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CASE | DECISION | ANALYSIS | JUDGE | FOOTNOTES

Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
IN THE CASE OF  


SUBJECT: Thomas Edward Musial,

Petitioner,

DATE: August 30, 2005

             - v -

 

Inspector General

 

Docket No. A-05-76
Civil Remedies CR1291
Decision No. 1991
DECISION
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FINAL DECISION ON REVIEW OF
ADMINISTRATIVE LAW JUDGE D
ECISION

Thomas Edward Musial (Petitioner) appealed a decision by Administrative Law Judge (ALJ) Keith W. Sickendick upholding the Inspector General's (I.G.) exclusion of Petitioner from participation in Medicare, Medicaid and all other federal health care programs as defined in section 1128B(f) of the Social Security Act (the Act). Thomas Edward Musial, DAB CR1291 (April 7, 2005) (ALJ Decision). The I.G. excluded Petitioner pursuant to section 1128(a)(4) of the Social Security Act (Act)(42 U.S.C. § 1320a-7(a)(4)) on the ground that he had been convicted of a felony criminal offense related to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance.

In his appeal to the Board, Petitioner identifies one technical error related to the date of his offense in Conclusion of Law (COL) 4. P. Br. at 1. He also argues the Board should modify the exclusion to "begin at a reasonable point in time," rather than June 16, 2004, the effective date of his exclusion. Id. at 2.

Board review of an ALJ decision in exclusion cases is governed by 42 C.F.R. § 1005.21. Section 1005.21(h) provides that our standard of review "on a disputed issue of fact is whether the initial decision is supported by substantial evidence on the whole record" and "on a disputed issue of law is whether the initial decision is erroneous."

As explained below, we conclude that COL 4, while technically in error, does not reflect the ALJ's actual findings and conclusions regarding the date of Petitioner's offense. Accordingly, the error is not a ground for reversal, and we simply correct it. We also conclude that neither the Board nor the ALJ has the authority to alter the effective date of the exclusion. We therefore uphold the ALJ Decision excluding Petitioner for five years, effective June 16, 2004.

ANALYSIS
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1. The Date of Petitioner's Offense

Petitioner was excluded pursuant to section 1128(a)(4) of the Act. Section 1128(a)(4) provides that the Secretary must exclude from participation in federal health care programs any individual convicted of a felony criminal offense that occurred after the date of the enactment of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) relating to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance. The date of HIPAA's enactment was August 21, 1996.

Petitioner concedes that he was convicted of a felony related to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance. P. Br. at 2. See also ALJ Decision at 6 ("Petitioner does not dispute the . . . facts related to his conviction and sentencing . . . [and] agrees that there is prima facie evidence for the elements of a violation of section 1128(a)(4).") However, Petitioner asserts, that in COL 4, the ALJ erroneously concluded:

Petitioner was convicted of a felony offense that was committed prior to the effective date of the Health Insurance Portability and Accountability Act of 1996.

ALJ Decision at 3.

Petitioner alleges that his offense occurred in January 2000, after the effective date of HIPAA. P. Br. at 1. (1) He also acknowledges that the error in COL 4 is a "technical" one. P. Br. at 1.

We agree with Petitioner that the record shows his offense post-dating the effective date of HIPAA. The remainder of the decision reflects the ALJ's understanding that the offense occurred after the effective date of HIPAA, not before, as erroneously stated in COL 4. FOF 1 describes the date of Petitioner's offense as "on or about January 24, 2000" (ALJ Decision at 2), and, in the body of the decision, the ALJ states, "There is no question that Petitioner's offense occurred after August 21, 1996," the effective date of HIPAA (id. at 6). Therefore, the ALJ's error in COL 4 was technical and harmless. However, to correct the record, we modify COL 4 to read as follows:

Petitioner was convicted of a felony offense that was committed after the effective date of the Health Insurance Portability and Accountability Act of 1996.

2. The Effective Date of Petitioner's Exclusion

Petitioner was convicted of the felony offense in question in April 2001. ALJ Decision at 2. By letter dated May 28, 2004, the I.G. notified Petitioner that he was being excluded from participation in Medicare and Medicaid and all federal health care programs for five years, effective 20 days from the date of the notice, i.e., June 16, 2004. ALJ Decision at 7-8.

Before the ALJ, Petitioner argued that the effective date of the exclusion should be the date of his sentence, May 31, 2001. ALJ Decision at 7. In rejecting this argument, the ALJ cited section 1128(c)(1) of the Act, which provides that an exclusion pursuant to section 1128(a) "shall be effective at such time and upon such reasonable notice to the public and to the individual or entity excluded as may be specified in regulations . . .," and 42 C.F.R. § 1001.2002(b), which provides that an exclusion is effective 20 days from the date of the notice of exclusion. The ALJ correctly noted that "t]he regulation does not give an ALJ discretion to change the effective date" and "42 C.F.R. § 1005.4(c)(1) specifically provides that an ALJ may not refuse to follow a regulation of the Secretary."

