Duriel Donnell Gray, DAB CR6543 (2024)

DECISION

The Inspector General (IG) of the United States Department of Health and Human Services excluded Petitioner, Duriel Donnell Gray, from participation in Medicare, Medicaid, and all other federal health care programs based on his conviction of a criminal offense related to the delivery of a health care item or service under Medicare or a state health care program.  For the reasons discussed below, I conclude that the IG has a basis for excluding Petitioner because he pleaded guilty to conspiracy to pay and receive health care kickbacks which is a conviction for a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  I affirm the 7-year exclusion period.  I also affirm that the effective date of Petitioner’s exclusion is February 20, 2024.

I.      Background

In a letter dated January 31, 2024, the IG excluded Petitioner from participation in Medicare, Medicaid, and all federal health care programs as defined in section 1128B(f) of the Social Security Act (Act) (42 U.S.C. § 1320a-7b(f)) for a minimum period of 10 years, effective 20 days from the date of the letter.  IG Ex. 1 at 1.  The IG explained

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that Petitioner’s exclusion was based on a “conviction” (as defined in section 1128(i) of the Act), in the United States District Court, Northern District of Georgia, Atlanta Division, of a criminal offense related to the delivery of an item or service under the Medicare or a State health care program, including the performance of management or administrative services relating to the delivery of items.  IG Ex. 1 at 1.  The IG explained that Petitioner was excluded pursuant to section 1128(a)(1) of the Act, which mandates the exclusion of any individual who is convicted under federal or state law of a criminal offense related to the delivery of an item or service under Medicare or any state health care program.  IG Ex. 1 at 1; see 42 U.S.C. § 1320a-7(a)(1).  The IG informed Petitioner that the exclusion was for “a minimum period of 10 years.”  IG Ex. 1 at 1; see 42 U.S.C. § 1320a-7(c)(3)(B).

An Amended Notice of Exclusion was issued on May 7, 2024.  IG Ex. 3 at 1.  The exclusion period was reduced to 7 years as a result of Petitioner’s cooperation with Federal or State officials.  IG Ex. 3 at 1. The period remained longer than the statutory minimum of five years based on the presence of the following two aggravating factors:  1) The acts resulting in the conviction, or similar acts, caused, or were intended to cause, a financial loss to a Government program or one or more entities of $50,000 or more; and 2) The acts that resulted in the conviction, or similar acts, were committed from about August 2017 to about December 2018.  IG Ex. 1 at 1; see 42 C.F.R. § 1001.102(b).  As discussed above, the IG did consider one mitigating factor.  IG Ex. 3; see 42 C.F.R. § 1001.102(c).

Petitioner filed a timely request for hearing on March 29, 2024.  The case was assigned to Administrative Law Judge Jacinta Alves.  Thereafter, the Civil Remedies Division issued a standing pre‑hearing order.  On May 8, 2024, Judge Alves presided over a telephonic pre-hearing conference and issued an order summarizing the conference.

The IG, through counsel, filed a brief and six proposed exhibits (IG Exs. 1-6).  Petitioner filed a brief (P. Br.) and six proposed exhibits (P. Exs. 1-6).  In the absence of any objections, I admit the parties’ exhibits into evidence.  Neither party has submitted the written testimony of any witnesses, and therefore, a hearing is unnecessary for the purpose of cross-examination of any witnesses.  Further, Petitioner specifically states in his pre-hearing exchange that an oral hearing was not requested.  P. Br. at 1.  

This case was transferred to me on September 6, 2024.  I will decide this case on the written submissions and documentary evidence.

II.     Issues

Whether there is a basis for exclusion, and if so, whether the 7-year exclusion that the IG has imposed is unreasonable.  42 C.F.R. § 1001.2007(a)(1).

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III.    Jurisdiction

I have jurisdiction to adjudicate this case.  42 U.S.C. § 1320a-7(f)(1); 42 C.F.R. § 1005.2.

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

1. There is a basis for the mandatory exclusion.

On February 9, 2022, a District Court accepted Petitioner’s guilty plea for conspiracy to pay and receive health care kickbacks, and he was ordered to pay $417,200.40 in restitution to various healthcare programs including Georgia Medicaid.

The conduct underlying the conviction for conspiracy to pay and receive health care kickbacks involved Petitioner ordering tests or services for students that he did not have a physician-patient relationship with as required by Georgia Medicaid.

