Robert C. Greenwood, DAB No. 1423 (1993)

Department of Health and Human Services

DEPARTMENTAL APPEALS BOARD

Appellate Division

In the Case of:

Robert C. Greenwood,
Petitioner,
- v. -
The Inspector General.

DATE: July 1, 1993
Docket No. C-93-016
Decision No. 1423


FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE
DECISION

Robert C. Greenwood (Petitioner) appealed an April 20, 1993 decision by
Administrative Law Judge Joseph K. Riotto upholding Petitioner's
five-year exclusion from participation in Medicare and state health care
programs. Robert C. Greenwood, DAB CR258 (1993) (ALJ Decision). The
Inspector General (I.G.) excluded Petitioner under section 1128(a)(1) of
the Social Security Act (42 U.S.C.  1320a-7(a)(1)) based on
Petitioner's conviction by a New York criminal court of one count of
petit larceny.

For the reasons stated below, we affirm the ALJ Decision upholding
Petitioner's five-year exclusion from Medicare and state health care
programs. We affirm and adopt each of the 18 findings of fact and
conclusions of law (FFCLs) upon which the ALJ Decision was based.


BACKGROUND

The ALJ found the following facts. At all times relevant and material
to this case, Petitioner was a home health aide, providing home health
care services on behalf of his employers, the Visiting Nurses
Association of Central New York (VNA) and the Medical Personnel Pool of
Syracuse (MPP). ALJ Decision at 2 (FFCLs 1, 2). From September 1988 to
April 1989, Petitioner submitted time sheets to VNA and MPP which
indicated that he had provided certain home health care services to a
patient ("patient R.P.") when, in fact, he had not done so. Petitioner
received payment for these claimed services from his employers. At all
times relevant to this case, patient R.P. was a Medicaid recipient
receiving medical services reimbursed by the Medicaid program. Id.
(FFCLs 3, 4, 5). Based on Petitioner's erroneous time sheets, VNA and
MPP submitted claims to Medicaid for reimbursement for the home health
care services and VNA and MPP were reimbursed by Medicaid in the amounts
of $440.48 and $415.44 for the erroneously claimed services. Id. (FFCLs
6, 7).

On February 13, 1990, Petitioner pled guilty to one count of petit
larceny, which was accepted by a New York criminal court. Id. at 2-3
(FFCLs 8, 10). Pursuant to his guilty plea, Petitioner was required by
the court to pay a fine of $1,000 and $941.88 in restitution to a
Medicaid fraud restitution fund. Petitioner's restitution of $941.88
represented the sum of the amounts that he had claimed for the services
he did not provide to patient R.P., plus nine percent interest. Id. at
3 (FFCLs 11, 12, 13).

On October 20, 1992, the I.G. notified Petitioner that he had been
excluded for a period of five years from participation in the Medicare
and state health care programs because he had been convicted of a
criminal offense related to the delivery of an item or service under
Medicaid. 1/ Id. (FFCL 15). Petitioner appealed, and the ALJ upheld
the exclusion, without a hearing, on summary judgment.

On appeal, Petitioner alleged that: 1) since there was no evidence that
he knew that patient R.P. was a Medicaid recipient or that his employers
would be submitting claims to Medicaid based on his false time sheets,
there was no evidence that his conviction was related to the delivery of
items or services under Medicare or Medicaid and thus his exclusion
under section 1128(a)(1) was improper; 2) there were disputed issues of
fact making summary judgment improper; and 3) the ALJ erred in applying
regulations which were effective upon publication in 1992 and 1993 to
this matter because the conduct at issue occurred during 1988 and 1989.
See generally Petitioner's Brief (P. Br.) at 1-3.

Petitioner stated generally that he appealed from "each and every
element of the findings in fact, conclusions of law and other aspects of
the conclusion and decision rendered by [the ALJ]." P.Br. at 1.
Petitioner's allegations, however, properly raise exceptions only to
FFCL 18, which states:

18. 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 Act.

ALJ Decision at 3 (citation omitted). Thus, we affirm and adopt the
remaining FFCLs without discussion.


DISCUSSION

Petitioner was excluded under section 1128(a)(1) of the Social Security
Act (Act), which provides:

(a) MANDATORY EXCLUSION. -- The Secretary shall exclude the
following individuals and entities from participation in any
program under [Medicare] and shall direct that the following
individuals and entities be excluded from participation in
[Medicaid]: (1) CONVICTION OF PROGRAM-RELATED CRIMES. -- Any
individual or entity that has been convicted of a
criminal offense related to the delivery of an item or
service under [Medicare] or [Medicaid].

