Sunday Iro Okoro, DAB CR5428 (2019)

DECISION

Petitioner, Sunday Iro Okoro, is excluded from participating in Medicare, Medicaid, and all federal health care programs pursuant to section 1128(a)(1) of the Social Security Act (Act) (42 U.S.C. § 1320a-7(a)(1)), effective February 20, 2019.  Petitioner’s exclusion for a minimum period of five years1 is required by section 1128(c)(3)(B) of the Act (42 U.S.C. § 1320a-7(c)(3)(B)).

I. Background

The Inspector General (IG) of the U.S. Department of Health and Human Services notified Petitioner by letter dated January 31, 2019, that he was excluded from participation in Medicare, Medicaid, and all federal health care programs for five years.  The IG cited section 1128(a)(1) of the Act as the basis for Petitioner’s exclusion.  The IG stated that the exclusion was based upon Petitioner’s conviction in the Superior Court of

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California, County of Los Angeles, of a criminal offense related to the delivery of an item or service under the Medicare or a state health care program.  IG Exhibit (Ex.) 1.

Petitioner timely requested a hearing on March 28, 2019 (RFH).  On April 5, 2019, the case was assigned to me to hear and decide.  I convened a telephone prehearing conference on April 23, 2019, the substance of which is memorialized in my Prehearing Conference Order and Schedule for Filing Briefs and Documentary Evidence issued on April 23, 2019 (Prehearing Order). 

On June 7, 2019, the IG filed a motion for summary judgment, supporting brief, and IG Exs. 1 through 6.  On July 8, 2019, Petitioner filed a cross-motion for summary judgment (P. Br.) with no exhibits.  The IG filed a reply brief on August 6, 2019.  Petitioner did not object to my consideration of IG Exs. 1 through 6 and they are admitted and considered as evidence.

II. Discussion

A. Applicable Law

Section 1128(f) of the Act (42 U.S.C. § 1320a-7(f)) establishes Petitioner’s right to a hearing by an administrative law judge (ALJ) and judicial review of the final action of the Secretary of Health and Human Services (the Secretary).

Pursuant to section 1128(a) of the Act, the Secretary must exclude from participation in any federal health care program any individual convicted under federal or state law of, among other things:  a criminal offense related to the delivery of an item or service under Medicare or a state health care program.  Act § 1128(a)(1).  The Secretary has promulgated regulations implementing these provisions of the Act.  42 C.F.R. § 1001.101(a), (c).2

Section 1128(c)(3)(B) of the Act provides that an exclusion imposed under section 1128(a) of the Act will be for a period of not less than five years.  42 C.F.R. § 1001.102(a).  The Secretary has published regulations that establish aggravating factors that the IG may consider to extend the period of exclusion beyond the minimum five-year period, as well as mitigating factors that may be considered only if the minimum five‑year period is extended.  42 C.F.R. § 1001.102(b), (c).

The standard of proof is a preponderance of the evidence, and there may be no collateral attack of the conviction that is the basis for the exclusion.  42 C.F.R. § 1001.2007(c), (d).  

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Petitioner bears the burden of proof and the burden of persuasion on any affirmative defenses or mitigating factors, and the IG bears the burden on all other issues.  42 C.F.R. § 1005.15(b), (c); Prehearing Order ¶ 4.

B. Issues

The Secretary has by regulation limited my scope of review to two issues:

Whether the IG has a basis for excluding an individual or entity from participating in Medicare, Medicaid, and all other federal health care programs; and

Whether the length of the exclusion is unreasonable.

42 C.F.R. § 1001.2007(a)(1).

When, as in this case, the IG imposes the minimum authorized five-year exclusion under section 1128(a) of the Act, there is no issue as to whether the period of exclusion is unreasonable.  42 C.F.R. § 1001.2007(a)(2).

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

My conclusions of law are set forth in bold text followed by my findings of fact and analysis. 

1. Petitioner timely filed his request for hearing and I have jurisdiction.

2. Summary judgment is appropriate.

There is no dispute that Petitioner timely requested a hearing and that I have jurisdiction pursuant to section 1128(f) of the Act and 42 C.F.R. pt. 1005.

Pursuant to section 1128(f) of the Act, a person subject to exclusion has a right to reasonable notice and an opportunity for a hearing.  The Secretary has provided by regulation that a sanctioned party has the right to a hearing before an ALJ, and both the sanctioned party and the IG have a right to participate in the hearing.  42 C.F.R. §§ 1005.2-.3.  Either or both parties may choose to waive appearance at an oral hearing and to submit only documentary evidence and written argument for my consideration.  42 C.F.R. § 1005.6(b)(5).  An ALJ may also resolve a case, in whole or in part, by summary judgment.  42 C.F.R. § 1005.4(b)(12).

