Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
__________________________ In the Cases of: ) DATE:
January 17, 1990 ) Charles W. Wheeler and ) Appellate Docket
Nos. Joan K. Todd, ) 89-163 and 89-164 )
Decision No. 1123 Petitioners, ) ) - v. -
) ) The Inspector General. ) )
FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE
DECISIONS
The Petitioners, Charles W. Wheeler and Joan K. Todd, appealed decisions
by Administrative Law Judge (ALJ) Charles E. Stratton affirming
determinations by the Inspector General (the I.G.) to exclude the
Petitioners from participating in the Medicare program for five years
and to direct that they be excluded from participating in State health
care programs (including Medicaid) for the same length of time. 1/ At
the Petitioners' request, we joined the two cases for review. 2/
The Petitioners were officers of incorporated nursing homes in West
Virginia. Mr. Wheeler pleaded guilty in Mercer County to two counts of
attempting to commit the offense of falsifying documents, and in Fayette
County to one count of attempting to commit the offense of falsifying
documents. Ms. Todd pleaded guilty in Fayette County to one count of
attempting to commit the offense of falsifying documents. The Circuit
Courts of Fayette and Mercer Counties accepted the Petitioners' pleas.
The I.G. notified the Petitioners that based on their plea agreements
with West Virginia, they were excluded from participating in the
Medicare and Medicaid programs.
The ALJ concluded that the Petitioners were convicted of a criminal
offense related to the delivery of an item or service under the Medicaid
program, within the meaning of section 1128(a)(1) of the Social Security
Act (the Act), and were subject to the minimum mandatory five-year
exclusion provision of section 1128(c)(3)(B) of the Act. See Docket No.
C-61, p. 5.
Petitioners' Exceptions
The Petitioners' arguments on appeal may be summarized as follows: 3/
1. The ALJ concluded that no ambiguity exists in section 1128 of the Act
which would make necessary under the Administrative Procedure Act the
promulgation of regulations. The Petitioners contended that
promulgation of regulations was necessary and cited for the first
time section 1128(c) of the Act, as well as its legislative history,
as specifically requiring such regulations. Petitioners' Request for
Appellate Review, pp. 11-13.
2. The ALJ concluded that if an offense falls within section 1128(a),
the I.G. has no choice but to exclude the provider for a minimum
five-year period. The Petitioners contended that the application of
1128(a) is not mandatory; rather, it is the five-year period of
exclusion under 1128(c)(3)(B) which is mandatory once the 1128(a)
provision is applied. The Petitioners contended that "the Secretary
has discretion to apply the 1128(a) or 1128(b) provisions when
overlap occurs." Petitioners' Request for Appellate Review, pp.
13-14. The Petitioners contended that the permissive exclusion
provision in section 1128(b) should apply in lieu of section
1128(a)(1), since section 1128(b)(7) applies to acts described in
section 1128B(a)(1), which specifically mentions false claims for
payments in the Medicaid program and thus more accurately describes
the Petitioners' alleged conduct. Petitioners' Request for Appellate
Review, pp. 14-15.
3. The ALJ concluded that no evidentiary hearing was required and that
the Petitioners were convicted of an offense related to the delivery
of an item or service under Medicaid.
o The Petitioners argued that their pleas were Alford pleas
equivalent to nolo contendere pleas, and therefore the Petitioners
cannot be estopped from establishing the underlying conduct which
defines whether their offense related to the delivery of an item or
service under the Medicaid program. 4/ The Petitioners also
submitted their own affidavits, claiming that the affidavits
establish that no criminal conduct occurred that relates to
delivery of an item or service under Medicaid. Request for
Appellate Review, pp. 16-17.
o In oral argument on appeal, the Petitioners stated that "the fact
of the matter is that obviously a nolo contendere plea constitutes
an adjudication of conviction for purposes of the administrative
proceedings here." Transcript (Tr.) of Telephone Conference, p. 6.