Section 1128(c)(3)(B) of the Act provides that --

In the case of an exclusion under subsection (a), the minimum
period of exclusion shall not be less than five years . . . .


I. Petitioner's offense was related to the delivery of items or
services under Medicaid; thus, the ALJ did not err in upholding
Petitioner's exclusion for five years under section 1128(a)(1).

Petitioner argued that there was no evidence in the record on which the
ALJ could have concluded that Petitioner was convicted of a
program-related crime. See generally P. Br. at 1-3. In support of his
argument, Petitioner asserted that there was no evidence that he had
knowledge that patient R.P. was a Medicaid recipient. Petitioner argued
that there was also no evidence showing that he knew that his employers
would be submitting reimbursement claims to Medicaid for the services he
falsely claimed to have provided to patient R.P. Id. at 1. Petitioner
argued that, based on the above facts, his exclusion under section
1128(a)(1) was not proper. Id. at 1-3.

In establishing whether the relationship between an offense and the
delivery of items or services under Medicare or Medicaid exists, the
Board has previously held that the I.G. is not bound by the four corners
of the judgment but must look at the circumstances of the conviction and
determine whether there is a "common sense connection" between the
conduct for which Petitioner was convicted and the delivery of
program-related items or services. E.g., Dewayne Franzen, DAB 1165
(1990). The Board has held that, where submission of a claim to
Medicaid is a necessary step following delivery of services to a
Medicaid patient, an offense is related to delivery of program-related
items or services for purposes of section 1128(a)(1) because the amount
of the claim is based entirely on the nature or value of items or
services delivered. Jack W. Greene, DAB 1078 (1989), aff'd sub nom
Greene V. Sullivan, 731 F. Supp. 839 (E.D.Tenn. 1990).

In this case, we find a very evident connection between Petitioner's
offense and the delivery of items or services under Medicaid.
Petitioner was convicted of petit larceny for misrepresenting on time
sheets that he provided services to patient R.P. on certain dates.
Petitioner did not argue that his employers did not, in fact, submit
claims to Medicaid based on these misrepresentations or that Medicaid
did not reimburse his employers for these services which were never
provided. See I.G. Ex. 1 at 3. While his employers actually submitted
the claims to Medicaid, the claims would not have been false but for
Petitioner's misrepresentations. 2/ This establishes a clear connection
between Petitioner's offense and the delivery of services under
Medicaid. Therefore, the ALJ did not err in concluding that
Petitioner's conviction related to the delivery of services under
Medicaid and that exclusion under section 1128(a)(1) was proper.

Contrary to what Petitioner argued, it was not necessary for Petitioner
to know of the relationship between his offense and the delivery of
items or services under Medicaid in order for the exclusion to be
proper. Section 1128(a)(1) does not define the phrase "related to the
delivery of an item or service under [Medicare] or [Medicaid]."
However, the literal language of the section provides for the mandatory
exclusion of any individual who has been convicted of a criminal offense
related to the delivery of items or services under Medicare or Medicaid.
The section does not limit exclusions merely to those individuals
convicted of criminal offenses which the individuals know to be related
to the delivery of items or services under Medicare or Medicaid. The
language of the section does not require any knowledge on the part of a
petitioner of the relationship between the offense and the program;
rather, the language requires only that the factual relationship between
the offense and the program exist. 3/ The Board has previously
expressed its reluctance to read into the exclusion provisions
requirements that are not contained in the literal language of the law.
Napoleon S. Maminta, M.D., DAB 1135 at 6-9 (1990).

We note, in any event, that application of section 1128(a)(1) here is
not unfair since Petitioner could have reasonably anticipated the
possibility that his misrepresented services might lead to a false claim
under Medicare or Medicaid and thus put the program at risk. Moreover,
in his appearance before the New York criminal court, Petitioner agreed
to pay restitution in the amount of $941.88 tendered to the "Medicaid
Fraud Restitution Fund." See I.G. Exhibit (Ex.) 3 at 4. This put
Petitioner on constructive notice that the offense related to the
Medicaid program.

For the reasons stated above, we affirm and adopt FFCL 18.


II. Petitioner did not offer evidence indicating that there was a
genuine dispute as to a material fact; thus, the ALJ did not err in
granting summary judgment to the I.G.

