Maria Blair, DAB, CR6921 (2026)

DECISION

Petitioner, Maria Blair, was a Licensed Professional Counselor, practicing in the State of Arizona.  The Arizona Board of Behavioral Health Examiners charged that she had had an inappropriate personal relationship with a client.  While the charges were pending, she agreed to settle the matter by surrendering her license.  The State Board considered the surrender a revocation of her license. 

The Inspector General (IG) has excluded Petitioner from participating in Medicare, Medicaid, and all other federal health care programs pursuant to section 1128(b)(4) of the Social Security Act (Act).  The exclusion remains in effect until she is reinstated.  To be eligible for reinstatement, she must regain her Arizona license, obtain another healthcare license in any state, or have been excluded for a minimum period of three years. 

Petitioner now appeals the exclusion. 

I affirm the IG’s determination.  Petitioner’s license to provide health care was revoked or otherwise lost for reasons bearing on her professional performance.  In the alternative, Petitioner surrendered her counselor’s license while formal disciplinary proceedings were

Page 2

pending against her before the Arizona licensing authority, and the licensing authority brought those proceedings against her for reasons bearing on her professional performance. 

Background

In a letter dated November 28, 2025, the IG notified Petitioner Blair that she was excluded from participating in Medicare, Medicaid, and all federal health care programs because her license to provide health care as a licensed professional counselor in the State of Arizona “was revoked, suspended, or otherwise lost, or was surrendered while a formal disciplinary proceeding was pending, for reasons bearing on [her] professional competence, professional performance, or financial integrity.”  IG Ex. 1.  The letter explained that section 1128(b)(4) of the Act authorizes the exclusion.  The letter also explained that the exclusion would remain in effect until Petitioner is reinstated by the IG.  To be eligible for reinstatement, she had to regain her Arizona license.  In the alternative, the letter explained, the IG would consider reinstatement if she obtained a health care license in any state or after she had been excluded for a minimum of three years.  IG Ex. 1. 

Petitioner requested review. 

Exhibits.  The IG submitted a written brief (IG Br.) and four exhibits (IG Exs. 1-4).  Petitioner submitted her own brief and three exhibits (P. Exs. 1-3).  In the absence of any objection, I admit into evidence IG Exs. 1-4 and P. Exs. 1-3. 

Hearing based on the written record.  The parties agree that this case may be decided without an in-person hearing.  IG Br. at 10; P. Br. at 7-8. 

Issue

The sole issue before me is whether the IG had the authority to exclude Petitioner from program participation based on her surrendering her license to provide health care as a licensed professional counselor.  Act § 1128(b)(4). 

Discussion

Statutory and regulatory provisions.  The Act authorizes the Secretary of Health and Human Services to exclude from program participation an individual whose license to provide health care has been revoked or suspended by a state licensing authority, “or who otherwise lost such a license,” for reasons bearing on her “professional competence, professional performance, or financial integrity.”  Act § 1128(b)(4)(A); 42 C.F.R. § 1001.501(a)(1). 

Page 3

The Act also authorizes the Secretary to exclude from program participation an individual who has surrendered her license to provide health care “while a formal disciplinary proceeding was pending” before a state licensing authority, and the proceeding concerned the individual’s “professional competence, professional performance, or financial integrity.”  Act § 1128(b)(4)(B); 42 C.F.R. § 1001.501(a)(2). 

The exclusion “will not be for a period of time less than the period during which an individual’s . . . license is revoked . . . as a result of . . . a State licensing agency action.”  Act § 1128(c)(3)(E); 42 C.F.R. § 1001.501(b)(1).  Under certain circumstances, the IG may lengthen the period of exclusion.  42 C.F.R. § 1001.501(b)(2). 

