Department of Health and Human Services DEPARTMENTAL APPEALS BOARD Civil Remedies Division |
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IN THE CASE OF | |
Brandon Ray Neaveth, |
DATE: September 13, 2000 |
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The
Inspector General
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Docket No.C-00-319 Decision No. CR699 |
DECISION | |
By letter dated December 30, 1999, the Inspector
General ("I.G."), U.S. Department of Health and Human Services, notified
Brandon Neaveth ("Petitioner") that he would be excluded from participation
in Medicare, Medicaid, and all federal health care programs for a period
of three years. The I.G. imposed this exclusion pursuant to section 1128(b)(1)
of the Social Security Act, 42 U.S.C. � 1320a-7(b)(1), based on Petitioner's
conviction, in the Second Judicial District Court, City and County of Denver,
Colorado, of a criminal offense relating to fraud, theft, embezzlement,
breach of fiduciary responsibility, or other financial misconduct in connection
with the delivery of a health care item or service. Petitioner requested review of his three-year exclusion
by letter to this office dated March 3, 2000. The I.G. moved for summary
disposition. Because I have determined that there are no facts of decisional
significance genuinely in dispute, and that the only matters to be decided
are the legal implications of the undisputed facts, I have decided the
case on the basis of the parties' written submissions. The I.G. submitted
a brief, a reply brief, and six proposed exhibits (I.G. Exs. 1- 6). Petitioner
objected to the introduction into evidence of proposed I.G. Exhibit 6.
I find that such exhibit is relevant and material and I note that the
content of such affidavit is confirmed by Petitioner's Exhibit 2. On such
basis, I accept I.G. Exhibit 6 into evidence. Petitioner submitted a brief
and five proposed exhibits (P. Exs. 1- 5). The I.G. did not object to
these exhibits and I accept P. Exs. 1-5 into evidence.
I conclude that Petitioner is subject to a three-year
period of exclusion from participation in the Medicare, Medicaid, and
all federal health care programs and I therefore affirm the I.G.'s determination.
PETITIONER'S CONTENTIONS Petitioner contends that the I.G. has not met its burden
of demonstrating that Petitioner's criminal offense was "in connection
with the delivery of health care item or service." Specifically, Petitioner
maintains that the I.G. has not produced competent evidence that his conviction
for falsifying the background check concerning the nurse aide his employment
agency recommended met the statutory requirement. He maintains that the
I.G. has not shown that the nurse aide was in fact employed at a nursing
home as a result of his action. In this regard, he asserts that the affidavit
supplied by the I.G. (I.G. Ex. 6) from the director of the employment
agency to which his company recommended the nurse aide is not based on
personal knowledge. Petitioner also asserts that, even considering such affidavit,
the I.G. has still failed to show that Petitioner's conviction was "in
connection with the delivery of a health care item or service." Petitioner
asserts that his agency and the other temporary staffing agency to which
he recommended the nurse aide are not businesses involved in the delivery
of a health care item or service to patients. Further, he contends that
it has not been shown that the nursing facility that used the services
of the nurse aide relied upon the forged background check. Petitioner
also maintains in this regard that the services of his employment agency
and that of the agency to which he recommended the nurse aide are too
removed from the actual delivery of health care services under the facts
of this case. Finally, Petitioner contends that it is anomalous for
the I.G. to exclude Petitioner when the criminal record of the nurse aide,
who had a theft conviction, would not evidently disqualify her from working
in a nursing home.
APPLICABLE LAW Section 1128(b)(1)(A)(i) of the Act provides for exclusion
from participation in Medicare and Medicaid any individual or entity that
has been convicted of a criminal offense consisting of a misdemeanor relating
to fraud, theft, embezzlement, breach of fiduciary responsibility, or
other financial misconduct in connection with the delivery of a health
care item or service. Such exclusion shall be for a period of three years
unless specified aggravating or mitigating factors are present which form
the basis for lengthening or shortening the period of exclusion.
