Brent Hofhines, DAB CR6974 (2026)

DECISION

The Inspector General (IG), excluded Petitioner, Brent Hofhines, from participation in Medicare, Medicaid, and all other federal health care programs for five years based on his conviction for a criminal offense related to the delivery of an item or service under a state health care program.  Petitioner challenges the IG’s exclusion action.  For the reasons stated below, I affirm the IG’s exclusion determination. 

I.    Procedural History

On February 27, 2026, the IG notified Petitioner he would exclude him from participation in Medicare, Medicaid, and all federal health programs under section 1128(a)(1) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(1)) for at least five years.  IG Ex. 1 at 1.  The letter was revised on June 24, 2026 to reflect the proper name of the court where the conviction was entered.  Id.  The IG explained he took this action based on Petitioner’s conviction in the Justice Court, Las Vegas Township, for 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 or services under any such program.  Id. at 4. 

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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 May 13, 2026, the substance of which is summarized in my May 14, 2026 Order Summarizing Pre-hearing Conference and Schedule for Filing Briefs and Documentary Evidence.  See 42 C.F.R. § 1005.6. 

I directed the parties to file pre-hearing briefs and identify witnesses and exhibits in support of their arguments. 

The IG filed a brief (IG Br.) and four proposed exhibits (IG Exs. 1-4).  Petitioner filed a brief (P. Br.) with two proposed exhibits (P. Exs. 1-2).  Neither party proposed any witnesses.  Accordingly, I decide this case on the briefs submitted and the exhibits of record.  Civ. Remedies Div. P. § 19(d); Standing Order at 8. 

II.    Admission of Exhibits and Decision on the Record

The IG did not object to Petitioner’s exhibits.  I therefore enter P. Exs. 1-2 into evidence. 

Petitioner objected to IG Ex. 3 (Affidavit of Probable Cause in Support of Criminal Complaint and Summons in Lieu of Arrest) on the grounds that it is immaterial and that any probative value it may have is substantially outweighed by the danger of unfair prejudice.  P. Objs.  Petitioner also argues the document is hearsay and that it is not permissible under 42 C.F.R. § 1005.17(g).  Id.  In the alternative, Petitioner asks that if the document is admitted, that it be given no weight.  Id. 

As discussed in-depth below, the issue to be decided is whether the IG has a basis for excluding Petitioner from participating in Medicare, Medicaid, and all other federal health care programs pursuant to section 1128(a)(1) of the Act.  In order to make this determination, this tribunal must examine the evidence to determine whether Petitioner was convicted of a criminal offense related to the delivery of an item or service under Medicare or a State health care program.  The Affidavit of Probable Cause in Support of Criminal Complaint is: 

Relevant to determining whether Petitioner was convicted of a criminal offense related to the submission of improper claims to Medicaid, in connection with the delivery of a health care item or service.  IG Ex. 3 contains evidence of the nature of the charge against Petitioner in the underlying criminal case. 

Documentary evidence of the nature of the charges against Petitioner, in particular, whether the State of Nevada’s allegations against Petitioner related to the submission of improper claims to Medicaid, irrespective of the veracity of those allegations. 

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The admissibility of these documents is distinct from the weight to be given to the information presented in them.  Because the document is relevant to examining the nature of Petitioner’s criminal offense, it is admitted into evidence. 

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)(1).  See 42 C.F.R. § 1001.2007(a)(1). 

IV.    Jurisdiction

I have jurisdiction to hear and decide this case.  42 C.F.R. §§ 1001.2007(a)(1)-(2), 1005.2(a); see also 42 U.S.C. § 1320a-7(f)(1). 

V.    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 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.  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 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.  Act § 1128(a)(1) (42 U.S.C. § 1320a-7(a)(1)).  Excluded parties seeking to challenge their exclusion may not collaterally attack the conviction upon which exclusion is based.  42 C.F.R. § 1001.2007(d). 

For exclusions imposed under section 1128(a) of the Act, section 1128(c)(3)(B) (42 U.S.C. § 1320a-7(c)(3)(B)) mandates a minimum five-year period of exclusion.  Exclusion is effective 20 days from the date the IG issues the notice of exclusion. 

