Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
In the Case of:
Michael Travers, M.D.
Petitioner,
- v. -
The Inspector General.
DATE: April 1, 1991
Docket No. C-170
Decision No. 1237
FINAL DECISION ON REVIEW OF
ADMINISTRATIVE LAW JUDGE
DECISION
Michael Travers, M.D., (Petitioner) requested review of a June 21,
1990
decision by Administrative Law Judge (ALJ) Steven T. Kessel
upholding
the exclusion of Petitioner by the Inspector General (I.G.)
from
participation in the Medicare and Medicaid programs for five
years. See
Michael Travers, M.D., DAB Civ. Rem. C-170 (ALJ
Decision).
Petitioner's exclusion was based on sections 1128(a)(1) and
1128(c)(3)(B)
of the Social Security Act (Act). Section 1128(a)(1)
mandates exclusion
from the Medicare and Medicaid programs for any
individual or entity
"convicted of a criminal offense related to the
delivery of an item or
service under title XVIII or under any State
health care program." 1/
Section 1128(c)(3)(B) establishes that "[i]n
the case of an exclusion under
subsection (a), the minimum period of
exclusion shall be not less than five
years . . . ."
Based on the following analysis, we affirm the ALJ's decision to
uphold
Petitioner's exclusion.
Background
The following findings of fact and conclusions of law (FFCL) from
the
ALJ's decision are undisputed: 2/
1. On December 16, 1988, Petitioner was charged in a
criminal
information in Utah state court with the offense of filing
false
Medicaid claims. I.G. [Exhibit] Ex. 1; [Petitioner's (P.) Ex.] 8A
at 3.
2. Petitioner was charged with using the wrong billing code number
in
claiming reimbursement for Medicaid claims, resulting
in
misrepresentation of the type, quality or quantity of the
services
rendered by Petitioner. I.G. Ex. 1.
3. Petitioner entered a plea agreement with the prosecutor in which
he
agreed to enter a plea of "no contest" to the criminal charge
against
him. I.G. Ex. 2.
4. Petitioner agreed to pay to the Utah Bureau of Medicaid
Fraud,
within 60 days, the sum of $8,464. This consisted of restitution
in the
amount of $6,464, costs of investigation in the amount of $1,000, and
a
civil penalty in the amount of $1,000. I.G. Ex. 2.
6. The plea agreement further provided that if Petitioner failed
to
make the agreed payment to the Utah Bureau of Medicaid Fraud, the
court
should accept his no contest plea and proceed to schedule the matter
for
imposition of sentence. I.G. Ex. 2.
8. On January 9, 1989, Petitioner filed a petition with the Utah
court,
asserting that he had complied with the terms of his plea,
and
requesting that he be permitted to withdraw his plea and the
criminal
charges against him be dismissed with prejudice. I.G. Ex.
5.
9. On January 9, 1989, the prosecuting attorney filed with the
Utah
court a notice of compliance stating that Petitioner had complied
with
the terms of his plea. I.G. Ex. 6.
10. On January 9, 1989, the Utah court entered an Order
permitting
Petitioner to withdraw his plea and dismissing with prejudice
the
criminal charges against Petitioner. I.G. Ex. 7.
14. The minimum mandatory period of exclusion for exclusions
pursuant
to section 1128(a)(1) of the Social Security Act is five
years. Social
Security Act, section 1128(c)(3)(B).
15. The Secretary delegated to the I.G. the duty to impose and
direct
exclusions pursuant to section 1128 of the Social Security Act.
48 Fed.
Reg. 21662 (May 13, 1983).
16. On June 20, 1989, the I.G. notified Petitioner that he was
being
excluded from participation in the Medicare and Medicaid programs as
a
result of his conviction of a criminal offense related to the
delivery
of an item or service under Medicaid. I.G. Ex. 8.
17. Petitioner was notified that he was being excluded
from
participation for five years, the minimum period mandated by law.
I.G.
Ex. 8.
