Mitchell Townsend DAB No. 3205 (2025)

FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE DECISION

Mitchell Townsend (Petitioner) appeals a decision by an administrative law judge upholding the Inspector General’s (I.G.) exclusion of Petitioner from participation in all federal health care programs for the mandatory minimum period of five years under section 1128(a)(1) of the Social Security Act (Act), based on Petitioner’s conviction of a criminal offense related to the delivery of an item or service under Medicare.  Mitchell Townsend, DAB CR6667 (2025) (ALJ Decision).  The ALJ also concluded that excluding Petitioner for 12 years was reasonable based on undisputed evidence of three aggravating factors and the absence of any cognizable mitigating factor.

Legal Background

Section 1128(a)(1) of the Act (42 U.S.C. § 1320a-7(a)) requires the Secretary of the Department of Health and Human Services (Secretary) to exclude from participation in all federal health care programs any individual who has been “convicted of a criminal offense related to the delivery of an item or service under [Medicare] or under any State health care program.”1  As the Act permits, the Secretary delegated the exclusion authority to the I.G., who implemented the exclusion authority in regulations at 42 C.F.R. Part 1001.  Act § 1128A(j)(2); 53 Fed. Reg. 12,993 (Apr. 20, 1988); 48 Fed. Reg. 21,662 (May 13, 1983); see 42 C.F.R. § 1001.1, 1001.101(a) (implementing the exclusion authority at Act § 1128(a)(1)).  Those regulations apply to and bind the I.G. in imposing exclusions, and they also apply to and bind ALJs and the Departmental Appeals Board (Board) in reviewing exclusions the I.G. imposes.  42 C.F.R. § 1001.1(b).

Exclusions imposed under section 1128(a) are referred to as “mandatory” exclusions.  The mandatory minimum period of an exclusion imposed under section 1128(a) is five years.  Act § 1128(c)(3)(B); 42 C.F.R. § 1001.102(a).  The I.G. may extend the exclusion

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period beyond the statutory minimum if any of the aggravating factors provided in the regulations apply, including, as relevant here:

(1) The acts resulting in the conviction, or similar acts, caused, or were intended to cause, a financial loss to a government agency or program or to one or more other entities of $50,000 or more.  (The entire amount of financial loss to such government agencies or programs or to other entities, including any amounts resulting from similar acts not adjudicated, will be considered regardless of whether full or partial restitution has been made);

(2) The acts that resulted in the conviction, or similar acts, were committed over a period of one year or more;

*        *        *        *

(5) The sentence imposed by the court included incarceration[.]

42 C.F.R. § 1001.102(b)(1), (2), (5); id. § 1001.102(b) (“Any of the following factors may be considered to be aggravating and a basis for lengthening the period of exclusion[.]”).

If any aggravating factor applies to lengthen the five-year exclusion period, then the three mitigating factors in 42 C.F.R. § 1001.102(c)—and only those mitigating factors—may be applied as a basis for reducing the exclusion period to no less than five years.  Id. § 1001.102(c).

If the I.G. determines exclusion is warranted, the I.G. will send written notice to the excluded individual or entity identifying, among other things, the basis for the exclusion, the length of the exclusion, and the factors, if any, that the I.G. considered in determining the length of the exclusion period.  Id. § 1001.2002(a), (c).

An excluded individual may request a hearing before an ALJ, but only on the issues of: (i) whether the I.G. had a basis for the exclusion; and (ii) whether an exclusion longer than the required minimum period is “unreasonable.”  Id. §§ 1001.2007(a)(1), 1005.2(a).  The ALJ issues an “initial decision” based on the record developed before the ALJ.  Id. § 1005.20(a).  When an exclusion is based on a criminal conviction, the basis for the underlying conviction is not reviewable or subject to collateral attack in the administrative appeal.  Id. § 1001.2007(d).

A party dissatisfied with an ALJ decision may appeal the decision to the Board.  Id. § 1005.21(a).  The Board “will not consider any issue not raised in the parties’ briefs, nor any issue in the briefs that could have been raised before the ALJ but was not.”  Id.

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§ 1005.21(e).  The Board may, among other actions, affirm, reverse, or remand any exclusion determined by the ALJ.  Id. § 1005.21(g).

Case Background2

Petitioner was employed as a Qualified Mental Health Specialist by Eye for Change Youth and Family Services from approximately September 11, 2017 to June 19, 2020.  I.G. Ex. 3, at 7; ALJ Decision at 4.  As a Qualified Mental Health Specialist, Petitioner provided counseling services to Medicaid beneficiaries.  Id.

On May 27, 2021, the United States District Court for the Northern District of Ohio (District Court) filed a Superseding Indictment charging Petitioner with one count of Conspiracy to Commit Health Care Fraud in violation of 18 U.S.C. § 1349 and two counts of False Statement Relating to Health Care Matters in violation of 18 U.S.C. § 1035.  I.G. Ex. 4, at 12-13, 30-31; ALJ Decision at 4.

