Oakey Chikere, Sr., DAB CR5112 (2018)

DECISION

Petitioner, Oakey Chikere, Sr., owned and operated a medical clinic in Houston, Texas.  A jury convicted him on one felony count of conspiracy to commit health-care fraud and four felony counts of health-care fraud.  Based on these convictions, the Inspector General (IG) has excluded him for 15 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 and that the 15-year exclusion falls within a reasonable range.

Background

In a letter dated April 28, 2017, the IG notified Petitioner that he was excluded from participating in Medicare, Medicaid, and all federal health-care programs for a period of 15 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.

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Petitioner timely requested review.

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 the IG submitted a reply (IG Reply).

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

I asked the parties to indicate whether an in-person hearing is necessary in order to resolve this case, and neither indicated that it would be.  IG Br. at 10; see P. Br.

Discussion

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

Under section 1128(a)(1) of the Act, the Secretary of Health and Human Services must exclude an individual or entity that 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.  See also 42 C.F.R. § 1001.101(a).

Petitioner Chikere owned and operated a medical clinic in Houston, Texas, that referred Medicare beneficiaries for home-health services.  IG Ex. 4 at 4-5.  With others, he conspired to defraud the Medicare program.  Among other actions, he recruited and paid physicians to certify and re-certify patients for home-health services even though those services were not medically necessary.  He submitted fraudulent claims to the Medicare program and, with the proceeds, paid unlawful kickbacks to those who abetted his activities, and he enriched himself.  IG Ex. 4 at 6-11.

On June 3, 2015, a federal grand jury indicted him on one felony count of conspiracy to commit health-care fraud (18 U.S.C. § 1349) and four felony counts of health-care fraud (18 U.S.C. § 1347).  IG Ex. 4.

On June 8, 2016, a jury found him guilty on all counts.  IG Ex. 3.  The court entered judgment against him on January 13, 2017, and sentenced him to 70 months in prison, followed by three years of supervised release.  The court also ordered him to pay $258,738 in restitution to the Medicare program.  IG Ex. 2.

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Petitioner does not deny that he was convicted of a felony related to the Medicare program but argues that he should not be excluded because he holds no medical degree or other professional degree or license.  P. Br. at 5-6.  This argument is nonsense.  The statute subjects to exclusion “any individual or entity that has been convicted” of a program-related crime.  Act § 1128(a)(1) (emphasis added).  No other qualifications are required, and the lack of a medical degree or license does not create an exemption.  Act § 1128(a)(1); 42 C.F.R. § 1001.101.

As a corollary to this argument, Petitioner claims that, instead of himself, one of the physicians with whom he conspired should have been indicted, convicted, and excluded.  But I cannot consider his complaints about the conduct of the criminal proceedings.  Federal regulations preclude collateral attacks on Petitioner’s underlying conviction:  

When the exclusion is based on the existence of a criminal conviction . . . the basis for the underlying conviction . . . 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 Chikere conspired to defraud the Medicare program and, in fact, defrauded the Medicare program.  His crimes fall squarely within the parameters of section 1128(a)(1), and he must therefore be excluded.

2. Based on the aggravating factors and the absence of any mitigating factor, a 15-year exclusion falls within a reasonable range.

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)).  Restitution has long been considered a reasonable measure of program losses.  Jason Hollady, M.D., DAB No. 1855 (2002).  Here, the sentencing judge ordered Petitioner to pay $258,738 in restitution to the victim of his crimes – the Medicare program.  IG Ex. 2 at 6; see IG Ex. 4 at 8.  Thus, Petitioner’s actions resulted in program financial losses more than five times the threshold amount for aggravation, which, by itself, justifies increasing the period of exclusion beyond the five-year minimum.2

Petitioner points to a chart in the indictment, which cites four specific instances of fraudulent billing, one for each of the four health-care fraud counts, Counts Two through Five of the indictment.  He argues that the amounts listed in that chart represent the total of the program losses, $25,453.  P. Br. at 4; IG Ex. 4 at 10-11.  This chart offers examples of the fraud but was not meant to be all-inclusive.  Moreover, Petitioner ignores the allegations of Count One (on which he was also convicted), which include his medical clinic’s fraudulent referrals.  They cost the Medicare program $258,738.  IG Ex. 4 at 8.  The court included that amount in its judgment, which, as discussed above, I have no authority to disturb.  42 C.F.R. § 1001.2007(d).

Duration of crime (42 C.F.R. § 1001.102(b)(2)).  Petitioner’s criminal acts were committed over a period of almost two years – beginning March 2011 and continuing until February 2013.  IG Ex. 4 at 4, 5, 7, 9.  The Departmental Appeals Board has sustained significant increases in the period of exclusion based on wrongful acts that were committed for even just “‘slightly more’ than the one-year minimum standard.”  Jeremy Robinson, DAB No. 1905 at 12 (2004) (citing Donald A. Burstein, Ph.D., DAB No. 1865 at 12 (2003)).

Again, Petitioner relies on the chart listing four instances of fraudulent billing.  P. Br. at 3; IG Ex. 4 at 10-11.  But, again, these do not encompass all of his fraudulent activities and are limited to Counts Two through Five.  The conspiracy began much earlier than that, as set forth repeatedly in Count One of the indictment and elsewhere.  IG Ex. 4 at 4, 5, 7, 9.

Incarceration (42 C.F.R. § 1001.102(b)(5)).  The criminal court sentenced Petitioner to a substantial period of incarceration – 70 months.  IG Ex. 2 at 3.  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

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more serious offense.  See Jeremy Robinson, DAB No. 1905 at 12 (2004) (characterizing a nine-month incarceration as “relatively substantial.”); Jason Hollady, M.D., DAB No. 1855 at 12 (2002); Stacy Ann Battle, D.D.S., 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 factor.  The regulations consider mitigating just three factors:  1) a petitioner was convicted of three or fewer misdemeanor offenses and the resulting financial loss to the program was less than $5,000; 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 does not cite any of these factors.

For about two years, Petitioner conspired with others to defraud the Medicare program; he was successful, costing the program substantial amounts of money.  Because his crimes were so serious, the court sentenced him to a lengthy prison term.  No mitigating factors offset these significant aggravating ones.  The IG thus reasonably determined that Petitioner poses a threat to program integrity and has reasonably excluded him from program participation for 15 years.

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 7 (2000), quoting 57 Fed. Reg. 3298, 3321 (1992).  I find that the 15-year exclusion falls within a reasonable range.

1. My findings of fact/conclusions of law are set forth, in italics and bold, in the discussion captions of this decision.
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2. Until February 13, 2017, a $5,000 program loss was considered an aggravating factor but this amount has been increased.  82 Fed. Reg. 4100, 4103, 4112 (Jan. 12, 2017).  I apply the amount in effect at the time the IG imposed Petitioner’s exclusion (April 28, 2017).
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