Kimberly Jones, DAB CR5758 (2020)

DECISION

The Inspector General (IG) of the United States Department of Health and Human Services excluded Petitioner, Kimberly Jones, for 15 years from participation in Medicare, Medicaid, and all other federal health care programs based on Petitioner’s conviction of a felony related to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance.  Although Petitioner does not dispute that the IG properly excluded Petitioner, Petitioner does dispute that the length of the exclusion is reasonable.  I affirm the 15-year length of the exclusion because the IG proved that three aggravating factors exist and those factors are sufficient for me to conclude that the 15-year length of exclusion is not unreasonable. 

I.  Background

In an April 30, 2020 notice, the IG informed Petitioner that she was excluding her from participation in all federal health care programs under section 1128(a)(4) of the Social Security Act (42 U.S.C. § 1320a-7(a)(4)) for a period of 15 years based on a felony conviction in a federal court of a criminal offense related to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance as defined under federal

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or state law.  IG Exhibit (Ex.) 1 at 1.  The IG found that a 15-year exclusion was warranted based on the following regulatory aggravating factors:

1. The acts that resulted in the conviction, or similar acts, were committed over a period of one year or more.  The acts occurred from about October 2014 to about July 2017.
2. The sentence imposed by the court included incarceration.  The court sentenced Petitioner to 78 months of incarceration.
3. Petitioner has been the subject of another action by a Federal, State or local government agency or board based on the same set of circumstances that serves as the basis for the imposition of the exclusion.  The Kentucky Board of Pharmacy suspended Petitioner’s license to practice as a pharmacist. 

IG Ex. 1 at 2.  The notice stated that the exclusion would be effective 20 days from the date of the notice.  IG Ex. 1 at 1.   

Petitioner timely requested a hearing.  On June 30, 2020, the Civil Remedies Division acknowledged receipt of the hearing request, advised the parties that I would hold a prehearing conference, and issued my Standing Prehearing Order.  On July 21, 2020, I convened a telephonic prehearing conference.  On July 21, 2020, I also issued an Order Following Prehearing Conference and Setting Schedule for Prehearing Submissions (Order).  The IG subsequently submitted a brief (IG Br.) together with five exhibits (IG Exs. 1-5).  Petitioner submitted a brief (P. Br.) and six exhibits (P. Exs. 1-6).  The IG did not submit a reply brief.   

II.  Decision on the Record

I admit all of the proposed exhibits because neither party objected to any of them.  Standing Prehearing Order ¶ 12; see 42 C.F.R. § 1005.8(c).

The Standing Prehearing Order stated that each party must exchange as a proposed exhibit the complete, written direct testimony of any proposed witness or, if unable to obtain the written direct testimony, to submit a request for a subpoena for the witness.  Standing Prehearing Order ¶ 10; see 42 C.F.R. §§ 1005.9, 1005.16(b); see also Order at 2.  Further, I stated that I would only hold a hearing if the opposing party requested to cross-examine one or more witnesses for whom written direct testimony had been submitted.  Standing Prehearing Order ¶¶ 11, 16; see 42 C.F.R. § 1005.16(b); see also Order at 2. 

The IG did not provide any written direct testimony for any witnesses, affirmatively stated that she had no witnesses to offer, and stated that no hearing was necessary in this

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case.  IG Br. at 10.  Petitioner stated that she thought a hearing was necessary and listed herself and a relative/employee of her pharmacy as witnesses.  P. Br. at 5.  However, Petitioner did not submit written direct testimony for herself or her relative/employee.  She also did not request a subpoena for her relative/employee.  Because Petitioner did not comply with my orders to submit written direct testimony, there are no witnesses for the IG to cross-examine at a hearing.  Therefore, I need not hold an evidentiary hearing in this matter.  42 C.F.R. §§ 1005.4(b)(8), 1005.16(b), 1005.14(a)(2); Civil Remedies Division Procedures §§ 16(b), 19(b), (d). 