On June 23, 2023, Petitioner pleaded guilty to Conspiracy to Commit Health Care Fraud.  I.G. Ex. 3, at 3, 15; ALJ Decision at 4.  By pleading guilty, Petitioner agreed that from “on or about September 11, 2017, to on or about June 19, 2020” (also described as “in or around June 2020”) he submitted claims to Ohio Medicaid for counseling services that were not actually performed and were not actually performed for the amount of time the billing codes reflected.  I.G. Ex. 3, at 10-13; ALJ Decision at 4.  On October 19, 2023, the District Court accepted Petitioner’s guilty plea and sentenced Petitioner to one year and one day of imprisonment and three years of supervised release upon release from imprisonment.  I.G. Ex. 2, at 2-3; ALJ Decision at 4.  The District Court also ordered Petitioner to pay $437,850.51 in restitution to the Ohio Department of Medicaid.  I.G. Ex. 2, at 6; ALJ Decision at 4.

By letter dated April 30, 2024, the I.G. notified Petitioner that he was being excluded under section 1128(a)(1) of the Act from participation in Medicare, Medicaid and all federal health programs because of his “conviction . . . 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.”  I.G. Ex. 1, at 1; ALJ Decision at 1-2.  The I.G. extended the period of exclusion beyond the statutory five-year minimum to 12 years based on three aggravating factors:  (1) financial loss to a government agency or program of $50,000 or more (stating the District Court ordered Petitioner to pay approximately $437,800 in restitution); (2) Petitioner committed the acts resulting in his conviction over a period of one year or more from about September 2017 to about June 2020; and (3) the District Court sentenced Petitioner to 12 months and one day of incarceration.  I.G. Ex. 1, at 1; ALJ Decision at 2.

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ALJ Proceedings and Decision

Petitioner timely requested ALJ review.  Request for Hearing, CRD Dkt. 1 (RFH); ALJ Decision at 2.  After a pre-hearing conference, the I.G. submitted a brief and four exhibits (I.G. Exs. 1-4), while Petitioner submitted a brief (P. ALJ Br.), a supplement to his brief (P. ALJ Br. Supp.), and seven exhibits (P. Exs. 1-7).  ALJ Decision at 2.  The I.G. submitted a reply brief, and Petitioner submitted a surreply (P. ALJ Surreply).  Id. .

The ALJ convened a second pre-hearing conference to address Petitioner’s request to supplement the record with documents to support Petitioner’s claim that his attorney in the underlying criminal case physically assaulted him.  Id.  The ALJ denied Petitioner’s request, explaining that she did not have the authority to overturn or disregard the underlying criminal conviction.  Id.

Neither party objected to the other’s proposed exhibits, and the ALJ admitted the parties’ exhibits into evidence.  Id.  The ALJ decided the case on the written record because neither party proposed any witnesses.  Id.

Petitioner did not dispute that the I.G. had a basis to exclude him under section 1128(a)(1) but contested the length of the exclusion.  P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply; ALJ Decision at 4.  Petitioner provided character references (P. Exs. 1-6), noted that he fully paid the restitution, and asserted that he has engaged in “positive activities” since his incarceration.  P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply at 1; ALJ Decision at 7-8.  He further alleged misconduct by the attorney who represented him during his criminal case, stating it “compromised his ability to mount a proper defense.”  P. ALJ Br. Supp.; P. ALJ Surreply at 1; ALJ Decision at 8.  Petitioner also suggested alternative remedies to “full exclusion,” such as “enhanced monitoring, compliance programs, or additional oversight.”  P. ALJ Surreply at 1; ALJ Decision at 5.

The ALJ affirmed the exclusion and the presence of three aggravating factors.  ALJ Decision at 4-7.  The ALJ concluded that the I.G. established a basis for Petitioner’s exclusion under section 1128(a)(1) because Petitioner “was convicted of a criminal offense” related to the delivery of a health care item or service under Ohio Medicaid as defined in the Act because he “pled guilty to one count of Conspiracy to Commit Health Care Fraud, and the [District] Court accepted Petitioner’s guilty plea.”  Id. at 4.  The ALJ further concluded that because a basis existed to exclude Petitioner under section 1128(a)(1), “Petitioner must be excluded for at least the statutorily required minimum of five years.”  Id. at 5.  The ALJ also explained that she was statutorily bound to affirm the I.G.’s exclusion if there is a proper basis for a mandatory exclusion and did not have the authority to grant an alternative remedy.  Id.

