Fiaz Afzal, M.D., DAB 3097 (2023)

FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE DECISION

Fiaz Afzal, M.D. (Petitioner) appeals the January 6, 2023 decision of an administrative law judge (ALJ), Fiaz Afzal, M.D., DAB CR6213 (ALJ Decision), upholding denials by the Centers for Medicare & Medicaid Services (CMS) of Petitioner’s Medicare enrollment applications.  The ALJ upheld CMS’s denials of enrollment based upon 42 C.F.R. § 424.530(a)(2) because Petitioner was excluded by the Inspector General (I.G.) from participation in federal health care programs on the dates Petitioner applied for enrollment.  We affirm the ALJ Decision for the reasons stated below.

Legal Background

Under the Social Security Act (Act), the Department of Health and Human Services administers the Medicare program through CMS and administrative contractors.  Act §§ 1816, 1842, 1874A.  A physician or other “supplier” must be enrolled in the Medicare program to receive payment from the program for covered items or services.  Id. § 1861(d); 42 C.F.R. §§ 400.202, 424.500, 424.505.

To enroll, a supplier must complete and submit to CMS the applicable enrollment application or an approved electronic submission.  42 C.F.R. §§ 424.502, 424.510(a)(1), (d)(1).  The enrollment process includes identifying the supplier, validating the supplier’s eligibility to provide items or services to Medicare beneficiaries, identifying and confirming the supplier’s practice location, and granting the supplier Medicare billing privileges.  Id. § 424.502.

CMS may deny a prospective supplier’s enrollment application for any reason listed in 42 C.F.R. § 424.530(a), such as when the supplier is “[e]xcluded from the Medicare, Medicaid, and any other Federal health care programs” in accordance with section 1128 of the Act.  42 C.F.R. § 424.530(a)(2)(i).

Section 1128(a)(1) of the Act requires the Secretary of Health and Human Services to exclude from participation in all federal health care programs any individual convicted of

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“a criminal offense related to the delivery of an item or service under” Medicare or any state health care program.  See also 42 U.S.C. § 1301(a)(6) (defining “Secretary”).  The Secretary’s exclusion authority is delegated to the I.G.  53 Fed. Reg. 12,993 (Apr. 20, 1988); 48 Fed. Reg. 21,662 (May 13, 1983); see also 42 C.F.R. § 1001.101(a) (implementing section 1128(a)(1) of the Act by stating that the I.G. “will exclude any individual or entity that . . . [h]as been convicted of a criminal offense related to the delivery of an item or service under Medicare or a State health care program”).

Denial of a supplier’s application for Medicare enrollment is among the specified “initial determinations” subject to administrative review under 42 C.F.R. Part 498.  See 42 C.F.R. §§ 498.3(a)(1), (b)(17); 498.5(l); Victor Alvarez, M.D., DAB No. 2325, at 3 (2010).  A dissatisfied supplier may request a “reconsidered determination” from CMS or its contractor, then a hearing on the reconsidered determination before an ALJ, then review of the ALJ’s decision by the Departmental Appeals Board (Board).  See 42 C.F.R. § 498.5(l)(1)-(3).

Case Background¹

Petitioner is a physician who pled guilty to numerous counts of Medicaid fraud in the 19th Judicial District Court of the State of Louisiana (State Court) on October 24, 2013.  ALJ Decision at 1; CMS Ex. 5, at 8, 18-19, 23-24.