The Petitioners contended nonetheless that the ALJ should make an
individual determination as to what specific facts were involved in
the prosecution and conviction of the Petitioners. Tr., p. 11.
o The ALJ found that the Petitioners' pleas were entered knowingly
and voluntarily. The Petitioners offered an affidavit to establish
that the Petitioners were misinformed by the prosecutor through
their attorney about their ability to continue to participate in
the Medicare and Medicaid programs.
o The Petitioners had offered an alleged expert's opinion as to
whether the offenses for which the Petitioners were convicted
related to delivery of an item or service under Medicaid. The
Petitioners claimed the ALJ erred in failing to offer any rationale
or basis for rejecting the expert's categorization of the
Petitioners' activities as related to a reimbursement function as
opposed to a delivery function. Petitioners' Request for Appellate
Review, pp. 15-16.
4. The Petitioners disagreed with the ALJ's finding that they "failed
to support their allegations that Ex. [Exhibit] A-4 was a set of
regulations." Petitioners' Request for Appellate Review, pp. 17-
18.
Based on our review of the ALJ's decision and the record below, the
parties' written submissions and the transcript of oral argument before
us, and the following analysis, we affirm the ALJ's decisions. We
affirm and adopt each of the ALJ's numbered findings of fact and
conclusions of law as written, with the exception of one of the
conclusions (Todd's FFCL No. 15; Wheeler's FFCL No. 18). We have
restated this conclusion below to make it more clearly reflect the ALJ's
discussion.
Analysis
1. The Secretary is not required to promulgate regulations prior to the
effective date of the exclusion.
The Petitioners contended that the ALJ erroneously concluded that the
I.G. did not violate the Administrative Procedure Act by not
promulgating regulations. The Petitioners did not directly challenge
the ALJ's analysis of the Petitioners' previous arguments, but argued
here for the first time that section 1128(c) requires the Secretary to
promulgate regulations prior to the effective date of any exclusion.
In In Re: Greene, DAB No. 1078 (1989), the Board discussed whether
section 1128(c) requires the Secretary to promulgate regulations prior
to the effective date of any exclusion. The Board determined that
section 1128(c) does not bar the imposition of an exclusion prior to
promulgation of new regulations. The Board also concluded that the
Secretary may rely on existing regulations as long as they are
compatible with the revised statute. The Board determined that section
1128(c), as revised, did not differ materially from the prior version.
The Board therefore concluded that the regulations which implemented the
prior version, and which have not yet been revised, provide for the
timing and the notice of an exclusion in a manner that is fully
consistent with the revised statutory provisions. See 42 C.F.R.
1001.124 and 1001.126. The Petitioners here received such a notice and,
thus, received the full procedural protection required by statute. 5/
Thus, we conclude that the Petitioners' exception is without merit and
affirm the ALJ's conclusions that the I.G. did not violate the
Administrative Procedure Act by not promulgating regulations (Todd's
FFCL No. 12; Wheeler's FFCL No. 15). 2. The ALJ correctly concluded
that if an offense falls within section 1128(a), the I.G. has no choice
but to exclude the provider for a minimum five-year period.
The Petitioners argued that the ALJ erroneously concluded that if an
offense falls within section 1128(a), the I.G. has no choice but to
exclude the provider for a minimum five-year period. The Petitioners
contended that the Secretary has discretion to apply the mandatory
exclusion provision at section 1128(a) or the permissive exclusion
provision at 1128(b).
The Petitioners argued also that the permissive exclusions of section
1128(b) should apply in lieu of the mandatory exclusion provision at
section 1128(a), because section 1128(b)(7) specifically describes as a
basis for exclusion false claims for payments in the Medicaid program.
That section applies to:
(7) FRAUD, KICKBACKS, AND OTHER PROHIBITED ACTIVITIES.--Any
individual or entity that the Secretary determines has committed an
act which is described in section 1128A or section 1128B.
Section 1128B(a)(1) describes "any false statement or representation of
a material fact in any application for any . . . payment under"
Medicaid. According to the Petitioners, this section describes more
accurately than section 1128(a)(1) the offense for which they were
convicted.
