Eva Misra, DAB CR6633 (2025)

DECISION

Respondent, the Inspector General of the United States Department of Health and Human Services (IG), excluded Petitioner, Eva Misra, from participation in Medicare, Medicaid, and all other federal health care programs for five years pursuant to section 1128(a)(3) of the Social Security Act (Act).  As explained below, I affirm the IG’s exclusion determination. 

I. Case Background and Procedural History

By letter dated July 31, 2024, the IG notified Petitioner of her exclusion from participation in Medicare, Medicaid, and all other federal health care programs pursuant to section 1128(a)(3) of the Act for a period of five years.  IG Exhibit (Ex.) 1.1  The IG based her exclusion action on Petitioner’s felony conviction of a criminal offense in the U.S. District Court for the Eastern District of Kentucky (District Court) “related to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct in 

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connection with the delivery of a health care item or service, or with respect to any act or omission in a health care program (other than Medicare and a State health care program) operated by, or financed in whole or in part, by any Federal, State or local government agency.”  Id. at 1. 

Petitioner timely sought review of her exclusion before an administrative law judge (ALJ) in the Civil Remedies Division.  Upon my designation to hear and decide this case,  I held a pre-hearing conference by telephone with counsel for the parties on October 30, 2024, the substance of which is summarized in my October 31, 2024 Order Summarizing Pre-hearing Conference and Setting Briefing Schedule (Summary Order).  See 42 C.F.R. § 1005.6.  Among other things, I directed the parties to file pre-hearing briefs articulating their respective arguments and identifying witnesses and exhibits in support thereof.  Summary Order at 4. 

Pursuant to that order, the IG filed a brief (IG Br.) and five exhibits (IG Exs. 1-5).  Petitioner filed a brief (P. Br.) and two exhibits (P. Exs. 1-2).  The IG subsequently filed a reply brief (IG Reply). 

II. Admission of Exhibits and Decision on the Record

Neither party has objected to the other party’s exhibits.  I therefore admit all proposed exhibits into the record.  42 C.F.R. § 1005.8(c); Civ. Remedies Div. P. § 14(e). 

Neither party proposed witnesses or believes a hearing to be necessary.  IG Br. at 11; P. Br. at 9.  Accordingly, I proceed to a decision based on the briefs submitted and the exhibits of record.  Civ. Remedies Div. P. § 19(d). 

III. Issue

Whether the IG had a basis to exclude Petitioner from participating in Medicare, Medicaid, and all other federal health care programs for five years under 42 U.S.C. § 1320a-7(a)(3).  See 42 C.F.R. § 1001.2007(a)(1). 

IV. Applicable Law

The Secretary must exclude from participation in Medicare, Medicaid, and all federal health care programs any individual who has been convicted, under Federal or State law, of a criminal offense that occurred after August 21, 1996, consisting 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.  42 U.S.C. § 1320a-7(a)(3); 42 C.F.R. § 1001.101(c)(1). 

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An individual has been “convicted” of a criminal offense within the meaning of the Act when there has been “a finding of guilt . . . [or] when a plea of guilty or nolo contendere by the individual . . . has been accepted by a Federal, State, or local court.”  42 U.S.C. § 1320a-7(i)(2)-(3).  The Act does not distinguish between misdemeanor and felony convictions.  There may be no collateral attack of the conviction that provides the basis for the exclusion.  42 C.F.R. § 1001.2007(d).

Section 1128(c)(3)(B) of the Act (42 U.S.C. § 1320a-7(c)(3)(B)) provides that an exclusion imposed under section 1128(a) of the Act (42 U.S.C. § 1320a-7(a)) shall be for a minimum period of five years.  Exclusion is effective 20 days from the date the IG issues the notice of exclusion.  42 C.F.R. § 1001.2002(b).  The period of exclusion may be extended based on the presence of specified aggravating factors.  42 C.F.R. § 1001.102(b).  Mitigating factors are considered as a basis for reducing the period of exclusion only if aggravating factors justify an exclusion of longer than five years.  42 C.F.R. § 1001.102(c). 