The ALJ next concluded that the I.G. established three aggravating factors permitting an increase of the exclusion period beyond the five-year statutory minimum.  Id. at 5-7.  The ALJ noted Petitioner did not dispute that he was sentenced to incarceration or that he

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committed the fraudulent billing from September 2017 through June 2020.  Id. at 6-7 (citing P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply).  Although Petitioner argued that the I.G. should not apply the financial loss aggravating factor because he satisfied his restitution obligation (P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply at 1.; P. Ex. 7), the ALJ explained that “the regulations expressly allow the [I.G.] discretion to apply this aggravating factor ‘regardless of whether full or partial restitution has been made.’”  Id. at 6, 9 (quoting 42 C.F.R. § 1001.102(b)(1)).  The ALJ also determined that Petitioner’s additional arguments about his character and his attorney in the underlying criminal case did not “fall within the approved categories” of the mitigating factors specified at 42 C.F.R. § 1001.102(c).  Id. at 7-8.  The ALJ thus concluded that the 12-year exclusion period is not unreasonable.  Id. at 8-10.

Petitioner timely requested Board review of the ALJ Decision.

Board Proceedings

Before the Board, Petitioner argues the ALJ “made errors in both the interpretation of the law and the assessment of facts presented during the proceedings.”  P. Br. at 1.  Petitioner states that “[i]mportant mitigating circumstances and evidence were not fully considered, which materially affected the outcome.”  Id.  Petitioner explains he was diagnosed with ankylosing spondylitis in 2020, which is a “serious and progressive medical condition that causes chronic pain, stiffness, and significantly limits [his] mobility.”  Id.  He contends that his condition “impacted his ability to function in many ways and should have been given appropriate consideration in evaluating my intent, conduct, and capacity regarding the allegations and circumstances of this case.”  Id. at 1-2.  Petitioner requested the Board:  “[r]eview this matter in full”; “[r]everse or vacate the ALJ’s decision, or remand the case for further proceedings to ensure all relevant factors, including my health condition, are properly weighed”; and “[p]rovide any further relief deemed just and appropriate.”  Id. at 2.  Other than seemingly arguing that the mitigating factor in section 1001.102(c) applies (record in the criminal proceedings “demonstrates that the court determined that the individual had a mental, emotional or physical condition before or during the commission of the offense that reduced the individual's culpability”), Petitioner identified no legal or factual error by the ALJ in reaching the conclusion that a 12-year exclusion is not unreasonable given the three aggravating factors and the absence of any mitigating factor.

Petitioner also “reserve[d] the right to supplement this appeal with a full argument brief and supporting documents upon direction from the Board.”  Id.  In the Acknowledgment of Appeal, the Board explained that the regulations, which were provided to Petitioner with the ALJ decision, anticipate that a notice of appeal would contain a petitioner’s entire argument and give the Board discretion to permit a petitioner to file a reply brief.  Acknowledgment of Appeal (May 12, 2025) at 2.  The Board allowed Petitioner to file a reply brief and any supporting documentation within 15 days after receipt of the I.G.’s response.  Id.  The Board explained that it may remand the matter to the ALJ for

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consideration of additional evidence if Petitioner showed that the additional evidence is relevant and material and there were reasonable grounds for not submitting the additional evidence to the ALJ.  Id. (citing 42 C.F.R. § 1005.21(f)).

The I.G. filed a response brief arguing that the Board should affirm the ALJ Decision upholding the I.G.’s exclusion of Petitioner for 12 years because the ALJ Decision is supported by substantial evidence and free of legal error.  I.G. Br. at 1.  The I.G. noted that while Petitioner argued that the ALJ made errors of law and fact, Petitioner did not identify what those purported errors were and did not provide any additional evidence to support his argument.  Id. at 3.  The I.G. also pointed out that Petitioner did not raise the issue of his medical condition before the ALJ and did not provide any evidence to show that the criminal court determined Petitioner’s medical condition reduced his culpability in the underlying conviction.  Id.; 42 C.F.R. § 1001.102(c).

After the I.G. filed its response, on the same day, Petitioner submitted numerous medical records dated from September 13, 2017 to August 13, 2021.  Board E-File Docket Entry No. (Docket No.) 4-4k.3  Petitioner did not file a reply brief.

Standard of Review

The Board reviews a disputed issue of fact as to whether the ALJ’s decision is “supported by substantial evidence on the whole record.”  42 C.F.R. § 1005.21(h).  The Board reviews a disputed issue of law as to whether the ALJ’s decision is “erroneous.”  Id.; see also Guidelines – Appellate Review of Decisions of Administrative Law Judges in Cases to Which Procedures in 42 C.F.R. Part 1005 Apply (Guidelines), “Completion of the Review Process, ¶ c.4  The term “substantial evidence” means “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.”  Richardson v. Perales, 402 U.S. 389, 401 (1971) (quoting Consol. Edison Co. v. NLRB, 305 U.S. 197, 229 (1938)).  The governing regulations provide that the Board “will not consider any issue not raised in the parties’ briefs, nor any issue in the briefs that could have been raised before the ALJ but was not.”  42 C.F.R. § 1005.21(e).

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Analysis

1. The ALJ’s conclusion that there is a basis to exclude Petitioner pursuant to section 1128(a)(1) of the Act, for a statutory minimum of five years, is supported by substantial evidence and free of legal error.

