Department of Health and Human Services DEPARTMENTAL APPEALS BOARD Civil Remedies Division |
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IN THE CASE OF | |
Larry B. Shuster, R.Ph., |
DATE: February 13, 2002 |
- v - |
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The
Inspector General
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Docket No.C-01-756
Decision No. CR872 |
DECISION | |
DECISION I affirm the Inspector General's (I.G.), determination
to exclude Larry B. Shuster, R.Ph. (Petitioner), under section 1128(a)(1)
of Social Security Act (Act) for a five-year minimum mandatory period
from participation in Medicare, Medicaid, and all other federally funded
health care programs.
BACKGROUND By letter dated May 31, 2001, the I.G. notified Petitioner
that he was being excluded from participation in Medicare, Medicaid, and
all federal health care programs as defined by 1128B(f) of the Act for
a period of five years. In that letter, the I.G. explained that Petitioner
was being excluded pursuant to section 1128(a)(1) of the Act based on
his conviction in the United States District Court for the Eastern District
of Pennsylvania of a criminal offense related to the delivery of an item
or service under the State health care (Medicaid) program.(1) By letter dated June 11, 2001, Petitioner requested a
hearing and the case was assigned to me for hearing and decision. During
an August 6, 2001 prehearing conference, the parties agreed to have the
case decided on written submissions in lieu of an in-person hearing. The
I.G. submitted a motion for summary judgment and brief in support (I.G.
Br.). Petitioner submitted a brief in response (P. Br.) to the I.G.'s
motion, and the I.G. submitted a reply (I.G. Reply Br.) to Petitioner's
response. The I.G. filed eight exhibits (I.G. Exs.1 - 8) as part of her
submission, and Petitioner filed four exhibits (P. Exs. 1 - 4). In the
absence of objection, I receive into evidence I.G. Exs. 1 - 8 and P. Exs.
1 - 4. Based on the documentary evidence, the applicable law and regulation, and the arguments of the parties, I find that the I.G. is authorized to exclude Petitioner pursuant to section 1128(a)(1) of the Act and that the five-year exclusion imposed by the I.G. is reasonable. Accordingly, I sustain the I.G.'s determination to exclude Petitioner, from participation in Medicare, Medicaid, and all other federal health care programs for a period of five years.
ISSUE The issue in this case is whether I have the authority
to change the effective date of the exclusion.
APPLICABLE LAW Section 1128(a)(1) of the Act authorizes the Secretary
of HHS to exclude from participation in any federal health care program
(as defined in section 1128B (f) of the Act):
Section 1128(c)(3)(B) of the Act provides that an exclusion
imposed under section 1128(a)(1) of the Act shall be for a minimum period
of not less than five years. Pursuant to Section 1128(i) of the Act an individual or entity is considered to have been convicted of a criminal offense:
FINDINGS OF FACT AND CONCLUSIONS OF LAW I make the following findings of fact and conclusions of law (Findings) to support my decision in this case. In the discussion section I discuss each Finding in detail and address Petitioner's arguments.
DISCUSSION During the time period relevant to this case, Petitioner
was a licensed pharmacist, in the Commonwealth of Pennsylvania working
at Queen Village Pharmacy and Center City Pharmacy, both located in Philadelphia.
I.G. Exs. 4-6. The pharmacies were owned and operated by Sheldon A. Durst
and Larry Durst. I.G. Ex. 6 at 1. During the course of his employment,
Petitioner submitted bills for high priced prescription medication to
various third-party payors including Medicaid. The third-party payor system
of reimbursing prescription claims depends upon the honest submission
by pharmacists of true claims based upon valid prescriptions. Petitioner
submitted these bills knowing that they were for drugs that were never
ordered by a physician nor dispensed by Petitioner or the pharmacies.
The amount of loss to all payors as a result of this fraudulent scheme
totaled $175,000. I.G. Exs. 4-6. On November 18, 1997, Petitioner was indicted and charged
with one count of wire fraud in violation of 18 U.S.C. � 1343. I.G Ex.
