Department of Health and Human Services DEPARTMENTAL APPEALS BOARD Civil Remedies Division |
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IN THE CASE OF | |
Joseph M. Rukse, jr., R.Ph., |
DATE: May 17, 2002 |
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The
Inspector General
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Docket No.C-01-1015
Decision No. CR904 |
DECISION | |
DECISION The Inspector General (I.G.) notified Joseph M. Rukse, Jr., R.Ph., (Petitioner) that he was being excluded from participation in Medicare, Medicaid and all other Federal health care programs for a period of ten years pursuant to sections 1128(a)(1) and (a)(4) of the Social Security Act (Act) (42 U.S.C. � 1320a-7(a)). Petitioner's section 1128(a)(1) exclusion was based upon his "conviction" of a program-related crime. Petitioner's section 1128(a)(4) exclusion was based upon his "conviction" for an offense related to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance. Petitioner timely requested review. I find that the I.G. failed to consider a mitigating factor when she imposed Petitioner's 10-year exclusion. Therefore, I modify the exclusion to a term of seven years and six months.
PROCEDURAL HISTORY The I.G. notified Petitioner of his exclusion by letter dated July 31, 2001. By letter dated September 25, 2001, Petitioner filed his appeal. This case was assigned to me for a hearing and a decision. I conducted a telephonic prehearing conference at which the parties agreed that the case could be decided based on their written submissions. The I.G. filed a Brief in Support of Motion for Summary Affirmance and a reply brief. The I.G. also submitted six proposed exhibits (I.G. Ex. 1 - I.G. Ex. 6). Petitioner filed a brief and one proposed exhibit (P. Ex. 1). Neither party objected to my admitting any of the proposed exhibits into evidence. Therefore, the offered exhibits are admitted. Summary judgment is appropriate and no hearing is necessary in this case for a full and fair disposition.
FINDINGS OF FACT The following findings of
fact are based upon the uncontested and undisputed assertions of fact
in the parties pleadings and the exhibits admitted: 1. Petitioner was, on the
date of the I.G. action, a pharmacist licensed by the State of West Virginia
and authorized to participate in Medicare, Medicaid and other Federal
health care programs, although Petitioner was not working as a pharmacist
at that time. 2. Petitioner entered into
a plea agreement with the United States Attorney's Office of the Southern
District of West Virginia on November 13, 2000. (I.G. Ex. 2). 3. On November 13, 2001,
Petitioner was adjudged guilty, pursuant to his pleas, by Judge Robert
C. Chambers, United States District Court, Southern District of West Virginia,
of health care fraud, pursuant to 18 U.S.C. � 1347, and acquisition of
a controlled substance by fraud, pursuant to 21 U.S.C. � 843(a)(3). (I.G.
Ex. 3). 4. On January 22, 2001,
Petitioner was sentenced to: 15 months imprisonment, 3 years supervised
release following his release from prison, participation in a drug treatment
program while on supervised release, to pay an assessment of $200, a fine
of $5,000 and restitution of $3,600. (I.G. Ex. 4). 5. By letter dated July
31, 2001, the I.G. advised Petitioner that he was being excluded from
participation in Medicare, Medicaid and all other Federal health care
programs for a period of 10 years, effective 20 days after the date of
the letter, based upon Petitioner's conviction as described in Finding
3. 6. The I.G. found three aggravating factors that justify an extended period of exclusion in this case: (a) the acts for which Petitioner was convicted resulted in financial loss to a government program of $1,500 or more; (b) the acts for which Petitioner was convicted occurred over a period of one year or more from September 1998 to December 1999; and (c) Petitioner's sentence included incarceration. (I.G. Ex. 6).
CONCLUSIONS OF LAW 1. Summary judgment is appropriate
in this case as there are no material facts in dispute. 2. Petitioner was convicted,
within the meaning of the Act, of a criminal offense related to the delivery
of an item or service, under the Medicaid program, Act, section 1128(a)(1)
(42 U.S.C. � 1320a-7(a)(1)), and of a felony criminal offense related
to the unlawful manufacture, distribution, prescription, or dispensing
of a controlled substance, Act, section 1128(a)(4) (42 U.S.C. � 1320a-7(a)(4)). 3. Petitioner must be excluded
from participation in any Federal health care program for a minimum period
of five years pursuant to section 1128(c)(3)(B) of the Act (42 U.S.C.