Section 1128(a)(1) of the Act requires a mandatory exclusion from all federal health care programs under certain conditions.¹  Section 1128(a)(1) states:

(a) Mandatory exclusion

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

(1) Conviction of program-related crimes--

Any individual or entity that has been convicted of a criminal offense related to the delivery of an item or service under title XVIII or under any State health care program.

See also 42 U.S.C. § 1320a-7(a)(1).

The IG contends that she excluded Petitioner from all federal health care programs based on his conviction for an offense that was related to the delivery of a health care item or service under Medicare or a state health care program.  IG Br. at 5-7.  As explained

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below, I find that Petitioner was convicted of a criminal offense for purposes of the Act that mandates exclusion from all federal health care programs.

On January 6, 2022, the United States filed a one-count information charging that Petitioner engaged in a conspiracy to pay and receive health care kickbacks, in violation of 18 U.S.C. § 371.  IG Ex. 5.  On February 9, 2022, the District Court accepted Petitioner’s agreement with the United States to enter a guilty plea to Count One of the information.  IG Ex. 6 at 1.  Petitioner acknowledged that he acted as the medical director for Do It for the Hood (D4H) and was paid $3,000 a month for that role.  IG Ex. 5 at 7.  He further acknowledged that he provided a standing order allegedly certifying the medical necessity of urine samples for students participating in the D4H program.  IG Ex. 5 at 7.  The orders for medically unnecessary urine samples were then sent to the lab which then submitted claims to Georgia Medicaid.  IG Ex. 5 at 7-8.  Eventually, an audit was conducted and Petitioner acknowledged that he signed a letter falsely claiming that all individuals identified in the audit were his patients and for whom medical records existed, when he knew that none did.  IG Ex. 5 at 11.  Petitioner recognized that he was pleading guilty to a charge that was punishable by up to five years of imprisonment.  IG Ex. 6 at 4; see 18 U.S.C. § 3559.

On April 13, 2023, a United States District Judge imposed a sentence that included a two-year period of probation.  IG Ex. 2 at 2.  The District Judge also ordered that Petitioner pay $417,200.40 in restitution to the victims of his crime—including Georgia Medicaid.  IG Ex. 2 at 5-6.

An individual is convicted within the meaning of the Act when a plea of guilty or nolo contendere by the individual is accepted by a Federal, State or local court.  42 U.S.C. § 1320a-7(i)(3); 42 C.F.R. § 1001.2(c).  Petitioner has a criminal conviction for conspiracy to pay and receive health care kickbacks, and he admitted that Georgia Medicaid was a victim of his crimes.  IG Exs. 2, 5.  Congress, through enactment of the Act, determined that an individual who has been convicted of a criminal offense related to the delivery of an item or service under Medicare or a state health care program must be excluded from federal health care programs for no less than five years, and it afforded neither the IG nor an administrative law judge the discretion to impose an exclusion of a shorter duration.  42 U.S.C. § 1320a-7(c)(3)(B).  Petitioner has a criminal conviction, and his actions caused the Georgia Medicaid program to pay for services that were not medically necessary.  IG Ex. 5.  Further, in his response brief, Petitioner concedes that his conviction was related to the delivery of an item or service under Medicare or Medicaid and that he is subject to the five-year mandatory minimum exclusion.  P. Br. at 5.

Therefore, exclusion is mandated for a minimum period of five years based on section 1128(a)(1) of the Act.

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2. A 7-year minimum exclusion is not unreasonable based on the presence of two aggravating factors and one mitigating factor.

The Act requires a minimum exclusion period of five years when the exclusion is mandated under section 1320a-7(a).  42 U.S.C. § 1320a-7(c)(3)(B).  In this case, exclusion is required under section 1320a-7(a)(1), and therefore Petitioner must be excluded for a minimum of five years.  The IG increased the minimum exclusion period from five years to 7 years based on her consideration of two aggravating factors and one mitigating factor.  IG Exs. 1, 3.  The IG has the discretion to impose an exclusion longer than the minimum period when there are aggravating factors present.  See 42 C.F.R. § 1001.102.

The IG asserts that the presence of two aggravating factors and one mitigating factor warrants an exclusion for 7 years.  IG Br. at 6-9.  The first aggravating factor is that the loss to a government program or other entity as a result of Petitioner’s criminal conduct was greater than $50,000.  IG Br. at 7-8; 42 C.F.R. § 1001.102(b)(1); see IG Ex. 5 at 8-9.  The second aggravating factor is that the acts that resulted in the conviction, or similar acts, were committed over a period of one year or more, occurring from approximately August 2017 until December 2018.  IG Br. at 8-9; 42 C.F.R. § 1001.102(b)(2); see IG Ex. 5 at 6.  Although Petitioner disputes the 7-year length of the exclusion, he has not demonstrated that the IG erroneously or improperly applied these aggravating factors or that she failed to consider his cooperation as a mitigating factor.

