Robert J. Tomlinson, M.D., DAB CR5079 (2018)

DECISION

The Centers for Medicare & Medicaid Services (CMS), acting through its administrative contractor, Novitas Solutions (Novitas), denied Petitioner Robert Tomlinson’s enrollment application pursuant to 42 C.F.R. §§ 424.530(a)(3) and (a)(4). Petitioner challenges the enrollment denial. For the reasons discussed below, I affirm CMS’ denial of Petitioner’s enrollment application.

I. Background

Petitioner is a physician specializing in orthopedic surgery currently licensed to practice in Arkansas. Petitioner’s Brief (P. Br.) at 2 3. On April 2, 2010, he pleaded guilty to one count of federal health care fraud in violation of 18 U.S.C. § 1347 for submission of false claims for surgical procedures not performed between around July 2002 to around April 2010. CMS Ex. 5 at 2.

In August 2010, CMS contractor Pinnacle Business Solutions (Pinnacle) revoked Petitioner’s billing privileges for his noncompliance with enrollment requirements resulting from the felony conviction, and for failing to timely report the adverse legal

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action against him.  CMS Ex. 6.  Pinnacle barred Petitioner from re-applying for enrollment for one year.  Id. at 3.

On March 1, 2017, Petitioner applied to reactivate his enrollment as a supplier in the Medicare program.  CMS Ex. 7 at 9, 65.  In Section 1 of the enrollment application, Petitioner checked the box for “Final Adverse Actions/Convictions.”  Id. at 11.  In Section 3 of the application, Petitioner marked the box “Yes” in response to the question “Have you, under any current or former name or business identity, ever had a final adverse legal action listed on page 12 of this application imposed against you?”  Id. at 29.  That section also provided a table for applicants to report “each final adverse legal action, when it occurred, the Federal or State agency . . . that imposed the action, and the resolution, if any.”  Id.  Petitioner reported the United States took adverse action against him on August 20, 2010 for “Medicare Fraud,” which he resolved by pleading guilty.  Id.

On May 22, 2017, CMS’ administrative contractor Novitas notified Petitioner by letter that it denied his Medicare enrollment application.  CMS Ex. 3.  Noridian cited two bases for denial: (1) because he was “adjudged guilty of Healthcare Fraud on August 20, 2010,” in violation of 42 C.F.R. § 424.530(a)(3); and (2) because he “did not report his prior license suspension and prior Medicare revocation on his reactivation application,” in violation of 42 C.F.R. § 424.530(a)(4).  Id. at 1.  Petitioner timely requested reconsideration, see CMS Ex. 2, which Novitas denied on August 29, 2017.  CMS Ex. 1.

Petitioner, through counsel, timely requested a hearing before an administrative law judge (ALJ), and I was designated to hear and decide this case.  On November 3, 2017, I issued an Acknowledgment and Pre‑hearing Order (Pre‑hearing Order) setting forth a briefing schedule.  CMS submitted its pre-hearing exchange (CMS Br.) and Exs. 1‑7 on December 8, 2017.  After I struck Petitioner’s initial filings for failing to comply with my Pre-hearing Order, Petitioner properly filed his brief and Exs. 1‑12 on January 26, 2018.  CMS subsequently objected to several of Petitioner’s exhibits (CMS Objections).

II. Admission of Exhibits and Decision on the Record

There being no objection from Petitioner, I admit CMS Exs. 1-7 into the record.

CMS objected to P. Exs. 3, 5-8, and 10, arguing they were all new and in some instances, irrelevant.  CMS Objections.  Petitioner filed no response to these objections.

I find good cause to admit Petitioner’s exhibits, which generally serve to clarify the exact nature and dates of the criminal actions taken against him which form the factual basis for CMS’ decision to deny his enrollment.  CMS’ objections are overwrought, given it supplied only a civil consent order to establish facts pertaining to the criminal conviction that is critical to my determination in this matter.  Documentation supplied by Petitioner concerning that criminal conviction and suspension of his medical license can hardly be

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described as irrelevant. P. Ex. 3 does not address these factors, but I deem it appropriate to accept merely as a matter of providing background concerning Petitioner’s professional qualifications. I therefore overrule CMS’ objections and admit all of Petitioner’s exhibits, P. Exs. 1-12, into the record.

Petitioner has provided written direct testimony for two witnesses. P. Exs. 11 and 12. CMS has not identified witnesses to testify in this matter, nor has it requested cross examination of Petitioner’s witnesses. Consequently, I will not hold an in-person hearing in this matter, and I issue this decision based on the written record.1 CRDP § 19(d).

III. Issues

Whether CMS has a legitimate basis to deny Petitioner’s enrollment application seeking Medicare billing privileges under 42 C.F.R. § 424.530(a)(3) based on Petitioner’s felony conviction for health care fraud.