� 1320a-7(c)(3)(B)) due to his conviction. 4. The I.G. may increase
the term of exclusion based on a finding of any of the aggravating factors
specified at 42 C.F.R. � 1001.102(b). 5. If the I.G. finds any
of the aggravating factors specified at 42 C.F.R. � 1001.102(b) justify
a term of exclusion greater than the statutory minimum exclusion of five
years, then the I.G. may consider the mitigating factors specified at
42 C.F.R. � 1001.102(c) to reduce the period of exclusion to no less than
five years. 6. The range of exclusionary
periods contemplated by the Act and the Secretary's regulations extend
from a minimum of five years to permanent exclusion, in the case of a
mandatory exclusion under section 1128(a). See
Act, � 1128(c)(3)(B) and (G) (42 U.S.C. � 1230a-7(c)(3)(B) and (G)); 42
C.F.R. � 1001.102(a) and (d). 7. Three aggravating factors
have been established by the I.G. by a preponderance of the evidence:
(a) the acts for which Petitioner was convicted resulted in financial
loss to a government program of $1,500 or more; (b) the acts for which
Petitioner was convicted occurred over a period of one year or more from
September 1998 to December 1999; and (c) Petitioner's sentence included
incarceration. 8. Petitioner has established
by a preponderance of the evidence that one mitigating factor exists:
[t]he record in the criminal proceedings, including sentencing documents,
demonstrates that the court considered that the individual had a mental,
emotional or physical condition before or during the commission of the
offense that reduced the individual's culpability. 9. A seven year and six
months exclusion (five years mandatory and a two year and six months extension)
is within a reasonable range and is not unreasonable.
A. APPLICABLE LAW Petitioner's right to a
hearing by an administrative law judge (ALJ) and judicial review of the
final action of the Secretary is provided by section 1128(f) of the Act
(42 U.S.C. � 1230a-7(f)). Petitioner's request for a hearing was timely
filed and I do have jurisdiction. However, the Secretary has by regulation
limited my scope of review to two issues: (1) whether there is a basis
for the imposition of the sanction; and, (2) whether the length of the
exclusion is unreasonable. 42 C.F.R. � 1001.2007(a)(1). The standard of
proof is a preponderance of the evidence and there may be no collateral
attack of the conviction that is the basis for the exclusion. 42 C.F.R.
� 1001.2007(c) and (d). Petitioner bears the burden of proof and 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) and (c). Pursuant to section 1128(a)(1)
of the Act, the Secretary must exclude from participation in the Medicare
and Medicaid programs any individual or entity that has been convicted
of a criminal offense related to the delivery of an item or service under
Medicare or Medicaid. Further, section 1128(a)(4) of the Act provides,
in part, that the Secretary must exclude any individual or entity that
has been convicted of a felony criminal offense related to the unlawful
dispensing of a controlled substance. Section 1128(c)(3)(B) of the Act
provides that an exclusion imposed under section 1128(a) of the Act shall
be for a minimum period of five years, unless specified aggravating or
mitigating factors are present which form the basis for lengthening or
shortening the period of exclusion. See
also 42 C.F.R. � 1001.102(a),
(b), and (c). Only if the aggravating factors justify an exclusion of
longer than five years, may mitigating factors be considered as a basis
for reducing the period of exclusion to no less than five years. 42 C.F.R.