Section 1128(f) of the Act (42 U.S.C. § 1320a-7(f)) provides Petitioner with rights to an administrative hearing and judicial review of the final action of the Secretary of Health and Human Services (Secretary).  The right to a hearing before an ALJ is set forth in 42 C.F.R. §§ 1001.2007(a) and 1005.2, while the rights of both the sanctioned party and the IG to participate in a hearing are specified by 42 C.F.R. § 1005.3. 

The standard of proof is a preponderance of the evidence.  42 C.F.R. § 1001.2007(c).  Petitioner bears the burden of proof and the burden of persuasion on any affirmative defenses or mitigating factors, while the IG bears the burden on all other issues.  42 C.F.R. § 1005.15(b). 

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

My conclusions of law are set forth in bold and followed by pertinent findings of fact and analysis. 

1. A. Petitioner’s request for hearing was timely, and I have jurisdiction.

There is no dispute that Petitioner timely sought appeal of an exclusion action taken against her by the IG.  I therefore have jurisdiction to hear and decide this case.  42 U.S.C. § 1320a-7(f)(1); 42 C.F.R. §§ 1001.2007(a)(1)-(2), 1005.2(a). 

1. B. There is a basis for Petitioner’s exclusion pursuant to section 1128(a)(3) of the Act.

Exclusion from participation in Medicare, Medicaid, and all other federal health care programs is mandated by section 1128(a)(3) of the Act where an individual has been 

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convicted, under Federal or State law, of a criminal offense that occurred after August 21, 1996, consisting 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.  42 U.S.C. § 1320a-7(a)(3); 42 C.F.R. § 1001.101(c)(1).  The IG has established these elements by a preponderance of the evidence. 

1. 1. Relevant Facts

Petitioner was a physician licensed to practice in Tennessee who worked at EHC Medical Offices.  IG Ex. 2 at 2.  In that capacity, she issued prescriptions for controlled substances to EHC patients.  Id.  EHC ordered urine drug testing for patients for whom Petitioner and other doctors prescribed controlled substances, a necessary corequisite to prescribe certain medications to those suffering from opioid addiction.  Id.  

Petitioner knew that EHC repeatedly caused the submission of false claims for urine drug testing that were not reimbursable.  Id. at 2-3.  Specifically, she knew other physicians at EHC ordered medically unnecessary urine drug testing for patients which benefited EHC because those tests were subsidized by state health care benefit programs, meaning patients could then afford to pay EHC what they otherwise could not.  Id.  Petitioner was aware the testing laboratory and EHC shared in the proceeds of this fraudulent billing scheme.  Id.  Those funds were further distributed to EHC physicians, including Petitioner.  Id.  Petitioner received $17,907 from EHC knowing some of the funds she received resulted from the fraudulent billing scheme.  Id. 

On March 4, 2021, a grand jury in the Eastern District of Kentucky indicted Petitioner and several others for various crimes related to the scheme described above.  IG Ex. 4.  On June 2, 2023, the U.S. Attorney for that district filed a superseding information charging Petitioner with one count of knowingly engaging and attempting to engage in a monetary transaction involving criminally derived property exceeding $10,000 where that amount derived from a conspiracy to engage in a scheme to defraud health care benefits programs, in violation of 18 U.S.C. § 1957.2   IG Ex. 3 at 2.  The government alleged Petitioner committed this criminal act on or about April 8, 2016.  Id.  The government also identified property belonging to Petitioner it believed to be forfeited to the United States because of its involvement in her criminal offense, namely $280,000 seized from a bank account held by Petitioner.  Id. 