On September 18, 2014, the I.G. excluded Petitioner from participation in all federal health care programs, pursuant to section 1128(a)(1) of the Act, for a minimum of five years.  ALJ Decision at 1; CMS Ex. 6; see also Resp. of CMS to P.’s Req. for Review of Decision CR6213 (CMS Br.) at 2 (citing Fiaz M. Afzal, M.D. v. The Inspector General, DAB CR3911, at 2 (2015)).²  

This case arises from Petitioner’s attempts to enroll in Medicare as a supplier in various states in 2021 and 2022.  Petitioner submitted applications for enrollment in New Jersey and Louisiana on December 23 and 27, 2021, respectively; however, CMS contractor Novitas Solutions (Novitas) denied those applications on January 10 and 12, 2022.  ALJ Decision at 2; CMS Ex. 2, at 8-13 (Application Data Report for New Jersey application), 14-19 (Application Data Report for Louisiana application); CMS Ex. 4 (denial letters).  On March 17, 2022, Petitioner applied to enroll as a supplier in Florida; however, on April 14, 2022, CMS contractor First Coast Service Options, Inc. denied that application.  

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ALJ Decision at 2; CMS Ex. 1, at 7-16 (Application Data Report); CMS Ex. 3 (denial letter).  As the reason for denial, all three letters cited 42 C.F.R. § 424.530(a)(2) and Petitioner’s September 18, 2014, exclusion by the I.G. from Medicare, Medicaid, and any other federal health care program.  ALJ Decision at 2; CMS Ex. 3, at 1; CMS Ex. 4, at 1, 4.

Petitioner requested reconsideration.  ALJ Decision at 2; CMS Ex. 1, at 1, 26-177; CMS Ex. 2, at 1, 26-177.  On June 27, 2022, CMS affirmed the denials of Petitioner’s three applications to enroll, in two separate reconsidered determinations (one of which addressed both Petitioner’s Louisiana and New Jersey applications).  ALJ Decision at 2; CMS Ex. 1, at 2-3; CMS Ex. 2, at 2-3.  CMS upheld the denial of Petitioner’s enrollment applications under 42 C.F.R. § 424.530(a)(2) because on the date Petitioner submitted each application Petitioner was excluded from participating in all federal health care programs by the I.G. under section 1128(a)(1) of the Act.  ALJ Decision at 2; CMS Ex. 1, at 2-3; CMS Ex. 2, at 2-3.

Petitioner timely requested an ALJ hearing.  ALJ Decision at 2; Request for Hearing (RFH).  Petitioner asserted few arguments directly against CMS, beyond a general contention that “[a]ll Defendants have an obligation/duty to conform to Expungement/Dismissal orders” of the State Court.  RFH at 12; see also id. at 37 (requesting that all opposing parties “be ordered to follow the Expungement orders”).  Petitioner complained that Novitas “continues to deny Medicare participation,” the denials are “based on expunged dismissed convictions issues,” and “Medicare has still not cleared Exclusion issues or reinstatement of” Petitioner.  Id. at 23, 46.  Petitioner extensively criticized the “Federation of State Medical Board” and individual state medical boards, seemingly in connection with the suspension of Petitioner’s medical license by the Louisiana State Board of Medical Examiners on August 18, 2014, and by the New Jersey Board of Medical Examiners on May 6, 2022.  Id. at 8, 14-16, 24-35, 43-45; see also CMS Ex. 1, at 17-22, 89-96.  Petitioner also sought relief from alleged acts and omissions by “Florida telehealth,” the “New Jersey Division of Consumer Affair,” the New Jersey Attorney General’s office, and other non-CMS entities.  RFH at 18, 20, 22, 27.

The ALJ issued a briefing schedule and pre-hearing order.  ALJ Decision at 2; Acknowledgment of Receipt of RFH (July 18, 2022) at 1; Standing Pre-hearing Order at 4-6.  On August 22, 2022, CMS timely filed its pre-hearing brief, styled as a motion to dismiss or for summary judgment, and submitted six proposed exhibits, including documentation that Petitioner remained excluded by the I.G. as of August 19, 2022.  ALJ Decision at 2; CMS Pre-Hr’g Br.; CMS Proposed Ex. List; CMS Exs. 1-6.  CMS moved, alternatively, either for dismissal because Petitioner “did not articulate a challenge” to CMS’s reconsidered determinations, or for summary judgment based on Petitioner’s “continuing” exclusion by the I.G.  CMS Pre-Hr’g Br. 5-6.  Petitioner submitted no timely pre-hearing exchange.

