Yitzchok Kurtzer a/k/a Barry Kurtzer, DAB CR6680 (2025)

DECISION

Respondent, the Acting Inspector General for the U.S. Department of Health and Human Services (IG), excluded Petitioner, Yitzchok Kurtzer, a/k/a Barry Kurtzer, from participation in Medicare, Medicaid, and all other federal health care programs for 15 years pursuant to Section 1128(a)(1) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(1)).  Petitioner challenges his exclusion before me.  For the reasons stated below, I affirm the IG’s exclusion action and find the 15-year exclusion period selected by the IG not unreasonable. 

I. Procedural History

On September 30, 2024, the IG notified Petitioner of his exclusion, effective in 20 days, from participation in Medicare, Medicaid, and all federal health programs under section 1128(a)(1) of the Act (42 U.S.C. § 1320a-7(a)(1)) for a minimum period of 15 years.  IG Ex. 1 at 1.  The IG explained she took this action based on Petitioner’s conviction in the U.S. District Court for the District of New Jersey (District Court), for 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 such items or services.  Id. 

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Petitioner timely sought review by an administrative law judge (ALJ) in the Civil Remedies Division, resulting in my designation to hear and decide this case.  I held a pre-hearing conference by telephone with the parties on December 5, 2024, the substance of which is summarized in my Dec. 6, 2024 Order Summarizing Pre-hearing Conference and Setting Briefing Schedule (Summary Order). 

Among other things, I directed the parties to file pre-hearing briefs and identify witnesses and exhibits in support of their arguments.  Summary Order at 5-6.  The IG filed a brief (IG Br.) and six proposed exhibits (IG Exs. 1-6), while Petitioner filed a brief (P. Br.) and six proposed exhibits (P. Exs. 1-6).  The IG subsequently filed a reply brief (IG Reply). 

II. Admission of Exhibits and Decision on the Record

In the absence of objections, I admit IG Exhibits 1 through 6 and Petitioner Exhibits 1 through 6 into the record. 

The IG did not propose witnesses or indicate she believed a hearing to be necessary.  IG Br. at 12.  Petitioner requests an in-person hearing to “testify regarding the four aggravating factors” identified by the IG.  P. Br. at 9.  However, I made clear in my Summary Order that I would not hold a hearing unless a party sought to cross-examine a witness for whom the opposing party has provided written direct testimony.  Summary Order at 5.  The IG has not identified a witness for whom Petitioner could request cross-examination. 

I also emphasized the necessity to submit written direct testimony from any witness a party deemed necessary to the presentation of its case.  Id. at 4.  Petitioner has not done so.  Even if I waived this requirement, Petitioner has failed to articulate how his testimony would be “relevant and non-cumulative.”  Id. at 5.  Petitioner only specifies that he intends to testify concerning the aggravating factors identified by the IG.  This vague allusion to the topic of his testimony is insufficient to establish its relevance or non-cumulative value.  For these reasons, I find a hearing in this matter unnecessary and not in the interest of judicial economy.  I therefore decide this case on the written record before me.  Summary Order at 5; Civ. Remedies Div. P. § 19(d). 

III.  Issues

Whether the IG had a basis to exclude Petitioner from participating in Medicare, Medicaid, and all other federal health care programs and if so, whether the 15-year exclusion period selected by the IG is unreasonable.  See 42 C.F.R. § 1001.2007(a)(1). 

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IV. Applicable Law

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 by the Secretary of Health and Human Services (Secretary).  The right to a hearing before an ALJ is set forth at 42 C.F.R. §§ 1001.2007(a) and 1005.2.  The rights of both the sanctioned party and the IG to participate in a hearing are set forth at 42 C.F.R. § 1005.3. 

The Act requires the Secretary to exclude from participation in federal health care programs “[a]ny individual or entity that has been convicted of a criminal offense related to the delivery of an item or service under subchapter XVIII of this chapter or under any State health care program.”  Act § 1128(a)(1) (42 U.S.C. § 1320a-7(a)(1)); see also 42 C.F.R. § 1001.101(a). 