The ALJ granted summary judgment in this matter to the I.G., stating
that there were no material factual issues in dispute and that the only
matter to be decided was the legal significance of the undisputed facts.
ALJ Decision at 1. The ALJ provided no further discussion on the matter
of summary judgment.

Petitioner objected to the granting of summary judgment to the I.G.:

[E]ven though the I.G. made a Motion for Summary Disposition for
exclusion upon the basis that there were no facts in dispute,
the Inspector General submitted an Affidavit of Fact (I.G. Ex.
1) [hereinafter "the LaCasse affidavit"] to the ALJ; and the ALJ
improperly received and considered evidence which [Petitioner]
factually controverted and requested an opportunity for evidence
to be taken.

P. Br. at 2. Petitioner did not state in his brief which specific facts
contained in the LaCasse affidavit (or otherwise) were in dispute.

It is unclear whether Petitioner is arguing before the Board that 1)
there is a disputed issue of material fact whenever the party moving for
summary judgment submits an affidavit containing factual assertions,
thus making summary judgment based on affidavits improper; or 2) the
LaCasse affidavit contained specific factual assertions which Petitioner
disputed. We note that in Petitioner's January 25, 1993 Response on
Behalf of Petitioner Robert C. Greenwood, submitted to the ALJ (P. Br.
before ALJ), Petitioner stated:

[T]he affidavit of Michael P. LaCasse contains factual
statements which [P]etitioner controverts . . . . Specifically,
at page 3 of the affidavit, Mr. LaCasse identifies (at
paragraph 8 of the affidavit) that he has reviewed Medicaid
records of payments made to the [VNA] and [MPP]. To the extent
that the affidavit identifies actions taken by the [VNA] and
[MPP] and their request for reimbursement from the New York
State Department of Social Services or otherwise from any other
Medicaid program, [Petitioner] objects. The issue in dispute
here is [P]etitioner's conduct, not the conduct of [VNA]
or [MPP]. . . . The [I.G.] now seeks to introduce to
this Court factual information which is outside the
scope of actions taken by Petitioner.

P. Br. before ALJ, at 3-4.

To the extent that Petitioner is arguing that there is a genuine dispute
whenever affidavits containing factual assertions are submitted, we
disagree. The fact that affidavits may be used to assert facts in
support of or in opposition to a summary judgment motion is specifically
contemplated by Federal Rule of Civil Procedure (Fed. R. Civ. P.) 56,
the summary judgment rule for federal courts. 4/ See also Celotex Corp.
v. Catrett, 477 U.S. 317 (1986). What is at issue is the extent to
which a party moving for summary judgment must provide evidence, in the
form of affidavits or otherwise, showing that summary judgment should be
granted. Also at issue is the extent to which a party opposing summary
judgment must provide affidavits or other evidence showing that there is
a genuine dispute as to a material fact.

The Board has held that, in a motion for summary judgment in a section
1128(a)(1) exclusion, the I.G. must put forth evidence on each material
element of its case and the evidence must be clear and not subject to
conflicting interpretation. Thelma Walley, DAB 1367, at 5-6 (1992). In
support of his motion for summary judgment in this matter, the I.G.
introduced several documents. See generally I.G. Exs. 1-3. First, the
I.G. proffered time sheets which Petitioner submitted to his employers,
which show that on certain dates in 1988 and 1989, Petitioner claimed to
have provided services to patient R.P. See I.G. Ex. 1, at 24-38.
Second, the I.G. proffered notes taken by a Medicaid fraud control unit
investigator showing that patient R.P. was out of town on certain of the
dates Petitioner claimed to have provided services to patient R.P. See
I.G. Ex. 1, at 17-19. Third, the I.G. provided an affidavit testifying
that the investigator interviewed several Medicaid recipients receiving
services from Petitioner and had reviewed payroll records, patient
medical records, telephone logs, and documentation of out-of-town travel
of patient R.P. See I.G. Ex. 1, at 1-4. Fourth, the I.G. introduced a
partial transcript of the criminal proceeding where Petitioner pleaded
guilty to petit larceny in connection with filing false time sheets.
See I.G. Ex. 3. Finally, the I.G. proffered payment statements to show
that Medicaid reimbursed Petitioner's employers for the services
Petitioner claimed to have rendered but, in fact, did not render. See
I.G. Ex. 1, at 20-23. Petitioner did not challenge the authenticity of
any of these documents.

