Maria Leary Zeltner, DAB CR5078 (2018)

DECISION

Petitioner, Maria Leary Zeltner, is excluded from participation in Medicare, Medicaid, and all federal health care programs pursuant to section 1128(a)(3) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(3)), effective September 20, 2017.  Petitioner’s exclusion for the minimum period of five years is required by section 1128(c)(3)(B) of the Act (42 U.S.C. § 1320a-7(c)(3)(B)).*

I. Background

The Inspector General (I.G.) notified Petitioner by letter dated August 31, 2017, that she was being excluded from participation in Medicare, Medicaid, and all federal health care programs for five years.  The I.G. cited section 1128(a)(3) of the Act as the basis for Petitioner’s exclusion and stated that the exclusion was based on her conviction in the

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Court of Common Pleas of Bucks County, Pennsylvania, of a criminal offense related to fraud, theft, embezzlement, breach of fiduciary responsibility or other financial misconduct in connection with the delivery of a health care item or service.  I.G. Exhibit (Ex.) 1.

Petitioner filed a request for hearing dated September 5, 2017, which was received on September 11, 2017 (RFH).  I convened a prehearing conference by telephone on October 25, 2017, the substance of which is memorialized in my Prehearing Conference Order and Schedule for Filing Briefs and Documentary Evidence dated October 27, 2017 (Prehearing Order).

The I.G. filed a motion for summary judgment and supporting brief (I.G. Br.) on December 11, 2017, with I.G. Exs. 1 through 6.  Petitioner has not objected to my consideration of the I.G.’s offered exhibits; therefore, I.G. Exs. 1 through 6 are admitted into evidence.  Petitioner filed a response on February 2, 2018, including documents reflecting that she has a Freedom of Information Act (FOIA) request pending with the Centers for Medicare & Medicaid Services.  On February 26, 2018, the I.G. filed a reply brief (I.G. Reply Br.).

II. Discussion

A. Applicable Law

Section 1128(f) of the Act (42 U.S.C. § 1320a-7(f)) establishes Petitioner’s rights to a hearing by an administrative law judge (ALJ) and judicial review of the final action of the Secretary of Health and Human Services (the Secretary).

Pursuant to section 1128(a)(3) of the Act, the Secretary must exclude from participation in any federal health care program:

Any individual or entity that has been convicted for an offense which occurred after . . . [August 21, 1996], under Federal or State law, in connection with the delivery of a health care item or service or with respect to any act or omission in a health care program (other than those specifically described in [section 1128(a)(1)]) operated by or financed in whole or in part by any Federal, State, or local government agency, of a criminal offense consisting of a felony relating to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct.

The Secretary has promulgated regulations implementing these provisions of the Act.  42 C.F.R. § 1001.101(c).

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Pursuant to section 1128(i) of the Act, an individual is convicted of a criminal offense when:  (1) a judgment of conviction has been entered by a federal, state, or local court whether or not an appeal is pending or the record has been expunged; (2) there is a finding of guilt by a court; (3) a plea of guilty or no contest is accepted by a court; or (4) the individual has entered into any arrangement or program where judgment of conviction has been withheld.  42 U.S.C. § 1320a-7(i)(1)-(4); 42 C.F.R. § 1001.2.

Section 1128(c)(3)(B) of the Act provides that an exclusion imposed under section 1128(a) of the Act will be for a period of not less than five years.  42 C.F.R. § 1001.102(a).  The Secretary has published regulations that establish aggravating factors the I.G. may consider to extend the period of exclusion beyond the minimum five-year period, as well as mitigating factors that may be considered only if the I.G. proposes to impose an exclusion greater than five years.  42 C.F.R. § 1001.102(b), (c).

The standard of proof is a preponderance of the evidence, and there may be no collateral attack of the conviction that provides the basis of the exclusion.  42 C.F.R. § 1001.2007(c), (d).  Petitioner bears the burden of proof and the burden of persuasion on any affirmative defenses or mitigating factors, and the I.G. bears the burden on all other issues.  42 C.F.R. § 1005.15(b), (c).