Petitioner filed a timely appeal of his exclusion to the ALJ. As
we
discuss below, Petitioner took exception to eight of the FFCLs in
the
ALJ's decision. In general, the ALJ found in those FFCLs
that
Petitioner was "convicted" of a criminal offense within the meaning
of
that term as defined in section 1128(i) of the Act, and that
the
criminal offense "related to the delivery of an item or service"
under
Medicaid. Consequently, the ALJ found that an exclusion was
mandated
under the law. ALJ's Decision, pp. 4-5.
Since Petitioner did not challenge FFCL Nos. 1-4, 6, 8-10, and 14-17,
we
adopt and affirm those FFCLs without further discussion. Below
we
discuss the FFCls challenged by Petitioner.
Petitioner's Exceptions
Petitioner took exception to the following FFCLs:
5. The plea agreement provided that the Utah court might
take
Petitioner's no contest plea under advisement, as part of
a
first offender program, and hold the matter in abeyance for
a
period of 60 days. I.G. Ex. 2.
Petitioner asserted that he did not participate in a first
offender
program as defined by section 1128(i)(4).
7. On December 16, 1988, the Utah court approved the
plea
agreement as a disposition of Petitioner's case, and
accepted
Petitioner's no contest plea. I.G. Ex. 3; P.
[Petitioner] Ex.
8-A at 6-7, 10.
Petitioner asserted that his no contest plea was held in abeyance and
was
not accepted by the court within the meaning of section 1128(i)(3).
11. Petitioner was convicted of a criminal offense within
the
meaning of section 1128(i) of the Social Security Act.
Because Petitioner asserted that his no contest plea was not accepted
by
the court as defined by section 1128(i)(3) and that he did
not
participate in a first offender agreement as defined by
section
1128(i)(4), he argued that he was not convicted of a criminal
offense
within the meaning of section 1128(i).
12. Petitioner was convicted of a criminal offense related
to
the delivery of an item or service under Medicaid, within
the
meaning of section 1128(a)(1) of the Social Security Act.
Petitioner argued that a billing infraction is not "related to
the
delivery of an item or service" and therefore he does not fall
within
section 1128(a) and should not be excluded pursuant to it.
13. Pursuant to section 1128(a)(1) of the Social Security
Act,
the Secretary is required to exclude Petitioner
from
participating in Medicare and Medicaid.
21. The exclusion imposed against Petitioner by the I.G.
was
mandated by law.
Since Petitioner maintained that he was not "convicted" as defined
by
section 1128(i) and that his offense was not "related to the delivery
of
an item or service under Medicaid" as defined by section 1128(a),
he
asserted that the Secretary was not required to exclude him from
the
Medicare and Medicaid programs.
18. I do not have authority to decide whether the
Secretary
lawfully delegated authority to the I.G. to impose
exclusions.
In his appeal to this Board, Petitioner actually agreed with the ALJ
on
this point and simply identified this issue as contested in order
to
preserve the question for District Court review. Since this question
is
controlled by our decision in Jack W. Greene, DAB No. 1078
(1989),
aff'd, 731 F.Supp. 835 (E.D. Tenn. 1990), we therefore summarily
affirm
and adopt FFCL No. 18.
19. The Secretary was not required to adopt
implementing
regulations prior to imposing exclusions pursuant to
section
1128(a)(1) of the Social Security Act.
Petitioner argued that it was a violation of the Administrative
Procedure
Act, 5 U.S.C. 552 et seq., for the Secretary to impose
exclusions pursuant to
section 1128(a)(1) prior to promulgating
regulations.
20. There do not exist disputed issues of material fact in
this
case; therefore summary disposition is appropriate.
Petitioner argued that he should have been allowed to present
evidence
concerning the nature of Utah criminal process and the nature of
the
charges against him.
