Usani Ewah, DAB CR5540 (2020)

DECISION

In this case, we again consider what constitutes a reasonable period of exclusion for an individual who actively participated in a massive and long-term scheme to defraud the Medicare program.

Petitioner, Usani Ewah, co-owned a home health agency in Dallas, Texas. He was an officer of the corporation and its "authorized official." For years, he and his cohorts conspired to defraud the Medicare program. He was eventually caught and pled guilty to felony conspiracy to commit healthcare fraud. Based on this conviction, the Inspector General (IG) has excluded him for 25 years from participating in Medicare, Medicaid, and all federal health care programs, as provided for in section 1128(a)(1) of the Social Security Act (Act). Petitioner now challenges the length of this exclusion.

For the reasons discussed below, I find that the IG properly excluded Petitioner and that the 25-year exclusion falls within a reasonable range.

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Background

By letter dated May 31, 2019, the IG notified Petitioner Ewah that he was excluded from participating in Medicare, Medicaid, and all federal health care programs for a period of 25 years because he had been convicted of a criminal offense related to the delivery of an item or service under Medicare or a state health care program. The letter explained that section 1128(a)(1) of the Act authorizes the exclusion. IG Exhibit (Ex.) 1.

Petitioner timely requested review.

Each party has submitted a written brief (IG Br.; P. Br.). The IG also submitted six exhibits (IG Exs. 1-6), and a reply brief (IG Reply). In the absence of any objections, I admit into evidence IG Exs. 1-6.

I instructed the parties to indicate in their briefs whether an in-person hearing would be necessary and, if so, to explain why, identify any proposed witness, and "submit witness testimony in the form of an affidavit or sworn declaration." Order and Schedule for Filing Briefs and Documentary Evidence at 4-5 (¶ 7); see attached Informal Brief of Petitioner at 4 (¶ IV). The IG indicates that an in-person hearing is not necessary. IG Br. at 16. Petitioner lists no witnesses, offers no witness testimony, and does not suggest that an in-person hearing is necessary.

Issues

As part of his plea agreement, Petitioner agreed that he would be excluded from program participation, so he has effectively waived the right to challenge the basis for his exclusion. IG Ex. 3 at 5 (¶ 9).1

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The sole issue remaining is whether the length of the exclusion (25 years) is reasonable. 42 C.F.R. § 1001.2007.

Discussion

Under section 1128(a)(1) of the Act, the Secretary of Health and Human Services must exclude an individual or entity convicted under federal or state law of a criminal offense related to the delivery of an item or service under Medicare or a state health care program. See also 42 C.F.R. § 1001.101(a).

Here, Petitioner Ewah was co-owner of Timely Home Health Services, a home health agency that participated in the Medicare program as a provider of services. IG Ex. 2 at 4 (Superseding Indictment ¶ 11); IG Ex. 4 at 3 (Factual Resume ¶¶ 4, 5).2 From about January 2007 until September 2015, he and others conspired to defraud the Medicare program. IG Ex. 2 at 6 (Superseding Indictment ¶ 20); IG Ex. 4 at 2 (Factual Resume ¶ 1). Specifically:

• Petitioner Ewah recruited and directed others to recruit, as patients, Medicare beneficiaries for whom the company could and did bill the program, regardless of whether they required home health services. IG Ex. 2 at 7 (Superseding Indictment ¶ 23); IG Ex. 4 at 3-4 (Factual Resume ¶ 7).
• He and his co-owner falsified assessment forms to make it appear that the patient qualified for home health services, when the patient did not. Even though the patients did not qualify for home health services and were not under the doctors' care, he took the falsified assessments, along with fraudulent care plans, to doctors for their signatures. IG Ex. 2 at 7-8 (Superseding Indictment ¶¶ 24-27); IG Ex. 4 at 4 (Factual Resume ¶ 8).
• He sent falsified physician telephone orders to doctors, even though the doctors had not ordered the services, and the patients were not under their care.  IG Ex. 4 at 4 (Factual Resume ¶ 9).
• He signed and altered patient records to make it appear that home health services were medically necessary and had been provided, when they were not necessary and had not been provided. IG Ex. 4 at 4 (Factual Resume ¶ 10).

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• He and his co-conspirators submitted fraudulent claims to the Medicare program, knowing that the claims were false and fraudulent. IG Ex. 2 at 8 (Superseding Indictment ¶ 29).
• He directed agency employees to alter patient files, creating the appearance that the agency had followed Medicare rules, when it had not. IG Ex. 4 at 4 (Factual Resume ¶ 11).
• In order to conceal the conspiracy, he and his co-owner attempted to "move" patients to other home health agencies that they owned and operated. IG Ex. 4 at 5 (Factual Resume ¶ 12).
• His conspiracy caused $13,434,550 to be billed to the Medicare program for false and fraudulent claims. IG Ex. 4 at 5 (Factual Resume ¶ 13).

