Amie VanCamp, DAB CR5511 (2020)

DECISION

Petitioner, Amie VanCamp, was convicted in the U.S. District Court for the Southern District of West Virginia (federal district court) of obtaining hydrocodone, a controlled substance, by misrepresentation, fraud, forgery, deception, and subterfuge.  Based on this conviction, the Inspector General (IG) has excluded Petitioner for five years from participating in Medicare, Medicaid, and all federal health care programs, pursuant to Section 1128(a)(3) of the Social Security Act (Act).1  Petitioner appeals the exclusion.  For the reasons discussed below, I find that the IG properly excluded Petitioner and that the five-year exclusion is the minimum period required by law. 

I. Background

Petitioner was an emergency room nurse employed by Camden Clark Medical Center (CCMC), a hospital located in Parkersburg, West Virginia.  IG Exhibit (Ex.) 3 at 10.  While Petitioner was employed by CCMC, she became addicted to narcotic pain

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medication.  Id. at 11.  CCMC used a computerized secure medication storage and dispensing system to assist in tracking and billing for controlled substances.  Id. at 10. The system dispenses controlled substances to authorized personnel who verify their identity by entering a secure password.  Id.  On June 23, 2015, Petitioner removed two hydrocodone tablets from the dispensing system.  Id. at 11.  Petitioner falsely documented in the electronic patient file that she had given the medication to a patient.  Id. However, Petitioner in fact kept the hydrocodone for her personal use.  Id.

As a result of these actions, the United States Attorney filed a criminal information against Petitioner charging her with one count of “knowingly and intentionally acquir[ing] and obtain[ing] hydrocodone, a Schedule II controlled substance[,] by misrepresentation, fraud, forgery, deception, and subterfuge” in violation of 21 U.S.C. § 843(a)(3).  IG Ex. 2.  Petitioner waived prosecution by indictment and pleaded guilty to the information in federal district court.  IG Ex. 3 at 1; IG Ex. 4 at 1.  Petitioner was sentenced to three years’ probation and to pay a fine of $1,000 and an assessment of $100.  IG Ex.4 at 2, 5.

In a letter dated June 28, 2019, the IG notified Petitioner that she was excluded from participating in Medicare, Medicaid, and all federal health care programs for a period of five years.  The IG explained that Petitioner was excluded based on her conviction:

This exclusion is due to your felony conviction . . . 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, including the performance of management or administrative services relating to the delivery of such items or services, or with respect to any act or omission in a health care program (other than Medicare and a State health care program) operated by, or financed in whole or in part, by any Federal, State or local Government agency.

IG Ex. 1 at 1.  The letter explained that Section 1128(a)(3) of the Act authorizes the exclusion.  Id.  Petitioner timely requested review.  I convened a telephone prehearing conference and issued an Order and Schedule for Filing Briefs and Documentary Evidence (Briefing Order).

Pursuant to my Briefing Order, the IG submitted a written argument (IG Br.) and four proposed exhibits (IG Exs. 1-4).  Petitioner filed a brief (P. Br.), but did not offer any proposed exhibits.  The IG filed a reply brief (IG Reply).  Petitioner did not object to the IG’s proposed exhibits.  Therefore, in the absence of objection, I admit into evidence IG Exs. 1-4.  Neither party offered the testimony of any proposed witness, and the parties agree that an in-person hearing is not necessary.  IG Br. at 6; P. Br. at 2-3.  Therefore, I decide this case based on the parties’ written submissions.

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II. Discussion

A. Petitioner must be excluded pursuant to section 1128(a)(3) of the Act because she was convicted of a felony criminal offense related to fraud in connection with the delivery of a health care item or service.2

The Act requires the Secretary of Health and Human Services (Secretary) to exclude certain individuals from participation in any Federal health care programs, as defined in Section 1128B(f) of the Act.  Act § 1128(a).  The IG excluded Petitioner pursuant to section 1128(a)(3) of the Act.  IG Ex. 1.  Section 1128(a)(3) mandates exclusion if the following elements are established:  1) an individual or entity has been convicted of a felony offense after August 21, 1996; 2) that offense was related to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct; and 3) the offense was in connection with the delivery of a health care item or service or with respect to any act or omission in a government health care program (other than Medicare or Medicaid).  The Secretary has delegated this exclusion authority to the IG.  42 C.F.R. § 1001.101(c).