Loss of Petitioner’s license.  The Arizona Board of Behavioral Health Examiners is Arizona’s licensing authority for behavioral health professionals.  Here, the licensing board initiated an action against Petitioner Blair, charging that she engaged in a sexual relationship with a client, which the Arizona statute defines as “unprofessional conduct.”  A.R.S. § 32-3251(16)(v); see IG Ex. 3 at 3.  Rather than contest the charge, Petitioner Blair voluntarily surrendered her license.  In a consent agreement, dated January 13, 2025, the licensing board acknowledged that Petitioner had surrendered her license and that the surrender would be considered a revocation of her license.  IG Ex. 3 at 4. 

1. Because Petitioner Blair’s license to practice as a Licensed Professional Counselor was revoked or otherwise lost for reasons bearing on her professional performance, the IG may exclude her from participating in Medicare, Medicaid, and all other federally-funded health care programs.  Act § 1128(b)(4)(A).1

The licensing board determined, and, by signing the consent agreement, Petitioner agreed, that the surrender of her license was “a revocation.”  IG Ex. 3 at 4.  Thus, based on the plain language of the consent agreement, the Arizona Board of Beahvioral Health Examiners “revoked” Petitioner’s counselor’s license. 

Moreover, as the Departmental Appeals Board long ago explained, the “otherwise lost” language included in the statute “indicates that Congress intended that section to encompass any loss that occurs by a means other than revocation or suspension by a licensing authority.”  William I. Cooper, DAB No. 1534 n.1 (1995); see Jordan Stern, M.D., DAB CR669 (2000) (holding that, pursuant to section 1128(b)(4)(A), the IG properly excluded a physician who surrendered his license after an administrative complaint had been filed but prior to any formal disciplinary hearing). 

Page 4

Petitioner concedes that the allegations against her – upon which the licensing board based the revocation – would “likely constitute matters bearing on [her] ‘professional competence’ or ‘professional performance.’”  P. Br. at 2.  Inasmuch as Arizona law categorizes, as unprofessional conduct, “engaging in any sexual conduct between a licensee and a client or former client” (A.R.S. § 32-3251(16)(v)), I find that Petitioner’s license was revoked or other wise lost for reasons bearing on her professional performance.  The IG was therefore authorized to exclude Petitioner pursuant to section 1128(b)(4)(A). 

2. In the alternative, because Petitioner surrendered her license to practice as a Licensed Professional Counselor while a formal disciplinary proceeding, bearing on her professional performance, was pending, the IG may exclude her from participating in Medicare, Medicaid, and all other federally-funded health care programs.  Act § 1128(b)(4)(B). 

As noted above, the IG may exclude an individual who has surrendered her license “while a formal disciplinary proceeding” was pending before the state licensing board. 

Petitioner does not agree that her license surrender occurred while a formal disciplinary proceeding was pending.  She asserts that the charges against her were “never substantiated by the [State] Board or admitted to by Petitioner.”  P. Br. at 2.  Instead, she immediately and voluntarily surrendered her license before the State Board even began its investigation.  P. Br. at 3.  She also points out that the State Board’s notice characterizes the proceeding at which the complaint against her would be considered as an “informal meeting.”  P. Ex. 3. 

Thus, in Petitioner’s view, because she surrendered her license before the more formal state proceedings commenced, she is not subject to exclusion.  I do not agree that the provision should be read this narrowly.  Section 1128(b)(4) does not define the term “formal disciplinary proceeding,” but the Departmental Appeals Board long ago found it reasonable to conclude, based on the statutory language and its legislative history, that the law refers to a license proceeding that places a party’s license in jeopardy and provides the party with an opportunity to defend against suspension or revocation. 

[T]he Act was designed to ensure that health care providers who lose their licenses for reasons related to their professional competence be prohibited from participating in Medicare and Medicaid in all states until they reacquire their licenses and demonstrate their trustworthiness.  The Act was, furthermore, intended to prevent providers from surrendering their licenses in order to avoid exclusion before the conclusion of state proceedings. 

Page 5

John W. Foderick, M.D., DAB No. 1125 (1990) (emphasis added) (citing S. Rep. No. 109, 100th Cong. 1st Sess. 7, reprinted in 1987 U.S. Code Cong. & Admin. News 688). 