4. On December 19, 1997, Petitioner pleaded guilty to one count of wire
fraud. I.G. Ex. 5. On August 10, 1998, judgement was entered against Petitioner
and he was sentenced to 15 months of incarceration and three years of
supervised release. I.G. Ex. 7 at 2-3. Petitioner was also ordered to
pay $3000 in partial restitution. On February 16, 1999, Petitioner's license
to practice pharmacy was suspended by the State Board of Pharmacy for
a period of three years, retroactive to December 3, 1997. I.G. Ex. 3 at
3. Section 1128(a)(1) of the Act requires that the Secretary
of Health and Human Services (Secretary) exclude an individual who has
been convicted under federal or State law of a criminal offense related
to the delivery of an item or service under Medicare or a State health
care program. 42 C.F.R. � 1001.101. Individuals excluded under section
1128(a)(1) of the Act must be excluded for a period of not less than five
years. Act, section 1128(c)(3)(B). The record reflects that Petitioner pleaded guilty to a criminal offense; his guilty plea was accepted by the court; and judgment of conviction was entered against him. I.G. Exs. 5, 7. Petitioners's conviction, based on his guilty plea, and the Court's acceptance of that plea, constitute a conviction under section 1128(i)(3) of the Act. Morever, Petitioner concedes the fact that he was convicted under federal law of a criminal offense related to the delivery of an item or service under the Medicaid program and acknowledges that the imposition of a five-year exclusion is mandatory. P. Reply Br. at 1, 5, 7. Therefore, no issue regarding reasonableness of the length of the exclusion exists and I must sustain an exclusion of at least five years pursuant to section 1128(a)(1) and 1128(c)(3)(B) of the Act. Petitioner does not challenge the I.G.'s authority to
exclude him pursuant to section 1128(a)(1) of the Act. However, Petitioner
argues that the setting of an effective date (June 20, 2001) at 20 days
from the date of the May 31, 2001, notice letter "a violation of Petitioner's
rights under the United States Constitution and a denial of Equal Protection
under the law." P. Br. at 1. Petitioner argues, further, that "while the length of
the exclusion is mandated and therefore reasonable, the arbitrary and
capricious application of an effective date for exclusion is manifestly
unreasonable." It is unreasonable, he argues, because it effectively increases
the punishment by making the exclusionary periods consecutive rather than
concurrent. Petitioner requests that the effective date of the exclusion
be backdated to August 10, 1998, the date the Commonwealth of Pennsylvania
terminated his participation in the State's Medical Assistance Program. It is well settled that an administrative law judge is
without authority to change the effective date of an exclusion. As a matter
of law, an exclusion must become effective 20 days from the date of the
I.G.'s notice of exclusion. 42 C.F.R. � 1001.2002. Additionally, neither
statute nor regulation set forth any specific time for the I.G. to begin
proceedings after a conviction. Tanya A. Chuoke, DAB No. 1721 (2000).
Further, an administrative law judge has no authority to review the timing
of the I.G.'s determination to impose an exclusion or to retroactively
alter the date of the imposition of the exclusion. Samuel W. Chang,
M.D., DAB No. 1198 (1990); Kathleen E. Talbot, M.D., DAB CR724
(2000); Ronald J. Crisp, M.D., DAB CR772 (2001). Thus, I do not
have the authority to grant the equitable relief sought by Petitioner. Additionally, I am without authority to hear or decide
Petitioner's constitutional arguments. My authority to decide these and
other cases involving the I.G. is limited to that which has been delegated
to me by the Secretary. Consequently, I have no authority to declare a
federal statute unconstitutional. John A. Crawford, DAB CR160 (1991);
Roberta E. Miller, DAB CR367 (1995); Richard A. Fishman,
DAB CR100 (1990). The statute's purpose is to protect federal health care
programs and the programs' beneficiaries and recipients from untrustworthy
providers. A provider that has been convicted of a crime described in
section 1128(a) is presumed by Congress to be untrustworthy and a threat
to federal health care programs and their beneficiaries and recipients.
The record shows that Petitioner has proven himself to be an untrustworthy
individual and therefore Petitioner's exclusion comports with the remedial
purpose of the Act.
CONCLUSION For the reasons set forth above, I conclude that the I.G. was authorized, under section 1128(a)(1) of the Act, to exclude Petitioner from participation in Medicare, Medicaid, and all federal health care programs for a period of five years. In addition, I am without authority to change the effective date of the exclusion. Accordingly, I must sustain the exclusion as imposed by the I.G. |
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JUDGE | |
Richard J. Smith Administrative Law Judge |
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FOOTNOTES | |
1. The term "State health care program" includes a State's Medicaid program. Section 1128(h)(1) of the Act; 42 U.S.C. � 1320a-7(h)(1). | |