Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Appellate Division
In the Case of:
Paul R. Scollo, D.P.M.
Petitioner,
- v. -
The Inspector General.
DATE: September 30, 1994
Docket No. C-93-58
Decision No. 1498
FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE
DECISION
Paul R. Scollo, D.P.M. (Petitioner) appealed a January 4, 1994 decision
by Administrative Law Judge (ALJ) Joseph K. Riotto upholding
Petitioner's exclusion from participation in Medicare and any State
health care program for five years. 1/ Paul R. Scollo, D.P.M., DAB
CR300 (1994) (ALJ Decision). The Inspector General (I.G.) had based the
exclusion on section 1128(a)(1) of the Social Security Act (Act) and on
Petitioner's nolo contendere plea to a criminal offense under federal
law. The ALJ found that the I.G. had established that Petitioner had
been convicted of a criminal offense and that his offense was related to
the delivery of an item or service under Medicare or Medicaid, as
required by section 1128(a)(1). The ALJ granted summary judgment for
the I.G., finding that there was no genuine issue of material fact.
Petitioner appealed the ALJ Decision. After both parties submitted
written arguments, oral argument was held by telephone on August 4,
1994. For the reasons stated below, we affirm the ALJ Decision.
BACKGROUND
The ALJ upheld Petitioner's exclusion based on the following findings of
fact and conclusions of law (FFCLs) --
1. At all times relevant to this proceeding, Petitioner was a
podiatrist, licensed to practice in New Jersey.
2. During 1988 and 1989, the U.S. Attorney for the Eastern District of
Pennsylvania investigated certain unlawful practices connected with
laboratory testing of Medicare patients. The tests were to assess
vascular functioning and were performed by a related group of firms,
collectively referred to here as Medical Diagnostic Service ("MDS").
3. The U.S. Attorney concluded that MDS was paying illegal kickbacks to
medical practitioners who referred patients to MDS for testing.
4. The U.S. Attorney determined also that MDS submitted false
information to Medicare, enabling it to bill for tests of a type
Medicare did not sanction, as well as for tests which had not been
ordered.
5. MDS was charged with defrauding Medicare of more than $100,000.
6. MDS entered into a plea bargain with the government under which it
pled guilty to some charges, paid restitution and damages, and
cooperated with the investigators.
7. In or about January 1984, Petitioner was paid $1000 by MDS in
connection with 20 individuals covered by Medicare, who were tested by
MDS during December of 1983.
8. MDS was reimbursed by Medicare for the $1000 in referral fees that
it paid to Petitioner in connection with 20 Medicare beneficiaries.
9. In mid-1988, the U.S. Attorney wrote to approximately 400 doctors
who had been identified (through examination of MDS's cancelled checks
and other business records) as having received payments from MDS. The
U.S. Attorney offered to release each of them from civil liability
should kickbacks be proven if the doctors voluntarily paid treble
damages.
10. Doctors cooperating with this offer also would, in effect, be
immunized from criminal prosecution, since the U.S. Attorney decided
that individuals who had given up the monies received from MDS and had
also been subjected to additional financial sanctions would have been
punished enough.
11. Several doctors, who had hired a single attorney to represent them,
replied to the government's proposal by arguing that the payments they
received were not kickbacks, but were rent that MDS paid them so that
MDS could use their examination rooms to do the vascular tests.
12. Because the payment of rent for space used to conduct
Medicare-reimbursed tests in a doctor's office was thought not unlawful,
the U.S. Attorney offered to excuse from repayment any doctor who would
swear either that he or she had only one examination/treatment room and
that MDS used it for conducting tests, or would swear that he or she
stayed with the individual being tested throughout the entire duration
of the test.
13. Three or four doctors opted to submit affidavits pursuant to the
U.S. Attorney's offer.
14. In August 1988, Petitioner submitted such an affidavit, swearing
that the money he received from MDS constituted rent for the use of his
examination/treatment room.
15. However, it was soon discovered that the 20 named Medicare
patients, with regard to whom Petitioner was paid $1000 by MDS, were not
tested by MDS in any office maintained by Petitioner, but, instead, were
tested in the Green Briar Home or Newton Home where they resided (and
where Petitioner himself came on a regular basis to treat their foot
problems).