B. Issues

The Secretary has by regulation limited my scope of review to two issues:

1. Whether the I.G. has a basis for excluding Petitioner from participation in Medicare, Medicaid, and all federal health care programs; and

2. Whether the length of the proposed period of exclusion is unreasonable.

42 C.F.R. § 1001.2007(a)(1).

When, as in this case, the I.G. imposes the minimum authorized five-year exclusion under section 1128(a) of the Act, there is no issue as to whether the period of exclusion is unreasonable.  42 C.F.R. § 1001.2007(a)(2).

C. Findings of Fact, Conclusions of Law, and Analysis

My conclusions of law are set forth in bold followed by the pertinent findings of fact and analysis.

1. Petitioner’s request for hearing was timely and I have jurisdiction.

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2. Summary judgment is appropriate.

There is no dispute that Petitioner timely filed her request for hearing, and that I have jurisdiction pursuant to section 1128(f) of the Act and 42 C.F.R. pt. 1005.  The I.G. filed a motion for summary judgment and Petitioner filed a response.  Accordingly, it is necessary for me to determine whether or not summary judgment is appropriate or whether I must decide this case on the merits after an oral hearing.

Pursuant to section 1128(f) of the Act, a person subject to exclusion has a right to reasonable notice and an opportunity for a hearing.  The Secretary has provided by regulation that a sanctioned party has the right to hearing before an ALJ, and both the sanctioned party and the I.G. have a right to participate in the hearing.  42 C.F.R. §§ 1005.2-.3.  Either or both parties may choose to waive appearance at an oral hearing and to submit only documentary evidence and written argument for my consideration.  42 C.F.R. § 1005.6(b)(5).  An ALJ may also resolve a case, in whole or in part, by summary judgment.  42 C.F.R. § 1005.4(b)(12).

Summary judgment is appropriate when the movant shows that there is no genuine dispute as to any material fact and the only questions to be decided involve application of the law to the undisputed facts; or the moving party prevails as a matter of law even if all disputed facts are resolved in favor of the party against whom the motion is made.  A party opposing summary judgment must allege facts which, if true, would refute the facts relied upon by the moving party.  Deciding a case on summary judgment differs from deciding a case on the merits after a hearing.  An ALJ does not assess credibility or weigh conflicting evidence when deciding a case on summary judgment.  Bartley Healthcare Nursing & Rehab., DAB No. 2539 at 3-4 (2013); Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300 at 3 (2010); Holy Cross Vill. at Notre Dame, Inc., DAB No. 2291 at 5 (2009); see Fed. R. Civ. Pro. 56.

There are no genuine disputes as to any material facts in this case.  The facts that trigger exclusion under section 1128(a)(3) of the Act as a matter of law are undisputed.  Accordingly, summary judgment is appropriate.

3. Petitioner’s exclusion is required by section 1128(a)(3) of the Act.

a. Facts

There is no dispute that Petitioner was a nursing home administrator.  I.G. Ex. 6 at 1.  On September 15, 2016, Petitioner was charged by information filed in the Bucks County Court with multiple counts including felony counts of forgery and theft by deception.  I.G. Ex. 2.  Petitioner was alleged to have made unauthorized purchases with her employer’s funds and submitted fraudulent/falsified expense reports.  I.G. Exs. 2 at 6; 4.

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On January 20, 2017, Petitioner entered into a Consent Agreement and Order with the State Board of Examiners of Nursing Home Administrators in Pennsylvania in which she acknowledged that her criminal charges arose from her behavior while acting in her capacity as a nursing home administrator.  I.G. Ex. 6 at 2.  Petitioner verified that the facts set forth in the Consent Agreement and Order were true and correct.  I.G. Ex. 6 at 6.  On March 13, 2017, Petitioner entered pleas of no contest to a misdemeanor charge of unauthorized writing and a felony count of theft by deception and her pleas were accepted.  Petitioner was sentenced to probation for two years and to pay restitution of $4,500 to her employer.  I.G. Exs. 3 at 2-3; 4; and 5.