Whether CMS has a legitimate basis to deny Petitioner’s enrollment application seeking Medicare billing privileges under 42 C.F.R. § 424.530(a)(4) based on Petitioner submitting false or misleading information on the enrollment application.

IV. Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(17), 498.5(l)(2).

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

A. Applicable Law.

As a physician, Petitioner is a supplier of health care services for purposes of the Medicare program.  See 42 U.S.C. § 1395x(d); 42 C.F.R. §§ 400.202 (definition of supplier), 410.20(b)(1).  In order to participate in the Medicare program as a supplier, an individual must meet certain criteria to enroll and receive billing privileges.  42 C.F.R §§ 424.505, 424.510.  CMS may deny a supplier’s enrollment for any reason stated in 42 C.F.R § 424.530.

1. Denial Based on a Felony Conviction

CMS may properly deny a supplier’s enrollment application for Medicare billing privileges based on the existence of a felony conviction, as set forth at 42 C.F.R § 424.530(a)(3):

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(3)  Felonies.  The provider, supplier, or any owner or managing employee of the provider or supplier was, within the preceding 10 years, convicted (as that term is defined in 42 CFR 1001.2) of a Federal or State felony offense that CMS determines is detrimental to the best interests of the Medicare program and its beneficiaries.

(i)  Offenses include, but are not limited in scope or severity to-

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(D)  Any felonies that would result in mandatory exclusion under section 1128(a) of the Act.

42 C.F.R. § 424.530(a)(3).

The criteria for mandatory exclusion from all federal health care programs referenced above in subsection (D) is set forth in section 1128(a) of the Social Security Act (Act), 42 U.S.C. § 1320a-7(a), which states in part:

(a) MANDATORY EXCLUSION

The Secretary shall exclude the following individuals and entities from participation in any Federal health care program (as defined in section 1320a 7b(f) of this title):

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(3) FELONY CONVICTION RELATING TO HEALTH CARE FRAUD

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 paragraph (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.

42 U.S.C. § 1320a-7(a)(3).

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When a supplier is convicted of a felony specifically listed in the regulations, an ALJ applies the most deferential review standard, as these felonies are considered detrimental per se.  Letantia Bussell, M.D., DAB No. 2196 at 9 (2008).

A criminal offense not enumerated in the Act may nevertheless be found to be detrimental to the best interests of the Medicare program and program beneficiaries if CMS determines that offense placed the Medicare program or its beneficiaries at immediate risk.  Abdul Razzaque Ahmed, M.D., DAB No. 2261 at 10, 14 (2009).  In that instance, an ALJ must assess whether CMS’ determination that a felony offense is detrimental to the best interests of the program and its beneficiaries is reasonable.  See Fady Fayad, M.D., DAB No. 2266 at 8, 16-17 (2009), aff’d, Fayad v. Sebelius, 803 F. Supp. 2d 699, 704 (E.D. Mich. 2011).

2. Denial Based on Provision of False or Misleading Information

CMS may properly deny a supplier’s enrollment application for providing false or misleading information, as set forth at 42 C.F.R. § 424.530(a)(4):

(4) False or misleading information. The provider or supplier has submitted false or misleading information on the enrollment application to gain enrollment in the Medicare program. (Offenders may be referred to the Office of Inspector General for investigation and possible criminal, civil, or administrative sanctions.)

42 C.F.R. § 424.530(a)(4).

B. Petitioner was convicted of a felony offense within ten years preceding the application for enrollment for purposes of 42 C.F.R. § 424.530(a)(3).

There is no dispute that Petitioner was convicted of a felony offense within the ten years preceding his most recent application for enrollment. On April 2, 2010, Petitioner was charged in the U.S. District Court for the Western District of Arkansas (District Court) via one-count information with a scheme to commit health care fraud in violation of 18 U.S.C. §§ 1347(2)2 and 2(b).3 P. Ex. 5. That same day, he pleaded guilty pursuant to that information. P. Ex. 10 at 2; CMS Ex. 5 at 2. On August 20, 2010, the District Court entered judgment against Petitioner, sentenced him to five months’ imprisonment, and ordered him to pay $66,497.34 in restitution to multiple victims, including CMS and the

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Arkansas Medicaid program.  P. Ex. 4.  Petitioner applied to CMS to reactivate his enrollment as a supplier on March 1, 2017.  CMS Ex. 7 at 65.  The felony at issue therefore occurred within the 10 years preceding the date Petitioner submitted his enrollment application for Medicare billing privileges.

C. Petitioner was convicted of a felony that is per se detrimental to the best interests of the Medicare program or its beneficiaries.

