SUBJECT:

Shirleen Henry,

Petitioner,

The Inspector General.

DECISION

I sustain the Inspector General's (I.G.) Determination to exclude Shirleen Henry, Petitioner, from participation in Medicare, Medicaid, and all federal health care programs for a 12-year period pursuant to sections 1128(a)(1) and 1128(c)(3)(B).

This case is before me pursuant to a request for hearing dated November 1, 2005, by Shirleen Henry, Petitioner.

By letter dated August 31, 2005, the Inspector General (I.G.) notified Petitioner, Shirleen Henry, that she was being excluded from participation in the Medicare, Medicaid, and all federal health care programs as defined in section 1128B(f) of the Social Security Act (Act) for a period of 12 years. ⁽¹⁾ The I.G. informed Petitioner that her exclusion was imposed under section 1128(a)(1) of the Act, due to her conviction of a criminal offense (as defined in section 1128(i) of the Act) related to the delivery of an item or service under the Medicaid program.

On April 5, 2006, I convened a telephone prehearing conference during which the parties agreed that an in-person hearing was not required and that the issues could be decided based on written memoranda and documentary evidence. Consequently, I issued an Order establishing briefing deadlines. Pursuant to that Order, on May 5, 2006, the I.G. filed a brief (I.G. Br.), accompanied by five proposed exhibits. In the absence of objection, I admit into evidence I.G.'s Exhibits (Exs.) 1-5. Although granted until June 5, 2006, Petitioner did not file a response brief, nor did she request an extension. Consequently, on June 30, 2006, I issued an order for Petitioner to show cause for failing to file her brief timely. Pursuant to that order, Petitioner submitted a notice through legal counsel stating that she would not file a response brief in this matter.

It is my decision to sustain the determination of the I.G. to exclude Petitioner from participating in the Medicare, Medicaid, and all federal health care programs, for a period of 12 years. I base my decision to sustain the 12-year exclusion in this case on the documentary evidence, the applicable law and regulations, and the arguments of the parties. ⁽²⁾ It is my finding that Petitioner was convicted of a criminal offense related to the delivery of an item or service under a state health care program and that the I.G. has a basis for the exclusion. I further find that the I.G. has proved the existence of aggravating factors which justify lengthening the minimum period of exclusion from 5 years to 12 years.

ISSUES

1. Whether Petitioner was convicted of a criminal offense related to the delivery of an item or service under the Medicare or Medicaid program; and, if so,

2. Whether the 12-year period of exclusion is unreasonable.

Section 1128(a)(1) of the Act authorizes the Secretary of Health and Human Services (Secretary) to exclude from participation in any federal health care program (as defined in section 1128B(f) of the Act), any individual convicted of a criminal offense relating to the delivery of a health care item or service under Title XVIII of the Act (Medicare) or a state health care program (Medicaid).

An exclusion under section 1128(a)(1) of the Act must be for a minimum period of 5 years. Act, section 1128(c)(3)(B). That exclusion period may be lengthened if any of the aggravating factors mentioned in 42 C.F.R. � 1001.102(b)(1) are present.

The findings of fact and conclusions of law noted below, in bold face, are followed by a discussion of each finding.

1. Petitioner's conviction of a criminal offense related to the delivery of an item or service under the Medicaid program requires her exclusion by the I.G. from participation in the Medicare, Medicaid, and all other federal health care programs.

Petitioner was a licensed practical nurse licensed in New York and enrolled as a provider of nursing services in that State's Medicaid program. From 1999 to 2003, she was assigned to care for Tara O'Dell, a Medicaid recipient. Petitioner hired another person, Tanya Hyatt, who was not a licensed practical nurse, to care for Tara O'Dell. Petitioner kept the money Medicaid paid her and compensated Hyatt considerably less for caring for Tara O'Dell. Through this scheme, Petitioner was paid $ 173,531.92. I.G. Ex. 2.

On October 19, 2004, in the Westchester County Superior Court of the State of New York, Petitioner agreed to enter a plea of guilty to one count of grand larceny in the third degree in connection with the above mentioned fraudulent scheme. I.G. Ex. 3, at 1, 4-5, 10. On January 12, 2005, Petitioner was sentenced to 5 years' probation and ordered to pay a total of $ 163,531.92 in restitution. ⁽³⁾ I.G. Ex. 4, at 1, 4.

In her request for hearing, Petitioner does not contest the I.G's authority to exclude her, but rather the length of the exclusion. Thus, there is no dispute that she was convicted of a program-related crime. I note, moreover, that the record establishes that Petitioner pled guilty to an offense related to the delivery of an item or service under a state health care program, and that the Westchester County Superior Court of the State of New York accepted her plea. Therefore, I find that Petitioner was convicted of a criminal offense, as defined in section 1128(i)(3) of the Act and that the offense was related to the delivery of an item or service under the New York Medicaid program. As a result of Petitioner's program-related conviction, the I.G. was required to exclude her, pursuant to section 1128(a)(1) of the Act, for at least 5 years. The only remaining issue is whether the 12-year exclusion imposed by the I.G. is unreasonable.

2. Petitioner's exclusion for a period of 12 years is not unreasonable.

An exclusion under section 1128(a)(1) of the Act must be for a minimum mandatory period of 5 years, as set forth in section 1128(c)(3)(B) of the Act:

Subject to subparagraph (G), in the case of an exclusion under subsection (a), the minimum period of exclusion shall be not less than five years . . . .

When the I.G. imposes an exclusion for the mandatory 5-year period, the reasonableness of the length of the exclusion is not an issue. 42 C.F.R. � 1001.2007(a)(2). Aggravating factors that justify lengthening the exclusion period may be taken into account, but the 5-year term will not be shortened. In Petitioner's case, the I.G. added 7 years to the statutory 5-year minimum period.

