Dr. Guillermo Munoz, DAB CR5108 (2018)

Department of Health and Human Services
Civil Remedies Division

Docket No. C-18-284
Decision No. CR5108


The Centers for Medicare & Medicaid Services (CMS), acting through its Medicare administrative contractor, Novitas Solutions (Novitas), denied Dr. Guillermo Munoz’s (Petitioner’s) Medicare enrollment application pursuant to 42 C.F.R. § 424.530(a)(3) and 42 C.F.R. § 424.530(a)(4).  Novitas found that:  1) Petitioner was convicted of a felony that it determined was detrimental to the best interests of the Medicare program and its beneficiaries; and 2) Petitioner failed to report final adverse actions, including suspension of his medical license and prior revocation from the Medicare program, on his enrollment application.  Petitioner challenges the enrollment denial.

For the reasons set forth below, I find that there is no genuine dispute as to any material fact and that CMS is entitled to judgment affirming the denial of Petitioner’s enrollment application based on his submission of false or misleading information on the enrollment application.  Accordingly, I grant summary judgment in favor of CMS.

I.  Background and Procedural History

Petitioner is a physician practicing medicine in New Jersey.  CMS Exhibit (Ex.) 2 at 8.  Petitioner was arrested and charged with health care claims fraud in the third degree in

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violation of N.J. Stat. Ann. § 2C:21-4.3.  CMS Ex. 1 at 1; Petitioner Exhibit (P. Ex.) 2 at 1.  Specifically, Petitioner was charged with receiving payments above fair market value for rental of office space to a diagnostic imaging group in exchange for referring his patients to that group for any diagnostic imaging services, which is a violation of N.J. Admin. Code § 13:35-6.17(c)(1).  CMS Ex. 1 at 6.  Petitioner entered into a plea agreement with the New Jersey Office of the Attorney General.  Id. at 3‑4.  Pursuant to the plea agreement, Petitioner was to plead not guilty to the criminal charge and enter a State‑approved pre‑trial intervention program for a minimum of one year, pay restitution, complete community service, and execute a Consent Order with the State Board of Medical Examiners.  Id.  The Consent Order suspended Petitioner’s license to practice medicine for 10 months.  Id.  Petitioner signed the Consent Order on October 7, 2015.  Id. at 5‑15.  On October 29, 2015, the Superior Court of New Jersey, County of Morris, Criminal Division, entered an Order of Postponement in Petitioner’s case.  P. Ex. 3.  The Order of Postponement indicates that it occurred in the context of “Pretrial Intervention” pursuant to N.J. Stat. Ann. § 2C:43‑12 &13.  P. Ex. 3 at 1.  Petitioner did not enter a plea of guilty or nolo contendere to the charge.  Id.; see also CMS Ex. 1 at 3.  On October 29, 2016, the State dismissed the charge, with prejudice, following Petitioner’s successful completion of pre‑trial intervention.  P. Ex. 7.

Based on the suspension of Petitioner’s medical license, Novitas revoked Petitioner’s Medicare billing privileges effective October 7, 2015, and issued a one‑year reenrollment bar beginning January 16, 2016.  CMS Ex. 3 at 1‑3; P. Ex. 4 at 1‑3.  Upon reconsideration, Novitas upheld the revocation and one‑year reenrollment bar, but changed the effective date of the revocation to November 25, 2015.  CMS Ex. 3 at 11‑14; P. Ex. 8 at 13‑15.

After Petitioner’s reenrollment bar was lifted, Petitioner applied for reenrollment in Medicare by completing a Form CMS‑855I:  Medicare Enrollment Application – Physicians and Non‑Physician Practitioners (Enrollment Application).  CMS Ex. 4 at 27; P. Ex. 9 at 27.  Petitioner subsequently submitted an amended Enrollment Application to correct information concerning his billing company.  CMS Ex. 5; P. Ex. 10.  Section 3 of the Enrollment Application instructs applicants to report “all applicable final adverse actions . . . regardless of whether any records were expunged or appeals are pending.”  See, e.g., CMS Ex. 4 at 13.  The instructions provide that an applicant must report the following adverse actions, among others:  “1.  [a]ny revocation or suspension of a license to provide health care by any State licensing authority . . . 5.  [a]ny Medicare revocation of any Medicare billing number.”  Id.  Petitioner responded “No” on both applications to the question “[h]ave you . . . ever had a final adverse legal action listed on page 12 of this application imposed against you?”  See CMS Exs. 4 at 14, 5 at 14; P. Exs. 9 at 14, 10 at 14.  Additionally, Petitioner signed certification statements attesting that the information

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contained in the applications was true, correct, and complete.  See CMS Exs. 4 at 27, 5 at 27; P. Exs. 9 at 27, 10 at 27.

By letter dated June 8, 2017, Novitas denied Petitioner’s enrollment application pursuant to 42 C.F.R. § 424.530(a)(3) based on his participation in the pre‑trial intervention program and pursuant to 42 C.F.R. § 424.530(a)(4) based on his failure to report that his medical license had been suspended and his Medicare enrollment revoked.  CMS Ex. 6 at 1‑3; P. Ex. 13.  Petitioner sought reconsideration.  CMS Ex. 6 at 4‑5; P. Ex. 17 at 1‑2.  Novitas upheld the enrollment denials pursuant to 42 C.F.R. § 424.530(a)(3) and (a)(4).  P. Ex. 14.