Analysis
The following four disputed issues were raised and addressed in the
ALJ's
decision:
o whether the Secretary is required to adopt
regulations
implementing the 1987 revision to section 1128(a) before
the
I.G. may make exclusion determinations;
o whether Petitioner was convicted of a criminal offense
within
the meaning of section 1128(i);
o whether Petitioner was convicted of a criminal
offense
related to the delivery of an item or service under
Medicaid
within the meaning of section 1128(a)(1); and
o whether there are disputed issues of material fact
which
would preclude summary disposition in this case.
Below we consider the disputed FFCLs in conjunction with each of
these
issues.
(1) The Secretary is not required to adopt
regulations
implementing the 1987 revision to section 1128(a)
before
allowing the I.G. to make exclusion determinations.
Other than incorporating by reference his earlier arguments that
the
Secretary was required to adopt regulations implementing revised
section
1128(a) before an exclusion could validly issue, Petitioner did
not
provide a basis for his position that the ALJ's decision to the
contrary
was erroneous. As noted by the ALJ, this argument was
addressed in
Greene, and was expressly found to be without merit by both this
Board
and the reviewing district court. Since Petitioner has not raised
any
new arguments to cause us to reconsider this issue, we uphold the
ALJ
decision and affirm and adopt FFCL No. 19.
(2) Petitioner was convicted of a criminal offense within
the
meaning of section 1128(i) of the Social Security Act.
Section 1128(a) requires mandatory exclusion of any individual
"convicted"
of a criminal offense related to the delivery of an item or
service under
Medicaid. Section 1128(i) sets forth the definition of
"convicted" for
purposes of section 1128(a). The ALJ found that the
facts of
Petitioner's case fell within both sections 1128(i)(3) and (4).
We uphold the
ALJ's determination as it relates to both subsections.
Under Section 1128(i)(3) an individual is defined as convicted "when
a
plea of guilty or nolo contendere by the individual or entity has
been
accepted by a Federal, State, or local court . . . ." (Emphasis
added.)
The ALJ found that Petitioner's plea of no contest had been
accepted
within the meaning of section 1128(i)(3). The ALJ reasoned
that, since
the state judge agreed to dispose of the criminal charges
against
Petitioner based on receipt of his plea, the judge had "accepted"
the
plea. The ALJ cited the common definition of the word "accepted" as
"to
receive with consent" and concluded that
[a] no contest plea is "accepted" within the meaning of
section
1128(i)(3) whenever a party offers a no contest plea and a
court
consents to receive it as an element of an arrangement
to
dispose of a pending criminal complaint against that party.
ALJ Decision at 11. We agree that the facts here indicate clearly
that
the court consented to receive Petitioner's plea as an element of
an
arrangement to dispose of a criminal complaint against him.
Petitioner
did not dispute that there was a criminal information filed
against him
and that the court approved a plea agreement which included a
plea of no
contest as one of the conditions for disposition of the
case. The
record of the proceeding before the court (P. Ex. 8A) shows
clearly that
the court took care to determine that the proffered no contest
plea was
both voluntary and informed and, therefore, acceptable as a basis
for
disposing of the criminal information. See Fed. R. Crim. P. 11(c)
and
Utah R. Crim. P.11(5) (required safeguards for such a plea).
If
Petitioner had failed to fulfill the conditions of the plea
agreement,
the court could have immediately imposed a sentence based on the
no
contest plea. Thus, we uphold the ALJ's finding that the
court
"accepted" Petitioner's plea within the meaning of section
1128(i)(3).
Consequently, we affirm the ALJ's conclusion that Petitioner met
the
definition of "convicted" under this section.
In addition, we uphold the ALJ's finding that Petitioner has
been
convicted of a criminal offense within the meaning of
section
1128(i)(4). That section provides that an individual is
considered to
have been convicted:
when the individual or entity has entered into participation
in
a first offender, deferred adjudication, or other arrangement
or
program where judgment of conviction has been withheld.