The Act defines an individual to be convicted of a criminal offense when:  (1) a judgment of conviction has been entered against him or her in a federal, state, or local court whether an appeal is pending or the record of the conviction is expunged; (2) there is a finding of guilt by a court; (3) a plea of guilty or nolo contendere is accepted by a court; or (4) the individual has entered into any arrangement or program where judgment of conviction is withheld.  Act § 1128(i) (42 U.S.C. § 1320a-7(i)); 42 C.F.R. § 1001.2.  Exclusion under this provision of the Act is mandatory and does not distinguish between misdemeanor and felony convictions.  Excluded parties seeking to challenge exclusion may not collaterally attack the conviction that provides the basis for 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)) mandates a minimum five-year period of exclusion if imposed under section 1128(a) of the Act.  Exclusion is effective 20 days from the date the IG issues notice of exclusion.  42 C.F.R. § 1001.2002(b).  The IG may elect to extend the period of exclusion based on the presence of certain aggravating factors.  42 C.F.R. § 1001.102(b).  The IG must consider only the mitigating factors identified by the regulations as a basis for reducing the period of exclusion, and then only if she has applied aggravating factors to increase the exclusion period beyond five years.  42 C.F.R. § 1001.102(c).  The IG’s ultimate determination of the length of exclusion enjoys deference only if it is not unreasonable.  42 C.F.R. § 1001.2007(a)(1)(ii). 

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; the IG bears the burden on all other issues.  Summary Order at 3; 42 C.F.R. § 1005.15(c). 

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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. 

A. I have jurisdiction to hear this case.

Petitioner timely requested a hearing after receiving notice of his exclusion.  I therefore have jurisdiction to hear and decide this case.  See 42 C.F.R. §§ 1001.2007(a)(1)-(2), 1005.2(a); see also Act § 1128(f)(1) (42 U.S.C. § 1320a-7(f)(1)). 

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

Section 1128(a)(1) of the Act mandates exclusion from participation in Medicare, Medicaid, and all federal health care programs where an individual has been 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.  42 U.S.C. § 1320a-7(a)(1); 42 C.F.R. § 1001.101(a).  Petitioner does not challenge the propriety of his exclusion but disputes its length as unreasonable.  P. Br. at 2.  Nevertheless, to provide necessary context for my analysis, I briefly address the factual bases for exclusion the IG has established by a preponderance of the evidence. 

1. Relevant Facts

On July 23, 2021, a federal grand jury seated in the District of New Jersey charged Petitioner with multiple counts, among them Conspiracy to Violate the Anti-Kickback Statute in violation of 18 U.S.C. § 371.  IG Ex. 3 at 1-2.  The grand jury accused Petitioner of conspiring with others to knowingly and willfully solicit kickbacks and bribes in exchange for referrals for genetic testing, payment for which derived in whole or part from the Medicare program.  Id. at 6.  The grand jury alleged that from approximately October 2018 to July 2020, Petitioner accepted approximately $2,000 per month in bribes and kickbacks from Individual-1, a sales representative for two laboratories, Laboratory-1 and Laboratory-2, in exchange for referring genetic testing to those laboratories.  Id. at 6, 7. 

In or around September 2019, Petitioner negotiated an increase to approximately $3,000 per month for referrals to Laboratory-1.  Id. at 8.  In or around February 2020, Petitioner began referring genetic testing to Laboratory-2 because it collected higher reimbursements from the Medicare program.  Id.  Petitioner also recruited or attempted to recruit employees to collect genetic testing swabs from his nursing home patients.  Id. at 10.   In sum, from approximately October 2018 to July 2020, Petitioner referred genetic 

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testing for his patients to Laboratory-1 and Laboratory-2 that resulted in approximately $1.07 million of billing to the Medicare program.  Id. at 6, 10.  