Before the ALJ, Petitioner did not appear to dispute that the I.G. was authorized to exclude him under section 1128(a)(1) of the Act.  RFH at 4; ALJ Decision at 4 (citing P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply).  Petitioner did not challenge that on June 23, 2023, he pleaded guilty to one count of Conspiracy to Commit Health Care Fraud in violation of 18 U.S.C. § 1349.  See I.G. Ex. 3, at 3, 15.  Petitioner also did not dispute that the District Court accepted his guilty plea, sentenced Petitioner to one year and one day of incarceration and three years of supervised release, and ordered him to pay $437,850.51 in restitution.  See I.G. Ex. 2, at 2, 3, 6.  Accordingly, Petitioner was convicted of a criminal offense for the purpose of his exclusion under section 1128(a)(1) of the Act.  See Act § 1128(i)(3) (stating that an individual is considered to have been “convicted” of a criminal offense if “a plea of guilty or nolo contendere by the individual . . . has been accepted by a Federal, State, or local court”).

Additionally, Petitioner did not contest that his conviction is related to the delivery of an item or service under Medicaid.  Conviction for Medicaid fraud in connection with claims for Medicaid services is reasonably a conviction of a “criminal offense related to the delivery of an item or service under title XVIII [Medicare] or under any State health care program,” justifying an exclusion under section 1128(a)(1) of the Act.  See, e.g., Matthew J. Girardy, DMD, DAB No. 2987, at 2, 5 (2020) (“there is an ‘obvious nexus’ between the offense for which Petitioner was convicted and the delivery of an item or service under the New Jersey Medicaid program” where Petitioner “did purposely obtain approximately $385,467.00 from the [Medicaid program] by creating or reinforcing the false impression that dental services were provided to Medicaid beneficiaries as or to the extent claimed”) (internal citations omitted); Joann Fletcher Cash, DAB No. 1725 (2000) (upholding exclusion under section 1128(a)(1) based on conviction for Medicaid fraud); see also I.G. Ex. 2, at 6, 7 (restitution to be paid to Ohio Department of Medicaid).

Because Petitioner was convicted of a criminal offense related to the delivery of an item or service under the Ohio Medicaid program, Petitioner must be excluded from participation in all federal health care programs for the statutory minimum five-year period.  Act § 1128(c)(3)(B); 42 C.F.R. § 1001.102(a).  The ALJ’s conclusions that there is a basis to exclude Petitioner under section 1128(a)(l) of the Act based on Petitioner’s conviction for Medicaid fraud, and that section 1128 requires that Petitioner be excluded for a minimum of five years, are thus supported by substantial evidence and free of legal error.

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2. The I.G. established three aggravating factors under 42 C.F.R. § 1001.102(b)(1), (2), and (5), authorizing the I.G. to extend the exclusion period to greater than the five-year statutory minimum.

Before the ALJ, Petitioner did not dispute the I.G.’s application of the two aggravating factors at 42 C.F.R. § 1001.102(b)(2) (duration of offenses greater than one year) and (b)(5) (incarceration).  ALJ Decision at 6-7 (citing P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply); RFH.  Petitioner pleaded guilty to engaging in the fraudulent billing for nearly three years, from September 2017 through June 2020.  I.G. Ex. 3, at 10.  Regarding the incarceration aggravating factor, the District Court sentenced Petitioner to one year and one day of incarceration and three years of supervised release.  I.G. Ex. 2, at 2, 3.

Petitioner argued to the ALJ that the aggravating factor in section 1001.102(b)(1) (financial loss to government programs) should not apply because he fully satisfied the restitution obligation.  RFH at 1, 4; P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply at 1-2; P. Ex. 7 (photocopy of a Department of Justice document titled “Certificate of Release of Lien” showing that Petitioner satisfied the full restitution amount imposed by the District Court).  As the ALJ correctly found, Petitioner’s argument would not warrant a reduction in the exclusion period as the regulation states that “[t]he entire amount of financial loss . . . will be considered regardless of whether full or partial restitution has been made.”  42 C.F.R. § 1001.102(b)(1).  Therefore, the ALJ’s determination that there are three aggravating factors justifying the I.G.’s exclusion of Petitioner for a period of longer than five years is supported by substantial evidence and free of legal error.

3. None of the mitigating factors in 42 C.F.R. § 1001.102(c) apply to reduce the length of Petitioner’s exclusion.
   1. The ALJ’s conclusion that Petitioner failed to meet his burden to establish the existence of a mitigating factor is supported by substantial evidence and free of legal error.

