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Crawford v. Sullivan

United States District Court, N.D. Illinois, Eastern Division
Jan 27, 1993
No. 92 C 3926 (N.D. Ill. Jan. 27, 1993)


No. 92 C 3926.

January 27, 1993

REPORT AND RECOMMENDATION of Magistrate Judge Edward A. Bobrick

Before the court is the action of plaintiff John N. Crawford, M.D., for judicial review of the decision of the Secretary of Health and Human Services ("Secretary") to exclude plaintiff from participation in the Medicare and Medicaid programs pursuant to Section 1128(a)(1) of the Social Security Act ("Act"). 42 U.S.C. § 1320a-7(a)(1).

The plaintiff in this case is a physician whom the Secretary excluded from participation in the Medicare program for a total of six years effective April 11, 1991. The exclusion is pursuant to 42 U.S.C. § 1320a-7, which provides, in pertinent part:

(a) Mandatory exclusion

The Secretary shall exclude the following individuals and entities from participation in any program under subchapter XVIII of this chapter and shall direct that the following individuals and entities be excluded from participation in any State health care program (as defined in subsection (h) of this section):

(1) Conviction of program-related crimes

Any individual or entity that has been convicted of a criminal offense related to the delivery of an item or service under subchapter XVIII of this chapter or under any State health care program.

* * *

(B) In the case of an exclusion under subsection (a) of this section, the minimum period of exclusion shall be not less than five years, except that, upon the request of a State, the Secretary may waive the exclusion under subsection(a)(1) of this section in the case of an individual or entity that is the sole community physician or sole source of essential specialized services in a community. The Secretary's decision whether to waive the exclusion shall not be reviewable.
42 U.S.C. §§ 1320a-7(a)(1); 1320a-7(c)(3)(B). In this instance, the plaintiff was convicted by jury on February 15, 1990, of 20 counts of Medicare fraud and 5 counts of mail fraud, thereby triggering the mandatory exclusion under Section 1320a-7(a)(1). Plaintiff's only quarrel with his exclusion is that he believes it violates the double jeopardy andex post facto clauses of the United States Constitution.


In April of 1987, a federal grand jury indicted plaintiff on 32 counts of Medicare fraud in violation of 18 U.S.C. § 1001 and 17 counts of mail fraud in violation of 18 U.S.C. § 1341. The violations involved plaintiff knowingly submitting false Medicare reimbursement claims, and knowingly causing the delivery of reimbursement checks through the mails as part of his scheme. Following trial, a jury convicted plaintiff on twenty of the Medicare fraud counts and five of the mail fraud counts on February 15, 1990. The presiding judge then sentenced plaintiff to five years' probation, during which he was not to practice medicine involving Medicare or Medicaid payments, and ordered him to serve six months in a work release program and perform 500 hours of non-medical community service. In addition, the judge ordered plaintiff to make restitution to the Medicare program in the amount of $50,461.56. This amount was later reduced to $6,427, to reflect losses to the program in connection with only those counts on which plaintiff was convicted. See Hughey v. U.S., ___ U.S. ___, ___, 110 S.Ct. 1979 (holding that restitution under the Victim and Witness Protection Act may only be ordered for losses caused by conduct related to convicted offenses).

In a letter dated March 22, 1991, the Office of Inspector General informed plaintiff that his Medicare-related conviction required the Secretary to exclude him from participation in Medicare and State health care programs for not less than five years. Plaintiff's exclusion — for six years — was to become effective April 11, 1991. Plaintiff requested a review of his exclusion and was granted a hearing before an Administrative Law Judge ("ALJ"), which took place July 18, 1991. On October 18, 1991, the ALJ entered a decision affirming the exclusion. Plaintiff requested a review of this determination and, on April 9, 1992, the Departmental Appeals Board affirmed the ALJ's determination, thereby rendering the Secretary's final decision on the matter. Plaintiff now challenges this decision, arguing that the mandatory five-year exclusion, given that it is based solely on his conviction, violates the double jeopardy andex post facto clauses of the United States Constitution.


