Neda Mehrabani a/k/a Neda Mehrabani Ladjevardi, DAB CR6651 (2025)

DECISION

The Inspector General (IG) of the United States Department of Health and Human Services excluded Petitioner, Neda Mehrabani, also known as Neda Mehrabani Ladjevardi, from participation in Medicare, Medicaid, and all other federal health care programs based on her conviction of a criminal offense that was related to the delivery of a health care item or service under Medicare.  For the reasons discussed below, I conclude that the IG has a basis for excluding Petitioner because she has a conviction for  health care fraud, with the victim of her crime being the Medicare program.  The IG has proven three aggravating factors, and no mitigating factors are present.  A 21-year exclusion, effective October 20, 2024, is not unreasonable.

I.  Background

In a letter dated September 30, 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 21 years, effective 20 days from the date of the letter.  IG Ex. 1 at 1.  The IG explained the following bases for excluding Petitioner:

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The [IG] is imposing this exclusion under section 1128(a)(1) of the Act, due to your conviction (as defined in section 1128(i) of the Act), in the United States District Court, Central District of California, of a criminal offense related to the delivery of an item or service under Medicare or a State health care program, including the performance of management or administrative services relating to the delivery of items or services under any such program.

IG Ex. 1 at 1.  The IG informed Petitioner that the exclusion was for “a minimum period of 21 years.”  IG Ex. 1 at 1; see 42 U.S.C. § 1320a-7(c)(3)(B).  The IG extended the exclusion period from the statutory minimum of five years to 21 years based on the presence of the following three 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, with approximately $2,465,700.00 in court-ordered restitution; 2) the acts that resulted in the conviction, or similar acts, were committed over a period of one year or more, from “about June 2018 to about June 2022”; and 3) the sentence imposed by the court included incarceration, specifically, 30 months of incarceration.  IG Ex. 1 at 1; see 42 C.F.R. § 1001.102(b).  The IG did not cite any mitigating factors.  IG Ex. 1; see 42 C.F.R. § 1001.102(c).

Petitioner filed a timely request for an administrative law judge (ALJ) hearing that was received on October 29, 2024.  Thereafter, the Civil Remedies Division issued my Standing Pre-Hearing Order.  On November 21, 2024, I presided over a telephonic pre-hearing conference, and the following day I issued an order summarizing the conference.

The IG, through counsel, filed a brief and four proposed exhibits (IG Exs. 1-4), along with a reply brief.  Petitioner filed a brief (P. Br.).  In the absence of evidentiary objections, I admit IG Exhibits 1-4 into the evidentiary record.

Neither party has submitted the written testimony of any witnesses, nor has a party provided notice that it is unable to provide the written direct testimony of an essential witness.  See Standing Pre-Hearing Order § 14.  An in-person hearing for the purpose of cross-examination of witnesses is therefore unnecessary.  See Standing Pre-Hearing Order §§ 15, 16.  This matter is ready for a decision on the merits of the written record.

II.  Issues

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

III.  Jurisdiction

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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 Analysis1

1. Petitioner was convicted of a program-related crime, in that her criminal offense was related to the delivery of a health care item or service under the Medicare program, which subjects her to a mandatory exclusion from all federal health care programs for a minimum period of five years.

Subsection 1128(a)(1) requires a mandatory exclusion from all federal health care programs under certain conditions.2  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.

42 U.S.C. § 1320a-7(a)(1).

As explained 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 for a minimum period of five years.

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On June 12, 2023, the United States Attorney for the Central District of California filed a one-count information charging that Petitioner committed health care fraud, in violation of 18 U.S.C. § 1347.  IG Ex. 2.  The information detailed that Petitioner was a chiropractor in the State of California and owned Health Clinic of Southern California, Inc.  IG Ex. 2 at 1.  The information charged that “[i]rrespective of the services provided, or whether any services were, in fact, provided, [Petitioner] submitted and caused to be submitted false and fraudulent claims to Medicare for chiropractic services,” utilizing a billing code for services she knew “had not been provided as represented and were not medically necessary.”  IG Ex. 2 at 4-5.  The information charged that Petitioner submitted approximately $3,332,365.00 in “false and fraudulent claims” and “received approximately $2,465,771.61 in payments on those claims.”  IG Ex. 2 at 5.

