SUBJECT:

Dr. David Vainio,

Petitioner,

The Inspector General

By letter dated October 31, 2000, the I.G. notified Petitioner of her decision to exclude him from program participation. Petitioner filed a timely request for review, and the matter was assigned to me for resolution. The parties have waived their rights to an in-person hearing, and agreed that the matter be decided on the written record.⁽³⁾

Without objection from the parties, I have identified and admitted into evidence I.G. Exhibits (I.G. Exs.) 1-3, and identified and admitted into evidence Petitioner's Exhibits (P. Exs. ) 1-2.

For the reasons discussed below, I uphold the I.G.'s decision.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

1. Petitioner is an optometrist licensed to practice optometry in the State of Montana. I.G. Ex. 1.

2. Petitioner participated in the State Medicaid program as an enrolled provider with an assigned identification number. I.G. Ex. 1.

3. On April 17, 1998, Petitioner was charged with three felony counts of Medicaid fraud, and one count of unsworn falsification to authorities. I.G. Ex. 2.

4. On February 11, 2000, Petitioner was convicted of two felony counts of Medicaid fraud, and one misdemeanor count of unsworn falsification to authorities. I.G. Ex. 3.

5. Petitioner was sentenced to six months in jail, suspended sentence, conditional upon his payment of restitution, fines, and meeting other conditions, including his suspension from participation in the Medicaid program for one year, effective March 22, 2000. I.G. Ex. 3.

6. Petitioner's illegal activity resulted in losses to the Medicaid program in excess of $17,000. I.G. Exs. 1-3.

7. Petitioner was convicted of criminal offenses related to the delivery of an item or service under a State health care program and falls within the scope of section 1128(a)(1) of the Act.

8. Because he was convicted of program-related crimes, Petitioner must be excluded from participation in the Medicare, Medicaid, and other State and federal healthcare programs, and a minimum five-year exclusion is mandatory.

9. The State court's imposition of a one-year suspension from participation in the Medicaid program as part of Petitioner's criminal sentence is not relevant to the imposition of an exclusion under section 1128(a)(1).

10. The statute requires that the I.G. impose the exclusion notwithstanding Petitioner's pending appeal, and Petitioner may not use this forum to attack collaterally his criminal conviction.

11. The I.G. properly excluded Petitioner for a period of five years as required by the minimum mandatory exclusion provision of section 1128(c)(3)(B) of the Act.

DISCUSSION

The critical facts of this case are not in dispute. Petitioner is an optometrist who owned and operated several optometry stores in the State of Montana, and participated in the Montana Medicaid program as an enrolled provider with an assigned identification number. I.G. Ex. 1; P. Ex. 2. On April 17, 1998, he was charged with three felony counts of Medicaid fraud, in violation of Mont. Code Ann. section 45-6-313,⁽⁴⁾ and one misdemeanor count of unsworn falsification to authorities, in violation of Mont. Code Ann. section 45-7-203.⁽⁵⁾ Two of the felony counts stemmed from his having submitted claims for optometric services that were, in fact, performed by his brother. His brother, though an optometrist, was not enrolled in the Montana Medicaid program, and, under the State agency rules, to receive Medicaid payment, a provider must be enrolled in the program and have a provider number. I.G. Exs. 1, 3; P. Ex. 2. One felony count charged that Petitioner submitted claims that he identified as new patient eye examinations, when, in fact, those examinations were provided to established patients, and should have been reimbursed at a lower rate. The misdemeanor count stemmed from Petitioner's having submitted a Medicaid provider enrollment form omitting certain information the State deemed significant: (1) that Petitioner provided Medicaid services in various counties of Montana, not just one;⁽⁶⁾ (2) that his wife was an agent or managing employee of his business; and (3) that his brother also had an ownership interest in the business. I.G. Exs. 1-3.

Petitioner entered pleas of "not guilty" to the charges, but, on February 11, 2000, following a jury trial, he was convicted on two of the felony counts and on the misdemeanor count. I.G. Ex. 3. He was sentenced to six months in jail, with that sentence suspended conditional upon his payment of restitution, fines, and meeting other conditions. The sentence also included his suspension from participation in the medicaid program for one year, effective March 22, 2000. I.G. Ex. 3.