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On October 13, 2022, the ALJ denied CMS’s motion to dismiss, reserved decision on CMS’s summary judgment motion, and closed the case record.  Order (Oct. 13, 2022).  Later that same day (and seventeen days after Petitioner’s deadline for filing a pre-hearing exchange), Petitioner filed proposed exhibits.  ALJ Decision at 2.

On January 6, 2023, the ALJ issued a written decision.  After admitting all of the parties’ proffered evidence (including Petitioner’s untimely but unopposed exhibits), the ALJ decided the case on the written record and denied CMS’s summary judgment motion as moot.  ALJ Decision at 2.  The ALJ stated that there was no dispute that the I.G. in 2014 excluded Petitioner from participation in Medicare and other federally funded health care programs under section 1128(a)(1) based on a conviction for a program-related offense, and that Petitioner submitted enrollment applications while still excluded.  Id. at 4.  The ALJ recognized that 42 C.F.R. § 424.530(a)(2)(i) permits CMS to deny an excluded supplier’s enrollment application.  Id.  Therefore, the ALJ held that CMS had a factual and legal basis to deny Petitioner’s enrollment in Medicare.  Id.  The ALJ considered and rejected Petitioner’s “wide-ranging” arguments as having “no bearing on the issue before me and generally seek[ing] relief I do not have the authority to provide.”  Id.

On January 22, 2023, Petitioner submitted to the Board a document entitled, in part, “Motion to Remand Case C-22-655 to District Court,” which the Board treated as a request for review of the ALJ Decision.  Request for Review (RR) at 4.³  The Board informed Petitioner that the contents of a request for review must comply with 42 C.F.R. § 498.82(b) and allowed Petitioner to file a supplemental submission by March 7, 2023.⁴  See Acknowledgment Letter (Jan. 24, 2023) at 1-2.  The next day, Petitioner submitted supplemental briefing (the contents of which still did not comport with the requirements of section 498.82(b)).  See Suppl. Statement (Suppl.).  CMS timely filed a responsive brief.  See CMS Br.  Petitioner filed a reply.  See Resp. Statement (P. Reply).

Standard of Review

In cases proceeding under 42 C.F.R. Part 498, the Board reviews disputed factual issues to determine whether the ALJ’s decision is supported by substantial evidence in the record as a whole, and reviews disputed legal issues to determine whether the ALJ decision is erroneous.  See Guidelines – Appellate Review of Decisions of Administrative Law Judges Affecting a Provider’s or Supplier’s Enrollment in the Medicare Program (Guidelines), “Completion of the Review Process,” ¶ (c), available at https://www.hhs.gov/about/agencies/dab/different-appeals-at-dab/appeals-to-board/guidelines/enrollment/index.html.

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Analysis

A. The ALJ’s determination that CMS had a legitimate basis to deny Petitioner’s Medicare enrollment applications pursuant to 42 C.F.R. § 424.530(a)(2) is supported by substantial evidence and free of legal error.

The record establishes that the I.G. excluded Petitioner on September 18, 2014, and had not granted reinstatement by the time Petitioner submitted Medicare enrollment applications on December 23, 2021 (for New Jersey), December 27, 2021 (for Louisiana), and March 17, 2022 (for Florida).  See ALJ Decision at 1-2, 4 n.2; CMS Ex. 1, at 2, 6; CMS Ex. 2, at 2-3, 6.  Petitioner shows no factual error in the ALJ’s findings and establishes no legal error in the ALJ’s determination that CMS had a lawful basis under 42 C.F.R. § 424.530(a)(2) for denying Petitioner’s enrollment applications.⁵

“So long as an ALJ finds that CMS has shown that one of the regulatory bases for
denying a supplier’s Medicare enrollment application set out in the reconsideration
determination exists, the ALJ (and the Board on appeal) may not refuse to apply the
regulation and must uphold the denial.”  Robert Tomlinson, M.D., DAB No. 2916, at 5 (2018), aff’d sub nom. Tomlinson v. Azar, No. 19-cv-05114, 2020 WL 376657 (W.D. Ark. Jan. 23, 2020).  Where CMS is legally authorized to deny an enrollment application, ALJs and the Board are not empowered to substitute their own discretion for that of CMS or its contractors as to how to exercise the power to deny enrollment.  Edward J.S. Picardi, M.D., DAB No. 3045, at 16 (2021); Stephen White, M.D., DAB No. 2912, at 14 (2018).

