicates that a false billing caused an insurance, the medical insurance program to pay for services not provided.”  Id. at 26-27.  Counsel accordingly referred to “the $554,000 that is the amount of loss, the actual loss that the parties all agree to.”  Id. at 27-28.

Petitioner’s contention that the conviction was of only “a single count of conspiracy to commit healthcare fraud for misrepresenting himself as another physician when seeking pre-authorizations for nuclear stress tests on July 11, 2013,” i.e. “a very narrow factual allocution to participation in the fraud on a single date,” similarly minimizes Petitioner’s culpability and conduct in a manner inconsistent with the record.  P. Br. at 7-8 (emphasis added).  That record includes Petitioner’s admissions, cited above, of having made false physician referrals that resulted in payments of some $554,331 for portions of nuclear stress tests not performed.  Petitioner does not assert that the pre‑authorizations falsified on that one date comprised the entire $554,331 CMA was paid for services not performed.  At the sentencing hearing, Petitioner’s counsel stated that the submission of

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false claims – “the $554,000 that is the amount of loss, the actual loss” – took place over a “period dating from 2010 up until the time of the FBI raid in November of 2015,” or “[a]lmost six years.”  P. Ex. 3, at 27-28.  While counsel made this statement in arguing that the false billings represented only a portion of CMA’s total revenues during that period, it confirms that Petitioner engaged in a persistent practice of falsifying physician referrals over a lengthy period of time.

The judge found, moreover, that “[f]or about 12 years, [Petitioner] engaged in a scheme to defraud Medicare and Medicaid” and that “[t]aking into account only the services that [Petitioner] was responsible for billing that were not performed, the fraud exceeded $500,000.”  P. Ex. 3, at 48.  The judge also found that “[i]n addition to those losses, [Petitioner] was responsible for submitting false information to Medicare and Medicaid by being responsible for the submission of over $6 million in requests for reimbursement using names of doctors who were not actually responsible for the services that were performed.”  Id. at 48-49 (emphasis added).  This “billing practice,” the judge further found, “prevented Medicare and Medicaid from making the judgments as to whether the services should be approved.”  Id. at 49.  This finding indicates that Petitioner’s practice of falsifying physician referrals was not limited to the approximately $554,300 worth of claims for services not performed, but extended to at least some of the claims resulting in the millions of dollars of reimbursement cited in the initial indictment.

This record similarly does not support Petitioner’s efforts to attribute to CMA employees Petitioner’s submission of false claims that led to the conviction (and the exclusion at issue here).  See P. Br. at 11 (stating that “the $554,331 overpayment . . . was the result of incorrect coding unintentionally done by CMA’s certified coders”); P. Ex. 3, at 26 (including an argument at sentencing that Petitioner’s misdeed was “allowing for a billing and administration system that didn’t care about the truth”).  The judge, at the sentencing hearing, rejected these characterizations of Petitioner’s conduct, stating that “[e]ven taking [Petitioner’s] explanations into account, the result of this massive disinformation” – the false physician referrals – “was to prevent scrutiny of the necessity of the services being performed at the time that they were performed,” and that “[t]he gravity of the offense is heightened by the fact that [Petitioner] was the leader and organizer of the fraudulent billing scheme and drew others into the scheme.”  P. Ex. 3, at 49.  The judge also found that Petitioner “qualifies as an organizer or leader” under the sentencing guidelines.  Id. at 7.  Again, these findings by the judge indicate that Petitioner’s conduct extended to at least some of the claims underlying the millions of dollars of reimbursement cited in the initial indictment.

The judge’s assessments of Petitioner’s culpability for the criminal acts, and rejections of the efforts to downplay the extent, duration and impact of those actions and to shift responsibility to others, reflect the charges in the Superseding Information that Petitioner “willfully and knowingly would and did execute, and attempt to execute, a scheme and artifice to defraud a health care benefit program” and “participated in a scheme to defraud

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insurance providers by making materially false statements in requests for preauthorization for medical tests and procedures and in claims for payment for the provision of medical services.”  I.G. Ex. 3, at 1-2 (¶ 2).  To the extent that Petitioner admits to only actions that, on their face, are not among the criminal acts for which Petitioner was convicted, those efforts amount to a prohibited collateral attack on the basis for the conviction.  See 42 C.F.R. § 1001.2007(d).