On November 22, 2023, Petitioner executed a plea agreement with the government, agreeing to plead guilty to the first count of the indictment filed against him, Conspiracy to Violate the Anti-Kickback Statute.  IG Ex. 4 at 1, 8.  As part of his plea deal, Petitioner agreed to pay $746,164.51 to the Medicare program, one of the victims of his criminal offense.  Id. at 3.  

On March 13, 2024, the Inspector General for New York’s Medicaid program excluded Petitioner from participation in that state’s Medicaid program, citing his conviction under New York law for a crime that related to or resulted from the furnishing of or billing for medical care, services, or supplies, or performance of management or administrative services related thereto.  IG Ex. 6 at 1.  

On July 23, 2024, the District Court accepted Petitioner’s guilty plea and entered judgment against him.  IG Ex. 2.  The Court sentenced Petitioner to a period of incarceration of time served and imposed a two-year period of supervised release.  Id. at 2-3.  It also ordered him to pay $746,164.51 in restitution to the Medicare program.  Id. at 6. 

2. Petitioner was convicted of a criminal offense within the meaning of section 1128(a)(1) of the Act.

Petitioner concedes his conviction of an offense within the meaning of the Act.  P. Br. at 2.  I therefore find the IG has established Petitioner was convicted of a criminal offense within the meaning of the Act.  Act § 1128(i)(1), (3) (42 U.S.C. § 1320a-7(i)(1), (3)); 42 C.F.R. § 1001.2. 

3. Petitioner’s criminal offense is related to the delivery of an item or service under Medicare or a state health care program within the meaning of section 1128(a)(1) of the Act.

The Act requires Petitioner be excluded from participation in federal healthcare programs if convicted of an offense relating to the delivery of an item or service under Medicare or a state health care program.  See Act § 1128(a)(1) (42 U.S.C. § 1320a-7(a)(1)).  Only a “common-sense connection” is required for the offense of conviction to be “related to” the delivery of an item or service under Medicare.  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); Berton Siegel, D.O., DAB No. 1467 (1994) (“[T]he statute requires some ‘nexus’ or ‘common sense connection’ between the offense of which a petitioner was convicted and the delivery of an item or service under a covered program.”). 

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Petitioner concedes his criminal offense warrants exclusion under section 1128(a)(1) of the Act.  P. Br. at 2.  It would be difficult to do otherwise.  The conduct to which Petitioner admitted clearly demonstrates his offense of conviction related to the delivery of an item or service of healthcare under the Medicare program.  As set forth in the first count of the indictment to which he pleaded, Petitioner conspired to knowingly and willfully solicit kickbacks and bribes from two laboratories in exchange for referring his patients to them for genetic testing, payment for which derived in whole or part from the Medicare program.  IG Ex. 3 at 6; IG Ex. 4 at 1.  Petitioner received $2,000 to 3,000 per month for these referrals, which took place between approximately October 2018 and July 2020, and resulted in approximately $1.07 million in billing to the Medicare program.  IG Ex. 3 at 6, 8, 10.  As a result of his criminal conduct, the District Court ordered Petitioner to repay the United States over $746,000 for losses incurred by the Medicare program.  IG Ex. 2 at 6. 

These facts establish to my satisfaction the requisite “common sense” connection between Petitioner’s crime of conviction and the delivery of services.  I find the evidence of record amply demonstrates a basis to exclude Petitioner under section 1128(a)(1) of the Act.  

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

Because I have concluded a basis exists to exclude Petitioner pursuant to section 1128(a)(1) of the Act (42 U.S.C. § 1320a-7(a)(1)), he must be excluded for a minimum of five years.  Act § 1128(c)(3)(B) (42 U.S.C. § 1320a-7(c)(3)(B)); 42 C.F.R. § 1001.102(a). 

D. The IG has established four aggravating factors to justify exclusion beyond the five-year statutory minimum.

1. The IG established a financial loss to a government program of $50,000 or more, as required by 42 C.F.R. § 1001.102(b)(1).