FINDINGS OF FACT AND CONCLUSIONS OF LAW 1. During the period relevant to this case, Petitioner
was the owner and manager of a temporary health care staffing agency called
Medical Staffing of Metro Denver, Inc. also known as American Medical
Management, Inc. located In Denver, Colorado. I.G. Exs. 3 and 6. 2. On June 19, 1998, in the Second Judicial District Court
for the City and County of Denver, Colorado, Petitioner was charged in
a Complaint/Information of 31 counts of forgery, criminal possession of
a forged instrument, second degree forgery, and criminal possession of
a second degree forged instrument, in violation of Colorado Revised Statutes
18-5-102,18-5-103,18-5-104.5, 18-5-105, and 18-5-107. I.G. Ex. 3. 3. Specifically, Count 3 of that Information charged Petitioner
with second degree forgery and alleged that Petitioner, with intent to
defraud Lifelines Care, Inc. did unlawfully and falsely make, complete,
alter and utter a written instrument which was and which was purported
to be and was calculated to become and to represent if completed, a written
instrument, to wit: a criminal background check of Awilda Panek prepared
by Loffert Background Services, L.L.C., and dated September 16, 1997,
in violation of Colorado Revised Statutes 18-5-104. I.G. Ex. 3. 4. Awilda Panek is a nurse aide who was hired to provide
health care services to patients relying, in part, on the falsified background
check. 5. On July 30, 1999, Petitioner pleaded nolo contendere
to Count 3 of the June 19, 1998 complaint/information, a violation of
Colorado Revised Statutes 18-5-104, as amended. I.G. Exs. 4 and 5. 6. On July 30, 1999, the Second Judicial District Court
for the City and County of Denver accepted Petitioner's plea. I.G. Exs.
4 and 5. 7. As a result of his conviction Petitioner was ordered
to pay restitution in the amount of $25,000; was sentenced to 2 years
probation; and was ordered to perform 100 hours of public service. I.G.
Exs. 4 and 5. 8. On December 30, 1999, the I.G. notified Petitioner
that, as a result of his criminal conviction, he was being excluded for
three years from participation in the Medicare, Medicaid, and all Federal
health care programs under section 1128(b)(1)(A)(i) of the Act. I.G. Ex.
1. 9. Under section 1128(b)(1)(A)(i) of the Act, the I.G.
is authorized to exclude any individual or entity that has been convicted
under federal or State law of a misdemeanor relating to fraud, theft embezzlement,
breach of fiduciary responsibility, or other financial misconduct in connection
with the delivery of a health care item or service. 10. Where the I.G. determines to exclude an individual
pursuant to section 1128(b)(1)(A) of the Act, the term of exclusion will
be for a period of three years, in the absence of aggravating or mitigating
factors that would support an exclusion of more or less than three years. 11. In a case involving an exclusion under section 1128(b)(1)(A)(i)
of the Act, an exclusion of more than three years may be justified where
there exist aggravating factors that are not offset by mitigating factors. 12. Petitioner's criminal conviction constitutes a conviction
within the meaning of section 1128(i)(3). of the Act. 13. Petitioner was convicted under state law of a criminal
offense relating to fraud, theft, embezzlement, breach of fiduciary responsibility,
or other financial misconduct in connection with the delivery of a health
care item or service. 14. The I.G. is authorized to exclude Petitioner pursuant
to section 1128(b)(1) of the Act. 15. The I.G. did not cite the presence of any aggravating
factor in imposing a three year exclusion. 16. Petitioner did not prove the presence of any mitigating
factor. 17. A three-year exclusion of Petitioner is reasonable.
DISCUSSION Petitioner does not dispute that he has been convicted
under state law and I so find. Petitioner pleaded nolo contendere and
the court accepted his plea. Such procedure constitutes a conviction within
the scope of section 1128(i)(3) of the Act. In pleading nolo contendere
to Count 3 of the Information, Petitioner chose not to contest the allegation
that he acted with intent to defraud. Accordingly, I find Petitioner's
conviction for second degree forgery was for a criminal offense relating
to fraud. The remaining issue concerns whether Petitioner's criminal
conviction is one in connection with the delivery of a health care item
or service. I find that the facts of Petitioner's case demonstrate that
it is one "in connection with the delivery of a health care item or service"
within the scope of the Act. Petitioner was the owner and manager of a
temporary staffing agency that provided registered nurses, licensed practical
nurses, and certified nurse aides to health care facilities in the metropolitan
Denver area. Awilda Panek was a nurse aide who was employed by Petitioner
to provide temporary nurse aide services to health care facilities. Petitioner
forged the criminal background check report of Awilda Panek by altering
the dates of the report, the number of the report, the date of Ms. Panek's
birth and, most importantly, by removing the information on her report
which showed Ms. Panek's felony criminal record and making the report
indicate that she had no criminal record. I.G. Exs. 3 and 6. Petitioner subsequently provided this forged background
check report of Awilda Panek to Lifelines Care, Inc., another temporary
staffing agency that subcontracted with Petitioner's company, Medical
Staffing of Metro Denver, to provide temporary nurses and nurse aides.