Petitioner timely filed a request for hearing and the case was assigned to me.  I issued an Acknowledgment and Pre‑Hearing Order (Pre‑Hearing Order) on December 8, 2017, establishing a schedule for the parties to file briefs and documentary evidence.  Pursuant to the Pre‑Hearing Order, CMS submitted a Motion for Summary Judgment (CMS Br.) and six exhibits (CMS Exs. 1‑6).  Petitioner filed a brief in response (P. Br.), along with eighteen exhibits (P. Exs. 1‑18).  Neither party objected to the exhibits offered by the opposing party.  Accordingly, in the absence of objection, I admit CMS Exs. 1‑6 and P. Exs. 1‑18 into the record.

Petitioner offered his own written direct testimony as P. Ex. 18.  As my Pre-Hearing Order explained, I will hold a hearing only if a party offers admissible written direct testimony and the opposing party requests cross-examination.  Pre-Hearing Order ¶ 10.  In the present case, CMS has not requested to cross‑examine Petitioner; thus, a hearing is not necessary.  Moreover, a hearing is not necessary because I grant CMS’s motion for summary judgment.

II.  Issues

The issues in this case are:

Whether CMS is entitled to summary judgment; and

Whether CMS had a legitimate basis to deny Petitioner’s Medicare enrollment application.

III.  Jurisdiction

I have jurisdiction to hear and decide this case.  42 C.F.R. §§ 498.3(b)(17), 498.5(l)(2); see also Social Security Act (Act) § 1866(j)(8) (codified at 42 U.S.C. § 1395cc(j)(8)).

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IV.  Discussion

A. Statutory and Regulatory Background

As a physician, Petitioner is a prospective supplier of health care services for purposes of the Medicare program.  See Act § 1861(d) (42 U.S.C. § 1395x(d)); 42 C.F.R. §§ 400.202 (definition of supplier), 410.20(b)(1).  In order to participate in the Medicare program as a supplier, an individual must meet certain criteria to enroll and receive billing privileges.  42 C.F.R §§ 424.505, 424.510.  CMS may deny a prospective supplier’s enrollment application for any reason stated in 42 C.F.R § 424.530.

CMS or its contractor may deny a prospective supplier’s enrollment application for Medicare billing privileges for providing false or misleading information, among other reasons:

(4)  False or misleading information.  The provider or supplier has submitted false or misleading information on the enrollment application to gain enrollment in the Medicare program.  (Offenders may be referred to the Office of Inspector General for investigation and possible criminal, civil, or administrative sanctions.)

42 C.F.R. § 424.530(a)(4).

B. Conclusions of Law and Analysis

1. Summary judgment is appropriate in this case.1

An administrative law judge may resolve a case, in whole or in part, by summary judgment.  See, e.g., Lebanon Nursing & Rehab. Ctr., DAB No. 1918 at 3 (2004).  Summary judgment is appropriate and no hearing is required where either:  there are no genuine disputes of material fact and the only questions that must be decided involve application of law to the undisputed facts; or the moving party prevails as a matter of law even if all factual disputes are resolved in favor of the party against whom the motion is made.  Mission Hosp. Reg’l Med. Ctr., DAB No. 2459 at 5 (2012) (and cases cited therein).  In determining whether there are genuine issues of material fact for trial, the reviewer must view the evidence in the light most favorable to the non‑moving party, drawing all reasonable inferences in that party’s favor.  Id.  The party requesting summary judgment bears the burden of showing that there are no genuine issues of material fact for trial and/or that it is entitled to judgment as a matter of law.  Id.  Generally, the non‑movant may not defeat an adequately supported summary judgment

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motion by relying upon the denials in its pleadings or briefs but must furnish evidence of a dispute concerning a material fact, i.e., a fact that would affect the outcome of the case if proven.  Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300 at 3 (2010) (and cases cited therein); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

CMS moves for summary judgment only on the ground that Petitioner’s application included false or misleading information, in violation of 42 C.F.R. § 424.530(a)(4).  CMS Br. at 6‑10.  I conclude that summary judgment is appropriate in this case as it pertains to CMS’s determination to deny Petitioner’s enrollment application pursuant to 42 C.F.R. § 424.530(a)(4).  There are no genuine disputes of material fact.  The issues raised by Petitioner must be resolved against him as a matter of law and the case can be resolved by applying the law to the undisputed facts.  For purposes of summary judgment, I draw all inferences in favor of Petitioner.  Even though not material to the outcome, I accept as true that Petitioner received conflicting and often confusing information from Novitas.  P. Br. at 1‑5.  I further accept as true that Petitioner had no intention to provide false or misleading information on his application based on his assumption that “given his ongoing discussions and written communications, including repeated disclosures” about his revocation and re‑enrollment bar, Novitas was aware of these issues.  Id. at 10.  However, even if these facts are true, summary judgment is still appropriate.