Petitioner admitted his criminal conduct, in concert with others, caused a loss to the Medicare program of $746,164.51.  IG Ex. 4 at 3.  The District Court subsequently ordered him to pay that amount in restitution to the Medicare program.  IG Ex. 2 at 6.  Petitioner does not dispute this restitution amount but points out that the pecuniary benefit he personally received amounted to only $27,700.  P. Br. at 6; IG Ex. 4 at 3 (Petitioner’s consent to the forfeiture of $27,700 as proceeds traceable from his criminal offense conduct).  He also asserts the District Court’s assessment of Petitioner’s character and the nature of his offense make the amount of restitution “misleading.”  P. Br. at 6-7. 

Petitioner erroneously substitutes the proceeds of his crime for the loss incurred by the victim of that crime.  The IG may extend the period of exclusion if Petitioner’s offense of conviction caused or intended to cause “a financial loss to a government agency or 

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program . . . of $50,000 or more.”  42 C.F.R. § 1001.102(b)(1).  The amount of gain Petitioner realized from his criminal offense is irrelevant.  It is well-established that an amount ordered as restitution constitutes proof of the amount of financial loss to a government program.  See, e.g., Summit S. Shah, M.D., DAB No. 2836 at 8 (2017); Juan de Leon, Jr., DAB No. 2533 at 5 (2013); Craig Richard Wilder, M.D., DAB No. 2416 at 9 (2011) (“[R]estitution has long been considered a reasonable measure of program loss.”).  The IG has established Petitioner was responsible for more than $50,000 in loss to the Medicare program. 

2. The IG established Petitioner’s conviction arose from acts that lasted for a period of one year or more, as required by 42 C.F.R. § 1001.102(b)(2).

The IG applied this aggravating factor asserting Petitioner’s criminal conviction arose from acts lasting for a period of one year or more.  IG Br. at 7-8.  Petitioner now claims “there is no evidence that definitely established [Petitioner’s] conduct lasted more than twelve months.”  P. Br. at 7.  This is plainly incorrect.  Petitioner acknowledges the indictment against him described his criminal conduct to have persisted “[f]rom in or about October 2018 to in or about July 2020.”  Id. (citing IG Ex. 2 at 1); see also IG Ex. 3 at 6.  But he fails to acknowledge he subsequently pleaded guilty to that count in its entirety.  IG Ex. 4 at 1.  

Petitioner’s plea to Count One of the indictment is evidence beyond a reasonable doubt as to the conduct described in that count.  Beyond merely incorporating the first count of the indictment by reference, Petitioner’s plea agreement expressly acknowledges the duration of the conspiracy to which he pleaded guilty.  See id. (providing execution of the agreement would preclude further prosecution by the government “for the following alleged conduct during the time period of October 2018 through July 2020 . . .”).  

Petitioner’s effort to contest the duration of the conduct to which he has already pleaded is a collateral attack on his underlying conviction and therefore impermissible in these proceedings.  42 C.F.R. § 1001.2007(d).  The IG has sufficiently established that Petitioner’s criminal conduct continued for longer than one year. 

3. The IG established Petitioner’s sentence included a period of incarceration, as required by 42 C.F.R. § 1001.102(b)(5).

The evidence of record establishes the District Court sentenced Petitioner to time served in addition to 12 months of home confinement.  IG Ex. 2 at 2-3.  Petitioner contests application of this aggravating factor because he was subject to “home detention” but not “home arrest or a half-way house.”  P. Br. at 8. 

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Petitioner’s claim is without merit.  First, the District Court imposed a sentence of actual imprisonment as part of its judgment, stating that Petitioner would be “committed to the custody of the United States Bureau of Prisons to be imprisoned for a period of TIME SERVED.”  IG Ex. 2 at 2.  Imprisonment for any period of time squarely establishes the application of this aggravating factor.  But even if this period of incarceration is not sufficient to establish this aggravating factor, perhaps because it elapsed prior to the imposition of judgment and conviction, the period of home detention imposed by the District Court as a term of Petitioner’s supervised release is itself sufficient to establish this aggravating factor. 