1. Petitioner was convicted of a felony criminal offense after August 21, 1996.

Petitioner concedes that she was convicted.  P. Br. at 1.  Petitioner pleaded guilty to acquiring and obtaining hydrocodone by misrepresentation, fraud, forgery, deception and subterfuge, in violation of 21 U.S.C. § 843(a)(3), as charged in the information.  IG Ex. 4 at 1.  The federal district court adjudicated her guilty on October 12, 2018.  Id.  Violation of 21 U.S.C. § 843(a)(3) is a felony offense.  21 U.S.C. § 843(d)(1), 18 U.S.C. § 3559(a)(5).  Petitioner’s guilty plea and the court’s finding of guilt meet the definition of “conviction” under subsections 1128(i)(2) and (3) of the Act.

2. The felony criminal offense for which Petitioner was convicted was related to fraud.

To support exclusion pursuant to section 1128(a)(3), the IG must show that Petitioner was convicted of an offense “related to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct.”  In connection with her plea agreement, Petitioner stipulated that the facts on which her conviction was based included, among others, that she “fraudulently documented in the electronic patient file” that the hydrocodone she removed from CCMC’s secure dispensing system “had been given to the patient.”  IG Ex. 3 at 11.  Moreover, in pleading guilty to violating 21 U.S.C. § 843(a)(3) as charged in the information, Petitioner necessarily admitted that she

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“knowingly and intentionally acquired and obtained hydrocodone, a Schedule II controlled substance[,] by misrepresentation, fraud, forgery, deception, and subterfuge.”  See IG Ex. 2 (emphasis added).  Fraudulent intent is an element of the crime to which Petitioner pleaded guilty and for which she was convicted.  Thus, as part of her guilty plea, Petitioner admitted that she acted with fraudulent intent when she documented that the tablets had been administered to the patient.  Her conviction was therefore “related to fraud” within the meaning of section 1128(a)(3). Further, as I discuss in the following section, the felony offense for which Petitioner was convicted was committed “in connection with the delivery of a health care item or service.”

3. Petitioner’s felony criminal offense was committed in connection with the delivery of a health care item or service.

As I have described above, Petitioner admitted, as part of her guilty plea, that she converted to her own use a controlled substance that was intended to be administered to a patient of CCMC, where Petitioner was employed.  This conduct establishes that the offense was “in connection with the delivery of a health care item or service” within the meaning of section 1128(a)(3).

Appellate panels of the Departmental Appeals Board (DAB) have held that the phrase “in connection with the delivery of a health care item or service” which appears in section 1128(a)(3) is broad and requires the same common sense nexus which is required for an offense to be “related to the delivery of an item or service” under section 1128(a)(1) of the Act.  Kenneth M. Behr, DAB No. 1997 at 7 n.5 (2005).  Such a connection is present when the offense occurs “in the context of an individual’s participation in the chain of delivery of health care items or services.”  Id. at 9.  This includes offenses which could not have been accomplished but for an individual’s position in the chain of delivery.  See Erik D. DeSimone, R.Ph., DAB No. 1932 (2004).  In finding that the conviction in DeSimone fell within the ambit of section 1128(a)(3), the appellate panel stated:

Petitioner’s responsibilities as a pharmacist for Eckerd Drugs involved the delivery of health care items or services to the general public. . . .[T]he specific drug [Petitioner] was convicted of stealing from Eckerd would have been a drug he otherwise would have delivered to the general public as part of his responsibilities at Eckerd. . . .  Indeed, Petitioner was able to steal this drug because he had access to it while he was in the process of performing his professional responsibilities of delivering health care items or services to the general public.  Petitioner’s theft of the drug while under the guise of performing his professional responsibilities is clearly the requisite common sense“connection” to health care delivery that section 1128(a)(3) requires.  Moreover, as the [administrative law judge] specifically found, his theft of this particular drug unquestionably had the

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effect of subverting the delivery by him and his employer of the very same drug to the general public.