�1001.102(c). Section 1001.102(b) of 42 C.F.R. provides, in relevant part, that the following factors may be considered to be aggravating and a basis for lengthening the period of exclusion:
Section 1001.102(c) of 42 C.F.R. provides that the following factors may be considered as mitigating and a basis for reducing the period of exclusion:
Evidence which does not
relate to an aggravating factor or a mitigating factor is irrelevant to
determining the length of an exclusion. The burden is upon petitioners
to show the presence of mitigating factors. The I.G. bears the burden
of proving the existence of aggravating factors. 42 C.F.R. � 1005.15;
John (Juan) Urquijo, DAB No. 1735 (2000). B. ISSUES
C. ANALYSIS
Summary disposition is appropriate where either: there are no disputed issues of material fact and the only questions that must be decided involve application of law to the undisputed facts; or, the moving party must prevail 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 disposition must allege facts which, if true, would refute the facts relied upon by the moving party. See, e.g., Fed.R.Civ.P. 56(c). There are no issues of material fact in dispute is this case. The only issue involves the interpretation of whether certain undisputed facts establish the existence of a mitigating factor within the meaning of 42 C.F.R 1001.102(c). Thus, the issue may be decided by application of the law to the undisputed facts and summary judgment is appropriate.
I note that the regulations
strictly limit my jurisdiction in cases such as this. I may decide whether
or not the I.G. had a proper basis for the exclusion of Petitioner
(1) and whether the period of exclusion for Petitioner was "unreasonable."
The Departmental Appeals Board (DAB) has made clear that the role of the
ALJ in cases such as this is to conduct a "de novo" review as
to the facts related to the basis for the exclusion and the facts related
to the existence of aggravating and mitigating factors identified at 42
C.F.R. � 1001.102. See Joann Fletcher Cash, DAB No.
1725 (2000), fn. 6, and cases cited therein. The regulation specifies
that I must determine whether the length of exclusion imposed is "unreasonable"
(42 C.F.R. � 1001.2007(a)(1)). The DAB has explained that in determining
whether a period of exclusion is "unreasonable," I am to consider whether
such period falls "within a reasonable range." Cash, fn. 6. The
DAB cautions that whether I think the period of exclusion too long or
too short is not the issue. I am not to substitute my judgment for that
of the I.G. and may only change the period of exclusion in limited circumstances. Despite a thorough search
of prior DAB decisions and Federal precedent, I have found no clear statement
of what constitutes the "reasonable range" referred to by the DAB. My
review of the statute and regulations shows that the range of possible
exclusions provided for in the case of mandatory exclusions range from
the minimum of 5 years to a maximum of permanent exclusion. 42 U.S.C.
� 1320a-7(c)(3)(B) and (G), 42 C.F.R. � 1001.102(a) and (d). This is the
only range I have found specified in the law and it seems to be "reasonable." My reading of 42 C.F.R.
� 1001.102 is that with a mandatory exclusion under section 1128(a) of
the Act, there is an automatic exclusion of five years. Pursuant to 42
C.F.R. � 1001.102(d) one prior conviction for conduct that would cause
mandatory exclusion under section 1128(a) of the Act, increases the minimum
period of exclusion to 10 years and two prior convictions automatically
causes permanent exclusion. The five-year and ten-year
minimum exclusions may only be extended if the I.G. can point to evidence
that one or more of the aggravating factors specified at 42 C.F.R. � 1001.102(b)
are present. The regulations do not limit the additional period of exclusion
the I.G. may impose based upon the presence of aggravating factors. The
regulations also do not specify how much of an extension is warranted
by the existence of an aggravating factor. The DAB has indicated that
it is not the number of aggravating factors that is determinative rather,
it is the quality of the circumstances, whether aggravating or mitigating,
which is controlling in analyzing these factors. Barry D. Garfinkel,
M.D., DAB No. 1572 (1996). Section 1001.102 of 42 C.F.R.