These same arguments were addressed in In Re: Greene, DAB No. 1078
(1989). See Greene, pp. 9-11. The Board came to the same conclusion
there as the ALJ did below. Docket No. C-61, pp. 13-14. The Board
determined that, in the absence of section 1128(a), which provides that
the Secretary "shall" exclude individuals where applicable, it is
possible that the offense in question might have fit within the scope of
the 1128(b) provisions. The Secretary, however, has no obligation under
the statute to decide that section 1128(b)(1) would not apply before
imposing the mandatory provisions of section 1128(a). The Board
determined also that section 1128(b)(7) did not support the argument
that the permissive exclusion provisions of section 1128(b) were
applicable instead of the mandatory provisions.
The Petitioners' arguments here were virtually identical to the
arguments presented to the Board in Greene. The Petitioners have not
shown us any reason why the Board's conclusion in Greene is erroneous,
or is contrary to law. Thus, we affirm the ALJ's conclusion that in
accordance with section 1128(a) of the Act, the Petitioners were
properly excluded from participating in Medicare and Medicaid for a
period of five years ( Todd's FFCL No. 11; Wheeler's FFCL No. 14).
3. The ALJ correctly concluded that no evidentiary hearing was required
and that section 1128(a)(1) applies.
The Petitioners challenged each of the ALJ's findings and conclusions
related to the issue of whether the Petitioners were convicted of a
criminal offense related to the delivery of an item or service under
Medicaid (Todd's FFCL Nos. 6-10, and 14; Wheeler's FFCL Nos. 9-13, and
17). The Petitioners also challenged the ALJ's conclusion that the
classification of the Petitioners' convictions of a criminal offense as
subject to the authority of section 1128(a)(1) is a legal issue (Todd's
FFCL No. 15; Wheeler's FFCL No. 18) and that there is no need for an
evidentiary hearing in this case (Todd's FFCL No. 16; Wheeler's FFCL No.
19).
A. The material facts are undisputed, and therefore no evidentiary
hearing was required.
Section 1128(a)(1) provides that the Secretary shall exclude any
individual from participating in the Medicaid program who has been
"convicted of a criminal offense related to the delivery of an item or
service" under the Medicaid program. In determining whether section
1128(a)(1) applies, the threshold issues include the following
questions: was the Petitioner convicted; what was the offense of which
the Petitioner was convicted; and was that offense "related to the
delivery of an item or service"?
The ALJ's numbered conclusion of law states:
The classification of the Petitioner's conviction of a criminal
offense as subject to the authority of section 1128(a)(1) is a
legal issue (Todd's FFCL No. 15; Wheeler's FFCL No. 18).
Elsewhere in his discussion, however, the ALJ stated that the issues
raised were "primarily legal issues." Docket No. C-61, p. 3. The ALJ
stated that the material facts were stipulated to and evidenced by the
court documents pertaining to the Petitioners' guilty pleas, and that
the Petitioners had acknowledged key facts. Docket No. C-61, p. 4.
Thus, his numbered conclusion of law may be read in context to mean
that, since the material facts are undisputed, the only remaining issue
concerning classification of the Petitioners' offense is a legal one.
To avoid any confusion, we are restating the numbered conclusion to
read:
Since the material facts are undisputed in this case, the
classification of the Petitioner's conviction of a criminal offense
as subject to the authority of section 1128(a)(1) is a legal issue.
We affirm the conclusion as so modified.
Since the classification of a conviction as subject to section
1128(a)(1) may involve mixed questions of fact or law, there are some
circumstances where an evidentiary hearing may be required. Under the
particular circumstances here, however, the ALJ correctly found that no
evidentiary hearing was required. As we discuss below, the facts which
the Petitioners sought to establish through testimony would not
materially affect the outcome of the case. Thus, we affirm as restated
Todd's FFCL No. 15 and Wheeler's FFCL No. 18.
B. The ALJ correctly concluded that the Petitioners were convicted
of a criminal offense.