This is because the Secretary’s regulations broadly define incarceration to mean “imprisonment or any type of confinement with or without supervised release, including, but not limited to, community confinement, house arrest and home detention.”  42 C.F.R. § 1001.2.  Here, as a term of Petitioner’s supervised release, the District Court imposed a 12-month period of “home detention” during which time Petitioner could not leave his residence outside of specific circumstances authorized by the Court or the U.S. Probation Office.  IG Ex. 2 at 3.  A period of home detention plainly meets the definition of incarceration set forth by the Secretary’s regulations.  See Roji Esha, DAB No. 3076 at 15 (2022) (affirming there is no distinction between community confinement, house arrest, or home detention for purposes of establishing a sentence included “incarceration” within the meaning of the Secretary’s exclusion regulations).  The IG has established a factual basis to apply this aggravating factor. 

4. The IG established Petitioner was the subject of another adverse action by another government entity based on the same set of circumstances forming the basis of exclusion, as required by 42 C.F.R. § 1001.102(b)(9).

The IG has established another government entity took an adverse action against Petitioner based on the same set of circumstances for which he was excluded.  42 C.F.R. § 1001.102(b)(9).  In March 2024, the Inspector General for New York’s Medicaid program excluded Petitioner from participation in that program because of his conviction of a crime that under New York law would be related to or resulted from the furnishing of or billing for medical care, services, or supplies, or performance of management or administrative services related thereto.  IG Ex. 6 at 1.  

Petitioner does not contest his exclusion by New York’s Medicaid program but asserts he has never been licensed to practice medicine in New York or practiced there.  P. Br. at 8.  He points out that Pennsylvania, where he is exclusively licensed to practice medicine, has not taken any action against him.  Id.  Petitioner may correctly observe his actual state of licensure has not sanctioned him (though it is not clear Pennsylvania was or is aware of his criminal conviction), but that fact is irrelevant.  The plain language of the applicable regulation only requires the IG to establish “another government entity” took 

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adverse action against Petitioner for the same circumstances underlying his conviction.  42 C.F.R. § 1001.102(b)(9).  It does not require the IG to show a nexus between that entity and the individual being excluded.  The IG has established application of this aggravating factor to be appropriate. 

E. A 15-year exclusion period is not unreasonable.

I must uphold the IG’s determination as to the length of exclusion if it is not unreasonable.  42 C.F.R. § 1001.2007(a)(1)(ii).  This means that: 

[s]o long as the amount of time chosen by the OIG is within a reasonable range, based on demonstrated criteria, the ALJ has no authority to change it under this rule.  We believe that the deference [42 C.F.R.] § 1001.2007(a)(2) grants to the OIG is appropriate, given the OIG’s vast experience in implementing exclusions under these authorities. 

57 Fed. Reg. 3,298, 3,321 (Jan. 29, 1992). 

In making my determination, the quality of the aggravating (or mitigating) factors is of greater significance than the mere number of the factors present in a given case.  As the Secretary stated in the preamble to the final rule establishing the exclusion regulations: 

We do not intend for the aggravating and mitigating factors to have specific values; rather, these factors must be evaluated based on the circumstances of a particular case.  For example, in one case many aggravating factors may exist, but the subject’s cooperation with the OIG may be so significant that it is appropriate to give that one mitigating factor more weight than all of the aggravating.  Similarly, many mitigating factors may exist in a case, but the acts could have had such a significant physical impact on program beneficiaries that the existence of that one aggravating factor must be given more weight than all of the mitigating.  The weight accorded to each mitigating and aggravating factor cannot be established according to a rigid formula, but must be determined in the context of the particular case at issue. 

Id. at 3,314-15. 

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In assessing the reasonableness of the exclusion period selected by the IG, I must consider both aggravating and mitigating factors, if any.  42 C.F.R. § 1001.102(b), (c).  Doing so, I note Petitioner’s criminal conduct resulted in a substantial loss to the Medicare program – over $746,000.  IG Ex. 2 at 6; IG Ex. 4 at 3.  The Board has found it “entirely reasonable” to give significant weight to loss amounts “substantially larger” than the minimum regulatory threshold.  Laura Leyva, DAB No. 2704 at 9-10 (2016). 

