Blanca Lopez Galapon, M.D., DAB CR5631 (2020)

DECISION

Petitioner, Blanca Lopez Galapon, M.D., is a physician, licensed to practice in California.  She pled nolo contendere to one felony count of conspiracy to commit healthcare insurance fraud.  Based on her plea, the Inspector General (IG) has excluded her for five years from participating in Medicare, Medicaid, and all federal health care programs, as authorized by section 1128(a)(1) of the Social Security Act (Act).  Petitioner appeals the exclusion.  For the reasons discussed below, I find that the IG properly excluded Petitioner Galapon and that the statute mandates a minimum five-year exclusion.

Background

In a letter dated December 31, 2019, the IG notified Petitioner that she was excluded from participating in Medicare, Medicaid, and all federal health care programs for a period of five years because she 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 Ex. 1.

Petitioner timely requested review.

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The IG submitted a written argument (IG Br.) and four exhibits (IG Exs. 1-4).  Petitioner responded to the IG’s brief (P. Br.) and submitted five exhibits (P. Exs. 1-5).1  The IG waived reply.

In the absence of any objections, I admit into evidence IG Exs. 1-4 and P. Exs. 1-5.

Neither party has indicated that an in-person hearing is necessary, and neither proposes any witnesses.  See Order and Schedule for Filing Briefs at 3 (¶ 7) (February 21, 2020).  I therefore decide the case based on the written record.

Discussion

Petitioner must be excluded from program participation for a minimum of five years because she was convicted of a criminal offense related to the delivery of an item or service under a state health care program.  Act § 1128(a)(1).2

Under section 1128(a)(1) of the Act, the Secretary of Health and Human Services must exclude an individual who has been 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.  42 C.F.R. § 1001.101(a).

Petitioner conspired with the owner of a hospice and others to defraud the Medicare and Medicaid programs (called Med-Cal in California).  As her part of the scheme, she certified that program beneficiaries were eligible for hospice services, when, in fact, they were not.  The hospice submitted $356,084.09 in claims to the Medicare and Medicaid programs and was paid $267,719.60 for services purportedly provided to these ineligible individuals.  IG Ex. 4 at 9-10, 13-14.

Petitioner was charged with one felony count of conspiracy to commit healthcare insurance fraud (Cal. Penal Code §§ 182(a), 550(a)(5)).  Specifically, in return for compensation, she “knowingly and falsely” certified 12 Medi-Cal and Medicare patients as “hospice eligible,” although they were not hospice-eligible.  IG Ex. 3 at 2-3.  On May 22, 2019, Petitioner pled nolo contendere to the charge; the court accepted her plea and sentenced her to 100 hours of community service.  IG Ex. 2 at 1.

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Petitioner concedes that she entered the plea, but claims that, as part of her plea agreement, judgment and sentencing were to be delayed for one year.  If, within the year, she complied with the court’s sentence – that she perform 100 hours of community service – her plea would be vacated and the case dismissed.  Even assuming that her conviction will be vacated, Petitioner was nevertheless “convicted” within the meaning of section 1128(a)(1).

The statute and regulations provide that a person is “convicted” when:  1) “a judgment of conviction has been entered” regardless of whether that judgment has been (or could be) expunged; 2) there has been a finding of guilt; 3) a plea of guilty or nolo contendere has been accepted by the court; or 4) the individual has entered into participation in a first offender, deferred adjudication, or other arrangement or program where the judgment of conviction has been withheld.  Act § 1128(i); 42 C.F.R. § 1001.2(a).

The Departmental Appeals Board characterizes as “well established” the principle that a “conviction” includes “diverted, deferred and expunged convictions regardless of whether state law treats such actions as a conviction . . . .”  Henry L. Gupton, DAB No. 2058 at 8 (2007), aff’d sub nom. Gupton v. Leavitt, 575 F. Supp. 2d 874 (E.D. Tenn. 2008).  For sound reasons, Congress deliberately defined “conviction” broadly to assure that exclusions would not hinge on state criminal justice policies.  Funmilola Mary Taiwo, DAB No. 2995 at 6 (2020); Gupton, DAB No. 2058 at 7-8.

The rationale for the different meanings of “conviction” for state criminal law versus federal exclusion purposes follows from the distinct goals involved.  The goals of criminal law generally involve punishment and rehabilitation of the offender, possibly deterrence of future misconduct by the same or other persons, and various public policy goals.  [footnote omitted].  Exclusions imposed by the I.G., by contrast, are civil sanctions, designed to protect the beneficiaries of health care programs and the federal fisc, and are thus remedial in nature rather than primarily punitive or deterrent . . . .  In the effort to protect both beneficiaries and funds, Congress could logically conclude that it was better to exclude providers whose involvement in the criminal system raised serious concerns about their integrity and trustworthiness, even if they were not subjected to criminal sanctions for reasons of state policy.

Gupton, DAB No. 2058 at 7-8.

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Petitioner also suggests that she was not really guilty, and that the hospice owner forged her signature.  P. Br. at 3.  She claims that she discussed testifying against her co‑conspirators in exchange for the prosecutor dropping the charges against her.  P. Ex. 5.  Inasmuch as she entered a plea, those discussions obviously didn’t go anywhere.  In any event, the regulation precludes a collateral attack on Petitioner’s underlying conviction:

When the exclusion is based on the existence of a . . . determination by another Government agency, or any other prior determination where the facts were adjudicated and a final decision was made, the basis for the underlying . . . determination is not reviewable and the individual or entity may not collaterally attack it either on substantive or procedural grounds in this appeal.

42 C.F.R. § 1001.2007(d); Marvin L. Gibbs, Jr., M.D., DAB No. 2279 at 8-10 (2009); Roy Cosby Stark, DAB No. 1746 (2000).

Petitioner was thus convicted within the meaning of the Act.  Because her conviction – conspiracy to commit healthcare fraud against the Medicare and Medicaid programs – was directly related to the delivery of services under those programs, she is subject to exclusion.  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. § 1001.2007(a)(2).

Conclusion

For these reasons, I conclude that the IG properly excluded Petitioner from participation in Medicare, Medicaid and all federal health care programs, and I sustain the five-year exclusion.

• 1. Petitioner has also asked me to stay the exclusion until her “conviction” is vacated by the California court, which, in Petitioner’s view, will mean that she was not convicted within the meaning of the statute. P. Ex. 2. As discussed below, Petitioner misinterprets the statute. In any event, I have no authority to stay the exclusion. 42 C.F.R. § 1005.4(c).
• 2. I make this one finding of fact/conclusion of law.