Nomo-Ongolo v. Secretary of the U.S. Department of Health and Human Services
Filing
35
ORDER denying 17 Motion for Summary Judgment; granting 21 Motion for Summary Judgment(Written Opinion) Signed by Senior Judge David S. Doty on 11/27/2018. (DLO)
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
CIVIL NO. 18-523 (DSD/HB)
Sirri A. Nomo-Ongolo
M.D.,
Plaintiff,
v.
ORDER
Secretary of the U.S. Department
of Health and Human Services,
Defendant.
Carol R. M. Moss, Esq., Terrance W. Moore, Esq. and Hellmuth
& Johnson PLLC, 8050 West 78th Street, Edina, MN 55439, counsel
for plaintiff.
Friedrich A. P. Siekert, United States Attorney’s Office, 300
South 4th Street, Suite 600, Minneapolis, MN 55415, counsel for
defendant.
This matter is before the court upon the cross-motions for
summary judgment by defendant Alex M. Azar, Secretary of the United
States Department of Health and Human Services (Secretary) and
plaintiff Sirri A. Nomo-Ongolo, M.D., Ph.D.
Based on a review of
the file, record, and proceedings herein, and for the following
reasons, the court denies the Secretary’s motion and grants NomoOngolo’s motion.
BACKGROUND
This dispute arises out of the Secretary’s decision to exclude
Nomo-Ongolo’s participation as a health care provider in federal
health care programs. Nomo-Ongolo is a licensed physician. Admin.
Rec. at 345.
She has practiced medicine in Minnesota for the past
sixteen years.
Id.
From March 2013 until April 2015, Nomo-Ongolo
worked for Addiction Care Practitioners, PA (Clinic) in Crystal,
Minnesota, specializing in opiate dependency treatment.
Id.
Nomo-Ongolo was a Clinic employee and did not own or manage the
Clinic.1
Id. at 66.
Nomo-Ongolo claims that she was not involved
with patient billing and never requested or received payments from
Clinic patients.
Id. at 345-46.
On January 13, 2015, Nomo-Ongolo received a termination notice
from the Minnesota Department of Human Services (MDHS).
356.
Id. at
MDHS explained that Nomo-Ongolo could no longer participate
as a medical provider in the Minnesota Health Care Program (MHCP)
because she had violated MHCP rules by requesting and receiving
forty-six direct cash payments from Clinic patients.
On
February
2,
2015,
Nomo-Ongolo,
through
Id.
her
attorney,
appealed the termination notice and denied responsibility for the
Clinic’s patient billing errors.
Id. at 361.
Nomo-Ongolo also
claimed that the Clinic, which had received a separate MDHS
termination notice, acknowledged its billing practices did not
comply with MHCP and its “office manager and owner ... apologized
[to her]... and [accepted] full responsibility for [the billing]
1
Dr. Arthur Fretag was the Clinic’s chief
officer during Nomo-Ongolo’s employment. Id. at 226.
2
executive
error[s].”2
Id. at 362.
On February 19, 2015, MDHS responded to Nomo-Ongolo’s appeal,
arguing
that
the
Clinic’s
records
showed
that
Nomo-Ongolo’s
patients had signed opiate-dependency treatment plans and agreed to
directly pay the Clinic $300 per month.
Id. at 55.
MDHS also
asserted that Nomo-Ongolo’s patient payment ledgers showed assorted
cash payments and MHCP drug authorizations issued in her name. Id.
MDHS argued that the evidence demonstrated that Nomo-Ongolo knew,
or should have known, that her MHCP-covered patients were paying
cash for treatments.
Id.
MDHS referred Nomo-Ongolo’s appeal to the Minnesota Attorney
General’s Office. Id. at 363. MDHS permitted Nomo-Ongolo to treat
MHCP-covered patients pending her appeal.
Id.
On May 18, 2015,
the Minnesota Office of Administrative Hearings scheduled the
matter for a June 30, 2015, prehearing conference.
In
early
June
2015,
Nomo-Ongolo’s
attorney
Id. at 365.
withdrew
his
representation. Id. at 345. On June 29, 2015, Assistant Minnesota
Attorney General Heather N. Kjos called Nomo-Ongolo about the
prehearing conference and told Nomo-Ongolo that her attorney had
withdrawn.