Thus, the record indicates that, over a period of at least five years, Petitioner repeatedly falsified another physician’s referral that was required for portions of nuclear stress tests that were not performed and were charged to ten managed care programs (which, according to Petitioner, received payment for the falsely claimed services from the Medicare and Medicaid programs).  P. Ex. 3, at 9.  This record does not support Petitioner’s argument that “[t]he erroneous billings underlying [Petitioner’s] conviction are clearly an aberration to an otherwise exemplary professional life of giving and service to others.”  P. Br. at 16.

7. Petitioner asserts equitable considerations that do not warrant reduction of the exclusion period.

The purpose of an exclusion “is not to punish the wrongdoer but to protect the programs and their beneficiaries from untrustworthy providers.”  Fuentes, DAB No. 2988, at 14 (citing Patel v. Thompson, 319 F.3d 1317, 1319 (11th Cir. 2003), aff’g No. 00-00277-CV-HLM-4 (N.D. Ga. 2002), aff’g Narendra M. Patel, M.D., DAB No. 1736 (2000)); see also ALJ Decision at 9 (citing Manocchio v. Kusserow, 961 F.2d 1539, 1541-42 (11th Cir. 1992); Greene v. Sullivan, 731 F. Supp. 838, 839-40 (E.D. Tenn. 1990)) (“The purpose of any exclusion is remedial.”); Patel at 1319-20 (providing that an I.G. exclusion serves a remedial, rather than punitive, purpose, i.e., to protect the Federal health care programs from abuse).

Petitioner raises essentially equitable considerations in arguing that the exclusion is unreasonably punitive and unnecessary to protect Medicare, considerations noted by the ALJ and the Judge at sentencing.  P. Br. at 14-20.  The judge found “substantial mitigating factors” including that Petitioner “has been a very skilled interventional cardiologist with privileges at prestigious medical centers and with extremely successful results,” and acknowledged “numerous letters” and “video tributes to [Petitioner] from grateful patients.”  P. Ex. 3, at 49.  The judge also found it to Petitioner’s “credit that he has provided services to an underserved community, namely patients who are insured by Medicare and Medicaid” and “provided valuable medical services during the pandemic.”  Id.  Petitioner also reports corrective measures and staff training and oversight implemented at the practice.  P. Br. at 16; see ALJ Decision at 9 (noting Petitioner’s “laudable” aid in combatting the COVID-19 pandemic and work ethic as an interventional cardiologist serving Medicare beneficiaries).  And, the record includes letters of gratitude and appreciation of Petitioner’s volunteer services at homeless shelters

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and a U.S. Army field hospital, and for FEMA during the COVID-19 pandemic.  P. Exs. 11-17.

These circumstances, which the judge cited before imposing a sentence significantly shorter than provided by sentencing guidelines, are not among the three mitigating factors the regulations permit ALJs and the Board to consider in our limited review.  42 C.F.R. § 1001.102(c).  The Board has thus observed that “general trustworthiness is not an independent basis, i.e., independent from the specified aggravating and mitigating factors, for determining whether the period of an exclusion is unreasonable.”  Yolanda Hamilton, M.D., DAB No. 3061, at 19 (2022) (internal quotations omitted) (citing Mohamed Basel Aswad, M.D., DAB No. 2741, at 11 (2016), aff’d, No. 2:16-cv-1367-BRB-SMV, 2018 WL 704370 (D.N.M. Feb. 2, 2018)).  The Board also has “rejected arguments that considerations such as a physician’s qualifications, skill or ability as a physician, standing in the medical community, or reputation among patients ought to be considered for mitigation purposes” and “that character references ought to be considered as relevant evidence since the regulations do not recognize character as a mitigating factor.”  Id. (citing Goldman, DAB No. 2635, at 10; Laura Leyva, DAB No. 2704, at 9 (2016), aff’d, No. 8:16-CV-1986-T-27AEP, 2017 WL 2880125 (M.D. Fla. Apr. 24, 2017); Baldwin Ihenacho, DAB No. 2667, at 8 (2015)).  The Board has no authority to treat the extenuating circumstances Petitioner cites as mitigating factors in addition to those established by regulation.

