By Leah S. Poniatowski, J.D.
A chief executive officer (CEO) who pleaded guilty to health care fraud could not have his 13-year exclusion period reconsidered in light of new evidence because the CEO’s cooperation with federal officials in another case was not "material and relevant information" to support his claims, nor was the information timely submitted at his initial hearing (Ajiri v. CMS, Docket No. A-17-99, Decision No. 2821, September 26, 2017).
"Mitigating factor" requirements. Individuals excluded from participating in federal health care programs pursuant to Section 1128(a)(1) of the Social Security Act (SSA) for fraud may be subject to an exclusion period longer than the mandatory five-year period when there are aggravating factors. The aggravating factors listed in 42 C.F.R. Sec. 1001.102(b) include, among others: causing a federal program to lose more than $5,000, committing the act over a period of one year or longer, and being sentenced to a period of incarceration. However, the Inspector General (IG) can apply a mitigating factor to reduce an exclusionary period if the excluded individual cooperates with government officials that results in another conviction.
Procedural history. The CEO ran a company that arranged in-home visits by physicians, Mobile Doctors, and was indicted by a federal grand jury in 2013 for 11 counts of health care fraud occurring over a six year period. He entered into an agreement to plead guilty to one indictment, in addition to a $300,000 forfeiture, a $1,854,000 restitution to Medicare and the Railway Retirement Board. He also was sentenced to 15 months in prison by a federal judge in 2016. The IG later notified the CEO that he was excluded from participating in federal health care programs for 13 years on the basis of three aggravating circumstances. The CEO requested a hearing before an administrative law judge (ALJ), but the CEO never argued that his cooperation with a federal officer in another case should be considered to reduce his exclusion period. Ultimately, the ALJ agreed that the 13-year period was reasonable. The CEO filed an appeal with the Departmental Appeals Board (DAB) to have the ALJ consider new evidence.
Final decision. The DAB was not persuaded to remand the case to the ALJ because the CEO did not support his arguments on appeal with any exhibits or identify what evidence he intended to proffer the ALJ. Additionally, the CEO failed to show how that evidence would be relevant. Specifically, the CEO admitted that the testimony he provided in a separate fraud proceeding was not necessary to convict the physician and, thus, his purported cooperation with federal officials was not a mitigating factor pursuant to the governing regulations. The DAB added that the CEO had sufficient time to raise the issue of his cooperation—agreeing to testify one month before filing his response and amended response briefs; or before the ALJ decision was issued three months later—but did not. Because the DAB cannot consider issues "not raised in the parties’ briefs, nor any issue in the briefs that could have been raised before the ALJ but was not," the CEO was precluded from presenting this argument before the DAB. Therefore, the ALJ’s ruling was affirmed.
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