Summary judgment is appropriate, and no hearing is required where either:  there are no disputed issues of material fact and the only questions that must be decided involve

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application of law to the undisputed facts; or the moving party prevails as a matter of law even if all disputed facts are resolved in favor of the party against whom the motion is made.  A party opposing summary judgment must allege facts which, if true, would refute the facts relied upon by the moving party.  See, e.g., Fed. R. Civ. P. 56(c); Garden City Med. Clinic, DAB No. 1763 (2001); Everett Rehab. & Med. Ctr., DAB No. 1628 at 3 (1997) (holding in-person hearing required where non-movant shows there are material facts in dispute that require testimony); Thelma Walley, DAB No. 1367 (1992); see also New Millennium CMHC, DAB CR672 (2000); New Life Plus Ctr., DAB CR700 (2000).

There are no genuine issues of material fact in dispute in this case.  Petitioner argues that his conviction does not trigger mandatory exclusion pursuant to section 1128(a) of the Act and that, if exclusion is appropriate, it should be pursuant to section 1128(b) of the Act.  The issues Petitioner raises are issues of law that must be resolved against him.  The material facts that trigger mandatory exclusion pursuant to section 1128(a) are not in dispute.  There is no issue of whether the period of exclusion is unreasonable because the IG imposed the minimum mandatory period of five years.  Accordingly, I conclude that summary judgment is appropriate.

3. Section 1128(a)(1) of the Act requires Petitioner’s exclusion from participation in Medicare, Medicaid, and all other federal health care programs.

a. Facts

The material facts are undisputed.

On February 22, 2017, Petitioner was charged by information with three crimes.  He was charged with grand theft occurring from about June 23, 2010 through August 28, 2013, by unlawfully taking from the California Health Care Deposit Fund property of a value in excess of $950 (Count 1).  He was charged with presenting false Medi-Cal claims from about June 23, 2010 through August 28, 2013, with intent to defraud (Count 2).  Petitioner was also charged with insurance fraud during the same period, by preparing and making a written statement he knew to contain false and misleading information concerning a material fact in support of a claim for payment (Count 3).  IG Ex. 4.

On June 1, 2017, the information was amended to add a Count 4 alleging second degree commercial burglary.  The state court judge explained that the new count of second degree burglary carried a maximum term of imprisonment of three years.  If Petitioner pleaded guilty, sentencing would be delayed for one year and Petitioner would be ordered to pay restitution of $50,000 to the California Health Care Deposit Fund.  If after one year Petitioner had paid $30,000 of the $50,000 in restitution, Petitioner would be sentenced for a misdemeanor with five years of informal probation and would be required to pay the remaining $20,000 in restitution.  IG Ex. 6 at 3-5.  Petitioner pleaded no

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contest to Count 4.  The state court judge advised Petitioner that his no contest plea would be treated as a guilty plea.  IG Ex. 6 at 8-9.  Counts 1 through 3 were dismissed.  The court found Petitioner guilty of Count 4.  IG Ex. 5 at 3-5; IG Ex. 6 at 9-12.  Petitioner was sentenced on June 26, 2018.  During the sentencing proceeding, the state court judge ordered that the count to which Petitioner pleaded no contest be amended to allege a misdemeanor but there is no evidence the judge changed or directed a change in the underlying factual allegation upon which the charges were based.  Petitioner was sentenced to a period of probation, an assessment, a fine of $150, and to pay the remaining restitution of $20,000 to the California Health Care Deposit Fund.  IG Ex. 5 at 5-6.

b. Analysis

The IG cites section 1128(a)(1) of the Act as the basis for Petitioner’s mandatory exclusion.  The statute provides in relevant part:

(a) MANDATORY EXCLUSION. – The Secretary shall exclude the following individuals and entities from participation in any Federal health care program (as defined in section 1128B(f)):

(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 title XVIII or under any State health care program.

Act § 1128(a)(1).  Congress has, by the plain language of section 1128(a)(1) of the Act, required the Secretary to exclude from participation in Medicare, Medicaid, and all federal health care programs any individual or entity:  (1) convicted of a criminal offense whether a misdemeanor or felony; (2) where the offense is related to the delivery of an item or service; and (3) the delivery of the item or service was under Medicare or a state health care program.  An individual or entity is considered to have been “convicted” of an offense if, among other things, “a plea of guilty or nolo contendre by the individual or entity has been accepted by a Federal, State, or local court.”  Act § 1128(i)(3) (42 U.S.C. § 1320a-7(i)(3)).  Here, the trial court accepted Petitioner’s plea of no contest to a felony offense that was later reduced to a misdemeanor offense at sentencing.  IG Ex. 5 at 3-5; IG Ex. 6 at 9‑12.  The court’s acceptance of Petitioner’s no contest plea constitutes a conviction for purposes of Petitioner’s exclusion under section 1128(a)(1) of the Act.  Act § 1128(i)(2), (3). 