On June 14, 2018, Petitioner Ewah pled guilty to one felony count of conspiracy to commit healthcare fraud, in violation of 18 U.S.C. § 1349. IG Ex. 5; see IG Ex. 2. The court accepted his plea and entered judgment against him. IG Ex. 5. The court sentenced him to 70 months (5 years, 10 months) in prison, followed by three years of supervised release. IG Ex. 5 at 2. The court also ordered him and his confederates to pay $8,682,321.66 in restitution. IG Ex. 5 at 4.

1. Based on the aggravating factors and no mitigating factor, a twenty-five-year exclusion falls within a reasonable range.3

Because he was convicted of healthcare fraud, Petitioner is subject to exclusion under section 1128(a)(1). An exclusion brought under section 1128(a)(1) must be for a minimum period of five years. Act § 1128(c)(3)(B); 42 C.F.R. § 1001.102(a). I now consider whether the length of the exclusion, beyond five years, falls within a reasonable range.

Among the factors that may serve as a basis for lengthening the period of exclusion are the three that the IG relies on in this case: 1) the acts resulting in the conviction, or similar acts, caused a government program or another entity financial losses of $50,000 or more; 2) the acts that resulted in the conviction, or similar acts, were committed over a period of one year or more; and 3) the sentence imposed by the court included incarceration. 42 C.F.R. § 1001.102(b). The presence of an aggravating factor or factors, not offset by any mitigating factor or factors, justifies lengthening the mandatory period of exclusion.

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Program financial loss (42 C.F.R. § 1001.102(b)(1)). In the factual resume underlying his plea agreement, Petitioner conceded that he and his co-conspirators billed the Medicare program a whopping $13,434,550 in false and fraudulent claims. IG Ex. 4 at 5 (Factual Resume ¶ 13). The program losses were apparently somewhat lower, although still enormous. The court ordered $8,682,321.66 in restitution to the Medicare program, roughly 174 times the $50,000 threshold for aggravation. IG Ex. 5 at 3.  Restitution has long been considered a reasonable measure of losses. Hussein Awada, M.D., DAB No 2788 at 7 (2017); Juan de Leon, Jr., DAB No. 2533 at 5 (2013); Craig Richard Wilder, DAB No. 2416 at 9 (2011). The Board has characterized amounts substantially greater than the statutory standard as an "exceptional aggravating factor" that is entitled to significant weight. Jeremy Robinson, DAB No. 1905 (2004); Donald A. Burstein, Ph.D., DAB No. 1865 (2003). I agree. Over time, the Medicare program simply cannot sustain this level of loss. The financial losses here justify a period of exclusion considerably longer than the five-year minimum.

Duration of criminal conduct (42 C.F.R. § 1001.102(b)(2)). As the above discussion shows, Petitioner engaged in his criminal activities for an astonishing eight years and eight months—from January 2007 until September 2015. IG Ex. 2 at 6 (Superseding Indictment ¶ 20); IG Ex. 4 at 2 (Factual Resume ¶ 1). This is obviously well over the one year threshold for aggravation and also justifies a period of exclusion that is much longer than the minimum. As the Board observed in affirming a 23-year exclusion based, in part, on criminal conduct that lasted 14 months:  "An individual whose lapse in integrity occurs over a period of more than one year poses a far greater threat to federal health care programs and beneficiaries than an individual 'whose lapse in integrity is short-lived.'" Hussain Awada, DAB No. 2788 at 8 (quoting Burstein, DAB No. 1865 at 8).

Incarceration (42 C.F.R. § 1001.102(b)(5)). The court sentenced Petitioner to a substantial period of incarceration – 70 months (five years and 10 months). IG Ex. 5 at 2. While any period of incarceration justifies increasing the period of exclusion, the Board has repeatedly held that longer periods of incarceration are relevant in determining whether a period of exclusion is reasonable. Eugene Goldman, M.D., DAB No. 2635 at 6 (2015). Generally, the longer the jail time, the longer the exclusion, because a lengthy sentence evidences a more serious offense. See Robinson, DAB No. 1905 at 12 (characterizing a nine-month incarceration as "relatively substantial."); Jason Hollady, M.D., DAB No. 1855 at 12 (2002); Stacy Ann Battle, DDS., DAB No. 1843 (2002) (finding that four months in a halfway house, followed by four months home confinement justifies lengthening the period of exclusion); Brenda Mills, M.D., DAB CR1461 (2006), aff'd DAB No. 2061 (2007) (finding that six months home confinement justifies increase in length of exclusion).

Mitigating factors. The regulations consider mitigating just three factors: 1) a petitioner was convicted of three or fewer misdemeanor offenses and the resulting financial loss to

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the program was less than $1,500; 2) the record in the criminal proceedings demonstrates that a petitioner had a mental, physical, or emotional condition that reduced his culpability; and 3) a petitioner's cooperation with federal or state officials resulted in others being convicted or excluded, or additional cases being investigated, or a civil money penalty being imposed. 42 C.F.R. § 1001.102(c). Petitioner bears the burden of proving any mitigating factor by a preponderance of the evidence. 42 C.F.R. § 1005.15(c); Barry D. Garfinkel, M.D., DAB No. 1572 at 12 (1996); see Order and Schedule for Filing Briefs and Documentary Evidence at 3-4 (¶ 4).