Additionally, the judge imposed a significant sentence notwithstanding the mitigating factors the judge recognized, describing the offense as “extremely serious,” its “gravity . . . heightened by the fact that [Petitioner] was the leader and organizer of the fraudulent billing scheme and drew others into the scheme.”  P. Ex. 3, at 48-49.  As noted earlier, at sentencing the judge also found that Petitioner had engaged in the conduct “[f]or about 12 years,” and Petitioner’s counsel stated that the claims for tests not performed took place for “[a]lmost six years.”  Id. at 28, 48; see Leyva at 10 (concluding that participation in a fraud scheme for over two years “amply demonstrates more than a short-lived lapse in integrity”).

Our assessment of a petitioner’s trustworthiness occurs within the confines of the limited review that accords deference to the I.G.’s discretion in selecting a reasonable exclusion period.  Serrano, DAB No. 2923, at 8-9 (internal citation omitted) (deference to the I.G.’s “broad discretion” in setting the length of an exclusion is appropriate, given the I.G.’s vast experience in implementing exclusions).  In Esha, we observed recently that “on the whole, the ‘aggravating and mitigating factors reflect the degree or level of the . . . untrustworthiness’ of the excluded individual or entity.”  DAB No. 3076, at 28 (quoting Jeremy Robinson, DAB No. 1905, at 11 (2004)).  Here, the presence of the two aggravating factors alone permitted the I.G. to lengthen Petitioner’s exclusion period beyond five years, and based on the seriousness and duration of Petitioner’s conduct as

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shown by the record, we cannot conclude that the 11-year term of exclusion the I.G. imposed is unreasonable.

8. Petitioner’s other arguments do not provide grounds to find the exclusion period unreasonable, or to set an earlier effective date.

Petitioner argues that the exclusion period is “unreasonable and a clear outlier” compared to other administrative actions “arising out of the exact same underlying facts.” P. Br. at 14, 21.  Petitioner asserts that the CMS contractor reduced the revocation of Petitioner’s Medicare enrollment and billing privileges from 10 years to three years “[a]fter considering the facts underlying this matter” and also “decided to date the reenrollment bar back to February 9, 2018, the date of the conviction.”  Id. at 15 (citing P. Ex. 6).  Petitioner also reports that the New York State licensing authority “determined that a 15-month suspension followed by an automatic reinstatement, was sufficient under the circumstances.”¹⁰  Id.

The ALJ correctly found that these actions are “not mitigating factors that I am authorized to consider to reduce the period of exclusion imposed by the IG.”  ALJ Decision at 9.  The Board has rejected the argument that CMS’s revocation of billing privileges for a period shorter, and commencing earlier, than the I.G.’s exclusion, “is one more consideration weighing in favor of reducing” an exclusion period greater that the five-year exclusion minimum.  Farzana Begum, M.D., DAB No. 2726, at 18 (2016), aff’d, No. 16-CV-9624, 2017 WL 5624388 (N.D. Ill. Nov. 21, 2017).  The Board in Begum noted prior holdings that “revocation under section 424.535 and exclusion under section 1128 are distinct remedial tools, each with its own set of prerequisites and consequences for the provider or supplier.”  Id. (quoting Abdul Razzaque Ahmed, MD.,DAB No. 2261, at 13 (2009), aff’d,710 F.Supp.2d 167 (D. Mass. 2010); Dinesh Patel, M.D.,DAB No, 2551, at 9 (2013) (distinguishing revocation from exclusion, as two different types of administrative enforcement actions from two different HHS components)).  As stated there, we are not aware of, and Petitioner has not cited, any authority under which the ALJ or the Board may consider the fact of revocation for a duration shorter than the duration of the section 1128 exclusion to determine the reasonableness of the section 1128 exclusion period.  Id. at 19.  Petitioner has not cited any authority supporting the consideration of duration of billing privilege revocation or state medical license suspension/revocation actions with regard to the duration of an I.G. exclusion under section 1128.