III.  Issue

The only issues in a case like the present one are whether there is a basis for exclusion and, if so, whether the length of the exclusion imposed by the IG is unreasonable.  42 C.F.R. § 1001.2007(a)(1)-(2).  However, Petitioner only disputes the reasonableness of the length of exclusion.  Order at 1; P. Br. at 1.  Therefore, that is the only issue to be decided. 

IV.  Jurisdiction

I have jurisdiction to adjudicate this case.  42 U.S.C. § 1320a-7(f)(1); 42 C.F.R. § 1005.2.

V.  Findings of Fact and Conclusions of Law,

1. Petitioner was a licensed pharmacist in the state of Kentucky.  IG Ex. 4 at 1-2.
2. Petitioner was charged in the United States District Court for the Eastern District of Kentucky (District Court) with 37 counts of criminal conduct.  See IG Ex. 5.
3. On February 7, 2019, a jury convicted Petitioner on seven of the 37 counts (Counts 5-6 and 31-35).  IG Ex. 5. 
4. Counts 5 and 6 and 31 through 35 all involve violations of 21 U.S.C. § 841(a)(1) (“Dispensed Outside Scope of Professional Practice and not for a Legitimate Medical Purpose, Schedule II Controlled Substances”).  IG Ex. 3 at 1. 
5. For Counts 5 and 6, the jury found beyond a reasonable doubt that, from February 13, 2014 and continuing through January 30, 2018, Petitioner knowingly and intentionally distributed and dispensed, outside the scope of professional practice and not for a legitimate medical purpose, Schedule II controlled substances Oxycodone and Oxymorphone.  IG Ex. 5 at 1-2. 
6. For Counts 31 through 35, the jury found beyond a reasonable doubt that, from October 31, 2014 and continuing through January 13, 2017, Petitioner knowingly

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6. and intentionally distributed and dispensed, outside the scope of professional practice and not for a legitimate medical purpose, Schedule II controlled substances Oxycodone and Hydrocodone.  IG Ex. 5 at 5. 
7. On June 19, 2019, a judge of the District Court signed a Judgment in a Criminal Case in which he sentenced Petitioner to:  78 months of imprisonment for each of the seven counts, to run concurrently; three years of supervised release for each of the seven counts, to run concurrently; a fine of $5,000; and an assessment of $700.  IG Ex. 3. 
8. In September 2019, the Kentucky Board of Pharmacy suspended Petitioner’s license to practice pharmacy for a period of time not to exceed five years and one day.  IG Ex. 4. 
9. The pharmacist license suspension was based on the February 7, 2019 jury verdict that Petitioner was guilty “of seven counts of knowingly and intentionally distributing and dispensing outside the scope of professional practice and not for legitimate medical purpose, a Schedule II controlled substance (oxycodone and hydrocodone).”  IG Ex. 4 at 2.   
10. Petitioner is subject to mandatory exclusion from participation in all federal health care programs under 42 U.S.C. § 1320a-7(a)(4), and a 15-year length of exclusion is not unreasonable based on the existence of three aggravating factors (42 C.F.R. § 1001.102(b)(2), (5), (9)) and no mitigating factors.1              

VI.  Analysis

Petitioner concedes that she is excludable from participating in all federal health care programs under 42 U.S.C. § 1320a-7(a)(4).  That statute provides:   

(a) Mandatory exclusion

The Secretary [of Health and Human Services] shall exclude the following individuals and entities from participation in

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any Federal health care program (as defined in section 1320a–7b(f) of this title):

* * * *

(4) Felony conviction relating to controlled substance

Any individual or entity that has been convicted for an offense which occurred after August 21, 1996, under Federal or State law, of a criminal offense consisting of a felony relating to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance.

Therefore, Petitioner must be excluded for a minimum period of five years.  42 U.S.C. § 1320a-7(c)(3)(B).  However, the IG is authorized to lengthen that term if certain aggravating factors exist.  See 42 C.F.R. § 1001.102(b)(1)-(9). 