Petitioner argued that he had not participated in a first offender
program
because a judgment of conviction was not withheld, since he was
"diverted" to
a non-criminal process set forth in Utah Code of Criminal
Procedure (Utah
Code Crim. P.) 77-2-5, which provides:
(1) At any time after the filing of an information or
indictment
and prior to conviction, the prosecuting attorney may,
by
written agreement with the defendant, file with the court,
and
upon approval of the court, divert a defendant to a
non-criminal
diversion program.
Petitioner also cited applicable state law providing that:
Diversion is not a conviction and if the case is dismissed
the
matter shall be treated as if the charge had never been filed.
Utah Code Crim. P. 77-2-7. According to Petitioner, he entered
into
this arrangement to resolve what amounted to a billing dispute with
the
state Medicaid program without resort to the criminal justice
system.
Petitioner contended that these provisions refute the ALJ's
findings
that he was convicted of a criminal offense within the meaning
of
section 1128(i) of the Social Security Act and that he participated in
a
first offender program as defined by section 1128(i)(4). 3/
The I.G. agreed that a "diversion agreement" as described by
Petitioner
would not be a section 1128(i) "conviction." The I.G.
characterized the
Utah non-criminal diversion system as a "deferred
prosecution" system in
which, if an individual failed to fulfill all
conditions, the individual
could still enter a plea of not guilty and defend
his innocence in a
criminal trial. According to the I.G., however, the
circumstances in
Petitioner's case clearly indicated that he participated in
a "deferred
adjudication" or "first offender" program, of the type covered
by
section 1128(i)(4), since the record showed that his failure to
fulfill
all conditions would have resulted in the court's acceptance
of
Petitioner's plea of no contest, with a corresponding judgment
and
sentencing based on that plea.
In his post-hearing brief, Petitioner introduced an affidavit from
the
attorney who represented him in this matter as support for
his
contention that all parties understood that they were proceeding
under
the above-cited sections of Utah law. The attorney also stated
that if
the judge had not accepted the plea agreement, Petitioner would
have
been permitted to withdraw his no contest plea and to defend
himself
from the state's charges. Affidavit of Kay L. McIff at par.
6.
Upon consideration of the record before us, we conclude that
Petitioner
was indeed a participant in a "first offender" program of the
type
encompassed by section 1128(i). The combined, contemporaneous
record of
the plea agreement and the judge's remarks on accepting that
agreement
are simply more compelling evidence of the nature and circumstances
of
the proceeding than Petitioner's attorney's recollection two
years
later. There is no mention of the cited Utah code sections in
either
the plea agreement, the judge's remarks, or the order which
ultimately
disposed of the case. See I.G. Ex. 2; P. Ex. 8A; I.G. Ex.
7. Moreover,
the plea agreement which Petitioner and his lawyer signed
referred to a
"first offender" program (I.G. Ex. 2 at par. 4), and the judge
also
referred to the case as involving a "first offense." P. Ex. 8A at
7.
Finally, the judge's order allowing withdrawal of the plea and
dismissal
of the case also referred to Petitioner "having completed all terms
of
the 1st offender program ordered by the Court." I.G. Ex. 7. In
the
face of all of the contemporaneous documents, the affidavit
is
unconvincing. 4/ We therefore conclude that the ALJ's
determination
that Petitioner was subject to section 1128(i) was
correct.
Accordingly, we affirm and adopt FFCL Nos. 5, 7 and 11.
(3) Petitioner was convicted of a criminal offense related
to
the delivery of an item or service under Medicaid within
the
meaning of section 1128(a)(1) of the Social Security Act.
With respect to the ALJ's lengthy discussion of his rationale for
the
above finding, Petitioner stated that he "disagrees with the
ALJ's
holding on this issue." Request for review at 4.
Petitioner's
disagreement is based on his position that he was not convicted,
which
we have rejected above, and his position that the offense at issue
was
not related to the delivery of an item or service under Medicaid.
While
Petitioner elaborated on his first position during the
proceedings
before this Board, he relied on his briefs below as support for
the
second position.