DAB No. 1932 at 5.  The panel’s description of the offense in DeSimone applies equally to Petitioner’s conduct in the present case.  Here, CCMC, through its employees, administered drugs, including controlled substances, to its patients.  Petitioner had access to controlled substances, including hydrocodone, because she was employed as a nurse at CCMC.  Petitioner falsely and fraudulently documented that she had administered hydrocodone tablets to a CCMC patient.  In fact, Petitioner kept the hydrocodone for her own use.  Had Petitioner not converted the hydrocodone to her own use, the drug would have been administered to a CCMC patient.  Therefore, for the same reasons articulated in DeSimone, the felony offense for which Petitioner was convicted is connected to the delivery of a health care item or service.

4. Petitioner’s conviction need not have a connection to a federal program to support exclusion pursuant to section 1128(a)(3).

Petitioner argues that her conviction is not one for which exclusion is required.  Petitioner contends that her conviction was not for “other financial misconduct” as described in section 1128(a)(3).  P. Br. Additional Argument at 1 (Item #7 in DAB E-File).  She explains that she does not believe she “committed financial Medicaid fraud.”  Id.

Petitioner misunderstands the statutory basis on which the IG bases her exclusion.  Section 1128(a)(3) does not require that Petitioner’s conviction be related to Medicaid fraud.  Had Petitioner been convicted of Medicaid fraud, her exclusion would be required under section 1128(a)(1) of the Act, which mandates exclusion of persons convicted of crimes related to the delivery of items or services under Medicare or Medicaid.  By contrast, exclusion pursuant to section 1128(a)(3) does not require a nexus with Medicare or Medicaid.  DeSimone, DAB No. 1932 at 4 (“Section 1128(a)(3) did not require that the offense have any connection with a government program.”).3

Therefore, because Petitioner’s conviction was for a felony offense related to fraud in connection with the delivery of a health care item or service, the IG correctly excluded Petitioner under Section 1128(a)(3) of the Act.

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B. The five-year exclusion imposed by the IG is the minimum period of exclusion required by law.

The Act requires that Petitioner’s period of exclusion “shall not be less than five years. . . .”  Act § 1128(c)(3)(B); see also 42 C.F.R. § 1001.102.  Thus, I am required to uphold the length of Petitioner’s exclusion.  Once I have concluded that Petitioner is subject to exclusion, I may not reduce Petitioner’s exclusion to zero, nor may I direct the IG to reinstate Petitioner to program participation.  See 42 C.F.R. § 1005.4(c)(6); see also 42 C.F.R. § 1001.3002(f).

III. Conclusion

For the reasons explained above, I conclude that the IG properly excluded Petitioner from participation in Medicare, Medicaid, and all federal health care programs, and I sustain the five-year exclusion, effective July 18, 2019.

• 1. The current version of the Social Security Act can be found at https://www.ssa.gov/OP_Home/ssact/ssact-toc.htm.  Each section of the Act on that website contains a reference to the corresponding United States Code chapter and section.
• 2. My findings of fact/conclusions of law appear as lettered and numbered headings in bold italic type.
• 3. Section 1128(a)(3) of the Act includes an alternative ground for exclusion of individuals convicted of felony offenses related to fraud, theft, embezzlement, breach of fiduciary responsibility, or other financial misconduct with respect to any act or omission in a health care program (other than Medicare and a State health care program) operated by, or financed in whole or in part, by any Federal, State or local Government agency.  See DeSimone, DAB No. 1932 at 4.  However, in the present case, the IG did not argue that Petitioner’s criminal conduct involved any acts or omissions connected with a health care program financed by a government agency.