The IG added ten years to Petitioner’s minimum mandatory five-year exclusion based on the presence of three aggravating factors:  1) 42 C.F.R. § 1001.102(b)(2) (the acts resulting in conviction, or similar events, were committed over a period of one year or more); 2) 42 C.F.R. § 1001.102(b)(5) (the sentence imposed by the court in this case included incarceration); and 3) 42 C.F.R. § 1001.102(b)(9) (an adverse action taken by a State board, based on the same circumstances that serve as the basis for imposing the exclusion.). 

Petitioner agrees that the record supports a conclusion that all three of these aggravating factors apply in this case.  P. Br. at 2.  However, Petitioner argues that these aggravating factors do not support a 15-year length of exclusion, asserting that various exclusion cases with similar aggravating factors resulted in exclusion lengths shorter than 15 years.  P. Br. at 2-4; P. Exs. 1-6.  Petitioner admits that the length of her imprisonment is longer than in the case comparisons and that the length of imprisonment is relevant to the length of exclusion.  P. Br. at 3.  Petitioner thinks it is significant that she was not convicted of 30 of the 37 crimes for which she had been indicted.  P. Br. at 4.  Petitioner also asserts that she ran a successful business for decades and provided excellent care for her adopted child and ill parents.  P. Br. at 4.  Finally, Petitioner argues that an administrative law judge can substitute his or her own view as to the appropriate length of the exclusion based on the record.  P. Br. at 4. 

I must uphold the IG’s determination concerning the 15-year length of exclusion unless that length is unreasonable.  42 C.F.R. § 1001.2007(a)(1)(ii).  This means that:  “So long as the amount of time chosen by the IG is within a reasonable range, based on demonstrated criteria, the [administrative law judge] has no authority to change it under

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this rule.  We believe that the deference § 1001.2007(a) grants to the IG is appropriate, given the IG’s vast experience in implementing exclusions under these authorities.”  57 Fed. Reg. 3327, 3321 (Jan. 29, 1992). 

In reviewing the aggravating factors in this case, I must make a qualitative assessment of each factor.  57 Fed. Reg. at 3314-15 (“We do not intend for the aggravating and mitigating factors to have specific values; rather, these factors must be evaluated based on the circumstances of a particular case.”). 

The length of Petitioner’s prison sentence weighs heavily in favor of a lengthy exclusion.  A prison sentence of as little as nine months is considered to be relatively substantial for exclusion purposes.  Jason Hollady, M.D., DAB No. 1855 at 12 (2002).  Petitioner’s seven concurrent sentences for 78 months of imprisonment is more than eight times longer than the nine months in the Hollady case.  Therefore, Petitioner’s term of imprisonment substantially supports the IG’s 15-year exclusion. 

I also conclude that the length of Petitioner’s criminal conduct, lasting more than a year, provides strong support for the 15-year length of exclusion.  The jury specifically found that the Petitioner’s criminal conduct spanned four years, from February 2014 through January 2018.  During that time, she improperly dispensed Schedule II opioids.  In 2017, and renewed again most recently on October 7, 2020, the Secretary of Health and Human Services declared a nation-wide Public Health Emergency due to the opioid crisis.  https://www.phe.gov/emergency/news/healthactions/phe/Pages/opioid-8Oct20.aspx  (last visited October 27, 2020).  It is not unreasonable for the IG to assign a long period of exclusion before potentially allowing Petitioner to participate in federal health care programs given that her crime likely contributed to the national opioid crisis.             

Finally, the adverse action imposed by the Kentucky Board of Pharmacy also supports the 15-year exclusion.  The lengthy suspension of Petitioner’s pharmacist’s license shows that she has betrayed the basic precepts of her profession and the public. 

Petitioner argues that, due to case comparisons, I should reduce the length of exclusion.  Case comparisons are not part of the regulatory factors to consider when reviewing the length of exclusion and, as seen below, do not aid Petitioner. 