These documents were sufficiently clear on their face to establish a
prima facie case that Petitioner was convicted of a criminal offense
related to delivery of items or services under Medicaid. Petitioner was
therefore obligated to present affidavits or other evidence disputing
the I.G.'s evidence in order to defeat a motion for summary judgment;
Petitioner did not do so. Petitioner offered only a single affidavit in
which he attested to certain facts leading up to his conviction. See P.
Ex. 1. None of those facts are in conflict with the I.G.'s evidence,
and therefore, the affidavit does not raise a genuine dispute of
material fact.

Moreover, despite Petitioner's broad assertion before the ALJ that there
were facts in dispute, Petitioner did not specifically identify such
facts. With regard to the LaCasse affidavit, Petitioner did not allege
that the factual assertions in the affidavit were or might be incorrect.
5/ See I.G. Ex. 1 at 2-3. What Petitioner objected to was the
relevance (and admissibility) of these facts to the case and the legal
conclusions to be drawn from them. That is, Petitioner argued that the
fact that MMP and VNA submitted claims to Medicaid was irrelevant as to
whether Petitioner's offense related to the delivery of items or
services under Medicaid. Clearly, legal conclusions may be resolved by
summary judgment. See Fed. R. Civ. P. 56. In fact, summary judgment
was specifically designed to resolve cases where the legal conclusions
to be drawn were the only matters remaining at issue. Therefore, it was
not erroneous for the ALJ to proceed to summary judgment in this matter
based on the uncontroverted evidence of the I.G. contained in the
affidavits and other documents submitted.

In the brief before the ALJ, Petitioner also alleged a disputed issue of
fact which was not related to reliance on affidavits:

The [I.G.] has produced no direct or circumstantial evidence
that [Petitioner] had any knowledge that [patient R.P.] was a
recipient of Medicaid benefits. Any allegation by the [I.G.] to
the contrary would create a dispute of material fact.

P. Br. before ALJ, at 8.

We find no indication in the record that the I.G. ever asserted that
Petitioner had knowledge that patient R.P. was a Medicaid recipient,
but, in any event, such knowledge is immaterial. 6/ Therefore, summary
judgment was proper.


III. Petitioner did not allege specific harm by the ALJ's application
of regulations published in 1993 and 1992; thus the ALJ did not err in
applying these regulations.

In his brief before the Board, Petitioner argued that:

[T]he activities alleged to have been the basis of the exclusion
occurred in 1988 and 1989. The conviction in the City Court
Proceedings occurred on February 13, 1990. Nonetheless, the
[I.G.] and the [ALJ] have utilized Regulations of the Department
of Health and Human Services which were put into force and
effect subsequent to the acts which formed the basis of the
exclusion. Therefore, the procedure utilized by the [ALJ] is
defective and deficient.

P. Br. at 2.

Section 1128(a)(1) of the Act was amended in 1987 to mandate a minimum
5-year exclusion for conviction of an offense related to delivery of an
item or service under Medicaid. Thus, even in the absence of
implementing regulations, an exclusion would be appropriate here.

In a letter to both parties dated February 2, 1993, the ALJ asked both
parties to comment on the applicability of exclusion regulations
published in the Federal Register on January 22, 1993 ("the 1993
regulations"). See 58 Fed. Reg. 5617 (1993). The 1993 regulations were
intended to clarify more extensive exclusion regulations which were
published in the Federal Register on January 29, 1992 ("the 1992
regulations"). See 57 Fed. Reg. 3298 (1992). The ALJ found in his
decision that the 1992 regulations applied to the case because of their
stated effective date of January 29, 1992; the ALJ stated that the 1992
regulations did not differ materially from regulations in effect prior
to the effective date of the 1992 regulations ("prior regulations").
The ALJ Decision did not discuss the 1993 regulations.

It is unclear whether Petitioner is objecting before the Board to
application of the 1993 or 1992 regulations, or both. In his response
to the ALJ's invitation to comment, Petitioner briefly referred to the
1993 regulations but then discussed only the 1992 regulations.
Petitioner stated that it would violate fundamental fairness to apply
the 1992 regulations to Petitioner since there was a large body of case
law developed around the prior regulations and it was unclear whether
this case law would be applicable to the new regulations.