Citing the Board’s reasoning in Foderick, an administrative law judge subsequently held that “formal disciplinary proceeding” refers to a licensing proceeding that:  1) places a party’s license in jeopardy; and 2) provides that party with an opportunity to defend against those charges.  Chester A. Bennett, M.D., DAB CR64 at 6 (1990).  As the judge there explained: 

If section 1128(b)(4)(B) required that I find that Petitioner had surrendered his license during the pendency of a formal hearing, his arguments would have some validity.  However, the language of the statute is much broader.  Although it is not specifically defined, it is reasonable to conclude that “during a formal disciplinary proceeding” encompasses more than just a hearing on the matter.  A proceeding “entails a succession of events taking place,” rather than just one event, such as a hearing. 

DAB CR64 at 7 (citing Webster’s Third New International Dictionary, 1976 Unabridged Edition). 

Based on this and similar reasoning, administrative law judges have, for decades, broadly interpreted the language “formal disciplinary proceeding.”  For example: 

• When faced with the prospect of a fine, a registered nurse voluntarily surrendered his license, stipulating that the action against him was disciplinary and that his conduct was unprofessional.  The judge found that where the stipulation had “a formal case caption” and the action was characterized as a “disciplinary action,” the elements for a permissive exclusion under section 1128(b)(4)(B) were met.  Marc Charles Hancock, DAB CR6697 (2025).
• In another case, the judge found that a hearing does not have to take place or be scheduled for the license surrender to have occurred while a “formal disciplinary proceeding was pending.”  Donovan C. James, DAB CR4127 at 4-5 (2015).
• A physician surrendered his license while still “under investigation.”  The judge found that a “formal disciplinary proceeding was pending” because the medical board had issued a complaint and an amended complaint, which included proposed sanctions, and the physician had appeared before a committee of the medical board.  Ashley William Forsyth, D.O., DAB CR3219 at 4 (2014).
• Rather than “pursue a formal investigation and hearing,” Petitioner, a physician assistant, signed a Stipulation with the licensing board.  After violating it terms,

Page 6

she signed a second stipulation, again, “rather than pursuing a formal investigation and hearing.”  The judge found that the statutory requirement of a “formal disciplinary proceeding” was met because, when she executed the Stipulations, allegations were pending against her that would have resulted in a hearing and formal findings, had she not executed each Stipulation.  April Ann May, P.A., DAB CR1089 (2003).

• Where Petitioner surrendered his license at an informal meeting, the judge found that he surrendered it while a “formal disciplinary proceeding” was pending.  Dillard P. Enright, DAB CR138 (1991).
• In response to a complaint, the physician and State Disciplinary Board drafted a Stipulation and Order, under which the physician surrendered his license, obviating the need for a conference.  The judge found that he surrendered his license while a “formal disciplinary proceeding” was pending.  Myron R. Wilson, Jr., M.D., DAB CR146 (1991). 

I am aware of no instance, and Petitioner (who is represented by counsel) has cited none, in which the Departmental Appeals Board or an administrative law judge has more narrowly defined “formal disciplinary proceeding.”  So long as the licensing board initiates an action based on a complaint and the licensee surrenders her license rather than pursuing the available review process (as happened here), the section 1128(b)(4)(B) criteria are met, and the IG may exclude the individual. 

Because the statutory criteria are met, I have no discretion.  I must follow the federal exclusion statute and regulations and sustain the exclusion.  42 C.F.R. § 1005.4(c)(5); Jimenez, DAB No. 2986 at 5-6; Frugia, DAB No. 2736 at 4-5; see Marvin L. Gibbs, Jr., M.D., DAB No. 2279 at 8-10 (2009). 

Conclusion

For the above reasons, I conclude that the IG properly excluded Petitioner Blair from participating in Medicare, Medicaid, and all other federal health care programs for so long as her license to practice as a Licensed Professional Counselor is revoked.