Before the ALJ, Petitioner did not argue that any of the mitigating factors in 42 C.F.R. § 1001.102(c) existed and did not contest the I.G.’s position that none apply.  ALJ Decision at 7-8.  Rather, Petitioner argued that he has engaged in “positive activities” since his incarceration, takes accountability for his actions, and “desire[s] to continue contributing in every conceivable capacity.”  P. ALJ Br.; P. ALJ Br. Supp.  He claimed he has a “proven track record of excellence in healthcare” and submitted “statement letters from past supervisors and children [he has] worked with” and “character letters” from friends that “attest to [his] significant contributions to the field and [his] service to countless individuals in securing community-based resources over the years.”  P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply; P. Exs. 1-6.  Petitioner further alleged that the attorney representing him in his criminal case assaulted him, “compromis[ing] [his] ability to mount a proper defense,” therefore, exclusion would be unfair as his “defense was severely undermined by factors beyond [his] control.”  P. ALJ Br. Supp.

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As the ALJ correctly explained, only the three factors in section 1001.201(c) may be considered as bases for reducing the exclusion imposed by the I.G.  See Shaun Thaxter, DAB No. 3053, at 35 (2021) (“The mitigating factors that ALJs and the Board may consider are limited to those listed in the regulation . . . .”); Anthony Joseph Moschetto, D.O., DAB No. 3030, at 14 (2021) (emphasizing that “only the mitigating factors in section 1001.102(c) may be considered for possible reduction of an exclusion period longer than the mandatory minimum period”); Hussein Awada, M.D., DAB No. 2788, at 8 (2017) (“Only the mitigating factors identified in section 1001.102(c) may be considered and applied to reduce a period of exclusion.”).  Petitioner’s arguments do not establish any of the three mitigating factors recognized by the regulation.

Additionally, Petitioner’s ineffective assistance of counsel argument has no bearing on the review of the I.G.’s exclusion.  The applicable regulations specifically prohibit an ALJ and the Board from considering any “collateral” attacks of the underlying conviction.  42 C.F.R. § 1001.2007(d) (“When the exclusion is based on the existence of a criminal conviction . . . the basis for the underlying conviction . . . is not reviewable and the individual or entity may not collaterally attack it either on substantive or procedural grounds . . . .”); see Devon Rambert-Hairston, DAB No. 3069, at 5, 9 (2022) (finding that the ALJ correctly rejected petitioner’s claims that her defense lawyer was ineffective because the contentions constituted a collateral attack of the conviction).  Therefore, we affirm the ALJ’s conclusion that Petitioner has failed to meet his burden to show the existence of any regulatorily permissible mitigating factor.

2. Petitioner failed to prove the existence of the asserted mitigating factor in 42 C.F.R. § 1001.102(c)(2).

On appeal to the Board, Petitioner appears to assert that the mitigating factor in 42 C.F.R. § 1001.102(c)(2) applies.  Petitioner argues that the ALJ did not consider “important mitigating circumstances and evidence,” specifically his diagnosis of ankylosing spondylitis in 2020.  P. Br. at 1.  He states his condition causes chronic pain and stiffness, limits his mobility, and impacts his ability to function in many ways.  Id. at 1-2.  Petitioner asserts the ALJ should have considered his condition to “evaluate [his] intent, conduct, and capacity regarding the allegations and circumstances of this case.”  Id.  Petitioner submitted numerous medical records dated from September 13, 2017 to August 13, 2021, such as progress notes and emergency department visit summaries, showing that he suffered from chronic neck and lower back pain and was eventually diagnosed with ankylosing spondylitis.  Docket No. 4-4k.

The mitigating factor in 42 C.F.R. § 1001.102(c)(2) states:

The record in the criminal proceedings, including sentencing documents, demonstrates that the court determined that the individual had a mental,

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emotional or physical condition before or during the commission of the offense that reduced the individual’s culpability.

42 C.F.R. § 1001.102(c)(2).  Petitioner has the burden of proof and the burden of persuasion as to any asserted mitigating factor.  See Yolanda Hamilton, M.D., DAB No. 3061, at 20 (2022) (citing Mohamad Ahmad Bazzi, DAB No. 2917, at 10-11 (2018)) (“The excluded individual bears the burden of establishing this mitigating factor” at 42 C.F.R. § 1001.102(c)(2)); see also Docket No. 1a, ALJ Standing Prehearing Order at 3 (“Petitioner will bear the burden of proving any affirmative defenses or factors to mitigate the length of exclusion.”).

Although Petitioner asserts the ALJ did not consider his medical condition, Petitioner did not invoke the mitigating factor in 42 C.F.R. § 1001.102(c)(2), much less raise the issue of his medical condition, before the ALJ.  See P. ALJ Br.; P. ALJ Br. Supp.; P. ALJ Surreply; ALJ Decision.  Moreover, Petitioner did not argue before the ALJ that one of the enumerated mitigating factors applied or challenge the I.G.’s argument that none of the mitigating factors existed.  The ALJ specifically noted that “Petitioner does not refute the IG’s contention” that “none of the enumerated mitigating factors in the applicable regulations apply.”  ALJ Decision at 8 (citing I.G. Br. at 7-8; P. ALJ Br. Supp.; P. ALJ Surreply).  Petitioner offers no explanation for only now raising these arguments, which could have been raised when the case was before the ALJ.  For this reason, we may not reduce the exclusion on the basis of this alleged mitigating factor.  See 42 C.F.R. § 1005.21(e) (“The [Board] will not consider any issue not raised in the parties’ briefs, nor any issue in the briefs that could have been raised before the ALJ but was not.”); accord Guidelines ¶ (a); see also Salman Ali, DPT & Roohi Ali, DPT, DAB No. 3048, at 13 (2021) (rejecting new argument not raised before ALJ, citing section 1005.21(e)), aff’d sub nom. Ali v. U.S. Dep’t of Health & Hum. Servs., No. 21-CV-12365, 2022 WL 3130227 (E.D. Mich. Aug. 4, 2022); Dike H. Ajiri, DAB No. 2821, at 6 (2017) (stating that petitioner’s failure to introduce an issue before the ALJ “precludes him from now arguing the issue before the Board”).