In May 2024, Petitioner, with the assistance of counsel, signed a plea agreement in which she agreed to enter a guilty plea to the health care fraud offense charged by information.  IG Ex. 3; see IG Ex. 2.  Petitioner certified the following:  “I am satisfied with the representation of my attorney in this matter, and I am pleading guilty because I am guilty of the charge and wish to take advantage of the promises set forth in this agreement, and not for any other reason.”  IG Ex. 3 at 18.  Petitioner also agreed to the following:  “Defendant understands and acknowledges that as a result of pleading guilty pursuant to this agreement, defendant will be excluded from Medicare, Medicaid, and all Federal health care programs.”  IG Ex. 3 at 4.

On December 1, 2024, a District Judge imposed judgment based on Petitioner’s guilty plea to the single-count information.  IG Ex. 4.  The sentence imposed included 30 months of imprisonment and an order that Petitioner pay $2,465,771.61 in restitution to a single victim, “Medicare.”  IG Ex. 4 at 1-2.

In her informal brief, Petitioner states that she does not disagree with the IG’s argument that exclusion is required.  P. Br. at 2.  Petitioner pleaded guilty to the criminal offense of health care fraud, in violation of 18 U.S.C. § 1347, and was ordered to serve 30 months of imprisonment and to pay restitution to the victim of the crime, Medicare.  IG Ex. 4 at 1-2; see 18 U.S.C. § 3553(a)(7) (restitution is provided to the victims of an offense).  Because Petitioner was convicted of a criminal offense related to the delivery of services that were fraudulently billed to the Medicare program, she has been convicted of a program-related crime that mandates exclusion.  42 U.S.C. § 1320a-7(a)(1).

Congress, through enactment of the Act, determined that an individual who has been convicted of a criminal offense related to either 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 ALJ the discretion to impose an exclusion of a shorter duration.  42 U.S.C. § 1320a-7(c)(3)(B).  I cannot shorten the length of the exclusion to a period of less than five years because I do not have authority to “find invalid or refuse to follow Federal statutes or regulations.”

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42 C.F.R. § 1005.4(c)(1).  Petitioner has a criminal conviction for health care fraud that was related to her role as a chiropractor and owner of a practice that fraudulently billed the Medicare program.  Inasmuch as Petitioner engaged in a health care fraud scheme that caused $2,465,771.61 in fraudulent billing to the Medicare program, Petitioner’s criminal offense undoubtedly relates to the delivery of a health care item or service under Medicare.  Petitioner’s exclusion is mandated for a minimum period of five years based on subsection 1128(a)(1).  See IG Ex. 3 at 4 (plea agreement stating, “as a result of pleading guilty pursuant to this agreement, defendant will be excluded from Medicare, Medicaid, and all Federal health care programs”).

2. A 21-year minimum exclusion is reasonable based on the presence of three aggravating factors and no mitigating factors.

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 has the discretion to impose an exclusion longer than the minimum period when aggravating factors are present.  See 42 C.F.R. § 1001.102.  The IG increased the minimum exclusion period from five years to 21 years based on the presence of three aggravating factors.  IG Ex. 1 at 1-2.  The IG bears the burden of persuasion with respect to aggravating factors, and Petitioner bears the burden of persuasion with respect to mitigating factors.  42 C.F.R. § 1005.15(c).

Petitioner does not dispute the presence of three aggravating factors.  Request for Hearing; P. Br.  Nor does Petitioner specifically dispute that a 16-year lengthening of the minimum period of exclusion is reasonable based on the IG’s application of three regulatory aggravating factors.  Request for Hearing; P. Br.  Rather, Petitioner, without specificity, argues that “[t]he length is unreasonable because after reviewing all the paperwork [the] IG has sent I have seen many cases with shorter lengths.”  P. Br. at 3.  Petitioner also argues that her case is being reviewed by the United States Court of Appeals for the Ninth Circuit (Ninth Circuit) and requests the length of the exclusion be reduced to five years.  P. Br. at 3.  As I explain below, a 21-year exclusion is reasonable based on the presence of three aggravating, and no mitigating, factors.