16. On January 24, 1991, Petitioner was indicted in the U.S. District
Court, Eastern District of Pennsylvania. The indictment stated that MDS
was reimbursed by Medicare for conducting laboratory tests; that some of
such monies were paid to doctors, including the Petitioner herein, as
unlawful remuneration for referring individuals for testing; that in
January 1984 Petitioner received approximately $1000 from MDS for
referring 20 Medicare patients for testing; that such tests were not
conducted in Petitioner's office or examination/treatment rooms; that
Petitioner, in order to take advantage of the government's offer to
excuse practitioners from liability for taking payments from MDS, swore,
in an affidavit submitted to the U.S. government, that the MDS payments
constituted rent for the use of his examination/treatment room; and that
thereby Petitioner willfully made a false statement in relation to a
matter within the jurisdiction of a Department of the United States, in
violation of 18 U.S.C. 1001.
17. On April 3, 1991, Petitioner pled nolo contendere in federal court
to the charge of knowingly and willfully making a false and fictitious
representation and statement as to a material matter within the
jurisdiction of the U.S. Department of Justice, in violation of 18
U.S.C. 1001.
18. When questioned by the judge at the time he entered his plea,
Petitioner admitted having had a specific intention to break the law;
admitted receiving the payments from MDS; acknowledged that, were there
a trial, the government would be able to prove that the settlement was
offered to him because of his taking kickbacks from MDS, and admitted
that an MDS representative would testify that MDS did not represent to
Petitioner that the fees he received from MDS were rental payments; and
lastly, Petitioner acknowledged, without reservation, that he did what
was charged in the indictment.
19. On July 17, 1991, Petitioner was sentenced to probation, community
service, and restitution.
20. Petitioner's plea of nolo contendere to a criminal charge, and the
United States District Judge's acceptance thereof, is a "conviction"
for
purposes of mandatory exclusion.
21. The Secretary of Health and Human Services delegated to the I.G.
the authority to determine and impose exclusions pursuant to section
1128 of the Act.
22. Petitioner is subject to a mandatory minimum exclusion of five
years for his conviction of a criminal offense related to the delivery
of an item or service under Medicare.
ALJ Decision at 2-5 (citations omitted). Petitioner excepted
specifically to FFCLs 18 and 22. Petitioner has not objected to FFCLs
1-17 or 19-21, and we affirm these FFCLs without further discussion.
ANALYSIS
We have a limited role as the forum for administrative review of an
ALJ's decision in an exclusion case. The standard of review on disputed
issues of fact is whether the ALJ Decision is supported by "substantial
evidence on the whole record." The standard of review on disputed
issues of law is whether the ALJ Decision is "erroneous." 42 C.F.R.
1005.21(h); Joyce Faye Hughey, DAB 1221, at 11 (1990); Lakshmi N. Murty
Achalla, DAB 1231, at 7 (1991).
Section 1128(a)(1) of the Act, under which Petitioner was excluded,
provides as follows:
(a) MANDATORY EXCLUSION. -- The Secretary shall exclude the
following individuals and entities from participation [in Medicare
and Medicaid] . . .
(1) CONVICTION OF PROGRAM RELATED CRIMES. -- 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].
Section 1128(i)(3) of the Act states that a person has been convicted
when a plea of nolo contendere has been accepted by a Federal, State or
local court. Section 1128(c)(3)(B) of the Act states that an exclusion
under section 1128(a)(1) will be for a minimum of five years.
I. Whether Petitioner pled nolo contendere to receiving illegal
"kickbacks" is not determinative; the actions for which he was
convicted clearly related to the delivery of items or services
under Medicare.
Petitioner argued that the ALJ erred in concluding that he was convicted
of an offense related to the delivery of an item or service under
Medicare. Petitioner stated that the criminal statute to which he pled
nolo contendere, 18 U.S.C. 1001, was a "generic" statute making
it a
crime to falsely swear, or make a misrepresentation going to a material
matter, to the government. Petitioner's Brief (Br.) at 24-25.
Petitioner argued that the elements of this crime -- statement, falsity,
specific intent, materiality, and jurisdiction -- do not in any way
implicate the Medicare or Medicaid programs. Petitioner argued that the
government did not charge him with, nor did the court convict him of,
the offense of receiving illegal kickbacks because the I.G. could not
prove that Petitioner had the requisite intent to engage in such
offense; therefore, Petitioner argued, the government chose not to
proceed against him on such charge because it would not be able to prove
its case. Id. 2/ Petitioner argued that to exclude him from
participation in Medicare was to use an uncharged crime (i.e., illegal
kickbacks) to impose a civil penalty upon him. Transcript of Oral
Argument Before the Department of Health and Human Services, August 4,
1994 (Tr.) at 4-7. As for Petitioner's admission in the plea colloquy
before the criminal court judge that he "did what is charged in this
indictment," Petitioner argued that he simply admitted to the crime of
false swearing, which is what was charged in the indictment. 3/
Petitioner's Reply Br. at 2.
