Dr. Robert Kanowitz, DAB CR5215 (2018)

DECISION

Petitioner, Dr. Robert Kanowitz, is a podiatrist, licensed to practice in Pennsylvania.  He participated in the Medicare program until July 19, 2012, when the Inspector General for the Department of Health and Human Services (IG) excluded him from participating in federal health care programs.  The IG took this action because Petitioner Kanowitz was convicted of criminal offenses related to the delivery of an item or service under a state health care program.  Petitioner recently reapplied for program enrollment but, because of his felony convictions, the Centers for Medicare & Medicaid Services (CMS) denied his application.  Petitioner now appeals the denial.

I find that CMS is authorized to deny Petitioner Kanowitz’s reenrollment application because, within the ten years preceding his filing, he was convicted of felonies that CMS reasonably determined are detrimental to the best interests of the Medicare program and its beneficiaries.  I therefore affirm CMS’s determination.

Background

By letter dated March 9, 2018, the Medicare contractor, Novitas Solutions, denied Petitioner Kanowitz’s application for enrollment in the Medicare program.  CMS Ex. 2.

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The contractor acted pursuant to 42 C.F.R. § 424.530(a)(3) because Petitioner was convicted of felonies that CMS determined are detrimental to the best interests of the program and its beneficiaries.  CMS Ex. 2 at 1.

Petitioner requested reconsideration.  In a revised reconsidered determination, dated May 25, 2018 (which amended a May 8, 2018 determination), a CMS hearing officer upheld the denial, citing Petitioner’s felony convictions for theft by deception – false impression (18 Pa. Cons. Stat. § 3922(a)(1)) and submitting claims for services not rendered (62 Pa. Stat. Ann. § 1407(a)(9)).  CMS Ex. 15.  Petitioner timely appealed, and that appeal is now before me.

CMS moves for summary judgment, which Petitioner opposes.  Because neither party proposes any witnesses, an in-person hearing would serve no purpose.  See Acknowledgment and Pre-hearing Order at 5-6 (¶¶ 8, 9, 10).  The matter may therefore be decided based on the written record, without considering whether the standards for summary judgment are satisfied.

CMS has submitted its brief (CMS Br.) and sixteen exhibits (CMS Exs. 1-16).1  Petitioner has submitted his brief and fourteen exhibits (P. Exs. 3-13, 13a, 14, and 15).2 In the absence of any objections, I admit into evidence CMS Exs. 1-16 and P. Exs. 3-6 and 15.

Discussion

CMS may deny Petitioner enrollment in the Medicare program because, within the last ten years, he was convicted of felonies that CMS reasonably finds detrimental to the best interests of the Medicare program and its beneficiaries.3

Statute and regulations.  CMS may deny a provider’s or supplier’s enrollment in the Medicare program if, within the preceding ten years, he was convicted of a felony offense that CMS “has determined to be detrimental to the best interests of the program and its beneficiaries.”  42 C.F.R. § 424.530(a)(3); see also Social Security Act (Act) §§ 1842(h)(8) (authorizing the Secretary to deny enrollment to a physician who has been convicted of a felony offense that the Secretary has determined is “detrimental to the best

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interests of the program or program beneficiaries”) and 1866(b)(2)(D) (authorizing the Secretary to deny enrollment after he ascertains that the provider has been convicted of a felony that he “determines is detrimental to the best interests of the program or program beneficiaries”).

Offenses for which billing privileges may be denied include – but are not limited to –financial crimes such as extortion, embezzlement, income tax evasion, insurance fraud, and similar crimes; a felony that places the Medicare program or its beneficiaries at immediate risk (such as malpractice); and felonies “outlined in section 1128 of the Act.”  42 C.F.R. § 424.530(a)(3)(i)(B), (D).  Section 1128 crimes include:  program-related crimes; crimes related to the neglect or abuse of patients in connection with the delivery of a healthcare item or service; crimes relating to health care fraud; and crimes relating to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance.  See 42 C.F.R. § 1001.101.