2. The undisputed facts show that Petitioner did not disclose on his enrollment application that his license to practice medicine had been suspended or that his Medicare enrollment and billing privileges had previously been revoked; accordingly, CMS had a legal basis to deny Petitioner’s application to enroll in the Medicare program under 42 C.F.R. § 424.530(a)(4).

Under 42 C.F.R. § 424.530(a)(4), CMS may deny a prospective Medicare supplier’s enrollment application if the prospective supplier submitted false or misleading information on the application.  Here, it is undisputed that Petitioner’s medical license was suspended for 10 months pursuant to the Consent Order he entered into with the State Board of Medical Examiners.  CMS Ex. 1 at 5‑15.  It is further undisputed that Petitioner’s Medicare billing privileges were revoked as a direct result of his license suspension.  CMS Ex. 3.  Nonetheless, on both of his enrollment applications, Petitioner indicated that he had no final adverse actions to report.  CMS Exs. 4 at 14; 5 at 14.  Each prospective supplier who files an enrollment application must certify that the application is accurate, and the prospective supplier is responsible for all of the contents of that application.  Facundo B. Dovale, M.D., DAB CR4952 at 2 (2017).  By indicating that he had no final adverse actions to report, Petitioner submitted false and misleading information on his Medicare enrollment application.

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Petitioner argues that he did not intend to submit false or misleading information because he was under the impression that Novitas was aware of his prior license suspension and revocation and thus, he had no further need to report this information again.  P. Br. at 10.  However, an appellate panel of the Departmental Appeals Board has held that a supplier may be found to have violated Medicare enrollment requirements without regard to his subjective intent:  “[sanction] does not require proof that [a supplier] subjectively intended to provide false information, only proof that [he] in fact provided misleading or false information that [he] certified as true.”  Mark Koch, D.O., DAB No. 2610 at 4 (2014) (emphasis in original).  Moreover, Petitioner has the burden to disclose adverse legal actions; it is not the contractor’s duty to draw inferences or make deductions.  Dovale, DAB CR4952 at 3.  The only issue here is whether CMS had a lawful basis to deny Petitioner’s enrollment application.  The undisputed facts show that Petitioner submitted an application without disclosing his license suspension or prior Medicare revocation.  CMS therefore had a sufficient basis to deny the application.

To the extent Petitioner argues that denial of his enrollment application is “inequitable” because “he did not intend to provide false or misleading information” (P. Br. at 10‑11), I may not consider this argument.  Similarly, there is no basis to “evaluate” Petitioner’s argument “in light of Novitas’ and [CMS’s] own errors throughout this lengthy ordeal.”  P. Br. at 10.  I have no authority to grant Petitioner equitable relief.  US Ultrasound, DAB No. 2302 at 8 (2010).

3. I need not decide whether CMS had a legitimate basis to deny Petitioner’s enrollment application under 42 C.F.R. § 424.530(a)(3).

Having concluded that CMS had a legitimate basis to deny Petitioner’s enrollment application based on his submission of false and misleading information, I need not decide whether CMS also had a basis to deny Petitioner’s enrollment application under 42 C.F.R. § 424.530(a)(3), based on an alleged felony conviction.2 It is unnecessary for

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me to do so because the enrollment denial under 42 C.F.R. § 424.530(a)(4) is supported by the record.  See, e.g., Daniel Wiltz & Family Healthcare Clinic, APMC, DAB No. 2864 at 12 (2018) (if one basis for sanction is established, CMS’s action would be sustained “regardless of any additional bases”).  Thus, even if I were to conclude that CMS did not have a basis to deny Petitioner’s enrollment application based on 42 C.F.R. § 424.530(a)(3) because he was not convicted of a felony offense, this would not result in a favorable outcome for Petitioner.  For these reasons, I do not decide whether CMS had a legal basis to deny Petitioner’s enrollment application based on a felony conviction in accordance with 42 C.F.R. § 424.530(a)(3).

V.  Conclusion

For the foregoing reasons, I affirm CMS’s determination to deny Petitioner’s application for Medicare enrollment and billing privileges.

  • 1. My conclusions of law appear as headings in bold italic type.
  • 2. To establish a basis to deny enrollment pursuant to 42 C.F.R. § 424.530(a)(3), CMS must show, among other things, that an individual was convicted of a felony offense within the preceding 10 years.  The regulation defines conviction by cross-referencing the definition at section 1128(i) of the Act.  Section 1128(i)(4) provides that an individual who enters into a “deferred adjudication” arrangement is “convicted.”  There is some authority for the proposition that a “deferred prosecution” is not equivalent to a “deferred adjudication” and therefore is not a “conviction” for purposes of section 1128(i).  See Travers v. Shalala, 20 F.3d 993, 997 (9th Cir. 1994).  While the record is not fully developed on this issue, it could be argued that disposition of Petitioner’s criminal case under N.J. Stat. Ann. § 2C:43-12 is a “deferred prosecution” arrangement, rather than a “deferred adjudication” arrangement.  If so, then the disposition of his criminal case may not represent a conviction under 42 C.F.R. § 424.530(a)(3).