The ALJ’s conclusion that CMS had a legitimate basis, under 42 C.F.R. § 424.530(a)(2), to deny Petitioner’s enrollment as a supplier in the Medicare program, based on Petitioner’s continuing exclusion by the I.G. on the dates of application, is supported by substantial evidence and is not legally erroneous.

B. Petitioner’s arguments state no valid basis for relief.  

A careful review of the entirety of Petitioner’s lengthy submissions before the Board reveals no factual or legal grounds for the relief that Petitioner requests.  Concerning the ALJ Decision, Petitioner raises only two charges of error that the Board can address, and

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neither is a basis for reversal.  First, Petitioner complains that CMS “did not follow the expungement orders” and “[t]his issue was not addressed at all,” which we interpret as a claim that the ALJ failed to address the alleged expungement of Petitioner’s criminal conviction.  See RR at 5; Suppl. at 3-4; P. Reply at 3-4.  Second, Petitioner complains that the “ALJ incorrectly states that it is beyond the jurisdiction of [the] ALJ to provide relief on such action of CMS,” that is, “non compliance with expungement orders.”  RR at 5-6; Suppl. at 4; P. Reply at 4; see also P. Reply at 6 (stating that if Petitioner’s issues “are not before DAB then these issues should be remanded/directed to sent to NJ federal court system”).

These arguments reflect Petitioner’s misunderstanding of the issues the Board has jurisdiction to consider in this appeal, and the relief the Board is empowered to render.  The ALJ committed no legal error in determining that the “voluminous and wide-ranging arguments” that Petitioner raised had “no bearing on” whether CMS had a lawful basis to deny Petitioner’s enrollment applications, see ALJ Decision at 4, for several reasons.

One reason that the alleged expungement of Petitioner’s criminal conviction has no bearing on this matter is that CMS did not base its enrollment denials on Petitioner’s conviction, whether expunged or not.  Instead, CMS denied enrollment under 42 C.F.R. § 424.530(a)(2) based on the I.G.’s exclusion of Petitioner from Medicare and other federal health care programs under section 1128(a)(1) of the Act.  Therefore, even a proven expungement of Petitioner’s conviction would not invalidate Petitioner’s undisputed exclusion from Medicare as of the submission dates of the enrollment applications.

A second reason that the alleged expungement of Petitioner’s criminal conviction has no bearing on this matter is that Petitioner did not submit timely proof of the alleged expungement.  CMS – not Petitioner – submitted an exhibit described as “State Court minutes for State of Louisiana v. Fiaz Afzal, MD,” which included a “Chronological History Report” that mentioned expungement.  See CMS Proposed Ex. List; CMS Ex. 5, at 11-12, 27.  The Report contains a January 22, 2015 entry stating, “DEFENDANT’S MOTION AND ORDER TO SET ASIDE CONVICTION AND DISMISS PROSECUTION PURSUANT TO LOUISIANA CODE OF CRIMINAL PROCEDURE ARTICLE 893 IS GRANTED.”  CMS Ex. 5, at 11, 27.  However, the Report’s only express references to expungement are notations of “EXPUNGEMENT FILED” on both August 25, 2015, and June 2, 2016, and (between those two dates) a January 29, 2016 notation of “EXPUNGEMENT COMPLETE.”  Id. at 11-12.  These enigmatic entries do not constitute an expungement order or clear proof of the existence and terms of one.

