Vincent Koh, M.D., DAB CR5262 (2019)

DECISION

Petitioner, Vincent Koh, M.D., is a physician, licensed to practice in the State of New York.  He owned a medical practice that specialized in the care and treatment of cancer patients.  He pled guilty to one count of receiving in interstate commerce and delivering a misbranded drug.  Based on his guilty plea, the Inspector General (IG) has excluded him for five years from participating in Medicare, Medicaid, and all federal health care programs, as authorized by section 1128(a)(1) of the Social Security Act (Act).  Petitioner appeals the exclusion.  For the reasons discussed below, I find that the IG properly excluded Petitioner Koh and that the statute mandates a minimum five-year exclusion.

Background

In a letter dated September 28, 2018, the IG notified Petitioner that he was excluded from participating in Medicare, Medicaid, and all federal health care programs for a period of five years because he had been convicted of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  The letter explained that section 1128(a)(1) of the Act authorizes the exclusion.  IG Ex. 1.

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Petitioner timely requested review.

The IG submitted a written argument (IG Br.) and six exhibits (IG Exs. 1-6).  Petitioner responded to the IG’s brief (P. Br.) and submitted 12 exhibits (P. Exs. 1-12).  The IG filed a reply.

In the absence of any objections, I admit into evidence IG Exs. 1-6 and P. Exs. 1-12.

The parties agree that an in-person hearing is not necessary.  IG Br. at 8; P. Br. at 19.

Discussion

Petitioner must be excluded from program participation for a minimum of five years because he was convicted of a criminal offense related to the delivery of an item or service under Medicare.  Act § 1128(a)(1).1

Under section 1128(a)(1) of the Act, the Secretary of Health and Human Services must exclude an individual who has been convicted under federal or state law of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  42 C.F.R. § 1001.101(a).

Petitioner Koh was a physician who maintained a private medical practice, specializing in the care and treatment of cancer patients.  IG Ex. 3 at 4.  His practice purchased oncology drugs from a Canadian company that sold drugs obtained from foreign sources.  The drugs were less expensive than those sold in the United States, but they were not approved by the Food and Drug Administration (FDA), did not include the same ingredients as the approved drugs, did not include directions for use, and did not meet FDA labeling requirements.  IG Ex. 3 at 3-5.  Petitioner Koh prescribed these drugs to his New York patients and, in some instances, billed the Medicare program for the drugs and for administering them.  IG Ex. 3 at 4; IG Ex. 5 at 4.

Petitioner was charged with one count of receiving in interstate commerce and delivering a misbranded drug.  IG Ex. 2.  He pled guilty, admitting that he received and distributed drugs that the Food and Drug Administration had not approved for distribution or use in the United States.  IG Ex. 3 at 3.  On May 21, 2018, the federal district court for the Northern District of New York accepted Petitioner’s plea and entered judgment against him.  IG Ex. 4.

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While the criminal action was pending, the United States Attorney for the Northern District of New York brought a parallel civil action, alleging violations of the federal False Claims Act.  Petitioner Koh also settled that action.  Among other admissions, he agreed that:

• his patients included individuals covered by the Medicare program;
• he prescribed non-approved drugs to his patients;
• Medicare generally pays for FDA-approved drugs only;
• a physician who submits a claim for a covered drug represents that the drug administered is an FDA-approved drug; and
• he “submitted or caused to be submitted knowingly false claims for payment to Medicare Part B for payment of non-FDA-approved drugs and for the administration of such drugs.”

IG Ex. 5 at 1, 4.  Petitioner agreed to pay the United States $500,000 in settlement, “of which $250,000 constitutes restitution.”  IG Ex. 5 at 4.

There is no doubt that the Petitioner’s False Claims Act settlement is tied directly to his criminal conviction.  In the sentencing memorandum he submitted to the criminal court, he pointed out that, as part of the civil action, he paid the government $500,000, so any additional fine would be “redundant and thoroughly unnecessary.”  IG Ex. 6 at 4.

Petitioner, nevertheless, maintains that his crime was not “related to” the delivery of an item or service under Medicare or a state healthcare program.  He argues that I may not consider the evidence adduced during the civil proceedings because civil proceedings require a lesser burden of proof than criminal proceedings.  Petitioner cites no direct support for this non sequitur of an argument, but lists cases in which the program connection was established by the criminal record.  Obviously, where the record of a conviction establishes the connection, the relatedness standard is met; but it does not follow that the connection can be established through the record of the conviction alone.  In fact, it is well-settled that, in determining whether a conviction is program-related, I may look beyond the four corners of the criminal court record, and consider extrinsic evidence to determine the facts and circumstances underlying a conviction.  42 C.F.R. § 1005.17(g) (evidence of “crimes, wrongs, or acts other than those at issue in the instant case is admissible in order to show motive, opportunity, intent, knowledge, preparation, identity, lack of mistake, or existence of a scheme”); Janet R. Constantino, DAB No. 2666 at 7-8 (2015) (holding that the basis for the underlying conviction may be established by judicial records or other probative evidence); Narendra M. Patel, M.D., DAB No. 1736 (2000) (stating that the Departmental Appeals Board has “repeatedly”

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held that the basis for an exclusion need not appear in the court records, but may be demonstrated “by extrinsic evidence of the underlying facts and circumstances . . . .”, aff’d, Patel v. Thompson, 319 F.3d 1317 (11th Cir. 2003).

Pointing to the “strict liability” nature of his misdemeanor conviction, Petitioner suggests that it shows that he did not intend to violate the law and therefore poses no risk to program integrity.  I find two problems with this position:  1) as a factual matter, he admitted in the False Claims Act settlement that he “knowingly” submitted the false claims to the Medicare program; and 2) the exclusion statute “does not require any knowledge on the part of a petitioner of the relationship between the offense and the program but only that the factual relationship between the offense and the program exist . . . .”  Lyle Kai, R. Ph., DAB No 1979 at 5 (2005), aff’d, Kai v. Leavitt, No. 05‑00514 BMK (D. Haw. July 17, 2006).

Finally, Petitioner submits evidence (letters from colleagues and patients) attesting to his good character and skills as a physician and discussing the impact his exclusion will have on his patients.  P. Exs. 11, 12.  Such arguments are not relevant.  My authority is constrained by the regulations, and I may not review the IG’s determination to impose a mandatory exclusion “on the ground that the excluded person is a good person or well-thought of in the profession or suffering from the loss of his/her vocation.”  Donna Rogers, DAB No. 2381 at 6 (2011).

Because his criminal conviction was directly related to the delivery of services under the Medicare program, Petitioner is subject to exclusion.  An exclusion brought under section 1128(a)(1) must be for a minimum period of five years.  Act § 1128(c)(3)(B); 42 C.F.R. § 1001.2007(a)(2).

Conclusion

The IG properly excluded Petitioner from participating in Medicare, Medicaid and other federal health care programs, and I sustain the five-year exclusion.