The Board will also not consider Petitioner’s newly submitted evidence.  The Board generally decides I.G. exclusion appeals based on the record developed before the ALJ.  Letatia Norris, DAB No. 3135, at 8 (2024) (citing Farzana Begum, M.D., DAB No. 2726, at 18 n.10 (2016), aff’d, No. 16-cv-9624, 2017 WL 5624388 (N.D. Ill. Nov. 21, 2017)).  If a party submits additional evidence on appeal, the Board may remand a matter for consideration of evidence not previously presented to an ALJ only if the party shows the additional evidence is “relevant and material” and it had “reasonable grounds” for failing to submit the evidence to the ALJ.  Gracia L. Mayard, M.D., DAB No. 2767, at 6-7 (2017) (citing 42 C.F.R. § 1005.21(f)).

Petitioner did not allege reasonable grounds for failing to submit the records to the ALJ and offers no explanation for only now raising these arguments.  The medical records predated the underlying criminal conviction forming the basis for Petitioner’s exclusion

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and the case before the ALJ.  Therefore, Petitioner’s newly submitted medical records are inadmissible and we decline to remand this case to the ALJ for consideration of that evidence.  See Mayard at 8 (declining to admit newly submitted evidence or remand a case to an ALJ because the evidence was not relevant and material and Petitioner did not provide reasonable grounds for failing to submit the evidence to the ALJ).

Petitioner also has not shown that his medical records are “relevant and material.”  For the mitigating factor in section 1001.102(c)(2) to apply, “[t]he record in the criminal proceedings, including sentencing documents, demonstrates that the court determined that the individual had a mental, emotional or physical condition before or during the commission of the offense that reduced the individual’s culpability.”  42 C.F.R. § 1001.102(c)(2) (emphasis added).  The regulation requires a “judicial determination, made on the record of the individual’s criminal proceeding.”  Mayard at 7 (emphasis in original).  Petitioner must prove not only that he had a mental, emotional, or physical condition but also that the sentencing court made a finding that Petitioner had that condition before or during the commission of the crime and that the condition reduced his culpability.  See Bazzi at 8 (citing Russell Mark Posner, DAB No. 2033, at 9 (2006)) (explaining that the administrative adjudicator must “be able to infer clearly from the evidence of the proceedings that the sentencing court made the requisite determination”); Begum at 9 (stating that the “relevant inquiry” is whether a petitioner has proven that the sentencing court determined that the mental condition reduced the petitioner’s culpability).

Although Petitioner submitted medical records presumably to support his assertion that his condition “impacted [his] ability to function in many ways” (P. Br. at 1) and that the condition existed during the commission of the crime, the medical records are not evidence of a judicial determination that Petitioner’s condition reduced his culpability.  Therefore, Petitioner has not established that his medical records are relevant and material to evaluating the applicability of the mitigating factor in 42 C.F.R. § 1001.102(c)(2).  See Mayard at 7 (finding that records that do not reflect or refer to a judicial determination are not relevant and material to determining the existence of the mitigating factor in section 1001.102(c)).  The medical records by themselves cannot provide the ALJ or the Board any basis to conclude that they satisfy the strict requirements of the regulation, by which we are bound.

For the same reason, even if we were to consider Petitioner’s argument and additional documents, we would conclude that Petitioner has not met his burden to establish the mitigating factor in section 1001.102(c)(2).  Although the sentencing court need not make explicit findings that a mental, emotional, or physical condition existed at the time of the offense that reduced culpability, the Board “must nevertheless be able to infer clearly from the evidence of the [criminal] proceedings that the sentencing court made the requisite determination.”  Hamilton at 20; see also Arthur C. Haspel, D.P.M., DAB No. 1929, at 4 (2004) (explaining that where an explicit finding is not required “for purposes of the sentencing proceeding itself,” the mitigating factor in section 1001.102(c)(2) may

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be established if “it would be reasonable to infer from the entire record that the presiding judge had made the determinations required by the regulation as part of the sentencing process”).