CMS may deny a supplier’s application for enrollment in the Medicare program for a felony conviction occurring within the preceding ten years of the application if that felony would otherwise result in mandatory exclusion under section 1128(a) of the Act.  42 C.F.R. § 424.530(a)(3)(i)(D); 42 U.S.C. § 1320a-7(a).  Section 1128(a)(3) identifies “[f]elony conviction[s] relating to health care fraud” as offenses requiring mandatory exclusion.  42 U.S.C. § 1320a-7(a)(3).

It is beyond dispute that Petitioner’s 2010 felony conviction would qualify for mandatory exclusion and is therefore per se detrimental.  Indeed, I need not speculate as to whether it would qualify; Petitioner’s conviction for health care fraud resulted in his actual mandatory exclusion by the Inspector General for the Department of Health and Human Services in July 2011.  P. Ex. 7.

Petitioner’s conviction for participating in a scheme to commit “Health Care Fraud” is reflexively explanatory as to whether he was convicted of a felony related to health care fraud.  P. Ex. 4 at 1.  Nevertheless, I note that the facts described in the information filed against Petitioner, to which he pleaded guilty, clearly describe criminal conduct related to health care fraud.  The information specified that Petitioner submitted false payment Current Procedural Terminology (CPT) codes to Medicare.  P. Ex. 5 at 1.  The District Court accepted Petitioner’s plea, and ordered him to pay over $66,000 in restitution to victims including both Medicare and the state Medicaid program.  P. Ex. 4.

Petitioner attempts to undermine his felony conviction, arguing that his “unintentional misclassification” of CPT codes was not properly argued before the District Court during his criminal case, and that his submissions should have been afforded deference as medically necessary, which ultimately affects whether his claims were indeed false.  P. Br. at 4-6.  Petitioner’s arguments amount to a collateral attack on his criminal conviction.  But CMS’ authority to deny enrollment in this instance derives from Petitioner’s felony conviction itself, which he does not dispute.  I find no authority which would allow me to look behind Petitioner’s conviction and make my own factual findings to undermine it.  See Ravindra Patel, M.D., DAB CR2171 at 6 (2010).

Petitioner makes several other arguments that have no impact on the outcome of this matter.  He claims various administrative errors made by CMS contractor Novitas.  P. Br. at 13‑18.  But as CMS notes in passing, it had the opportunity to review the actions of its

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contractor at the reconsideration level, and thus any procedural errors at the initial level amount to harmless error at best.  CMS Br. at 7 n.3.  Petitioner also makes equitable arguments to justify his enrollment.  P. Br. at 18-20.  But I am not authorized to ignore the controlling regulations simply because Petitioner does not believe his per se felony conviction is in fact detrimental to the Medicare program or its beneficiaries.  Bussell, DAB No. 2196 at 9.  Nor does his intent to practice in a medically underserved area allow me to fashion equitable remedies on his behalf.  See US Ultrasound, DAB No. 2302 at 8 (2010).  Finally, Petitioner’s assertion that the CMS hearing officer who issued the reconsideration decision in this case attempted to unlawfully “exclude” him is both clearly wrong and entirely irrelevant.  P. Br. at 20-21.

It is clear that Petitioner was convicted within the ten years preceding his enrollment application of a felony related to health care fraud.  This felony conviction would require mandatory exclusion under section 1128(a)(3) of the Act, and is therefore per se detrimental to the Medicare program and its beneficiaries.  42 C.F.R. § 424.530(a)(3)(i)(D).  Accordingly, I conclude CMS had a legitimate basis to deny Petitioner’s application for enrollment as a supplier to the Medicare program.  See Stanley Beekman, D.P.M., DAB No. 2650 at 3 (2015) (providing CMS may revoke billing privileges based solely on a qualifying felony conviction without regard to other factors).

D. I do not need to decide whether CMS had a legitimate basis under 42 C.F.R. § 424.535(a)(4) to deny Petitioner’s enrollment application.

Having concluded that CMS had a legitimate basis to deny Petitioner’s enrollment application based on his felony conviction for health care fraud, I need not consider whether denial of Petitioner’s enrollment application under section 42 C.F.R. § 424.530(a)(4) for making false or misleading statements was reasonable.

VI. Conclusion

I affirm CMS’ determination to deny Petitioner’s Medicare enrollment application.

1. As such, I will not further address CMS’ motion for summary judgment, which is denied as moot.
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2. This appears to be a typographical error contained in the information, as the statutory provision in question, entitled “Health care fraud,” includes sections (a) and (b); section (a) contains subsections (1) and (2). See 18 U.S.C. § 1347.
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3. 18 U.S.C. § 2 provides for “aider and abettor” liability, making an accessory equally as punishable as the principal offender. U.S. Dep’t of Justice, U.S. Attorney’s Manual, Crim. Resources Manual 2471 at https://www.justice.gov/usam/criminal-resource-manual-2471-18-usc-2 (last updated Oct. 1998).
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