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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).  If the IG has applied aggravating factors to increase the exclusion period beyond five years, she must consider the mitigating factors identified by the regulations as a basis for reducing the period of exclusion.  42 C.F.R. § 1001.102(c).  The IG’s 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, while the IG bears the burden on all other issues.  42 C.F.R. § 1005.15(b). 

VI.    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. The IG has established a basis to exclude Petitioner 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).  The IG has established these elements by a preponderance of the evidence. 

1. Relevant Facts

On August 19, 2025, Petitioner was charged with intentional failure to maintain adequate records, a gross misdemeanor in violation of NRS 422.570.  IG Ex. 2 at 1.  The complaint charged that Petitioner intentionally failed to maintain adequate records for at least 5 years for claims submitted for payment to the State Plan for Medicaid.  Id. at 2.  Specifically, from January 1, 2021 through December 16, 2022, Petitioner failed to maintain accurate documentation concerning the services Petitioner provided to Medicaid recipients.  Petitioner offered to plead no contest to the charge of intentional failure to maintain adequate records on October 1, 2025 but there was apparently some confusion about the effective date of the NOC1 under which Petitioner was charged.  P. Ex. 2.  On October 8, 2025, per the parties negotiations, Petitioner plead nolo contendere to an amended charge of acting without lawful authority.  P. Ex. 1; IG Ex. 4.  The disposition

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notice and judgment makes note that the charge was originally filed as failure to maintain adequate Medicaid records for specified time frame.  IG Ex. 4.  Petitioner was ordered to pay $25,000 in restitution to the Nevada Attorney General’s Office. 

2. Petitioner was convicted of a criminal offense within the meaning of the Act. 

Petitioner concedes he was convicted of a criminal offense, as defined by the Act.  P. Br. at 1.  The evidence of record confirms Petitioner executed a plea to resolve the criminal charges against him and that the state court accepted Petitioner’s plea of nolo contendere and entered judgment against him.  P. Ex. 1; IG Ex. 4.  The IG has established Petitioner was convicted of a criminal offense within the meaning of the Act.  Act § 1128(i)(1) (42 U.S.C. § 1320a-7(i)(1)); 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 exclusion from participation in federal programs for convictions related to the delivery of an item or service under Medicare or a state health care program.  See 42 U.S.C. § 1320a-7(a)(1).  The term “related to” means there must be a nexus or common-sense connection.  See 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); see also Quayum v. U.S. Dep’t of Health and Human Servs., 34 F. Supp. 2d 141, 143 (E.D.N.Y. 1998). 

Petitioner contends that his criminal offense did not relate to the delivery of a healthcare service under the Nevada Medicaid program.  P. Br.  He asserts his plea of guilty to a misdemeanor charge of acting without lawful authority cannot reasonably be seen to relate to the delivery of an item or service in healthcare.  Id. at 3-4.  Petitioner claims the record of the underlying criminal proceeding contains no findings of fact that demonstrate a relation between his offense of conviction and failing to maintain adequate Medicaid records.  Id. 

Petitioner’s arguments are unpersuasive.  His claim that his offense or conviction cannot relate to the delivery of a healthcare item or service because such delivery was not an element of the charge to which he pleaded is without merit.  Summit S. Shah, M.D., DAB No. 2836 at 7 (2017) (observing the Board “has long held, however, that an ALJ is free to look beyond the narrow constructs of a state’s criminal statutes”); Berton Siegel, D.O., DAB No. 1467 at 4 (1994) (“[i]t is not the labeling of the offense under the state statute which determines whether the offense is program-related”). 

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In Summit S. Shah, Dr. Shah similarly argued the IG could not establish relatedness because the evidence establishing his offense of conviction contained no facts relating it to the delivery of an item or service to the Medicare or Medicaid programs.  Id. at 6.  The Board rejected this argument, holding that even where the facts established by the plea colloquy fail to create an explicit link between a petitioner’s criminal conduct and delivery of an item or service in healthcare to the Medicaid program, it is appropriate to consider extrinsic evidence beyond the findings which form the basis of a criminal court’s imposition of judgment.  Id. at 8. 

Here, Petitioner correctly observes the charge to which he pleaded, a misdemeanor charge of acting without lawful authority, bears no discernable relationship to the delivery of an item or service in healthcare on its face.  But Petitioner incorrectly concludes there are no facts in the record to establish the relatedness of such delivery to his offense of conviction. 