Both the double jeopardy clause and the ex post facto clause apply only to sanctions that are punitive in nature. See United States v. Halper, 490 U.S. 435, 448-449, 109 S.Ct. 1892, 1901-02 (1989) (double jeopardy clause); Fleming v. Nestor, 363 U.S. 603, 616, 80 S.Ct. 1367, 1375 (1960) (ex post facto clause). In Halper, the Supreme Court stated that "the determination whether a given civil sanction constitutes punishment in the releveant sense requires a particularized assessment of the penalty imposed and the purposes that the penalty may fairly be said to serve." Halper, 490 U.S. at 448, 109 S.Ct. and 1901. A sanction constitutes punishment when the sanction as applied serves the twin aims of retribution and deterrence. Id. at 448-49, 109 S.Ct. at 1902. If a civil sanction can only be explained as serving retributive or deterrent purposes, and cannot fairly be characterized as remedial, that sanction must be regarded as punitive in nature. Id. The government in Halper was seeking a civil monetary penalty equal to twice the government's actual damages as a result of Medicare fraud and the costs of its prosecution. Focusing on the disparity between the government's actual costs in investigating and prosecuting Medicare fraud and the actual damage to the Medicare program, the Supreme Court remanded the case for an accounting of the government's actual damages and costs to determine whether the penalty sought crossed the line between remedy and punishment. Id. at 449-50, 109 S.Ct. at 1902-03. While no excessive monetary penalty is involved here, the Halper court's concerns are nevertheless relevant.

The Secretary has pointed out the factors that distinguish this case from Halper, as well as the purposes § 1320a-7a exclusions were designed to further. The exclusion's legislative history demonstrates that the sanction is remedial in nature. The Senate Finance Committee Report states:

the basic purpose of the Medicare and Medicaid Patient and Program Protection Act is to improve the ability of the Secretary and the Inspector General of [HHS] to protect Medicare, Medicaid, [and other social services programs] from fraud and abuse, and to protect the beneficiaries of those programs from incompetent practitioners and from inappropriate or inadequate care.

S. Rep. No. 109, 100th Cong., 1st Sess. 1-2 (1987), reprinted in 1987 U.S.C.C.A.N. 682. The exclusion has the further effects of ensuring that the tax payer funds that support Medicare and Medicaid programs is not wasted by fraud or abuse, 133 Cong. Rec. H4067 (daily ed. June 1, 1987) (statement of Rep. Stark), and fostering public confidence in those programs. Greene v. Sullivan, 731 F.Supp. 838, 840 (E.D. Tenn. 1990). These are not merely "laudible [sic] goals," as the plaintiff characterizes them (Memorandum in Opposition, at 4), but are necessary to the administration of a $120 billion program upon which 48 million Americans rely. 133 Cong. Rec. H4067 (daily ed. June 1, 1987) (statement of Rep. Stark).

We cannot ignore, however, that the Senate Finance Committee Report also states that "a mandatory five-year exclusion should provide a clear and strong deterrent against the commission of criminal acts." S. Rep. No. 109, 100th Cong., 1st Sess. 1-2 (1987), reprinted in 1987 U.S.C.C.A.N. at 686 (emphasis added). Clearly, the desire to provide a deterrent is a punitive goal, but this is not to say that the exclusion can only be characterized as a deterrent or retribution. See Halper, 490 U.S. at 449, 109 S.Ct. at 1902. Given the exclusion's legislative history as a whole, the exclusion may fairly be characterized as remedial. Id. Any deterrent effect is a furtherance of the primary goal of protecting the Medicare and Medicaid programs, and its present and future beneficiaries, from abuse and abusers.Manocchio v. Kusserow, 961 F.2d 1539, 1542 (11th Cir. 1992). Accordingly, we find that the plaintiff's exclusion under § 1320a-7a does not violate the double jeopardy or ex post facto clauses of the United States Constitution. In so holding, we note that the Eleventh Circuit and one other district court have held likewise. See Manocchio, 961 F.2d at 1543;Greene, 731 F.Supp. at 840. While these decisions are not necessarily controlling here, they do provide guidance for our determination.


For the foregoing reasons, it is hereby recommended that the defendant's motion for summary judgment be granted.

Summaries of

Crawford v. Sullivan

United States District Court, N.D. Illinois, Eastern Division
Jan 27, 1993
No. 92 C 3926 (N.D. Ill. Jan. 27, 1993)
Case details for

Crawford v. Sullivan

Case Details

Full title:JOHN N. CRAWFORD, M.D., Plaintiff, v. LOUIS W. SULLIVAN, M.D., Secretary…

Court:United States District Court, N.D. Illinois, Eastern Division

Date published: Jan 27, 1993


No. 92 C 3926 (N.D. Ill. Jan. 27, 1993)

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