A third reason that the alleged expungement of Petitioner’s criminal conviction has no bearing on this matter is that, even if it were proven, it is immaterial.  The I.G.’s exclusion of Petitioner is not under review here, but if it were, a criminal conviction can serve as the basis for an I.G. exclusion “regardless of . . . whether the judgment of

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conviction or other record relating to the criminal conduct has been expunged.”  Act § 1128(i)(1).  Thus, even a proven expungement could not erase either the I.G.’s authority to exclude Petitioner based on the underlying conviction, or CMS’s authority to deny Petitioner’s enrollment applications based on that exclusion.  Moreover, there is no evidence that the I.G. ever reinstated Petitioner before Petitioner submitted the enrollment applications in December 2021 and March 2022.  See 42 C.F.R. §§ 1001.3001 (requiring excluded individual to apply for reinstatement by the I.G. following an exclusion), 1001.3002(d) (providing that reinstatement will not be effective until the I.G. grants the request and provides notice).  Regardless of any expungement (or application for reinstatement), there is no dispute that Petitioner remained excluded by the I.G. when Petitioner attempted to enroll in Medicare.  See CMS Ex. 6 (indicating that Petitioner remained excluded as of August 19, 2022); RFH at 46 (requesting that the I.G. be ordered to “properly look into the issue of reinstatement which should otherwise be granted”); see also ALJ Decision at 4 n.2.

All other issues that Petitioner renews before the Board are unavailing.  Petitioner’s allegation that CMS is relitigating a “[c]losed license” case misconstrues CMS’s denials of Petitioner’s enrollment applications, which CMS based on the I.G.’s exclusion of Petitioner, not on separate state proceedings concerning Petitioner’s medical licensure.  See RFH at 8; RR at 7-8; Suppl. at 6; P. Reply at 8.  Petitioner’s allegations of wrongdoing by New Jersey and Louisiana state medical boards and other state agencies amount to collateral attacks on decisions by non-federal administrative bodies that neither the ALJ nor the Board has authority to review.  See RFH at 8, 15-16; RR at 7, 12-13; Suppl. at 12-13; P. Reply at 13-14.  “[T]he regulations governing this proceeding authorize hearing and appeal rights only with respect to specific federal agency determinations.”  Douglas Bradley, M.D., DAB No. 2663, at 16 (2015) (citing 43 C.F.R. §§ 498.3, 498.5); accord Cheryl Ackerman, MD, DAB No. 3050, at 17 (2021).  “Nothing in those regulations, or in the Medicare statute, even remotely suggests that they were intended to provide a forum to collaterally challenge adverse decisions by federal or state courts or non-federal regulatory bodies.”  Bradley at 16; accord Ackerman at 17.

The ALJ appropriately decided the only issue that the ALJ was authorized to resolve:  whether CMS had a lawful basis to deny Petitioner’s Medicare enrollment applications under 42 C.F.R. § 424.530(a)(2).  “The ALJ’s (and the Board’s) role in an appeal of CMS’s denial or revocation of enrollment in the Medicare program is to determine whether CMS had a legal basis for its action,” and if so, “then we are bound to affirm the denial.”  Dr. Robert Kanowitz, DAB No. 2942, at 4 (2019); see also Letantia Bussell, M.D., DAB No. 2196, at 13 (2008).  The Board is “not authorized to reverse CMS’s enrollment denial that, we conclude, was permitted by the applicable regulations.”  Kanowitz at 7.

The ALJ did not err in concluding that CMS had a lawful basis, under 42 C.F.R. § 424.530(a)(2)(i), for denying Petitioner’s applications for enrollment.

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C. Petitioner’s newly raised arguments and newly submitted evidence are not properly before the Board.  