As discussed above, Petitioner’s medical records are insufficient to establish a judicial determination of reduced culpability.  Additionally, none of the documents from the criminal proceedings in the record (judgment (I.G. Ex. 2), plea agreement (I.G. Ex. 3), and superseding indictment (I.G. Ex. 4)) indicate the District Court took note of Petitioner’s condition or reduced his culpability for the offense to which he pled guilty during sentencing.  The record lacks any evidence that directly supports, or from which we can infer, that the District Court made the requisite findings.  Therefore, Petitioner has not met his burden to show that the record supports the application of the mitigating factor in 42 C.F.R. § 1001.102(c)(2).  See, e.g., Bazzi at 12-13 (concluding that the petitioner did not identify any evidence of record to support a conclusion that the sentencing court made the required finding for application of the mitigating factor in section 1001.102(c)); Mayard at 5-6 (affirming the ALJ’s finding that the petitioner did not raise a genuine issue for hearing concerning the existence of the mitigating factor in section 1001.102(c) because the record did not contain any evidence that the court in the petitioner’s criminal case made the reduced-culpability determination required by the regulation); Christopher Switlyk, DAB No. 2600, at 5-6 (2014) (rejecting the petitioner’s contention that the mitigating factor in section 1001.102(c)(2) applied because the record of his criminal case did not “clearly show[ ] that the court in fact imposed a lesser sentence because it determined that [petitioner] suffered from [a mental, emotional or physical condition] that reduced his culpability”).

Further, as the ALJ properly concluded, Petitioner also has not established that any of the other two mitigating factors enumerated in the regulation apply.  Therefore, none of the mitigating factors in 42 C.F.R. § 1001.102(c) apply to reduce the length of Petitioner’s exclusion.

4. The ALJ’s determination that a 12-year exclusion period is not unreasonable based on three aggravating factors and no mitigating factors is supported by substantial evidence and free of legal error.

When analyzing the duration of an exclusion period longer than the five-year statutory minimum, the ALJ’s role is to “review[] the length of an exclusion de novo to determine whether it falls within a reasonable range, given the aggravating and mitigating factors and the circumstances underlying them.”  Rosa Velia Serrano, DAB No. 2923, at 8 (2019) (quoting Sushil Aniruddh Sheth, M.D., DAB No. 2491, at 5 (2012)).  “Such an evaluation ‘does not rest on the specific number of aggravating or mitigating factors or any rigid formula for weighing those factors, but rather on a case-specific determination of the weight to be accorded each factor based on a qualitative assessment of the circumstances surrounding the factors in that case.’”  Kimberly Jones, DAB No. 3033, at 7 (2021) (quoting Sheth at 5).  The I.G. has “broad discretion” in determining an

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exclusion length, based on the I.G.’s “vast experience” in implementing exclusions.  Janice Cassandra Wrenn, DAB No. 3118, at 14 (2023) (citing 57 Fed. Reg. 3,298, 3,321 (Jan. 29, 1992)).  An ALJ, or the Board, “may not substitute [its] judgment for that of the I.G. or determine a ‘better’ exclusion period.”  Jones at 8 (quoting Sheth at 5).

The ALJ determined that a 12-year exclusion period is “not unreasonable” based on the presence of three aggravating factors and the absence of regulatory mitigating factors.  ALJ Decision at 10.  The ALJ specifically noted the duration of Petitioner’s conduct and the significant program losses resulting from his fraudulent conduct supported the exclusion length.  Id.  Based on the presence of three aggravating factors and the absence of mitigating factors, under the circumstances of this case, we find no error in the ALJ’s decision to sustain the 12-year exclusion imposed by the I.G.  We agree that a 12-year exclusion period is not unreasonable.

1. The $437,850.51 restitution amount, nearly nine times greater than the threshold for aggravation, weighs heavily in favor of extending the mandatory period of exclusion.

The financial loss factor at section 1001.102(b)(1) weighs heavily in favor of a 12-year exclusion.  The District Court ordered Petitioner to pay $437,850.51 in restitution.  I.G. Ex. 2, at 6.  The ALJ concluded that the restitution amount alone justified extending the exclusion period by a significant amount because the restitution amount was nearly nine times greater than the threshold for aggravation.  ALJ Decision at 9.

The ALJ properly found that Petitioner’s conduct resulted in program losses nearly nine times the threshold for aggravation, warranting a significant increase in the exclusion period.  Id.  “The Board has long acknowledged that restitution is a measure of program loss.”  Awada at 7; see also Summit S. Shah, M.D., DAB No. 2836, at 8 (2017); Spyros N. Panos, M.D., DAB No. 2709, at 7 (2016); Craig Richard Wilder, DAB No. 2416, at 9 (2011).  The restitution amount is one indication of the seriousness of the individual’s crime and thus the level of threat the individual poses to program integrity. Awada at 7.  When the program loss is substantially larger than the threshold, this factor may be considered “an ‘exceptional aggravating factor’ to be accorded significant weight.”  Laura Leyva, DAB No. 2704, at 10 (2016) (quoting Sheth at 7), aff’d, No. 8:16-CV-1986-T-27AEP, 2017 WL 2880125 (M.D. Fla. Apr. 24, 2017).