Petitioner explained the situation that led to her no contest pleas.  I accept her representations as true for purposes of summary judgment.

b. Analysis

The I.G. cites section 1128(a)(3) of the Act as the basis for Petitioner’s mandatory exclusion.  The statute requires the Secretary to exclude from participation any individual or entity:  (1) convicted of an offense under federal or state law; (2) the offense occurred after August 21, 1996 (the date of enactment of the Health Insurance Portability and Accountability Act of 1996); (3) the offense was committed in connection with the delivery of a health care item or service, or with respect to any act or omission in a health care program (other than Medicare or Medicaid) operated by or financed in whole or in part by any federal, state, or local government agency; (4) the criminal offense was a felony; and (5) the offense was related to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct.  Act § 1128(a)(3) (42 U.S.C. § 1320a-7(a)(3)); 42 C.F.R. § 1001.101(c).  I conclude that all the elements that trigger mandatory exclusion under section 1128(a)(3) of the Act are satisfied in this case. 

Petitioner was charged in state court with a state felony offense of theft by deception.  Petitioner does not dispute that the charges stem from her actions as a nursing home administrator.  Petitioner does not dispute that the felony charge to which she pleaded no contest was connected to her status as a nursing home administrator.  There is no dispute that Petitioner’s duties as a nursing home administrator related to the delivery of a health care item or service under Medicare or Medicaid.  Petitioner does not dispute that the offense occurred after August 21, 1996.  Petitioner stresses that she pleaded no contest and that she did not plead guilty.  However, this argument must be resolved against her as a matter of law.

Indeed, Petitioner pleaded no contest.  Her plea was accepted and judgment was entered against her on the felony offense and she was sentenced on March 13, 2017.  I.G. Ex. 3.  Pursuant to section 1128(i) of the Act, an individual is convicted of a criminal offense when:  (1) a judgment of conviction has been entered by a federal, state, or local court whether or not an appeal is pending or the record has been expunged; (2) there is a

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finding of guilt by a court; (3) a plea of guilty or no contest is accepted by a court; or (4) the individual has entered into any arrangement or program where judgment of conviction has been withheld.  42 U.S.C. § 1320a-7(i)(1)-(4); 42 C.F.R. § 1001.2.  Therefore, under the Act, Petitioner was convicted of the felony when her no contest plea was accepted and the court entered judgment against her.  I conclude as a matter of law that Petitioner was convicted of a felony conviction that triggers mandatory exclusion under section 1128(a)(3) of the Act.

Petitioner also argues in her response to the motion for summary judgment that she continues to work to exonerate herself, and she submitted evidence of the pending FOIA request.  I accept as true for purposes of summary judgment that Petitioner continues to work to prove herself innocent of the charges to which she pleaded no contest.  However, because the conviction occurred, neither the I.G. nor I have any discretion in the face of the mandate of Congress in section 1128(a)(3) of the Act, to decide not to exclude Petitioner.  However, the Secretary has provided by regulation that an individual will be reinstated in Medicare, Medicaid, and other federal health care programs retroactive to the date of exclusion, if the underlying conviction is reversed or vacated on appeal.  42 C.F.R. § 1001.3005(a)(1).

Accordingly, I conclude that the elements of section 1128(a)(3) of the Act are satisfied and that Petitioner’s exclusion is required pursuant to section 1128(a)(3) of the Act.

4. Five years is the minimum authorized period of exclusion pursuant to section 1128(a)(3) of the Act.

5. Petitioner’s exclusion for five years is not unreasonable as a matter of law.

I have concluded that there is a basis to exclude Petitioner pursuant to section 1128(a)(3) of the Act.  Therefore, the I.G. must exclude Petitioner for a minimum period of five years pursuant to section 1128(c)(3)(B) of the Act.  The I.G. has no discretion to impose a lesser period and I may not reduce the period of exclusion below five years.

Exclusion is effective 20 days from the date of the I.G.’s notice of exclusion to the affected individual or entity.  42 C.F.R. § 1001.2002(b).

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III. Conclusion

For the foregoing reasons, Petitioner is excluded from participation in Medicare, Medicaid, and all federal health care programs for the minimum statutory period of five years, effective September 20, 2017.

• *. Pursuant to 42 C.F.R. § 1001.3001, Petitioner may apply for reinstatement only after the period of exclusion expires. Reinstatement is not automatic upon completion of the period of exclusion.