Even though Petitioner was not convicted under the anti- kickback
statute, we find that Petitioner's offense nevertheless was related to
the delivery of an item or service under Medicare within the meaning of
section 1128(a)(1). Petitioner was convicted of false swearing in
regard to whether certain vascular testing services he ordered for his
patients were performed in his office and thus whether the per patient
fees he received from the company performing those services constituted
office rent rather than unlawful referral fees. I.G. Ex. 7. The
patients referred to MDS by Petitioner were Medicare patients; MDS
sought reimbursement and was reimbursed for the vascular testing
services from Medicare. MDS paid Petitioner a fee of $50 for each of
the Medicare patients he referred. Id. MDS was charged with defrauding
Medicare of more than $100,000 in connection with such vascular testing
services. FFCLs 2 and 5. Petitioner was identified during the
investigation of MDS as having received payments from MDS. FFCL 9.
While the false swearing was made in an affidavit submitted to the
Department of Justice rather than the Department of Health and Human
Services (which administers the Medicare program), the affidavit was
submitted pursuant to an investigation into Petitioner's referral of
Medicare patients for services. Petitioner was one of hundreds of
physicians investigated. The restitution Petitioner was ordered to pay
was based on the amount which Petitioner received from MDS for referring
the 20 Medicare patients. Tr. at 17. The fact that the services
claimed for Medicare reimbursement were actually provided by another
entity is irrelevant. E.g., Napolean S. Maminta, M.D., DAB 1135, at 7
(1990). Faced with possible legal action against him, Petitioner
deliberately misrepresented where medical services were provided to
Medicare beneficiaries. Based on these facts, we conclude that
Petitioner's conviction was related to the delivery of an item or
service under Medicare.
While Petitioner argued that he "only admitted what was charged in the
indictment," we find that Petitioner admitted in the plea colloquy to
the factual circumstances outlined above which then establish that his
offense was related to the delivery of items or services under Medicare.
Petitioner's Reply Br. at 2. Petitioner's admissions were summarized by
the ALJ in FFCL 18, to which Petitioner excepted (although he did not
explain why he alleged that the ALJ erred). In addition to admitting
that he did what was charged in the indictment (Plea Colloquy at 32)
which included an admission that Petitioner had received the payments
from MDS, Petitioner acknowledged that he understood that the government
would have to prove, if the matter went to trial, that Petitioner had a
specific intent to break the law (Plea Colloquy at 35). In addition,
Petitioner admitted that the U.S. Attorney's evidence would show that
the government offered Petitioner a civil settlement for "taking
approximately $1,000 in illegal kickbacks from a medical testing
company" and that a representative of the testing company would testify
that he never told the defendant the $50.00 per patient Petitioner
received was a rent payment (Plea Colloquy at 37). After hearing the
U.S. Attorney's evidence, Petitioner was asked whether that is
"substantially what happened," to which Petitioner answered
affirmatively (Plea Colloquy at 41). Accordingly, we affirm and adopt
FFCL 18.
We have previously held that it is not the particular label assigned to
the crime of which a petitioner is convicted that determines whether the
offense is related to the delivery of an item or service under Medicare
or Medicaid, but rather the actions and circumstances surrounding the
offense:
The fact that Petitioner's offense was labeled "facilitation of
theft" is irrelevant. Petitioner's appeal correctly acknowledged
that evidence as to the nature of an offense may be considered when
determining whether an offense is related to the delivery of items
or services under Medicare or Medicaid.
Berton Siegel, D.O., DAB 1467, at 6-7 (1994). Therefore, the fact that
Petitioner was convicted of a "generic" offense is irrelevant where
the
actions underlying the offense clearly provide such a relationship.
For the above reasons, we find the ALJ did not err in concluding that
Petitioner's conviction was related to the delivery of an item or
service under Medicare, and we affirm and adopt FFCL 22.
II. The phrase "related to the delivery of an item or service" under
Medicare or Medicaid should be interpreted more broadly than
Petitioner urges.