The aggravating factors that the I.G. may consider as a basis for lengthening a period of exclusion are found at 42 C.F.R. � 1001.102(b). In the case at hand, the I.G. alleges the existence of three aggravating factors to justify the 12-year exclusion period imposed against Petitioner:

(1) Petitioner committed criminal acts that resulted in a financial loss to a government program of $5,000 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) Petitioner was the subject of adverse action by a state government agency based on the same set of circumstances that gave rise to her conviction.

Petitioner does not dispute that these three aggravating factors are present in this case. The I.G. has offered evidence showing that Petitioner pled guilty to defrauding the New York Medicaid program of $ 173,531. I.G. Ex. 3, at 11. The amount of the loss is thus many times greater than the $ 5,000 required to establish the aggravating factor described in 42 C.F.R. � 1001.102(b)(1). Petitioner admitted at her plea hearing that her conduct occurred between June 1999 and November 2003. I.G. Ex. 3, at 10-11. The I.G. has therefore proved that her conduct occurred over a period of one year or more, establishing the aggravating factor described in 42 C.F.R. � 1001.102(b)(2). Finally, the I.G. proved that Petitioner was excluded from participation in the New York State Medicaid program. I.G. Ex. 5. The I.G. represents that Petitioner's Medicaid exclusion was based on the same conviction that is at issue here. I.G. Br. at 8. Thus, the I.G. has established the aggravating factor described in 42 C.F.R. � 1001.102(b)(9). Nevertheless, Petitioner contends that the 12-year period of exclusion is extremely harsh.

42 C.F.R. � 1001.102(c) provides that if any of the aggravating factors set forth in paragraph (b) of that section justifies an exclusion longer than 5 years, mitigating factors may be considered as a basis for reducing the period of exclusion to no less than 5 years. This regulation states that only the following factors may be considered mitigating:

(1) The individual or entity was convicted of 3 or fewer misdemeanor offenses, and the entire amount of financial loss . . . to Medicare or any other Federal, State or local governmental health care program due to the acts that resulted in the conviction, and similar acts, is less than $1,500;

(2) The record in the criminal proceedings, including sentencing documents, demonstrates that the court determined that the individual had a mental, emotional or physical condition before or during the commission of the offense that reduced the individual's culpability; or

(3) The individual's or entity's cooperation with Federal or State officials resulted in-

(i) Others being convicted or excluded from Medicare, Medicaid, and all other federal health care programs,

(ii) Additional cases being investigated or reports being issued by the appropriate law enforcement agency identifying program vulnerabilities or weaknesses, or

(iii) The imposition against anyone of a civil money penalty or assessment under part 1003 of this chapter.

42 C.F.R. � 1001.102(c).

Petitioner contends that I should consider the following factors in my decision as to whether the 12-year exclusion is unreasonable:

� She has had an excellent record of patient care as a licensed practical nurse.

� The way in which the facts underlying the conviction were framed during the criminal proceedings gives a harsher appearance of her behavior than the facts as she recalls they occurred.

To decide whether the length of the exclusion imposed by the I.G. is unreasonable, I must consider evidence submitted by the parties pertaining to the aggravating and mitigating factors contained in 42 C.F.R. � 1001.102. Only if I conclude that the exclusion imposed by the I.G. does not fall within a reasonable range may I adjust the length of the exclusion. I conclude that the I.G. has established the existence of three aggravating factors, and Petitioner has failed to point to even one mitigating factor defined in the regulations. In fact, the evidence before me points to the seriousness of Petitioner's deliberate conduct over several years, impairing the fiscal soundness of a state health care program and the public confidence in that program. This is clear evidence of Petitioner's untrustworthiness. None of the factors relied upon by Petitioner are contemplated by the regulations as grounds for reducing the length of the exclusion. Neither Petitioner's record of patient care as a licensed practical nurse nor her belief that her behavior was not as culpable as was portrayed in the criminal proceedings constitute valid arguments under the applicable regulations for reduction of the exclusion period.

For the reasons stated above, and in light of my consideration of the current statutory and regulatory criteria, I find that the 12-year exclusion imposed by the I.G. is within a reasonable range of possible exclusion periods given the circumstances of Petitioner's case, in which three aggravating factors are present and no mitigating factors have been established. The 12-year exclusion is a legitimate remedy consistent with the purpose of section 1128 of the Act. That purpose is to protect federally-funded health care programs, and their beneficiaries and recipients, from untrustworthy individuals and entities. See Joann Fletcher Cash, DAB No. 1725 (2000).

CONCLUSION

Sections 1128(a)(1) and 1128(c)(3)(B) of the Act mandate that Petitioner be excluded from Medicare, Medicaid, and all other federal health care programs, for a period of at least 5 years, because she was convicted of a criminal offense related to the delivery of an item or service under Medicaid. The I.G. is also justified in lengthening the period of exclusion, due to the existence of aggravating factors. I therefore sustain Petitioner's 12-year exclusion, because it falls within a reasonable range.

José A. Anglada

Administrative Law Judge

1. Petitioner's hearing request was timely filed. Petitioner demonstrated that she did not receive the I.G.'s notice letter until sometime after September 11, 2005. The I.G. does not dispute that the hearing request was timely filed.

2. Although Petitioner did not file a response brief, her contentions are briefly outlined in her request for hearing.

3. The sum of $ 163,531.92 was in addition to $10,000 Petitioner had already paid at time of sentencing. I.G. Ex. 4, at 4.