Here, Petitioner’s criminal conduct resulted in a loss to the Medicare program almost 15 times the $50,000 in program loss required to qualify as an aggravating factor.  42 C.F.R. § 1001.102(b)(1).  The fact that Petitioner realized a relatively paltry amount of money from his criminal offense does not mitigate his responsibility for the loss he caused.  If anything, his willingness to do profound financial damage to the nation’s safety net program for the elderly and disabled to obtain slightly less than $28,000 highlights his lack of trustworthiness. 

The criminal acts Petitioner participated in lasted almost two years, from approximately October 2018 to July 2020.  IG Ex. 3 at 6.  During this time, Petitioner participated in a scheme to receive illegal kickbacks in exchange for the referral of Medicare patients for genetic testing.  Id.  He recruited or attempted to recruit others to aid in and amplify his criminal scheme.  Id. at 10.  He also negotiated a higher kickback from one laboratory for his referrals and then switched to another offering a higher kickback to maximize his ill-gotten gains.  Id. at 8.  Petitioner’s prolonged criminal conduct and opportunism demonstrate a significant level of untrustworthiness.  His involvement was not a one-time error in judgment or a matter of happenstance.  The nature and length of his participation support the IG’s decision to lengthen Petitioner’s period of exclusion. 

Petitioner’s exclusion by the New York Medicaid program reinforces the seriousness of his criminal conduct.  That program’s Inspector General believed Petitioner’s felony conviction sufficient to automatically preclude him from treating the state’s Medicaid patients.  IG Ex. 6 at 1.  This action is consistent with the IG’s assessment of Petitioner’s untrustworthiness and justifies, in part, a longer period of exclusion. 

Finally, Petitioner’s sentence of time served and 12 months of home confinement does not suggest less serious criminal conduct but rather the District Court’s consideration of mitigating factors that I cannot weigh here.  P. Ex. 4 at 65-68.1  But it is noteworthy that even after accounting for these mitigating factors, the District Court nevertheless deemed it necessary to subject Petitioner to electronic monitoring and restrict him to home confinement, warning him the terms of his supervised release were not a “toothless tiger.”  Id. at 69.  The District Court recognized the seriousness of Petitioner’s crime and 

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the need to deter physicians like him from violating the Anti-Kickback Statute.  Id. at 64, 67.2

The Board has recognized the imposition of a type of confinement other than imprisonment can suggest placing less weight on this particular aggravating factor.  Esha, DAB No. 3076 at 30 (citing Juan Urquijo, DAB No. 1735 at 8 (2000); Stacy Ann Battle, D.D.S., DAB No. 1843 at 4 (2002)).  But it reiterated that consideration of this factor in conjunction with other aggravating factors could nevertheless support an increased exclusion period.  Id. at 31. 

I acknowledge this particular aggravating factor is due less weight than it would carry if the District Court had imposed a sentence of imprisonment.  Nevertheless, the IG reasonably considered the fact of Petitioner’s incarceration, as that term is defined in the Secretary’s regulations, as one among several aggravating factors that together warranted an increase in his period of exclusion.  See Battle, DAB No. 1843 at 7 (concluding a sentence of four months in a halfway house and four months of home confinement supported the IG’s decision to lengthen the exclusion period).  Ultimately, having considered the nature and quality of the aggravating factors established by the IG, I cannot say excluding Petitioner from participation in Medicare, Medicaid, and all federal health care programs for 15 years is unreasonable. 

V. Conclusion

For the foregoing reasons, I affirm Petitioner’s exclusion from participation in Medicare, Medicaid, and all other federal health care programs for 15 years, effective 20 days from the date the IG issued notice to Petitioner of his exclusion, pursuant to section 1128(a)(1) of the Act (42 U.S.C. § 1320a-7(a)(1)).