Petitioner was ordered to pay $417,200.40 in restitution.  IG Ex. 2 at 5.  Petitioner’s plea agreement acknowledges that he was part of a conspiracy that caused Georgia Medicaid to pay out at least $400,000 for fraudulently submitted drug tests.  IG Ex. 5 at 9.  Despite this, Petitioner argues that he did not cause or intend to cause this financial loss to a government program.  P. Br. at 6.  However, this argument is without merit.  The IG may consider the entire amount of the restitution when relying on this aggravating factor, regardless of a finding of joint or several liability.  42 C.F.R. § 1001.102(b)(1).  Laura Leyva, DAB No. 2704 at 9-10 (2016); see Yolanda Hamilton, DAB No. 3061 at 12 (2022) (“[T]here need be only evidence of financial loss to a government program of a minimum of $50,000 to apply the aggravating factor to lengthen the mandatory minimum exclusion period.”).  In this case, the amount of restitution is approximately eight times the $50,000 threshold amount that triggers consideration of the aggravating factor, and the IG had a reasonable basis to lengthen the exclusion based on this factor.

With respect to the duration of the acts that resulted in Petitioner’s conviction, Petitioner was convicted of conspiracy to pay and receive health care kickbacks from approximately August 2017 through December 2018.  IG Br. at 8-9.  Petitioner argues in response that he was unaware of any criminal wrongdoing until December 2018.  P. Br. at 6-7.  However, Petitioner’s actions leading to his conviction were not a one-time lapse in judgment.  Rather, Petitioner received approximately $3,000 each month for providing a

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standing order for services for patients he had no physician-patient relationship with at the time.  IG Ex. 5 at 9-11.  Further, Petitioner agreed that the conspiracy he was involved with took place from August 2017 through December 2018 when he signed the plea agreement.  IG Ex. 5 at 6.  The IG properly considered the length of the acts that resulted in Petitioner’s conviction.  See IG Br. at 8 (“The purpose of the aggravating factor addressing the length of criminal conduct ‘is to distinguish . . . petitioners whose lapse in integrity is short-lived from those who evidence a lack of such integrity over a longer period of time.’”), citing Donald A. Burstein, PhD, DAB No. 1865 at 8 (2003).

Evidence of aggravation may be offset by evidence of mitigation if it relates to one of the factors set forth at 42 C.F.R. § 1001.102(c).  The IG considered Petitioner’s cooperation as a mitigating factor when she reduced Petitioner’s exclusion from 10 years to 7 years.  IG Br. at 9.

The 7-year period of Petitioner’s exclusion is not unreasonable based on the two aggravating factors present in this case and one mitigating factor.  The amount of loss caused by Petitioner’s criminal conduct is substantial and is more than eight times the threshold $50,000 amount of loss necessary to trigger consideration of this aggravating factor.  In addition, Petitioner’s criminal activity lasted for more than one year.  Petitioner’s cooperation with Federal or State officials was taken into account and weighed against the two aggravating factors.  I conclude that the IG’s imposition of a minimum period of exclusion for 7 years is not unreasonable.  42 C.F.R. § 1001.2007(a).

3. The effective date of Petitioner’s exclusion is February 20, 2024.

The effective date of the exclusion, February 20, 2024, is 20 days after the date of the IG’s January 31, 2024 letter and is established by regulation.  42 C.F.R. § 1001.2002(b).  I am bound by that regulation, and despite Petitioner’s arguments to the contrary, have no authority to adjust the date.  42 C.F.R. § 1005.4(c)(1); see Anthony Joseph Moschetto, D.O., DAB No. 3030 at 13 (2021).

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V.     Conclusion

For the foregoing reasons, I affirm the IG’s decision to exclude Petitioner from participation in Medicare, Medicaid, and all other federal health care programs for a minimum period of 7 years, effective February 20, 2024.

Endnotes

¹  While there are slight differences in the wording of Section 1128 of the Act and its codification at 42 U.S.C. § 1320a-7, the two authorities are substantively identical, and I refer to them interchangeably.  I further note that the Secretary of the Department of Health and Human Services has delegated to the IG the authority “to suspend or exclude certain health care practitioners and providers of health care services from participation in these programs.”  48 Fed. Reg. 21,662 (May 13, 1983); see also 42 C.F.R. § 1005.1.