P. Ex. 2. Petitioner provided the forged background check in response
to Lifelines Care, Inc.'s request that Medical Staffing of Metro Denver
provide them with a nurse aide to fill a temporary staffing position at
Solomon Health Care Facility. Id. Lifelines Care, Inc. relied on
the representation of Petitioner that Ms. Panek had no criminal record
and was qualified to serve as a nurse aide. Id. In fact, Ms. Panek
was hired by Solomon Health Care Facility and delivered health care services
to patients at that facility as a nurse aide. I.G. Ex. 6; P. Ex. 2. Petitioner's forgery of Ms. Panek's criminal background
check with intent to defraud Lifelines Care, Inc. constitutes fraud "in
connection with the delivery of a health care item or service." The object
of Petitioner's fraud was to defraud Lifelines Care, Inc., who clearly
sought to recommend Ms. Panek to its clients in her capacity as a nurse
aide. In fact, Lifelines Care, Inc. recommended to Solomon Health Care
Facility where she was employed as a nurse aide. Clearly, Petitioner was
in the business of recommending health care professionals for work in
that field and recommended in this instance a nurse aide to another temporary
health care staffing agency. This is a sufficient nexus to find that Petitioner
is properly excluded under section 1128(b)(1)(A) of the Act. In fact,
Ms. Panek was employed as a nurse aide by Solomon Health Care Facility
as Petitioner's own evidence reflects. P. Ex. 2. On these facts, it is
clear that, but for Petitioner's falsification of Ms. Panek's felony record,
Lifelines Care, Inc. would not have referred this nurse aide to any of
its clients, including Solomon Health Care Facility. These facts demonstrate
a nexus or common sense connection between the criminal offense for which
Petitioner was convicted and the delivery of a health care item or service.
See Elsbeth Barnes, DAB CR340 (1994); Berton Siegel,
D.O., DAB No. 1467 (1994). Petitioner maintains that there is no competent proof
that Ms. Panek was in fact employed in a health care facility as a nurse
aide. The affidavit submitted by the I.G. shows this to be so. I.G. Ex.
6. Moreover, even Petitioner's own evidence concedes this fact. P. Ex.
2. Additionally, such evidence is not necessary. Proof of the actual delivery
of health care services is not necessary for an individual to be excluded
under section 1128(b)(1)(A). Petitioner's argument that such proof is
required is contrary to a plain reading of the statute and prior administrative
law judge decisions which establish that a petitioner's crime need not
involve the direct or immediate manipulation of items or services. See
Joel Fass, DAB CR349 (1994); Chander Kachoria, DAB CR220
(1993). It is sufficient under the Act that Petitioner's offense need
only be "in connection with the delivery of a health care item or service"
not that the fraud involve the direct delivery of a health care item or
service. The facts in this case establish that Petitioner was in
the business of recommending qualified health care professionals to other
health care staffing agencies and to health care facilities and that the
fraud concerned the qualifications of a recommended health care provider.
On such facts, I find that Petitioner's fraud was "in connection with
the delivery of a health care item or service." Petitioner asserts that
it is anomalous to exclude him when it is not evident that Ms. Panek would
herself would have been excluded under the Act from providing health care
services as a result of her own criminal record. I find, however, that
Petitioner's case meets the criteria of the statute. It is irrelevant
whether or not Ms. Panek's criminal record would authorize her exclusion. In the present case, the I.G. has not alleged or established
any aggravating factors and Petitioner has not alleged or established
any mitigating factors. Therefore, no basis exists to lengthen or shorten
the statutory exclusion period of three years.
CONCLUSION I conclude that the I.G. was authorized to exclude Petitioner,
pursuant to section 1128(b)(1)(A)(i) of the Act. I find that the three
year exclusion is reasonable and I sustain it. |
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JUDGE | |
Joseph K. Riotto Administrative Law Judge
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