A. There is no requirement that there be harm to Medicare or Medicaid
in order for a conviction to be related to the delivery of items or
services under one or both programs within the meaning of section
1128(a)(1); however, harm did occur under the facts of this case.
Petitioner argued that in order to find that a conviction is related to
the delivery of an item or service under Medicare or Medicaid, the
offense for which a petitioner was convicted must have inflicted direct
harm on one of those programs. Petitioner's Br. at 18-20. Petitioner
cited several of the Board's previous cases in which a petitioner's
exclusion by the I.G. was upheld because the petitioner engaged in some
type of fraud which resulted in a financial cost to one of the programs.
Petitioner also argued that the legislative history of section
1128(a)(1) required that there be a finding of such harm to one of the
programs.
We do not agree with Petitioner that there must be some type of direct
harm to one of the programs as a result of the offense of which a
petitioner was convicted, in order for the conviction to be related to
the delivery of an item or service under one of the programs. First,
there is no requirement in the plain language of section 1128(a)(1)
which would require a finding of harm before a person must be excluded
from the programs. The section merely requires that a person be
excluded once he or she "has been convicted of a criminal offense
related to the delivery of an item or service" under Medicare or
Medicaid. If it was Congress' intent to exclude only individuals who
harmed one of the programs, Congress could have drafted the section to
exclude any individual or entity which "has been convicted of a criminal
offense related to the delivery of an item or service under [Medicare]
or [Medicaid] and which resulted in financial harm to one or both of
these programs."
Second, while the particular cases Petitioner cited did involve
financial harm to either Medicare or Medicaid, we have never stated
either explicitly or implicitly that these are the limited situations in
which we will find that a crime relates to the delivery of items or
services under the programs. Among other cases, Petitioner cited to
Greene v. Sullivan, 731 F.Supp. 835 (E.D.Tenn. 1990), and Travers v.
Sullivan, 791 F.Supp. 1471 (E.D.Wash. 1992), in support of his argument
that section 1128(a)(1) of the Act implicitly requires financial harm to
Medicare or Medicaid. In both Greene and Travers, the petitioners
argued that their crimes were not related to the delivery of items or
services under Medicare or Medicaid because their convictions were for
crimes committed in billing for services under one of those programs and
did not occur at the time of the actual delivery of the items or
services to the patients. However, in both of these cases, the courts
upheld the exclusions, concluding that crimes committed during the
billing were related to the delivery of items or services because
billing was a necessary step which brought the claim under Medicare or
Medicaid. Greene, 731 F.Supp. at 838; Travers, 791 F.Supp. at 1481-82.
Thus, the Greene and Travers courts held that crimes which occur when
services are billed to Medicare or Medicaid are included among those
crimes which are related to the delivery of items or services under
Medicare or Medicaid. Those cases did not hold that financial crimes
are the only crimes which are related to the delivery of items or
services under the programs.
Petitioner cited to the legislative history of section 1128(a)(1), which
was enacted in 1977, in support of his argument that Congress intended
for the section to address "fraudulent and abusive practices associated
with the Medicare and Medicaid programs" and "crimes against the
programs." Petitioner's Br. at 19, citing H.R.Rep. No. 95-393, 95th
Cong., 1st Sess., reprinted in 3 U.S.C.C.A.N. 3039, 3042 and 3072.
Petitioner cited the following language from Greene in support of his
position:
The language of the statute itself as well as its legislative
history indicate that the dichotomy was not intended to be between
financial crimes and crimes in the delivery of services (such as
direct patient abuse) but between program-related crimes and other
relevant crimes which do not defraud the program itself (such as
fraud on insurance companies.)
Petitioner's Br. at 18, citing Greene, 731 F.Supp. at 838. 4/
Petitioner argued that when the section was amended in 1987, "nothing in
the legislative history of the amendments themselves hints at any change
in the congressional intent." Petitioner's Br. at 19.
However, this legislative history does not support Petitioner's position
that there must be financial harm to Medicare or Medicaid in order for
the conviction to be related to the delivery of an item or service under
one or both programs. There is nothing to suggest that "abusive
practices" or "crimes against the program" are limited to financial
crimes. Nor is there anything which suggests that an individual or
entity which engages in abusive practices or in crimes against the
program without causing actual harm to the programs should not be
excluded. Moreover, since the petitioner in Greene was arguing that his
fraudulent billing crime was not related to the delivery of
program-related items or services, the distinction which the Greene
court drew is between program-related crimes and crimes related to fraud
covered by the permissive exclusion authority in section 1128(b) of the
Act, not between financial and non- financial crimes.