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That same day, the government and Petitioner filed a plea agreement wherein she pleaded guilty to the one-count superseding information and stipulated to the scheme described above.3   IG Ex. 2.  Petitioner also agreed to forfeit the $280,000 the government seized from her because it was involved in the criminal offense to which Petitioner pleaded guilty.  Id. at 5.  The District Court accepted Petitioner’s guilty plea and imposed judgment against her on October 10, 2023.  IG Ex. 5.  The court sentenced Petitioner to four months’ incarceration followed by a two-year period of supervised release.  Id. at 2‑3.  The court also imposed a $10,000 fine with a $100 special assessment and ordered forfeiture to the United States of Petitioner’s property described in the forfeiture allegation in the information to which she pleaded guilty, namely $280,000.  IG Ex. 3 at 2; IG Ex. 5 at 6‑7. 

2. 2. Petitioner was convicted under federal or state law of a criminal offense that occurred after August 21, 1996.

Petitioner does not dispute her conviction of an offense committed after August 21, 1996.  P. Br. at 1.  The IG has established this element by a preponderance of the evidence. 

3. 3. Petitioner’s criminal offense is related to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct within the meaning of section 1128(a)(3) of the Act.

The Act requires Petitioner to be excluded from participation in federal health care programs if she was convicted of an offense related to “fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct.”  42 U.S.C. § 1320a-7(a)(3).  The term “related to” simply means that there must be a nexus or common-sense connection.  See Quayum v. U.S. Dep’t of Health & Human Servs., 34 F. Supp. 2d 141, 143 (E.D.N.Y. 1998); see also Friedman v. Sebelius, 686 F.3d 813, 820 (D.C. Cir. 2012) (describing the phrase “related to” in another part of section 1320a-7 as “deliberately expansive words,” “the ordinary meaning of [which] is a broad one,” and one that is not subject to “crabbed and formalistic interpretation”) (internal quotation marks omitted). 

The IG asserts Petitioner’s offense of conviction for money laundering is “necessarily” financial misconduct that relates to financial misconduct within the meaning of the Act.  IG Br. at 6.  Petitioner does not appear to dispute this.  P. Br. at 2.  Any effort to do so would be unsuccessful.  The criminal offense Petitioner admitted to committing prohibits knowingly engaging or attempting to engage in a “monetary transaction in criminally derived property” of a value exceeding $10,000 that is “derived from specified unlawful activity.”  18 U.S.C. § 1957(a). 

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By pleading guilty to this offense, Petitioner admitted she engaged in a monetary transaction of property derived from unlawful activity – an act of financial misconduct.  I therefore have no difficulty concluding Petitioner’s offense of conviction related to “fraud, theft, embezzlement, breach of fiduciary responsibility or other financial misconduct,” within the meaning of 42 U.S.C. § 1320a-7(a)(3). 

4. 4. Petitioner’s criminal offense was committed in connection with the delivery of a health care item or service.

The parties dispute whether Petitioner committed her offense of conviction in connection with the delivery of a health care item or service.  The IG asserts this connection exists because the funds received by Petitioner derived from payments made for fraudulent urine drug testing.  IG Br. at 8.  Petitioner contends there is no nexus between her acceptance of funds from EHC and the fraudulent submission of claims made by other physicians at EHC.  P. Br. at 4.  Petitioner points out that “no part of [her conduct] resulted in or contributed to those false claims or the proceeds from those claims.”  Id. 

Petitioner emphasizes she herself did not order unnecessary tests, had no managerial, supervisory, or billing responsibilities, and had no part in establishing EHC’s policies or protocols.  Id. at 4-5.  As Petitioner puts it, she simply received a payment from a place of employment where other physicians engaged in the fraudulent acts warranting exclusion under the Act.  Id. at 5.  Petitioner argues it would be unreasonable to extend the Act’s exclusion mandate to health care providers like her who simply worked in the same location as others who engaged in fraudulent activity.  Id.  