Petitioner’s felony offenses.  Petitioner Kanowitz was charged in Pennsylvania state court with multiple felony counts:  receiving stolen property; theft by deception – false impression; submitting false/fraudulent medical assistance claims; submitting claims for services not rendered; and submitting claims with false information.  CMS Ex. 5 at 2.  On November 22, 2010, he pled nolo contendere and was convicted on two felony counts:  theft by deception, in violation of 18 Pa. Cons. Stat. § 3922(a)(1); and submitting claims for services not rendered by the provider, in violation of 62 Pa. Stat. Ann. § 1407(a)(9).  CMS Ex. 5 at 2-3.

Because of these convictions, the IG excluded him from participating in all federal health care programs for a minimum period of five years.  CMS Ex. 6.  Section 1128(a)(1) of the Act mandates that the IG exclude an individual who has been convicted of a criminal offense related to the delivery of an item or service under Medicare or a state health care program.

The five years passed, and Petitioner requested reinstatement.  In a letter dated August 11, 2017, the IG approved his request and recommended that he contact his Medicare contractor to determine his options for participating in that program.  CMS Ex. 7.

Petitioner’s reenrollment application.  In an application filed on November 22, 2017, Petitioner applied for reenrollment in the Medicare program.  CMS Ex. 4.  He disclosed his criminal convictions and the exclusion but told the contractor that he had been reinstated, his medical license had never been “taken away,” and Highmark Blue Shield had granted him preferred provider status.  CMS Ex. 4 at 8.  Pointing to these factors, along with his acceptance by other insurers and his veracity on the application form, Petitioner maintains that his Medicare enrollment should be allowed.

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Exclusion under section 1128 and denial of enrollment under 42 C.F.R. § 424.530 (as authorized by sections 1842(h)(8) and 1866(b)(2)(D) of the Act) are separate and distinct enforcement tools, each with its own requirements and consequences.  See Fady Fayad, M.D., DAB No. 2266 at 12 (2009), citing Abdul Razzaque Ahmed, M.D., DAB No. 2261 at 13 (2009).  That the IG may have imposed a minimum period of exclusion does not preclude CMS from making its own, independent determination regarding a supplier’s reenrollment.  Indeed, the statute and regulations mandate that it do so.

Citing a series of ALJ decisions, Petitioner favorably compares his own criminal activity to that of others denied enrollment based on felony convictions.  But my review authority here is limited.  I may determine whether the regulatory elements required for denial of enrollment under section 424.530(a) are present, and, if the record establishes that they are, I must affirm.  See Douglas Bradley, M.D., DAB No. 2663 at 6-7, 13-14 (2015) and cases cited therein.  By regulation, Petitioner’s felony offenses are detrimental to the best interests of the program and its beneficiaries.  Not only were his offenses “financial crimes,” similar to insurance fraud, they subjected him to exclusion under section 1128(a).  Because Petitioner’s convictions were among those specifically enumerated in section 424.530(a), CMS may deny his Medicare enrollment without regard to equitable or other factors.  See Fayad, DAB No. 2266 at 15-17.

Thus, CMS justifiably determined that Petitioner was convicted of felonies that are detrimental to the best interests of the Medicare program and its beneficiaries and may deny his enrollment in the Medicare program.

Conclusion

CMS may deny Petitioner Kanowitz’s Medicare enrollment application because he was convicted of felonies that CMS reasonably determined are detrimental to the best interests of the Medicare program and its beneficiaries.  I therefore affirm CMS’s determination.

• 1. In its exhibit list, CMS lists seventeen exhibits but it submitted only sixteen.
• 2. Petitioner marked as exhibits some documents that are not exhibits. His brief and his exhibit list are marked as P. Exs. 1 and 2. P. Exs. 7-13, 13a, and 14 are decisions by administrative law judges, which need not be admitted as exhibits.
• 3. I make this one finding of fact/conclusion of law to support my decision.