The issue of what is meant by "conviction" under the section is a
legal
question answered by the plain language of the statute which, for
purposes here, defines "conviction" to include a guilty plea or nolo
contendere plea accepted by a state court. Section 1128(i). The
Petitioners did not directly dispute the factual findings that they
entered guilty pleas accepted by a state court, but tried to attack the
application of the section on the basis that the plea entered was an
Alford plea, which they contended is the equivalent to a nolo contendere
plea because there is no admission of guilt. The ALJ correctly found
that an Alford plea is nonetheless a plea of guilty. Indeed, although
the Petitioners attributed significance to the fact that an Alford plea
is equivalent to a nolo contendere plea, the Petitioners admitted on
appeal that "a nolo contendere plea constitutes an adjudication of
conviction for purposes of the administrative proceedings here." Tr.,
p. 6; see also Zamora, pp. 4-7.
The Petitioners also contended that the ALJ incorrectly found that their
pleas were entered "knowingly and willfully." The Petitioners pointed
to an affidavit by a former Internal Revenue Service agent, present
during the Petitioners' discussion with their counsel in the State court
proceeding, stating that the Petitioners were told by their counsel that
the State prosecutor had said they would not be excluded from federal
programs based on their guilty pleas. Ex. A-18. The Petitioners' own
affidavits assert that they "had been informed by [their] counsel that
by [entry of their pleas they] would not be subject to an exclusion from
the Medicaid/Medicare programs." Exs. A-21 and 22. Thus, the
Petitioners argued, their pleas were not entered "knowingly."
The ALJ discussed the "knowingly and willfully" standard in Alford
as
part of his analysis of whether the State court had accepted the
Petitioners' guilty pleas. His finding that this standard was met was
amply supported by the transcript of the hearing on the plea agreement.
Docket No. C-61, p. 10; Ex. A-1(a). The proffered testimony that a
misrepresentation was made to the Petitioners about the effect of their
pleas on participation in Medicare and Medicaid would not necessarily
establish that their pleas were not properly accepted by the State court
under Alford. In any event, the proper forum for any challenge to the
validity of their pleas, and their acceptance by the State court, is in
State court and not in this administrative proceeding. We also note the
Petitioners signed a plea agreement which said it represented their
entire agreement and which does not refer to the alleged
misrepresentation. Ex. A-2, paragraph 13. Moreover, we question whether
the Petitioners could reasonably rely on any alleged representations by
a State prosecutor which were not made directly to them and which
regarded whether they would be excluded in a civil action under federal
statutes.
Most important, though, even if the pleas were not "knowingly and
willfully" made, the record amply supports the ALJ's conclusion that the
guilty pleas were accepted by the State courts, which is all that
section 1128(i) requires.
Therefore, we affirm the ALJ's findings and conclusions that Petitioners
were "convicted."
C. The ALJ correctly found that the offense of which the
Petitioners were convicted was attempting to falsify Medicaid
cost reports.
The ALJ found, based on the documents to which the Petitioners had
stipulated, that the offense to which the Petitioners pleaded guilty was
of attempting to falsify accounts and that the specific accounts which
they allegedly attempted to falsify were Medicaid cost reports.
Although Petitioners tried to characterize their proposed testimony as
going to the nature of the offense to which they pleaded guilty, nothing
in that proposed testimony is inconsistent with the ALJ's finding about
the nature of the offense. Exs. A-21 and 22. The Petitioners admitted
that the offense for which they were originally charged was related to
submission of Medicaid cost reports. Tr., p. 15.
In their oral argument, the Petitioners asserted that their testimony
would show the following: that they had reasonably trusted their
certified public accountant (CPA) who prepared the cost reports; that
the issue involved was whether they correctly claimed management fees
for their services when they did not actually pay themselves but used
the money as working capital instead; that this is a highly complicated
accounting issue; that they correctly claimed the management fees as
costs; and that they pleaded guilty only to avoid the strain of the
trial on Petitioner Todd, who had recently had a pacemaker implanted,
and because they were assured by their attorney that the prosecuting
attorney had said that guilty pleas would not result in them being
excluded from Medicare or Medicaid. Tr., pp. 18-25.