Petitioner acknowledges that he was convicted of program-related crimes, within the meaning of the statute, but suggests that his exclusion should be limited to the one-year suspension imposed as part of his criminal sentence. He also points out that he has appealed his conviction, that "many issues" are not final, and that he expects all charges to be reversed on appeal. P. Ex. 2. He does not prevail on either argument.

First, the fact that the State court judge imposed a one-year suspension from Medicaid participation does not affect the I.G.'s authority and responsibility to implement federal law. A State court judge has no authority to invalidate a federal statute, even if she were so inclined, although nothing suggests that the judge here intended to usurp the I.G.'s authority. She simply added the suspension as part of Petitioner's criminal penalty. The federal exclusion provisions serve a wholly different purpose from the punitive objective of a criminal sentence. An exclusion is imposed to protect the health care program from those who have demonstrated themselves to be untrustworthy. Manocchio v. Kusserow, 961 F.2d 1539 (11th Cir. 1992); Douglas Schram, R. Ph., DAB No. 838 (1992). Congress determined that providers convicted of program-related crimes are untrustworthy, and a threat to federal health care programs, their beneficiaries and recipients, and set five years as the minimum exclusion time necessary for the I.G. to insure that program interests would be protected. Thus, these differing judgements were imposed by different adjudicators with different goals and interests, and the State court action does not control the federal. In Shanti Jain M.D., DAB No. 1398 (1993), an appellate panel of the Departmental Appeals Board dismissed as "simply irrelevant" to her section 1128(a)(1) mandatory exclusion, the length and effect of Petitioner's suspension from state health care programs.

Second, with respect to Petitioner's pending appeal, section 1128(I) of the Act specifically precludes my consideration as to whether an appeal is pending:

[a]n individual or entity is considered to have been "convicted" of a criminal offense -

(1) when a judgment of conviction has been entered against the individual or entity by a Federal, State, or local court, regardless of whether there is an appeal pending . . . (emphasis added)

Nor may Petitioner use this forum to attack collaterally his criminal conviction. The regulations are explicit:

[w]hen the exclusion is based on the existence of a conviction . . . the basis for the underlying determination is not reviewable and the individual or entity may not collaterally attack the underlying determination, either on substantive or procedural grounds, in this appeal.

42 C.F.R. § 1001.2007(d).

See also Chander Kachoria, R. Ph., DAB No. 1380 (1993) ("There is no reason to 'unnecessarily encumber the exclusion process' with efforts to reexamine the fairness of State convictions.")

CONCLUSION

For these reasons, I conclude that the I.G. properly excluded Petitioner from participation in the Medicare, Medicaid, and all other federal health care programs. Therefore, the five-year exclusion is sustained.

Carolyn Cozad Hughes

Administrative Law Judge

1. "Federal health care program" is defined in section 1128B(f) of the Act as any plan or program that provides health benefits, whether directly, through insurance, or otherwise, which is funded directly, in whole or in part, by the United States Government, or any State health care program. "State health care program" is defined in section 1128(h) of the Act and includes the Medicaid program (Title XIX).

2. In error, the I.G. cites 42 C.F.R. §1001.2007(a)(1) for the proposition that the issue before me is whether the length of the exclusion is reasonable. I.G.'s Brief at 6-7, 11-12. But, § 1001.2007(a)(2) explicitly makes inapplicable the reasonableness provision when the I.G. imposes the five-year minimum exclusion under 42 C.F.R. Part 1001 subpart B (Mandatory Exclusion.)

3. Petitioner declined to file a written brief; however, attached to his Request for Hearing is an October 31, 2000 letter from M. Joanne Lanahan notifying Petitioner of his exclusion, which I identify as Petitioner's Exhibit 1. Also attached is a copy of Petitioner's brief in his criminal appeal to the Supreme Court of the State of Montana, submitted October 26, 2000, which I identify as Petitioner's Exhibit 2.

4. Mont. Code Ann. section 45-6-313 makes it a criminal offense for a person to obtain Medicaid payments to which he knows, or has reason to know, he is not entitled.

5. Mont. Code Ann. section 45-7-203 provides that a person commits an unsworn falsification to authorities if, in a written application for a benefit, he purposely creates a false impression by omitting information necessary to prevent his statements from being misleading.

6. In fact, Petitioner owned many optometry stores across the state. P. Ex. 2.