The first aggravating factor is that the loss to a government program or other entities as a result of Petitioner’s criminal conduct was greater than $50,000, as evidenced by the sentencing order that she pay $2,465,771.61 in restitution to Medicare.  IG Ex. 4 at 2; 42 C.F.R. § 1001.102(b)(1).  The Departmental Appeals Board (DAB) has recognized that “restitution is a measure of program loss.”  Hussein Awada, M.D., DAB No. 2788 at 7 (2017).  The amount of loss is quite significant and is more than 49 times the $50,000 threshold for application of this aggravating factor.  IG Ex. 4 at 2; 42 C.F.R. § 1001.102(b)(1).  The DAB has explained that when program loss is substantially higher than the threshold amount, this factor may be considered “an ‘exceptional aggravating

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factor’ to be accorded significant weight.”  Laura Leyva, DAB No. 2704 at 10 (2016).  While there are a number of enumerated aggravating factors, an exceptional aggravating factor signals that the petitioner’s conduct was egregious enough to cause losses well beyond the minimum regulatory threshold.  Petitioner does not dispute that she was ordered to pay more than $2.4 million in restitution, nor does she argue that the IG misapplied this aggravating factor to lengthen the exclusion.  The IG had a reasonable basis to lengthen the exclusion based on this aggravating factor.  42 C.F.R. § 1001.102(b)(1).

The second aggravating factor is that the acts resulting in Petitioner’s conviction, or similar acts, were committed over a period of one year or more.  42 C.F.R. § 1001.102(b)(2); see IG Exs. 2 at 4 (information charging that the scheme to defraud began “no later than in or around June 2018” and continued through “at least in or around June 2022”); 3 at 9 (Petitioner’s admission in the plea agreement that she engaged in the health care fraud scheme from “no later than in or around June 2018, and continuing through at least in or around June 2022”).  The IG properly considered the length of the acts underlying Petitioner’s conviction to be an aggravating factor.  42 C.F.R. § 1001.102(b)(2); see Kimberly Jones, DAB No. 3033 at 11 (2021) (unlawful conduct that “occurred over a period far exceeding a year . . . more than satisfies the aggravating factor and supports the significant weight given to it”).

The third aggravating factor is that the sentence imposed included incarceration, specifically 30 months of incarceration.  IG Ex. 4 at 1-2; 42 C.F.R. § 1001.102(b)(5).  Because Petitioner was sentenced to significant period of incarceration, the IG had a reasonable basis to lengthen the exclusion.  42 C.F.R. § 1001.102(b)(5).

Petitioner does not dispute the IG’s application of any of the three aforementioned aggravating factors, nor does she specifically dispute that the IG had a reasonable basis to lengthen the minimum period of exclusion by 16 years based on these three factors.  Request for Hearing; P. Br.  Although Petitioner broadly disagrees with the length of the exclusion, she does not argue that the IG misapplied any of the regulatory aggravating factors.  See P. Br. at 3 (short-form brief template question asking Petitioner to “address each aggravating factor cited by the IG and explain why you disagree with the IG’s determination”).

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 short-form brief I provided to Petitioner included a list of the regulatory mitigating factors found at 42 C.F.R. § 1001.102(c).  However, Petitioner neither argued nor submitted evidence that the IG failed to apply a regulatory mitigating factor.

To the extent Petitioner argues that her exclusion should be shortened to a minimum period of five years because her case is on appeal to the Ninth Circuit, a pending appeal is

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not an enumerated basis to shorten the duration of an exclusion.3  See 42 C.F.R. § 1001.102(c); see also 42 C.F.R. § 1001.3005(a) (stating an exclusion will be withdrawn and the individual reinstated when the exclusion is based on a conviction that has been reversed).

In the absence of any argument or evidence demonstrating that the lengthening of the minimum period of exclusion to 21 years based on the presence of three aggravating factors is unreasonable, I conclude that the imposition of a minimum period of exclusion for 21 years is not unreasonable.  42 C.F.R. § 1001.2007(a).  Petitioner has not demonstrated the presence of any mitigating factors.

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

The effective date of the exclusion, October 20, 2024, is 20 days after the date of the IG’s September 30, 2024 letter and is established by regulation.  See 42 C.F.R. § 1001.2002(b).  I am bound by that regulation.  42 C.F.R. § 1005.4(c)(1). 

V.  Conclusion

For the foregoing reasons, a 21-year exclusion from participation in Medicare, Medicaid, and all other federal health care programs, effective October 20, 2024, is not unreasonable.