The ALJ also did not err in finding no authority to grant Petitioner’s request to move the beginning date of the exclusion from March 20, 2022 to February 9, 2018, the beginning date of the revocation of Medicare enrollment by CMS.  ALJ Decision at 12.  The Board

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“has repeatedly held that the statute and regulations give an ALJ no authority to adjust the beginning date of an exclusion by applying it retroactively” or “to review the timing of a petitioner’s exclusion.”  Charice D. Curtis, DAB No. 2430, at 6 (2011) (quoting Randall Dean Hopp, DAB No. 2166, at 3-4 (2008)).  “[T]his lack of discretion extends to the Board.”  Hopp at 4; see Fereydoon Abir, M.D, DAB No. 1764, at 8 (2001) (noting that “a determination by a state regulatory body that the conduct in question was not only criminal but was a basis for exclusion from [Medicaid] has a bearing on trustworthiness”).  Petitioner’s equitable arguments relating to the effective date of exclusions do not authorize ALJs or the Board to ignore regulations setting it at 20 days from the date of the notice of exclusion or to alter the effective date of an exclusion.  42 C.F.R. § 1001.2002(b).  Those actions are not within our limited authority to review the basis for the exclusion and the reasonableness of the term the I.G. imposes.  Id. §§ 1001.2007(a)(1), 1005.2(a).  We also note that the effective date of a CMS revocation of Medicare enrollment based on a felony conviction is set by regulation as the date of the conviction.  Id. § 424.535(g).

Finally, we note that the revocation and the state’s suspension of Petitioner’s license are evidence of an additional aggravating factor that the I.G. could have applied but did not apply in setting the length of the exclusion.  42 C.F.R. § 1001.102(b)(9) (“The individual or entity has been the subject of any other adverse action by any Federal, State or local government agency or board if the adverse action is based on the same set of circumstances that serves as the basis for the imposition of the exclusion.”); see Sushil Aniruddh Sheth, M.D., DAB No. 2491, at 11 (2012) (stating that the I.G.’s non-citation of potential aggravating factor does not preclude the Board from “considering those circumstances in the context of the exclusion statute’s overarching concern of protecting the Medicare program from untrustworthy individuals”), appeal dismissed in part & summarily aff’d in part,No. 13-0448 (BJR), 2014 WL 11813597 (D.D.C. Jan. 10, 2014), appeal dismissed,No. 14-5179, 2015 WL 3372286 (D.C. Cir. May 7, 2015) (per curiam).

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Conclusion

We affirm the ALJ’s conclusion that the I.G. had a legal basis to exclude Petitioner under section 1128(a)(3) of the Act and to extend the exclusion period beyond the five-year minimum based on the presence of two aggravating factors, and that Petitioner did not establish any of the available mitigating factors.  We reverse the ALJ’s determination to reduce the exclusion period the I.G. imposed as not supported by substantial evidence concerning the financial loss aggravating factor.  We determine that the 11-year exclusion period the I.G. imposed is not unreasonable.

---

Endnotes

¹ The current version of the Act can be found at https://www.ssa.gov/OP_Home/ssact/ssact-toc.htm.  Each section of the Act on that website contains a reference to the corresponding United States Code chapter and section.  Also, a cross-reference table for the Act and the United States Code can be found at https://www.ssa.gov/OP_Home/comp2/G-APP-H.html.

² Background information is drawn from the ALJ Decision and the record before the ALJ and is not intended to substitute for the ALJ’s findings, though we later determine that the ALJ’s finding regarding the financial loss aggravating factor is not supported by substantial evidence.