Additionally, as the ALJ correctly determined, Petitioner’s argument that he satisfied the full restitution amount would not permit a reduction in the exclusion period, as the regulations state “[t]he entire amount of financial loss . . . will be considered regardless of whether full or partial restitution has been made.”  See Asim A. Hameedi, M.D., DAB No. 3087, at 9 (2023) (quoting 42 C.F.R. § 1001.102(b)(1)) (emphasis added); Awada at 8 (holding that “the fact that Petitioner made full restitution . . . is not a basis for giving little or no weight to this aggravating factor”).  We agree that the financial loss factor in section 1001.102(b)(1) is an exceptional factor that warrants significant weight.  See

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Jeremy Robinson, DAB No. 1905, at 12 (2004) (finding that a restitution amount four times the amount of minimum loss required to establish the aggravating factor is “entitled to ‘significantly more weight’”).

2. The length of Petitioner’s fraudulent conduct warrants extending the exclusion period.

Consistent with prior holdings, Petitioner’s criminal conduct lasting over a period far exceeding the one-year threshold indicates a significant threat to program integrity and weighs heavily in favor of extending the exclusion.  Petitioner admitted to participating in the criminal conduct from around September 11, 2017 to around June 2020, nearly three years.  I.G. Ex. 3, at 10.  As the ALJ appropriately noted, Petitioner’s conduct lasted almost three times longer than the threshold required for aggravation, demonstrating a lack of integrity over a long period of time rather than a minimal lapse in judgment.  See Donald A. Burstein, Ph.D., DAB No. 1865, at 8 (2003) (explaining that the purpose of the aggravating factor in section 1001.102(b)(2) “is to distinguish between petitioners whose lapse in integrity is short-lived from those who evidence a lack of such integrity over a longer period of time”); Awada at 10 (noting that “simply meeting the threshold for an aggravating factor is a clear indication of untrustworthiness”).

The Board has held that similar fraudulent conduct occurring for similar or even shorter durations than Petitioner’s fraudulent billing warrants a lengthier exclusion.  See, e.g., Awada at 8-10 (upholding a 23-year exclusion based, in part, on illegal conduct spanning 14 months); Leyva at 10 (stating that participation in the fraud scheme for over two years “amply demonstrates more than a short-lived lapse in integrity”); Vinod Chandrashekhar Patwardhan, M.D., DAB No. 2454, at 7 (2012) (holding that a three-year scheme demonstrated an “ongoing lack of integrity”).  Significant weight may be assigned to illegal conduct that “occurred for even slightly longer than the one-year threshold.”  Mrugeshkumar Shah, M.D., DAB No. 3079 at 10 (2022) (citing Awada at 8-10).  Petitioner’s criminal conduct for nearly a three-year period more than satisfies the aggravating factor in section 1001.102(b)(2) and supports the significant weight given to the factor.

3. Petitioner’s sentence to one year and one day of incarceration further supports the 12-year exclusion period.

With respect to the aggravating factor in section 1001.102(b)(5), the ALJ found that “[a]ny period of confinement, no matter how short, triggers the application of this aggravating factor and justifies increasing the period of exclusion.”  ALJ Decision at 10.  The ALJ also noted that she could not consider Petitioner’s assertion that the 12-year exclusion is unreasonable because he served his period of incarceration, as she was “prevented under the law from considering such facts as mitigating circumstances,” i.e., mitigating circumstances other than those listed in 42 C.F.R. § 1001.102(c).  Id. at 9.

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The Board has assigned “significant weight” to sentences similar and even shorter than Petitioner’s incarceration period.  See Roji Esha, DAB No. 3076, at 29 (2022) (affirming the ALJ’s conclusion that petitioner’s 90-day sentence permitted the I.G. to lengthen the period of exclusion); Thaxter at 32 (crediting the ALJ’s determination that “a six-month sentence is not insignificant” and “[a]ny period of incarceration justifies increasing the period of exclusion”); Begum at 16 (noting that petitioner’s sentence of incarceration, “even reduced to nine and a half months . . . was relatively substantial”) (citation omitted); Robinson at 12 (stating that an incarceration term of one year and a day in concert with other factors supports “sufficient” “weight”); Jason Hollady, M.D., a/k/a Jason Lynn Hollady, DAB No. 1855, at 12 (2002) (characterizing a nine-month incarceration term that included a period of work release as “more than a token incarceration” and “relatively substantial”).  We agree with the ALJ that Petitioner’s incarceration term of one year and one day justifies an increase in the period of exclusion.

The ALJ appropriately considered the three aggravating factors and the absence of any mitigating factors to support the determination that the 12-year exclusion period is not unreasonable.  We agree with the ALJ and conclude that the ALJ’s decision to sustain the 12‑year exclusion the I.G. imposed is supported by substantial evidence and free of legal error.

Conclusion

We affirm the ALJ Decision.