In the first case provided by Petitioner, the excluded individual had three aggravating factors to support a ten-year exclusion.  The excluded individual was only sentenced to four months in prison and four months of home confinement.  P. Ex. 1 at 2.  Further, the criminal acts occurred only for slightly over two years.  P. Ex. 1 at 4.  This case is insufficiently close for comparison purposes. 

In the second case Petitioner provided, the excluded individual had three aggravating factors to support a ten-year exclusion.  These factors were the same as Petitioner’s

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factors; however, the excluded individual’s acts occurred over the course of only approximately two years, her incarceration was for only 33 months, and her medical license was revoked.  P. Ex. 2 at 3-4.  While this case is a relatively good comparison, it simply supports Petitioner’s 15-year exclusion.  The IG obviously took into account that Petitioner was sentenced to 15-months more incarceration and that the length of time Petitioner engaged in criminal acts was double than the length of time in the comparison.     

In the third case Petitioner provided, the excluded individual had three aggravating factors to support a ten-year exclusion.  These factors were the same as Petitioner’s factors; however, the excluded individual’s criminal acts occurred during a period of just over a year, the excluded individual’s incarceration was for only 30 months, and the excluded individual surrendered his Medical license.  P. Ex. 3 at 5-6.  While this case is comparative to the present one, just as the case above, it supports an increased length of exclusion for Petitioner.

In the fourth case Petitioner provided, the excluded individual had three aggravating factors to support a ten-year exclusion.  These factors were the same as Petitioner’s factors; however, the IG reduced the length of exclusion to seven years because the excluded individual proved that a mitigating factor existed.  See P. Ex. 4.  This case is not comparable to the present case because of the presence of a significant mitigating factor.

In the fifth case Petitioner provided, the excluded individual had three aggravating factors to support a ten-year exclusion.  These factors were the same as Petitioner’s factors; however, the excluded individual’s incarceration was for only 33 months, the excluded individual’s criminal acts occurred over the course of only approximately one and a half years, and the excluded individual’s medical license was suspended and state Medicaid enrollment was revoked.  P. Ex. 5 at 6.  While this case is comparable, again it simply supports Petitioner’s 15-year exclusion because Petitioner had a longer length of incarceration and a longer period of committing criminal acts.    

In the sixth case Petitioner provided, the excluded individual had four aggravating factors to support a 13-year exclusion.  Three of the factors were the same as Petitioner’s factors; however, the excluded individual’s acts occurred over the course of only three years, the excluded individual was incarcerated for only 24 months, and the excluded individual’s state Medicaid enrollment was suspended.  P. Ex. 6 at 6-8.  The excluded individual’s criminal acts also included the loss to the government of $931,118.96.  P. Ex. 6 at 5-6.  While this case has certain similarities, it also contains an additional aggravating factor. Given that two of the three aggravating factors shared by both cases were less serious in the comparison case and because the comparison case had a fourth aggravating factor, this case is insufficiently similar for comparison purposes.

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VI.  Conclusion

For the foregoing reasons, I affirm the IG’s determination to exclude Petitioner for 15 years from participating in Medicare, Medicaid, and all federal health care programs under 42 U.S.C. § 1320a-7(a)(4).

• 1. Petitioner briefly asserts in her brief that I should reduce the length of exclusion based on the mitigating factor at 42 C.F.R. § 1001.102(c)(1).  P. Br. at 4-5.  That mitigating factor only applies if Petitioner had been convicted of three or fewer misdemeanors.  However, in this case, Petitioner was convicted of seven violations of 21 U.S.C. § 841(a)(1), which resulted in a sentence of seven concurrent terms of imprisonment of 78 months each.  IG Ex. 3 at 2; see 21 U.S.C. § 841(b).  Petitioner’s convictions were felonies and not misdemeanors.  See 18 U.S.C. § 3559(a)(6).