Accordingly, we reject Petitioner's assertion that Greene stands for the
proposition that relatedness requires direct (financial) harm or that
this proposition can be derived from the legislative history. See
Petitioner's Br. at 20-21 and 26.
Finally, even if we were to find that there was a requirement implicit
in the section that a petitioner's crime have caused some harm to the
programs in order to be related to the delivery of items or services
(which we do not), we would find such harm here. In Niranjana B.
Parikh, M.D., DAB 1334 (1992), the petitioners, four physicians who had
pled guilty to receiving kickbacks for referring Medicaid patients to a
medical supply company, were excluded under section 1128(a)(1). The
Board stated:
[C]ontrary to Petitioners' allegations, the programs were
victimized and harmed by Petitioners' actions. By choosing a
supplier to which to refer patients for medical equipment based on
the availability of kickbacks from that supplier, Petitioners have
undercut the public's perception of the honesty and integrity of
other program providers. See DAB 1135 at 16. Further, choice
based primarily on the receipt of remuneration potentially raises
the cost of the equipment to the program.
Id. at 6. In a footnote, the Board stated that "Petitioners' argument
that the equipment was medically necessary for the patients for whom it
was prescribed is completely irrelevant to either the crimes for which
Petitioners were convicted or to the exclusions." Id. at 6, n.9. While
the petitioners in Parikh were actually convicted in criminal court
under an anti-kickback statute and the Petitioner in this matter was
convicted of false swearing, the actions underlying the convictions were
similar since both involved receipt of referral fees. Here, Petitioner
lied in an effort to avoid legal action and establish a lawful purpose
for taking referral fees. We have previously stated that it is the
nature of the offense rather than the terminology used in the criminal
statute which determines whether a crime is related to the delivery of
an item or service under Medicare or Medicaid.
B. Petitioner's argument that the distance between the delivery of the
Medicare services and the false swearing offense on which the
conviction was based destroyed the nexus between the conviction and
the delivery of Medicare services is unavailing.
Petitioner criticized the Board's previous conclusion that all that was
required by section 1128(a)(1) was "some nexus" or a "common
sense
connection" between the offense and the delivery of an item or service
under Medicare or Medicaid. Petitioner's Br. at 22, citing Thelma
Walley, DAB 1367 (1992), and Dewayne Franzen, DAB 1165 (1990).
Petitioner suggested that these holdings would permit an individual to
be excluded on the basis of "tangential or ephemeral" contact with
Medicare or Medicaid. Petitioner's Br. at 22. Petitioner argued that
there were at least three layers of events separating the delivery of
Medicare services and the offense of false swearing in this case, and
that such intervening events and the passage of time destroyed any nexus
between the conviction and the delivery of Medicare items or services.
Id. at 23-24. Petitioner argued that the three layers destroying the
nexus were:
1) the alleged payment of referral fees;
2) the MDS prosecutions; and
3) the investigation conducted by the Department of Justice.
Petitioner's Br. at 23. Finally, Petitioner suggested that the offense
was not related to the delivery of a Medicare item or service because
the funds which Petitioner received could not be traced directly to the
Medicare program. Tr. at 12.
We see no reason to revisit our legal analysis in Walley and Franzen.
We find that a "nexus" or a "common-sense connection" test
is consistent
with the plain language of section 1128(a)(1) and its legislative
history and purpose. Moreover, we find that Petitioner's offense
involved more than merely "tangential or ephemeral" contacts with
the
programs. In this case, Petitioner made a false statement about the
nature of the fees he received for referring Medicare patients to MDS
for services MDS delivered and, in effect, about where those services
were delivered.
We do not find that the events intervening between the actual delivery
of the services and the false statement destroys this nexus. The
payment of referral fees to Petitioner (and approximately 400 other
providers) was discovered as a result of the investigation of MDS's
billing practices. The investigation of MDS led to the Department of
Justice's investigation of Petitioner, and Petitioner's false swearing
was contained in an affidavit submitted pursuant to that investigation.