We conclude:
o The ALJ properly relied on the documents, including the indictments,
the plea agreement, and the transcript of the court hearing on their
plea as the best evidence of the nature of the offense of which the
Petitioners were convicted.
o Even if there might be some circumstances where it would be
appropriate to consider other evidence in addition to such documents
to determine the nature of the offense, those circumstances are not
present here since the documents are clear on their face.
o In any event, the crucial fact on which the ALJ relied--the fact
that the accounts which the Petitioners allegedly attempted to
falsify were Medicaid cost reports--is undisputed.
o The underlying facts which the Petitioners seek to establish go to
the correctness of the allegations in State court--that is, to the
Petitioners' guilt. As we stated above, the ALJ correctly concluded
that, under the statute, guilt is not material because "conviction"
includes a plea of guilty or a nolo contendere plea accepted by a
court.
D. The ALJ correctly concluded that the offense of which the
Petitioners were convicted was "related to delivery of an item
or service" under Medicaid.
On the issue whether the offense of which the Petitioners were convicted
was "related to the delivery of an item or service" under Medicaid,
the
Petitioners asserted they had additional relevant evidence not
considered by the ALJ, but offered evidence only as to the correctness
of the cost reports. This is not material to the outcome of the ALJ's
decision since it goes to the Petitioners' guilt, not to the nature of
the offense of which they were convicted.
The Petitioners also alleged that the ALJ did not give appropriate
weight to the affidavit by their "expert," a former official of the
Health Care Financing Administration (HCFA), in determining whether
submission of a cost report was related to the delivery of an item or
service. The Petitioners cited three court decisions for the
proposition that, while an ALJ is not bound by an expert's
uncontradicted opinions on the "ultimate issue," the ALJ must "if
he
rejects them, expressly state clear and convincing reasons for doing
so." Petitioners' Request for Appellate Review, pp. 15-16, citing Day
v. Weinberger, 522 F.2d 1154, 1156 (9th Cir. 1975); Walker v. Mathews,
546 F.2d 814, 820 (9th Cir. 1976); Rhodes v. Schweiker, 660 F.2d 722,
723-724 (9th Cir. 1981). According to the Petitioners, the ALJ offered
no rationale nor basis for rejecting the expert's opinion distinguishing
between the reimbursement function and the delivery of patient care in
the Medicaid program.
The interpretation of the phrase "related to the delivery of an item or
service" is primarily a legal one. Unlike the Social Security
disability cases cited by Petitioners, where the expert testimony went
to the issue of whether certain individuals were in fact disabled, here
the Petitioners wish us to consider the affidavit as evidence of how a
statutory phrase should be interpreted based on the administrative
practice of HCFA, the administering agency. This is a different
question.
We do not here decide whether expert testimony on program practices
would ever carry weight in interpreting whether an offense was related
to delivery of an item or service. The particular affidavit submitted
does not establish such a practice, as the ALJ found. The ALJ found
that the alleged expert did not have expertise in the particular
provision at issue. The ALJ further concluded that the fact alleged in
the affidavit -- that program practice distinguished between patient
care delivery and other conditions of participation for purposes of
certification of providers -- was irrelevant to the issue of whether an
attempt to falsify a Medicaid cost report was an offense subject to
section 1128(a)(1). Docket No. C-61, pp. 14-15. 6/
While the ALJ did not provide a lengthy explanation of his rationale for
rejecting the alleged expert's opinion, we find that rationale to be
sufficient and affirm the ALJ's conclusion. Nothing in the affidavit or
the Petitioners' challenge to the ALJ's findings alleges that the
affiant has any expertise particular to the exclusion authorities at
issue here. The distinction drawn in the affidavit is a distinction
between delivery of patient care and other functions in the Medicare and
Medicaid programs; the affiant is talking about certification
requirements when he distinguishes sanctions for non- compliance with
requirements related to patient care or safety from sanctions for
non-compliance with program requirements such as inadequate
recordkeeping or out-of- date procedure manuals. Ex. A-3, pp. 3-4.