The 1993 regulations state that they are effective immediately upon
publication, i.e., January 22, 1993. Furthermore, as the ALJ Decision
noted, the 1992 regulations state that they are effective January 29,
1992. We have previously found that, while the 1992 regulations are
applicable to exclusions which are considered by the Board after January
29, 1992 on procedural matters, it would be unfair to apply them on
substantive matters in exclusion cases brought by the I.G. prior to that
date. See, e.g., Behrooz Bassim, M.D., DAB 1333 at 8-9 (1992).

The ALJ Decision stated that the substantive provisions of the 1992
regulations do not materially differ from prior regulations where the
I.G. is seeking to impose only the mandatory minimum five-year
exclusion. See ALJ Decision at 7. This is not technically correct
since the prior regulations on exclusions (then called "suspensions")
for program-related crimes were based on the provisions of section
1128(a) as they existed prior to the 1987 amendments. See 42 C.F.R. 
1001.122 (1991). However, the substantive provisions of the 1992
regulations on program-related crimes, to the extent relevant, simply
track the statutory language, as amended, and do not change the
interpretations of that language in existing case law.

Moreover, with respect to the procedural provisions, Petitioner did not
identify any specific way in which he was prejudiced by application of
the 1992 or 1993 regulations rather than the regulations in effect at
the time of the conduct. It is not sufficient for Petitioner to simply
label the application of these newer regulations as "defective and
deficient." P. Br. at 2. Therefore, we find no merit to Petitioner's
objection to application of the 1993 or 1992 regulations.


CONCLUSION

For the above reasons, we find that the ALJ did not err in finding that
Petitioner's conviction was for an offense related to delivery of an
item or service under Medicaid, and that summary judgment was proper.
We further find that the ALJ did not err in applying the 1992
regulations to this matter. We affirm and adopt each of the ALJ's
FFCLs. Consequently, we affirm the ALJ Decision upholding Petitioner's
exclusion from Medicare and Medicaid for five years.


______________________________
Donald F. Garrett


______________________________
M. Terry Johnson


______________________________
Judith A. Ballard Presiding
Board Member


1. "State health care program" is defined in section 1128(h) of the
Social Security Act and includes the Medicaid program under title XIX of
the Act. Unless the context indicates otherwise, we use the term
"Medicaid" to refer to all programs listed in section 1128(h).

2. Section 1128(a)(1) clearly requires the exclusion of individuals
found liable under the false claims provisions of section 1128B(1) and
(2) of the Act. The false claims provisions impose criminal penalties
on any person who knowingly and willfully makes or causes to be made
false representations of fact either on Medicare and Medicaid payment
applications or for use in determining rights to payments under such
programs. Similarly, here, Petitioner's actions were a cause of false
representations of material fact being made to Medicaid.

3. The Board has previously considered two section 1128(a)(1)
exclusions which, like this case, involved the actual submission of
claims to Medicare or Medicaid by someone other than the petitioners.
See Catherine Dodd, R.N., DAB 1345 (1992); Thelma Walley, DAB 1367
(1992). In both of those cases, the Board concluded that the I.G. had
failed to prove that the convictions related to the delivery of
program-related items or services. However, these conclusions were
based on the fact that there was no proven factual relationship between
the offense and the delivery of program-related items or services, not
because there was no knowledge of a factual relationship on the part of
the petitioners.

4. While ALJs are not bound by the Federal Rules of Civil Procedure,
ALJs may properly use the rules as guidance. See, e.g., Thelma Walley,
DAB 1367 at 4 (1992).

5. For example, as stated earlier, Petitioner did not allege that the
affiant's statement that patient R.P. was a Medicaid recipient was or
might be false. Nor did Petitioner argue that VNA or MMP did not, in
fact, submit claims for Medicaid reimbursement based on Petitioner's
incorrect time sheets or that Medicaid did not reimburse VNA and MMP for
these claims. See I.G. Ex. 1 at 2-3.

6. Even if the I.G. had alleged (and supported with evidence) that
Petitioner had knowledge of his conduct's relationship to the Medicaid
program, summary judgment would have still been proper here. Summary
judgment is proper when all genuine issues of fact, even when resolved
against the movant, would still result in judgment in favor of the
movant. In other words, summary judgment is proper where, though there
are genuine issues of fact, their outcome is irrelevant to the decision
(and therefore, the issues of fact are not "material.") See Janet
Wallace, DAB 1326, at 14-15 (1992). Since we have determined that
knowledge of the relationship between the offense and the Medicare or
Medicaid programs is not a required element of section 1128(a)(1),
resolution of the Petitioner's knowledge would not have been relevant to
the outcome and summary judgment would still have been