Michael Corey Smith, ALJ Ruling 2026-35 (HHS CRD August 10, 2026)

RULING

Petitioner, Michael Corey Smith, was married to a Nancy Shepherd, who was deemed eligible for personal home care services through the Virginia Medicaid program.  Using fabricated names for the home health aides, Petitioner and his wife submitted timesheets for care that no one provided and that she did not receive.  In fact, she was incarcerated at the times they claimed she received the services.  The Medicaid program paid Petitioner a total of $37,646.54 based on the false claims. 

Petitioner was caught and convicted of making false statements in applications for payment under medical assistance, in violation of Va. Code § 32.1-314. 

Based on his conviction, the Inspector General (IG) has excluded Petitioner from participating in Medicare, Medicaid, and all federal health care programs for a minimum period of five years, as authorized by section 1128(a)(1) of the Social Security Act (Act). 

Petitioner appeals the exclusion.  He concedes that the IG has a basis for excluding him but challenges its length. 

Page 2

Because Petitioner has not raised an issue that I may properly address, I must dismiss this appeal.  42 C.F.R. §§ 1001.2007(a)(2), 1005.2(e)(4). 

Background

In a letter dated May 29, 2026, the IG notified Petitioner that he was excluded from participating in all federal health care programs for a period of five years because he had been convicted of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  The letter explained that section 1128(a)(1) of the Act authorizes the exclusion.  E-File #1a. 

Petitioner timely requested review, and the matter is before me. 

I scheduled a prehearing conference in this matter.  See 42 C.F.R. § 1005.6; E-File #2.  Petitioner, however, did not appear.  His sister subsequently contacted my staff to explain that Petitioner missed the conference because he was in the emergency room, suffering from an illness.  This is good cause for his failing to appear.  However, as the following discussion shows, because Petitioner’s appeal does not raise an issue that I can address, rescheduling the prehearing conference would serve no purpose and would unnecessarily delay my resolving this case. 

With his hearing request (E-File #1), Petitioner submitted:  the IG notice letter, dated May 29, 2026 (E-File #1a); the sentencing order following his criminal conviction, dated April 11, 2025 (E-File #1b at 1-2); and an investigation report prepared by the Department of Corrections, Commonwealth of Virginia (including cover letter) (E-File #1b at 4-8). 

Discussion

Petitioner’s hearing request must be dismissed because it fails to raise any issue that I may properly address.

Under section 1128(a)(1) of the Act, the Secretary of Health and Human Services must exclude an individual who has been convicted under federal or state law of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  42 C.F.R. § 1001.101(a). 

Although the record in this case is thin, it establishes that Virginia’s Medicaid program pays for personal home care provided to Medicaid beneficiaries.  Petitioner’s wife, Nancy Shepherd, qualified for those services.  E-File #1b at 7.  From October 26, 2017, until January 23, 2018, Nancy Shepherd was incarcerated for 99 days.  From October 26, 2018, until November 20, 2018, she was incarcerated for 25 days.  And from June 11, 2019, until December 20, 2019, she was incarcerated for 192 days.  Id. at 7-8.   During

Page 3

her periods of incarceration, she and her husband, Petitioner Smith, submitted claims for home care services she could not have received, falsifying the names of the purported home health aides.  Id. at 8. 

The Medicaid program paid them $37,646.54 for services that were never provided.  Id.

On October 28, 2024, Petitioner was convicted of making false statements in applications for payment under medical assistance, in violation of Va. Code § 32.1-314.  His offenses lasted from October 16, 2017, through September 18, 2019 (almost two years), according to the sentencing order.  E-File #1b at 1.  The criminal court sentenced Petitioner to ten years in prison, with nine years and six months suspended.  E-File #1b at 1.  The court ordered him to pay $37,646.54 in restitution to the Virginal Department of Medical Assistance Service, plus $873 in costs.  E-File #1b at 2. 

Petitioner’s conviction for submitting false claims to the Virginia Medicaid program is thus obviously related to the delivery of services under a state health care program, and the IG was authorized to exclude him.  Act § 1128(a)(1); 42 C.F.R. § 1001.101(a). 

Petitioner concedes that he was convicted of a criminal offense for which he must be excluded but argues that the length of the exclusion should be reduced, pointing out that his prison sentence was reduced from ten years to six months.  E-File #1.1

By statute and regulation, an exclusion brought under section 1128(a)(1) must be for a minimum period of five years.  Act § 1128(c)(3)(B); 42 C.F.R. § 1001.2007(a)(2).  I am bound by the statute and the regulations and am not authorized to reduce the period of exclusion below the five-year minimum. 

When the IG imposes a minimum five-year exclusion, the excluded individual may not file a request for hearing challenging only the length of the exclusion.  42 C.F.R. § 1001.2007(a)(1), (2).  I am required to dismiss a hearing request where it fails to raise any issue that may properly be addressed in a hearing.  42 C.F.R. § 1005.2(e)(4).  I therefore dismiss Petitioner’s appeal. 

Page 4

Petitioner expresses concern that his personal eligibility for health care benefits could be affected by this exclusion.  He points out that he needs medical assistance for himself and his dependents.  E-File #1 at 2.  His personal eligibility is not affected.  As the IG explains in his notice letter: 

This exclusion does not affect your rights or the rights of your family members to collect benefits to which you or they may be entitled as a beneficiary under any Federal program such as Medicare, Medicaid, or Social Security. 

E-File #1a at 3. 

Conclusion

Petitioner concedes that the IG has a basis for excluding him from program participation but challenges the length of the exclusion.  By statute and regulation, he must be excluded for a minimum of five years, and I cannot change that.  Because Petitioner has not raised an issue that I may properly address, I must dismiss this appeal.  42 C.F.R. §§ 1001.2007(a)(2), 1005.2(e)(4).