Congress did not limit the application of the mandatory exclusion under
section 1128(a)(1) to convictions related to delivery of patient care,
however. The wording is "related to delivery of an item or service."
Under section 1905(a) of the Act, "medical assistance" for which federal
Medicaid funding is available includes "skilled nursing facility
services" and "intermediate care facility services" provided
by nursing
homes.
The ALJ concluded that there "is a simple, commonsense connection,
supported by the record, between the actions associated with the
Petitioner's conviction and the Medicaid program." Docket No. C-61, p.
12. This connection is more than commonsense, however; it is clearly
established by the Social Security Act. Under section 1902(a)(13)(A), a
State plan for Medicaid must provide for payment of skilled nursing and
intermediate care facility services--
through the use of rates (determined in accordance with methods and
standards developed by the State . . .) which the State finds . . .
are reasonable and adequate to meet the costs which must be
incurred by efficiently and economically operated facilities in
order to provide care and services in conformity with applicable
State and Federal laws, regulations, and quality and safety
standards . . . .
This section also requires States to provide assurance for the "filing
of uniform cost reports" by each facility.
In other words, under the statute and implementing state plans, a
facility participating in the program must submit a cost report, and the
state sets a reimbursement rate, generally based on reported costs,
which must be those incurred in providing care and services. If a rate
is inflated for a facility due to falsification of a cost report to
include costs which were not so incurred, each time a facility bills for
services it will be in effect seeking reimbursement in excess of what
Congress intended. 7/ As the Board stated in Greene, the submission of
a bill or claim for Medicaid reimbursement is the necessary step,
following delivery of the item or service, to bring the item or service
within the purview of the program. Moreover, as explained in Greene,
the language and legislative history of section 1128(a)(1) provide
further support for the conclusion that Congress did not intend to limit
that section to offenses related to patient care. Greene, p. 9; see
also Docket No. C-61, p. 13, fn. 15.
The Petitioners objected that the interpretation of "related to delivery
of an item or service" applied in this case would mean that any
program-related crime would lead to a mandatory five-year exclusion. We
note that the heading in the statute for section 1128(a)(1) is precisely
that -- "CONVICTION OF PROGRAM-RELATED CRIMES." This phrase was also
historically used for the section prior to amendment and the
implementing regulations clearly indicated that the phrase encompassed
administrative and management functions and not only patient care
functions in the delivery of an item or service. 42 C.F.R.
1001.122(a)(2) (1988). As the Board said in Greene, the 1987
legislative change, if anything, broadened the coverage of section
1128(a)(1). Greene, p. 11. Indeed, this history of the section is a
further reason for rejecting, for purposes of section 1128(a)(1), the
distinction the affiant made between delivery of patient care and
reimbursement and other management and administrative-type functions.
Thus, we affirm the ALJ's conclusions that the Petitioners were
convicted of a criminal offense "related to delivery of an item or
service" under the Medicaid program.
4. The ALJ correctly determined that the I.G. did not rely upon an
"unpublished guidance/directive."
The Petitioners disagreed with the ALJ's finding that the I.G. did not
rely upon an unpublished guidance (Petitioners' Ex. 4). As the ALJ
explained, Exhibit 4 is a 15-page document entitled "Civil Monetary
Penalty and Exclusion Authorities," which contains a listing of each of
the statutory authorities under which the I.G. may proceed in
sanctioning a health care provider.
The ALJ correctly concluded that the Petitioners provided no support for
their allegation that the I.G. used this document in determining whether
to classify a particular case as subject to section 1128(a) or 1128(b).