Likewise, we do not find that the element of time destroys such nexus;
the time (4.5 years) that elapsed between Petitioner's receipt of the
referral fees and his false swearing is not exceptional in light of the
extent of the fraudulent activities engaged in by MDS which were
uncovered during the investigation. Moreover, there is no statute of
limitations imposed upon the I.G. in exclusion cases and section
1128(a)(1) makes these exclusions mandatory.
Finally, it is irrelevant that the fees which Petitioner received for
referring the Medicare patients cannot be traced dollar for dollar to
the Medicare program. It is sufficient that MDS paid Petitioner a per
patient referral fee for referring 20 Medicare patients to MDS for
testing, that MDS sought and received reimbursement from Medicare for
services to those patients, and that Petitioner's false statement was
related to the delivery of those services. See FFCLs 8 and 9.
III. Plaintiff may not challenge the circumstance of his conviction
before the Board.
In his brief, Petitioner apparently contests the foundation upon which
the conviction is based. For example, Petitioner appears to be
criticizing the U.S. Attorney for concluding, based on the testimony
before a grand jury of two witnesses alone, that the 20 Medicare
patients were in fact treated in the nursing home instead of in
Petitioner's office. See Petitioner's Br. at 10. Petitioner also
"maintains his innocence of the crime for which he was convicted."
Petitioner's Br. at 16, n.3.
Petitioner presents a sympathetic case with respect to the hardship
resulting from an exclusion on him and his family. Nevertheless, if
Petitioner did not intend to make a misrepresentation to the government,
and if Petitioner believed that the government's proof as to where the
20 Medicare patients at issue were tested was weak, then he should not
have pled nolo contendere before the criminal court which convicted him.
Yet this is not the forum in which to challenge that conviction. As we
stated in regard to a mandatory exclusion taken under section 1128(a)(2)
of the Act: 5/
It is the fact of the conviction which causes the exclusion. The
law does not permit the Secretary to look behind the conviction.
Instead, Congress intended the Secretary to exclude potentially
untrustworthy individuals or entities based on criminal
convictions. This provides protection for federally funded
programs and their beneficiaries and recipients, without expending
program resources to duplicate existing criminal processes.
Peter J. Edmonson, DAB 1330, at 4 (1992) (emphasis in original). This
reasoning would also apply to exclusions under section 1128(a)(1) of the
Act. As we stated in another section 1128(a)(1) case, "[c]learly, the
correct forum for the Petitioner to have explained the factors
underlying his conviction was the [criminal] court in which he was
charged." Francis Shaenboen, R.Ph., DAB 1249, at 9 (1991). While
Petitioner concedes that he cannot collaterally attack his conviction in
these proceedings, such an attack pervades the briefing submitted. See
Petitioner's Br. at 12, n.2.
IV. Petitioner's due process rights are not being violated, nor is
Petitioner being treated in a way that violates fundamental
fairness.
Petitioner argued throughout this proceeding that his due process rights
are being violated by this exclusion. Specifically, Petitioner argued
that his right against being deprived of property (i.e, his right to
make a living) without due process of law was being violated because the
I.G. was basing this exclusion on "uncharged crimes" (i.e., kickbacks).
Tr. at 4-5. Petitioner argued that the Board "cannot mete out
punishment for offenses that have never seen the light of day in a
courtroom" and that the government "should not be able to take with
one
hand what it couldn't get with the other." Petitioner's Reply Br. at 3;
Tr. at 13.
The Board has previously stated that exclusions are administrative
remedies designed to protect federally funded health care programs; they
are not punitive actions:
[T]he purpose of the exclusion here is to protect federally funded
health programs, not to punish Petitioner. Both the State . . .
and the federal government have an interest in protecting such
programs from untrustworthy individuals.
Larry White, R.Ph., DAB 1346, at 3 (1992). As such, the Board has held
that the mandatory exclusion statute does not violate principles of
federalism, nor does it impose upon an individual's right not to be
placed in double jeopardy. E.g., White at 3; Janet Wallace, L.P.N., DAB
1326, at 12-14 (1992). While Petitioner's argument is slightly
different -- that he is being deprived of property without due process
of law because he was never charged with a kickback offense -- it
likewise has no merit. Petitioner's offense is not covered by the
mandatory exclusion provision based on the allegation that he accepted
kickbacks. Instead, he must be excluded because he was convicted of
making a false statement related to the delivery of Medicare services.
Petitioner has not argued that the I.G.'s or the Board's procedures have
been unfair. Thus, there is no basis here to find a violation of due
process.