The Board cannot and does not consider any remaining issues that Petitioner attempts to raise for the first time before the Board, without having previously raised them before the ALJ.  “A party appearing before the Board is not permitted to raise on appeal issues that could have been raised before the ALJ but were not.”  Meadowmere Emergency Physicians, PLLC, DAB No. 2881, at 15 (2018) (citing Guidelines, “Completion of the Review Process,” ¶ (a)); accord Angela Johnson, DAB No. 3042, at 9 (2021).  These unpreserved, and thus barred, issues include any contention that Petitioner’s exclusion by the I.G. is invalid or defunct.  See RR at 6 (asserting that the “ALJ incorrectly affirms [the] CMS exclusion order which expired 5 years after 2014”).

The Board also does not admit into the decisional record certain proffered evidence that Petitioner did not present before the ALJ, as the Board cannot admit or consider any new evidence at this stage of Petitioner’s appeal.  See 42 C.F.R. § 498.86(a); Guidelines, “Development Of The Record On Appeal,” ¶ (f).  “In provider or supplier enrollment appeals,” including this one, “the Board may not admit evidence into the record in addition to the evidence introduced at the ALJ hearing (or the documents considered by the ALJ if the hearing was waived).”  White at 10.  Petitioner’s newly submitted documents appear in three filings by Petitioner on January 22, January 25, and March 4 of 2023.⁶  We recognize that some of this documentation, if timely presented to the ALJ, might have been relevant to supporting Petitioner’s argument regarding the existence and details of an expungement order concerning Petitioner’s criminal conviction record.  Yet Petitioner bears the responsibility for submitting that documentation too late; “[t]he time to have proffered evidence on any factual matter was at the time of reconsideration,” or, at latest, before the ALJ “upon a showing of good cause for producing it for the first time at that level.”  Sheetal Kumar, M.D., P.A., DAB No. 2965, at 10 n.4 (2019).

Therefore, the identified documents are retained in the administrative record, but the Board does not admit them as evidence or consider their contents in rendering this decision.  However, even if these documents were admissible – which they are not – they would not affect our conclusions, explained above, that CMS had a legitimate basis (independent of Petitioner’s conviction) for denial of Medicare enrollment pursuant to 42 C.F.R. § 424.530(a)(2), and Petitioner states no valid basis for relief.

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Conclusion

We affirm the ALJ’s January 6, 2023 decision and uphold CMS’s denials of Petitioner’s Medicare enrollment applications submitted on December 23, 2021, December 27, 2021, and March 17, 2022.

Endnotes

¹ The facts in this section are drawn primarily from the ALJ Decision, but also, as appropriate, from the administrative record as a whole.  See “Standard of Review,” infra.

² DAB CR3911 is published at https://www.hhs.gov/sites/default/files/static/dab/decisions/alj-decisions/2015/cr3911.pdf (last visited May 18, 2023).

³ We cite to Petitioner’s unpaginated filings by their PDF page numbers.

⁴ Section 498.82(b) requires that a request for review of an ALJ decision “specify the issues, the findings of fact or conclusions of law with which the party disagrees, and the basis for contending that the findings and conclusions are incorrect.”

⁵We observe that the ALJ Decision does not expressly discuss Petitioner’s application for Medicare enrollment in Louisiana.  See CMS Ex. 2, at 14-19.  Regardless, there is no material difference among Petitioner’s Medicare enrollment applications (which were all submitted while Petitioner remained excluded), and the ALJ’s analysis upholding the enrollment denials under section 424.530(a)(2)(i) applies to all of them.  Petitioner’s request for review raised no issue about the ALJ Decision’s silence concerning the Medicare application for Louisiana, so the Board need not and does not consider that issue further.  See Guidelines, “Completion of the Review Process,” ¶ (a) (“The Board will not consider issues not raised in the request for review. . . .”).

⁶Specifically, the previously unsubmitted documents appear in filings entitled:  “nj_medicaid_exclusion” (Jan. 22, 2023) at 1 and 10-12; “Prescribed_Claim_Issue_Dept_of_Health” (Jan. 25, 2023); and “DETAILS_EXPUNGEMENT_ORDERS_FIAZ_AFZAL_MD” (Mar. 4, 2023).