Once again, we find that this question was already discussed and
decided
in Greene. In brief, we found in that case that the plain
meaning of
the law, its legislative history, and a comparison of language in
the
current version of the law with language contained in previous
versions,
clearly indicated that "submission of a bill or claim for
Medicaid
reimbursement is the necessary step, following the delivery of the
item
or service, to bring the 'item' within the purview of the
program."
Greene at 7, 11. Since Petitioner has not provided any
reasons why the
ALJ's application of this precedent to his case is
inapposite, we reject
Petitioner's objection, and we affirm and adopt FFCL
Nos. 12, 13 and 21.
(4) There was no material fact alleged by Petitioner before
the
Administrative Law Judge that made summary
judgment
inappropriate.
In his request for review, Petitioner disagrees with the ALJ's FFCL No.
20
that there were no disputed issues of material fact which would
preclude
summary disposition. In particular, Petitioner stated --
Petitioner contends that the nature of his local
litigation
precludes his being estopped from challenging all material
facts
herein. Petitioner also asserts that even if there were
no
issues of material fact that would preclude summary
disposition
of issues within the jurisdiction of the ALJ, an
evidentiary
hearing is required for the purpose of creating a record
through
use of subpoenas issued against the OIG and otherwise on
the
preserved issues unless the Department waives such
exhaustion
administratively and waives objection to subsequent
discovery
during U.S. District Court review.
Petition for review at 3. Petitioner also contended that by
introducing
his previous counsel's affidavit about the character of the
state
proceeding underlying this exclusion, a factual controversy has
been
created that makes this case inappropriate for disposition by
summary
judgment. Petitioner's post-hearing brief at 4.
In considering whether the ALJ erred in granting summary disposition,
it
is important first to understand what evidence was before the ALJ in
the
proceeding below. The ALJ Decision accurately describes that
evidence
as follows:
Petitioner has submitted his affidavit to show: (1) that
he
never intentionally committed a criminal offense, and (2)
his
understanding of the legal significance of his plea to
the
criminal charges. P. Ex. 1.
ALJ Decision at 8. The ALJ concluded that these allegations, even
if
taken as true, did not establish facts material to the issues
before
him, since they did not refute the official records documenting
the
state proceeding underlying this exclusion.
We concur with the ALJ that Petitioner's affidavit that was
introduced
below did not raise material facts requiring an evidentiary
hearing.
Petitioner's intentions and understanding concerning the
state
proceeding did not matter; what mattered was the precise legal
character
of that proceeding.
Petitioner has now introduced further evidence about that question,
which
was apparently available to him during the proceeding below but
was never
offered to the ALJ. It is a significant omission here
that
Petitioner has not advanced any reasons why this evidence was
not
submitted during the proceedings before the ALJ. In any event,
this
affidavit merely offers further evidence on Petitioner's
understanding
of the legal significance of his plea, which the ALJ correctly
found to
be irrelevant. Moreover, we have concluded above that this
new
affidavit by Petitioner's former counsel does not overcome
the
contemporaneous official documents for the state proceeding that
were
considered by the ALJ in reaching his conclusion that
summary
disposition was warranted. Accordingly, we affirm FFCL No.
20.
Conclusion
Based on the analysis above, we affirm the ALJ's June 21, 1990
decision
sustaining Petitioner's five-year exclusion from participation in
the
Medicare and Medicaid programs.
Donald F. Garrett
Theodore J. Roumel U.S. Public Health Service
Cecilia Sparks Ford Presiding Panel Member
1. "State health care program" is defined by section 1128(h)
of the
Act to include any State Plan approved under Title XIX of the
Act
(Medicaid). We use the term Medicaid to refer to all state
health
programs.
2. We have not repeated the footnotes from the ALJ's Decision.
3. Petitioner did not introduce these state statutory provisions
in
the proceeding below, so the ALJ decision did not address them.
4. The affidavit's statement that Petitioner would have been
permitted
to defend himself if the judge had rejected the plea agreement
simply
states a truism. It does not indicate that the arrangement,
once
ratified, was not a "first offender" or "deferred
adjudication"