Petitioner argues in his request for hearing that his conviction does not trigger exclusion pursuant to section 1128(a)(1) of the Act because it was commercial burglary.  RFH.  In

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his cross-motion for summary judgment and opposition to the IG motion for summary judgment, Petitioner argues that section 1128(a) of the Act is not triggered by his conviction and, if he is to be excluded, the exclusion should be a permissive exclusion pursuant to section 1128(b) and be for no more than three years.  Petitioner reasons that his state criminal offense is not, on its face, related to Medicare, Medicaid, or a state health care program and that the words of the charge, not the underlying facts, control.  Petitioner also argues that his offense was a misdemeanor not a felony.  P. Br. at 1-4.  Petitioner is in error on both issues of law. 

Petitioner’s argument that his conviction was not related to the delivery of an item or service under Medicare must be resolved against him as a matter of law based on the undisputed facts.  The Board has repeatedly opined that for an offense to trigger exclusion pursuant to section 1128(a)(1) of the Act, the offense need only be in connection with the delivery of a health care item or service, and all that needs to be shown to satisfy that element is a common sense connection or nexus between the conviction and the delivery of a health care item or service under Medicare or Medicaid.  The Board has stated that the facts upon which a conviction was predicated may be considered in deciding whether the required nexus exists.  Kimbrell Colburn, DAB No. 2683 at 5 (2016).  In this case, there is an obvious nexus between Petitioner’s offense and the delivery of a health care item or service under a state health care program.  Petitioner was charged with grand theft occurring from about June 23, 2010 through August 28, 2013, by unlawfully taking from the California Health Care Deposit Fund property of a value in excess of $950 (Count 1).  He was charged with presenting false Medi-Cal claims from about June 23, 2010 through August 28, 2013, with intent to defraud (Count 2).  Petitioner was also charged with insurance fraud during the same period by preparing and making a written statement, he knew to contain false and misleading information concerning a material fact in support of a claim for payment (Count 3).  IG Ex. 4.  As part of his plea agreement, the state agreed to dismiss Counts 1 through 3 in exchange for Petitioner pleading no contest to a new Count 4 that alleged commercial burglary.  There is no evidence and no dispute that the same facts that were the bases for Counts 1 through 3 were the same facts that are the basis for the new commercial burglary charge as stipulated during the plea hearing.  IG Ex. 6 at 3-9.  The order to make restitution to the California Health Care Deposit Fund is further undisputed evidence that Petitioner’s conviction related to a state health care program.  IG Ex. 5 at 5-6; IG Ex. 6 at 3-5.  Based on the undisputed facts and drawing all favorable inferences for Petitioner, I conclude as a matter of law that there is a nexus between Petitioner’s criminal conduct and the delivery of an item or service under a state health care program. 

Accordingly, I conclude that all elements that trigger a mandatory exclusion pursuant to section 1128(a)(1) of the Act are satisfied and the IG has a basis to exclude Petitioner. 

Petitioner argues that, if there is a basis for exclusion, it is for exclusion under section 1128(b) of the Act.  Petitioner argues that he was convicted of a misdemeanor and not a

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felony.  Petitioner argues that if exclusion is necessary it should be a permissive exclusion of three or fewer years.  P. Br. at 1-4.  These arguments are also without merit.  The plain language of section 1128(a)(1) of the Act does not limit its application to felonies.  Further, the Board has been consistent that when a conviction falls within the scope of section 1128(a)(1) of the Act, that section controls even if the conviction may also be characterized as being subject to section 1128(b) of the Act.  Congress mandated exclusion under section 1128(a)(1) of the Act and gave the IG no discretion to impose a permissive exclusion under 1128(b) of the Act when the elements for an exclusion under section 1128(a) exist.  Colburn, DAB No. 2683 at 9; Lorna Fay Gardner, DAB No. 1733 (2000); Boris Lipovsky, M.D., DAB No. 1363 at 4-5 (1992). 

4. Section 1128(c)(3)(B) of the Act requires a minimum exclusion period of five years for any exclusion action pursuant to section 1128(a) of the Act.

5. Petitioner’s exclusion for five years is not unreasonable as a matter of law.

Congress established five years as the minimum period of exclusion for exclusions pursuant to section 1128(a) of the Act.  Act § 1128(c)(3)(B).  Pursuant to 42 C.F.R. § 1001.2007(a)(2), when the IG imposes an exclusion pursuant to section 1128(a) of the Act for the statutory minimum period of five years, there is no issue of whether or not the period is unreasonable.  Accordingly, I conclude that Petitioner’s exclusion for a period of five years is not unreasonable as a matter of law.

III. Conclusion

For all of the foregoing reasons, Petitioner is excluded from participation in Medicare, Medicaid, and all other federal health care programs for a minimum of five years, effective February 20, 2019.

• 1. Pursuant to 42 C.F.R. § 1001.3001, Petitioner may apply for reinstatement only after the period of exclusion expires. Reinstatement is not automatic upon completion of the minimum period of exclusion.
• 2. Citations are to the 2018 revision of the Code of Federal Regulations (C.F.R.), unless otherwise stated.