³ Exhibits relating to Petitioner’s guilty plea and sentencing describe the charge to which Petitioner pleaded guilty as both a violation of 18 U.S.C § 371 (Conspiracy to commit offense or to defraud United States) and as a conspiracy to violate 18 U.S.C. § 1347 (Health care fraud).  The Judgment states that Petitioner was adjudicated guilty of the former violation, and also that Petitioner pleaded guilty to Count One of the Superseding Information, which charged a conspiracy to violate the latter provision.  I.G. Ex. 3, at 1-2 (¶¶ 1-2); I.G. Ex. 5, at 1.  Based on sentencing ranges, and the 20-month sentence imposed on Petitioner, a violation of either provision is classified as a felony, as required for exclusions under section 1128(a) of the Act.  18 U.S.C. § 3559(a).

⁴ The ALJ noted that the “specific amounts to be paid to the victims of financial loss” were set forth in an attachment to the Order of Restitution that “is filed under seal.”  ALJ Decision at 7 (citing I.G. Ex. 6, at 4).  At the sentencing hearing, “the parties agree[d] there were at least 10 victims,” described as “managed care insurance plan providers which had contracts with federal Medicare and Medicaid funding sources and received false bill claims from CMA.”  P. Ex. 3, at 10-12.

⁵ The record contains no indication that Petitioner was tried on or pleaded to any charges in the indictment, and the Judgment adjudicating Petitioner guilty of the count in the Superseding Information issued a year later states that “all open counts . . . are dismissed on the motion of the United States.”  I.G. Ex. 5, at 1. 

⁶ We cite Petitioner’s brief in A-23-9 as “P. Br.,” the I.G.’s response brief in that appeal as “I.G. Resp.,” and the I.G.’s brief in Docket No. A-23-10 as “I.G. Br.”  In Docket No. A-23-10, Petitioner did not file a brief in response to the I.G.’s brief, as permitted by regulation, nor respond to an email from Board staff inquiring about a response brief.  42 C.F.R. § 1005.21(c).  In A-23-9, Petitioner requested and was granted leave to withdraw Petitioner’s Proposed Exhibit A (Order of Restitution, Aug. 9, 2021) and to file “Petitioner’s Revised Brief in Support of Appeal.”  All citations and references to Petitioner’s brief in A-23-9 (P. Br.) are to the “Revised Brief.”

⁷ Petitioner provided a copy of the I.G.’s February 28, 2022 Notice Letter as “Exhibit A” to Petitioner’s initial request for an ALJ hearing, although it was not among the 18 exhibits that Petitioner later filed with the brief and that the ALJ admitted.  ALJ Decision at 2; P. Amended Ex. List.

⁸ The preamble text was from the final rule publishing the 1998 regulations that created the aggravating factor now at 42 C.F.R. § 1001.102(b)(9), that the excluded individual or entity “has been the subject of any other adverse action by any Federal, State or local government agency or board if the adverse action is based on the same set of circumstances that serves as the basis for the imposition of the exclusion.”  63 Fed. Reg. 46,676, 46,680-81, 46,685-86 (Sept. 2, 1998).

⁹ We need not remand this case to the ALJ to reassess the reasonableness of the exclusion period the I.G. imposed.  The Board has the authority to address that question and to increase the exclusion period the ALJ selected.  See 42 C.F.R. § 1005.21(g) (stating the Board may “decline to review the case, or may affirm, increase, reduce, reverse or remand any penalty, assessment or exclusion determined by the ALJ”).  Both parties have had an opportunity to brief the Board on the issue of reasonableness of the exclusion period, and neither party asked us to remand this case to the ALJ to reassess this issue.  See, e.g., Esha, DAB No. 3076, at 13, 13 n.8 (internal citations omitted) (declining to remand where ALJ’s reduction of exclusion period was based on legally erroneous interpretation of the aggravating factor at section 1001.102(b)(9)).

¹⁰ Petitioner makes these arguments in regard to the eight-year exclusion the ALJ selected, but they also apply to the 11-year exclusion the I.G. imposed.