Petitioner’s arguments appear well-taken but ultimately fail.  First, she mischaracterizes her role.  As the admissions she made to resolve the criminal charge against her attest, she was not an innocent bystander as she now claims.  Petitioner admitted the funds she received derived from a scheme to submit fraudulent claims to state health care programs.  IG Ex. 2 at 3.  Given her awareness of a scheme to fraudulently bill state health care programs and the pecuniary benefit she gained as a result, Petitioner cannot evade exclusion simply because she did not directly submit those false claims or cause them to be submitted.  Ellen L. Morand, DAB No. 2436 at 9 (2012) (“For a crime to be committed ‘in connection with the delivery of a health care item or service,’ the conduct underlying the criminal offense does not necessarily have to involve actual delivery . . . of a health care item or service to the patient or beneficiary.”) (citing Charice D. Curtis, DAB No. 2430 at 5 (2011)). 

Instead, the Act more broadly demands Petitioner’s exclusion if she committed her criminal conduct “in connection with” the delivery of a health care item or service.  That is the salient issue here.  The Departmental Appeals Board has interpreted the phrase “in connection with” to require only a “common sense connection” between the circumstances of the offense and the delivery of a health care item or service.  W. Scott 

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Harkonen, M.D., DAB No. 2485 at 7 (2012) (citing Morand, DAB No. 2436 at 9; Curtis, DAB No. 2430 at 5).

Here, the clear and common-sense connection between Petitioner’s criminal conduct and the delivery of a health care item or service is evident.  It would in fact be difficult to understand Petitioner’s conduct as criminal without that connection.  Petitioner admitted that she prescribed certain medications to EHC patients along with the other physicians.  IG Ex. 2 at 2.  She knew EHC routinely ordered urine drug tests in their names to facilitate the ongoing prescription of these medications.  Id.  She knew EHC repeatedly caused the submission of false and fraudulent claims for these urine drug tests to state health care programs for reimbursement and that EHC patients were thereby able to afford additional treatment at EHC.  Id. at 2-3.  Petitioner’s criminal offense – receiving a share of the proceeds she knew derived from fraudulent submissions to state health care programs for the delivery unnecessary services – is not merely connected to but could not have occurred without the delivery of health care services.  

Petitioner’s offense conduct was not only criminal within its own right but also allowed her employer and other physicians to persist in their scheme by seeing returning patients who could not have obtained their prescriptions without state health care programs paying for their urine drug testing.  IG Ex. 2 at 2-3.  By receiving payouts from EHC that derived from what she knew to be false and fraudulent claims, Petitioner aided in perpetuating the scheme by laundering its proceeds.4  The fact that her own criminal offense conduct aided in the submission of false claims to state health care benefits programs is another strong indicator of its connectedness to those submissions.  

In short, Petitioner’s offense of conviction did not occur in isolation from the scheme EHC and other physicians enacted to submit false claims to state health care programs.  Petitioner’s role in knowingly accepting proceeds from that scheme is sufficient to warrant her exclusion withing the meaning of 42 U.S.C. § 1320a-7(a)(3).  See Benny R. 

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Bailey, DAB No. 2935 at 8-9 (2019) (holding that even where a petitioner was not a health care provider, his money laundering offense was sufficiently connected to the delivery of a health care item or service to warrant exclusion because he knowingly deposited proceeds resulting from the dispensing of illegitimate prescriptions). 

1. C. Petitioner must be excluded for a minimum of five years.

Because I have concluded a basis exists to exclude Petitioner under 42 U.S.C. § 1320a-7(a)(3), Petitioner must be excluded for a minimum period of five years.  42 U.S.C. § 1320a-7(c)(3)(B); 42 C.F.R. §§ 1001.102(a), 1001.2007(a)(2).  Neither I nor the IG may reduce the period of exclusion below five years.  Id. 

VI. Conclusion

For the foregoing reasons, I affirm the IG’s determination to exclude Petitioner for five years from participating in Medicare, Medicaid, and all federal health care programs pursuant to 42 U.S.C. § 1320a-7(a)(3).