Finally, Petitioner has implied throughout this proceeding that this
exclusion is fundamentally unfair. Petitioner's position can be gleaned
from such comments as:
"In response to this act of temerity [i.e., contesting his
liability], the government turned all its investigatory weapons
on him in an effort to disprove the truth of his affidavit."
Petitioner's Br. at 2.
"As a result of Dr. Scollo's anomalous position, the
government was able to marshal against him the full weight of
its investigatory resources." Petitioner's Br. at 9.
"[In reference to the criminal sanctions,] . . . even these
penalties could not appease the civil authorities."
Petitioner's Br. at 13.
However, we do not find any unfairness to Petitioner. Petitioner's
attorney was told at the time Petitioner filed his affidavit containing
the misrepresentations that --
[t]hese [affidavit] statements are made under oath, and under the
penalty of perjury if untrue. It is essential that each doctor who
signs one of these two affidavits has carefully reviewed his
records and his memory and is comfortable all the facts sworn to by
that doctor in his affidavit are true. We also agreed that each of
your doctors who sign one of these affidavits will make his records
available, and such other information as we believe necessary to
satisfy ourselves of the accuracy of these representations.
Petitioner's Ex. B. If Petitioner was unable to review his records and
did not clearly recall where the tests were performed, he should not
have signed an affidavit attesting to those facts. Petitioner was not
unfairly treated in comparison with the approximately 400 other doctors
who were the target of the MDS investigation, since Petitioner was the
only one who signed an affidavit and later admitted it contained
misrepresentations. Plea Colloquy at 22. The overwhelming majority of
the physicians opted to pay treble damages, an option which was offered
to but declined by Petitioner.
Moreover, Petitioner was told at the time of his plea that he could be
excluded from further participation in Medicare or Medicaid based on the
court's acceptance of his nolo contendere plea. Plea Colloquy at 36.
This case therefore differs from cases where we have upheld mandatory
exclusions even though a petitioner alleged that he or she was not told
at the time he or she pled guilty or nolo contendere that such an
exclusion could follow. See, e.g., Edmonson at 3-4.
CONCLUSION
For the above stated reasons, we affirm the ALJ Decision and uphold
Petitioner's exclusion from Medicare and Medicaid under section
1128(a)(1) for five years.
___________________________ Donald F.
Garrett
___________________________ M. Terry
Johnson
___________________________ Cecilia Sparks
Ford Presiding Board Member
1. "State health care program" is defined in section 1128(h) of the
Act and includes the Medicaid program under Title XIX of the Act.
Unless the context indicates otherwise, we use the term "Medicaid"
here
to refer to all programs listed in section 1128(h).
2. Petitioner also argued that since he was not charged under section
1128B(a) of the Act, his crime was not related to the delivery of a
covered item or service. There is no basis in the language of the
mandatory exclusion provision to support a conclusion that only crimes
actionable under the Social Security Act provisions are covered.
3. The I.G. frequently referred to Petitioner's receipt of "kickbacks"
from MDS. Petitioner was neither indicted nor convicted of an offense
under section 1128 B(b)(1)(A) of the Act, the anti-kickback statute.
However, the I.G. may have inferred that Petitioner admitted he had
taken illegal kickbacks when he pled nolo contendere to the false
swearing charge. In the plea colloquy, the U.S. Attorney stated that
the government's evidence would show that defendant was offered "a civil
settlement for taking approximately $1,000 in illegal kickbacks from a
medical testing company." Plea of Nolo Contendere Before Judge Raymond
J. Broderick, April 3, 1991, introduced as I.G. Exhibit (Ex.) 11 (Plea
Colloquy) at 37. A few moments later, the judge addressed the
Petitioner:
Now, you heard the United States Attorney set forth the evidence
that it would present in the event this case went to trial, and I
am asking you whether that's substantially what happened.
Petitioner responded, "Yes it is, sir." Plea Colloquy at 41. However,
it is not necessary for us to conclude that Petitioner violated the
anti-kickback statute to find that the offense for which he was
convicted was program- related.
4. The language in Greene addressed the argument that such a financial
crime was covered by the permissive exclusion authority in section
1128(b)(1) for convictions related to fraud rather than by the provision
mandating exclusion for program-related crimes.
5. Section 1128(a)(2) provides for the mandatory exclusion of anyone
convicted of a criminal offense relating to neglect or abuse of patients
in connection with the delivery of a health care item or