Contrary to what Petitioners argued here, the use of the phrase
"participation in the Medicaid program" in this listing and in the
I.G.'s notice of proposed exclusion to Petitioner Wheeler (Exhibit 6)
did not indicate that the I.G. somehow relied on this listing. Rather,
the language in both the listing and the notice of exclusion merely
reflects the statutory language of section 1128(a) prior to the 1987
amendments. The prior law mandated suspension from participation in the
Medicare and state programs of physicians and other individuals
convicted of a "criminal offense related to such individual's
participation in the delivery of medical care or services" under
Medicare, Medicaid, or the social services programs. The use of this
language in both the notice of proposed exclusion and the listing does
not establish that the I.G. was relying on this listing rather than on
the statute itself. Even if we were to find that the I.G. had relied on
this listing, however, this would not be material to the outcome of the
decision since the statute independently provides a basis for the
exclusion.
Therefore, we affirm the ALJ's findings that the I.G. did not rely on an
unpublished guidance in classifying the Petitioners' convictions as
subject to the mandatory exclusion authority of section 1128(a)(1) of
the Act (Todd's FFCL No. 13; Wheeler's FFCL No. 16).
Conclusion
Based on the foregoing, we affirm the ALJ's decisions.
Donald F. Garrett
Theodore J. Roumel U.S. Public Health
Service
Judith A. Ballard Presiding Panel
Member
1. Departmental Appeals Board, Civil Remedies Division, Docket Nos.
C-61 and C-63 (1989).
2. The Petitioners are mother and son; the underlying circumstances
and the I.G.'s actions to exclude them were essentially identical.
3. The Petitioners disagreed generally with the ALJ's findings and
conclusions on all six issues in dispute, but provided no legal argument
concerning Issue No. 5. Specifically, Petitioner Todd disagreed with the
ALJ's findings of fact and conclusions of law (FFCL) Nos. 6 through 18.
Docket No. C-63, pp. 6-8. Petitioner Wheeler disagreed with the ALJ's
FFCL Nos. 5 and 9 through 21. Docket No. C-61, pp. 6-8.
The Petitioners did not specifically disagree with Todd's FFCL Nos. 1
through 5 and Wheeler's FFCL Nos. 1 through 4 and 6 through 8 and made
no arguments explaining their basis for disputing some of the ALJ's
findings (Todd's FFCL Nos. 17 and 18 and Wheeler's FFCL Nos. 20 and 21).
We therefore affirm these findings and conclusions without further
discussion. Petitioner Wheeler disagreed with FFCL No. 5 only to the
extent that it omitted that the Mercer County Court accepted his guilty
plea on the same legal basis as the Fayette County Court. Petitioners'
Request for Appellate Review, p. 7. We also affirm this finding since
this omission does not materially affect the outcome of this decision,
as we discuss below.
4. Under an Alford plea, a defendant does not admit guilt but concedes
that the state has sufficient evidence for conviction. As the ALJ
found, an Alford plea is nonetheless a guilty plea. See North Carolina
v. Alford, 400 U.S. 25, 35-38 (1970); Kennedy v. Frazier, 357 S.E.2d 43,
45 (W. Va. 1987).
5. We also note that the Appellate Division Guidelines provide that
the Appellate Panel "will not consider issues not raised in the appeal,
nor issues which could have been presented to the ALJ but were not." In
In Re Zamora, DAB No. 1104 (1989), the Board found that an argument
raised for the first time on appeal need not be considered. Zamora, p.
8. In any event, the I.G. was correct that the Secretary is not
required to promulgate regulations.
6. Medicaid program regulations provide that the State Medicaid agency
may not execute a provider agreement with a facility for skilled nursing
or intermediate care facility services nor make Medicaid payments to a
facility for those services until facility has been certified by the
state to provide those services. 42 C.F.R. 442.12; see 42 C.F.R.
442.101(d) and 42 C.F.R. 442, Subparts D, E, and F.
7. The record here does not indicate precisely the effect including
the contested management fees in the Petitioners' cost reports had on
the per diem reimbursement rates for their facilities. We note,
however, that as part of the plea agreement, the Petitioners agreed to
make "restitution" to the West Virginia Department of Public Welfare
of
$31,149.68. Ex. A-2, paragraph