provides that when aggravating factors justify an exclusion of more than
the mandatory minimum period, then the I.G. may consider any of the three
specified mitigating factors if they are shown to exist. In Urquijo,
the DAB suggested that the I.G.'s failure to consider a mitigating factor
amounts to an abuse of discretion. The DAB also made clear in Urquijo
that: if the I.G. considers an aggravating factor to extend the period
of exclusion and that factor is not later shown to exist on appeal; or
if the I.G. fails to consider a mitigating factor that is shown to exist,
then the ALJ may make a decision as to the appropriate extension of the
period of exclusion beyond the minimum. Thus, my determination of
whether or not the exclusionary period in this case is unreasonable hinges
on three-points: (1) whether the period of exclusion is within the reasonable
range; (2) whether the I.G. has shown the existence of aggravating factors;
and, (3) whether the Petitioner has shown that there is a mitigating factor
that the I.G. failed to consider. The I.G. found three aggravating
factors existed that justified an extended period of exclusion in this
case: (a) the acts for which Petitioner was convicted resulted in financial
loss to a government program of $1,500 or more; (b) the acts for which
Petitioner was convicted occurred over a period of one year or more from
September 1998 to December 1999; and (c) Petitioner's sentence included
incarceration. As previously stated, Petitioner concedes these aggravating
factors. However, Petitioner argues that the length of the exclusion is
nevertheless unreasonable because the I.G. failed to consider Petitioner's
mitigating factors. Petitioner argues that two
mitigating factors are present in his case. Petitioner argues that, since
he gave extensive cooperation to prosecuting authorities that resulted
in the return of the overpayments and investigative fees to the government,
42 C.F.R. � 1001.102(c)(3) is applicable to his case as a mitigating factor.
Additionally, Petitioner asserts that section 1001.102(c)(2) of 42 C.F.R.
is applicable to Petitioner's case because the record in the criminal
proceeding shows that Petitioner had a "mental, emotional or physical
condition before or during the commission of the offense" that reduced
Petitioner's culpability in that Petitioner suffered from a chemical addiction
to hydrocodone cough syrup. I do not accept Petitioner's
argument that a mitigating factor exists because he gave extensive cooperation
to prosecuting authorities. It is clear that Petitioner has misinterpreted
the regulatory provision. Section 1001.102(c)(3) of 42 C.F.R. provides
that a factor may be considered mitigating if the individual's cooperation
resulted in "[o]thers being convicted or excluded,"which is not the situation
in this case. Given the plain language of the regulatory provision, I
need not discuss Petitioner's argument further. However, I am persuaded
by Petitioner that 42 C.F.R. � 1001.102(c)(2) is applicable to his case
as the record in the criminal proceeding demonstrates that the court considered
in sentencing, that Petitioner had a mental, emotional or physical condition
before or during the commission of the offense that reduced Petitioner's
culpability. Although the judge did not enter specific findings of reduced
culpability due to mental impairment, the I.G. cites no law for the proposition
that the sentencing judge must make such specific findings. Also contrary
to the I.G.'s position, I find several reasons in the record of the criminal
proceeding, including the sentencing documents, to conclude that Petitioner's
drug addiction was considered by the court and such consideration resulted
in a lesser sentence due to Petitioner's reduced culpability. The court's
sentencing document adopted the factual findings and guideline application
as presented in the Pre-sentence Investigation Report. I.G. Ex. 4 at 9.
The Pre-sentence Investigation Report documents Petitioner's addiction.
P. Ex. 1 at �53. Further, a review of Petitioner's plea agreement and
of the offenses of which Petitioner was convicted shows that Petitioner
faced a maximum confinement of 14 years. I.G. Exs. 1 and 2. However, Petitioner
was sentenced to 15 months confinement, the lower range of the sentencing
guideline for such offenses. As further indication that the judge considered
the impact of Petitioner's drug addiction, the judge's sentence recommended
that Petitioner be allowed to participate in a drug abuse treatment program.
I.G. Ex. 4 at 2. Finally, while Petitioner faced a possible restitution
amount of $35,000, the judge only ordered Petitioner to pay restitution
in the amount of $3,600. Because the IG failed to consider a mitigating factor which is shown by a preponderance of the evidence, I must reassess the appropriate period of exclusion in this case. I consider the existence of the three aggravating factors and the one mitigating factor and conclude that a two year six month extension of the mandatory minimum exclusion of five years is warranted. According, Petitioner should be excluded for a total period of seven years and six months.
CONCLUSION For the foregoing reasons, I find that the I.G. failed to consider a mitigating factor when she imposed Petitioner's exclusion. Therefore, I modify Petitioner's exclusion to a term of seven years and six months. |
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JUDGE | |
Keith W. Sickendick Administrative Law Judge |
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FOOTNOTES | |
1. In this case, Petitioner concedes the basis for the exclusion and the mandatory minimum 5-year exclusion period. | |