First, there is no dispute a complaint was filed against Petitioner charging him with failure to maintain adequate records related to the Nevada State Medicaid program.  IG Exs. 2, 3.  There has also been no evidence filed to dispute that Petitioner originally agreed to plead nolo contendere to the charge of failure to maintain adequate records.  P. Ex. 2; IG Ex. 4.  There is equally no dispute Petitioner resolved the criminal charges against him by pleading guilty to an amended count in the same criminal case.  Id.  It is therefore clear that there is a clear connection between the initial charge in the complaint and the plea agreement Petitioner made to resolve those charges. 

There is no dispute Petitioner opted to plead nolo contendere to acting without authority to resolve the original charge against him.  His plea establishes relatedness between those initial charges, which plainly describe a criminal offense involving the delivery of a healthcare item or service to the Nevada Medicaid program, and his offense of conviction.  This is all the Act requires. 

In sum, Petitioner was charged with an offense that plainly related to the delivery of items or services to the Nevada Medicaid program.  IG Ex. 2, 3.  To resolve those charges against him, Petitioner pleaded to a lesser seemingly unrelated offense.  P. Ex. 1; IG Ex. 4.  The facts above establish beyond a preponderance of the evidence that Petitioner was convicted of a criminal offense related to the delivery of an item or service in healthcare to the Nevada Medicaid program. 

2. The IG was required to exclude Petitioner under the Act’s mandatory exclusion authority. 

Section 1128(a)(1) of the Act does not distinguish between misdemeanor and felony offenses.  The Act mandates exclusion if an individual is convicted of a criminal offense related to the delivery of an item or service under Medicare or a state health care

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program.  42 U.S.C. § 1320a-7(a)(1).  The IG has established these elements here, meaning Petitioner must be excluded under the Act’s mandatory exclusion authority. 

Where a criminal offense meets the elements of the Act’s permissive and mandatory exclusion authorities, the IG has no discretion to determine which exclusion authority to apply, as Petitioner suggests.  Instead, the IG must impose exclusion under section 1128(a)(1)’s mandatory exclusion authority.  See Gregory J. Salko, M.D., DAB No. 2437 at 4 (2012), quoting Timothy Wayne Hensley, DAB No. 2044 (2006) (“[I]f an offense falls under the mandatory exclusion statute, ‘courts have repeatedly held that the I.G. is then required to impose a mandatory exclusion even if an individual’s conduct also falls within the scope of a permissive exclusion provision.’”).  Petitioner’s misdemeanor conviction does not preclude mandatory exclusion under section 1128(a)(1) of the Act.  The fact that the IG may have been able to otherwise exclude Petitioner under the Act’s permissive authority is irrelevant.  Because Petitioner’s offense of conviction met the elements for mandatory exclusion under section 1128(a)(1) of the Act, the IG was obliged to exclude him under that provision and had no discretion to do otherwise. 

3. Petitioner must be excluded for a minimum of five years; the period of exclusion is therefore reasonable as a matter of law. 

For the foregoing reasons, I conclude a basis exists to exclude Petitioner under 42 U.S.C. § 1320a-7(a)(1).  Under that provision of the Act, 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 have the discretion to impose a lesser period of exclusion. 

Lastly, Petitioner makes some constitutional arguments for which I have no authority to consider.  An “ALJ does not have the authority to . . . [f]ind invalid or refuse to follow Federal statutes or regulations or secretarial delegations of authority.”  42 C.F.R. § 1005.4(c)(1); Esohe Agbonkpolor, DAB No. 3002 at 9 (2020) (citing W. Scott Harkonen, M.D., DAB No. 2485 at 22 (2012), aff’d, Harkonen v. Sebelius, No. C 13-0071 PJH, 2013 WL 5734918 (N.D. Cal. Oct. 22, 2013)).  As such, this claim cannot be addressed at this forum. 

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VII.    Conclusion

For the foregoing reasons, I conclude the IG had a basis to exclude Petitioner from participation in Medicare, Medicaid, and all federal health care programs for five years pursuant to section 1128(a)(1) of the Act (42 U.S.C. § 1320a-7(a)(1)).