Petitioner was guilty of a felony and caused multi-million dollar losses to the Medicare program. No evidence suggests that he had a mental, physical, or emotional condition that reduced his culpability.

Petitioner minimizes his own role in this massive fraud and claims that "[w]hen [he] discovered the ramification of [his] crime[,] [he] immediately volunteered to help the [state's] case and decided not to go into a protracted trial with the [s]tate to cut trial cost." P. Br. at 1. There are two major problems with this claim. First, no evidence suggests that he provided any level of cooperation. In fact, Petitioner's crime included his efforts to conceal the conspiracy from investigators. IG Ex. 4 at 5 (Factual Resume ¶ 12). He points to no examples of others being convicted or excluded, any additional case being investigated, or any civil money penalty being imposed as a result of his so-called cooperation. That he may have "cooperated" with law enforcement in his own case, after he was caught, does not create a mitigating circumstance.

Thus, no mitigating factor offsets the significant aggravating factors present in this case.

Based on the aggravating factors and the absence of mitigating factors, then, I must determine whether the exclusion period imposed by the IG falls within a reasonable range. So long as that period falls within a reasonable range, my role is not to second-guess the IG's judgment. Robinson, DAB No. 1905 at 5 (ALJ review must reflect the deference accorded to the IG by the Secretary). A "'reasonable range' refers to a range of exclusion periods that is more limited than the full range authorized by the statute [i.e. from a minimum of five years to a maximum of permanent] and that is tied to the circumstances of the individual case." Joseph M. Rukse, Jr. R. Ph., DAB No. 1851 at 11 (2002)(citing Gary Alan Katz, R.Ph., DAB No. 1842 at 8 n.4 (2002)).

Here, Petitioner's crime demonstrates that he presents a significant risk to the integrity of healthcare programs. The IG may reasonably determine that longer periods of exclusion are necessary, not only to protect federal funds, but "to staunch an increasing amount of health care fraud." Robinson, DAB No. 1905 at 10 n.8. As I have noted elsewhere, the statistics on Medicare fraud are sobering:

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The National Health Care Anti-Fraud Association, an organization composed of both public and private health insurers and regulators, conservatively estimates that 3% of all health care spending in the United States is lost due to fraud.  If such an estimate is accurate, health care fraud cost our economy a staggering $68 billion in 2007, the most recent year for which figures are available.

Christopher George Collins, DAB CR2515 at 6 (2012). Lengthy periods of exclusion are an appropriate means by which the IG can attempt to protect the integrity of the Medicare program from the worst offenders, and the evidence here establishes the Petitioner Ewah is among the worst offenders. He caused enormous financial losses to the Medicare program; his criminal conduct lasted for many years; and he was sentenced to almost six years in prison.

Conclusion

The IG properly excluded Petitioner from participating in Medicare, Medicaid and other federal health care programs. So long as the period of exclusion is within a reasonable range, based on demonstrated criteria, I have no authority to change it. Joann Fletcher Cash, DAB No. 1725 at 16-17 (2000) (citing 57 Fed. Reg. 3298, 3321 (1992)). I find that the 25-year exclusion falls within a reasonable range.

• 1. In his hearing request, Petitioner conflates a challenge to the IG's authority to exclude him (which he waived as part of his criminal plea agreement) with a challenge to administrative law judge (ALJ) authority to hear his appeal. Because he relies on the Supreme Court decisions in Lucia v. Securities & Exchange Commission, 138 S. Ct. 2044 (2018) and Free Enterprise Fund v. Public Company Accounting Oversight Board, 561 U.S. 477 (2010), I assume he intended to challenge the basis for this adjudication under the Appointments Clause of the U.S. Constitution. However, under a statutory grant of authority, the Secretary of Health and Human Services properly appointed me as an ALJ. 5 U.S.C. § 3105; see U.S. Const. art II, § 2, cl. 2; IG Ex. 6. Further, the U.S. Supreme Court has acknowledged that officials in the Executive Branch who are solely engaged in adjudications are not subject to at-will removal. See Wiener v. U.S., 357 U.S. 349, 355-56 (1958); see also Free Enterprise, 561 U.S. at 507 n.10 ("[O]ur holding also does not address that subset of independent agency employees who serve as administrative law judges. . . . [U]nlike members of the Board, many administrative law judges of course perform adjudicative rather than enforcement or policymaking functions."). In any event, because Petitioner did not pursue this issue in his written submission, he appears to have abandoned it.
• 2. Petitioner pled guilty to Count One of the superseding indictment, which includes its first 29 paragraphs. IG Ex. 2 at 1-8; IG Ex. 3.
• 3. I make this one finding of fact/conclusion of law.