On appeal, Petitioner asks, "[I]n the interest of fairness and justice that I be granted the remedy of having my exclusion date begin at a reasonable point in time as opposed to arbitrary." P. Br. at 2. Petitioner cites efforts he has made "to improve my life and be of service to my government and local community." P. Br. at 2. He alleges that he has overcome the drug addiction underlying his criminal offense and has spent the last several years working in programs helping homeless, drug addicted, and mentally ill people and preventing Medicaid and Medicare fraud. He also alleges that he is about to recover his nurse's license. P. Br. at 1-2.

In requesting that we adjust the start day of the exclusion, Petitioner relies on the following statement, made by the ALJ in reference to 42 C.F.R. § 1005.4(c)(1), the regulation precluding ALJs from refusing to follow a regulation of the Secretary:

I note that no similar restriction is imposed upon the Departmental Appeals Board to which the Secretary has granted regulatory authority to review ALJ decisions in cases of this type. 42 C.F.R. § 1005.21. I express no opinion on the issue of whether the Board, as the representative of the Secretary, might accord the relief requested by the Petitioner in the interest of equity or on other grounds.

ALJ Decision at 7, n.1.

We must reject Petitioner's request. As the ALJ recognized, the Board has repeatedly held that the applicable statute and regulations give an ALJ no authority to adjust the beginning date of an exclusion. Douglas Schram, R.PH., DAB No. 1372, at 11 (1992) ("Neither the ALJ nor this Board may change the beginning date of Petitioner's Exclusion."); David D. DeFries, DAB No. 1317, at 6 (1992) ("The ALJ cannot . . . decide when [the exclusion] is to begin."); Richard D. Phillips, DAB No. 1279 (1991) (An ALJ does not have "discretion . . . to adjust the effective date of an exclusion, which is set by regulation."); Samuel W. Chang, M.D., DAB No. 1198, at 10 (1990) ("The ALJ has no power to change . . . [an exclusion's] beginning date.") (2) In Schram, we held that this lack of discretion extends to the Board as well as the ALJs, and we reiterate that holding here, for the reasons stated in Schram. Accordingly, we find no error in the ALJ's conclusion that the beginning date of the exclusion in this case is established by operation of law as June 16, 2004, the date that is 20 days from the date of the May 28, 2004 I.G. notice, and we further conclude that we have no authority to change the June 16, 2004 date.

Petitioner points out that section 1128(c) provides that an exclusion is effective "at such time and upon reasonable notice to the public and to the individual . . . excluded as may be specified in regulation and consistent with paragraph (2)." Petitioner argues that a three-year delay is not reasonable notice. P. Br. at 2. We addressed this argument in Chang, DAB No. 1198. Afer reviewing relevant statutory and regulatory provisions and related caselaw, we concluded that reasonable notice, as prescribed in section 1128(c), does not require prompt notice. Id. at 11. Rather, the term "reasonable" requires that the notice "is reasonably calculated to reach [a Petitioner] in adequate time for him to request a hearing, notify him what the proceeding is about, and inform him how he is to go about requesting a hearing." Id. at 14.

In Steven R. Caplan, R Ph. v. Tommy G. Thompson, CIV. No. 04-00251 (D. Hawaii, December 17, 2004), a district court inquired as to a two-year delay between a conviction and an exclusion. The court did not find the delay to be a basis for modifying the exclusion. In Seide v. Shalala, 31 F.Supp. 2d 466 (E.D. Pa. 1998), a district court declined to modify an exclusion because of a 26-month delay between the conviction and imposition of the exclusion. The court relied on the fact that "[n]either the Social Security Act nor its implementing regulations set any deadline within which the Inspector General must act." Id. at 469.

Conclusion

For the reasons discussed above, we affirm FOFs 1 through 5, and COLs 1 through 3 and 5 through 9. We modify COL 4 as set forth above to reflect that the offense occurred after the effective date of HIPAA.

JUDGE
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Cecilia Sparks Ford

Donald F.Garrett

Sheila Ann Hegy
Presiding Board Member

FOOTNOTES
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1. Petitioner also alleges errors of fact in Finding of Fact (FOF) 2. P. Br. at 1. FOF 2 discusses Petitioner's sentence, as stated in the sentencing order (I.G. Ex. 4) cited by the ALJ. That order supports the ALJ's finding in FOF 2 that Petitioner's sentence to one year of confinement was suspended and that he was placed on probation. It also supports the ALJ's finding as to amounts described in the order as a fine and as restitution imposed as part of Petitioner's sentence. The sentencing order does not show the incarceration and additional fines alleged by Petitioner; accordingly, we find no error in FOF 2. But even if FOF 2 did contain the errors alleged by Petitioner, they would be immaterial because they could have no impact on the mandatory five-year exclusion that provided the basis for the I.G.'s exclusion action.

2. Since these cases were decided, the I.G. amended and renumbered the notice regulation. 57 Fed. Reg. 3330 (Jan. 29, 1992); compare 42 C.F.R. § 1001.123 (1991) (suspension effective 15 days from notice) and 42 C.F.R. § 1001.2001 (2003) (exclusion effective 20 days from date of notice). Petitioner identified no difference between these versions of the notice regulations that would call into question the Board's prior decisions, and we see no such difference.

CASE | DECISION | ANALYSIS | JUDGE | FOOTNOTES