Id. at 209.
During their conversation, Nomo-Ongolo
claims that she and Kjos reached an agreement whereby Nomo-Ongolo
2
At the hearing, Nomo-Ongolo’s counsel reported that the
Minnesota Board of Medicine revoked the Clinic’s license, and that
the Clinic closed after Nomo-Ongolo’s employment.
3
would voluntarily opt out of MHCP, and in exchange, MDHS would drop
its case.
Id.
Nomo-Ongolo also claims that she and Kjos agreed
that the only consequence of the withdrawal would be that NomoOngolo’s appeal would be dismissed and she would stop treating
MHCP-covered patients.3
Id. at 346; see also id. at 209.
Later that day, Kjos informed Administrative Law Judge (ALJ)
Eric L. Lipman that Nomo-Ongolo had withdrawn her appeal.
211.
Id. at
On June 30, 2015, the ALJ canceled the prehearing conference
and all additional administrative proceedings, and dismissed NomoOngolo’s appeal.
Id. at 204; see also id. at 210.
On July 9, 2015, MDHS terminated Nolo-Ongolo’s participation
in MHCP, effective July 1, 2015.
Id. at 207.
Nolo-Ongolo was
advised that she could apply for reinstatement in MHCP on July 1,
2020.
Id.
On November 30, 2016, the United States Department of Health
and Human Services, Office of Inspector General (OIG) notified
Nomo-Ongolo that she was being excluded from participation in all
federal health programs under Section 1128(b)(5)(B) of the Social
Security Act and 42 C.F.R. § 1001.601(a)(1)(ii), because she had
been suspended, excluded, or otherwise sanctioned by MDHS for
reasons bearing on her professional competence or performance, or
3
It appears that during their conversation, Nomo-Ongolo
and Kjos discussed reinstatement in MHCP. In a follow-up email,
Nomo-Ongolo told Kjos that she would apply for reinstatement in
MHCP in five years. Id. at 209.
4
financial integrity.
Id. at 348.
The OIG’s exclusion notice
informed Nomo-Ongolo that she could apply for federal reinstatement
after she was reinstated in MHCP.
Id. at 349.
On January 18, 2017, Nomo-Ongolo appealed the OIG’s exclusion
notice and requested a hearing before an ALJ.
Id. at 20.
On
February 13, 2017, a telephonic hearing was held before ALJ Keith
Sickendick.
Id. at 2.
Ongolo’s exclusion.
On July 10, 2017, the ALJ affirmed
Id. at 1–8.
Nomo-
In affirming, the ALJ found that
Nomo-Ongolo’s exclusion was appropriate because she was “otherwise
sanctioned”
integrity.4
by
MDHS
Id. at 5.
for
reasons
bearing
on
her
financial
Specifically the ALJ determined that Nomo-
Ongolo voluntarily withdrew her appeal with the intent to avoid
MDHS sanctions.
Id.
The ALJ also determined that although there
had been no state adjudicative findings bearing on Nomo-Ongolo’s
financial integrity, there was a nexus between the improper cash
payment allegations contained in the termination notice and her
eventual termination from MHCP, which the ALJ found “[was] clearly
an attack upon and related to [Nomo-Ongolo’s] financial integrity.”
Id. at 6.
4
Section 1128(b)(5) does not define the term “otherwise
sanctioned,” however, 42 C.F.R. § 1001.601(a)(2) defines the term
as “all actions that limit the ability of a person to participate
in the [state] program ... and includes situations where an
individual or entity voluntarily withdraws from a program to avoid
a formal sanction.”
5
On September 7, 2017, Nomo-Ongolo appealed the ALJ’s decision
to the United States Department of Health and Human Services
Appeals Board.
Id. at 278.
Board affirmed.
Id. at 10.
On December 18, 2017, the Appeals
However, the Appeals Board’s analysis
differed from that of the ALJ’s.
The Appeals Board found that
Nomo-Ongolo was not “otherwise sanctioned” by MDHS, but rather that
her termination from MHCP constituted a state “exclusion” for
reasons bearing on her financial integrity.
Id. at 14.
The
Appeals Board further found that MDHS had not dropped Nomo-Ongolo’s
case in exchange for the withdrawal of her appeal, but that the
termination notice constituted a state exclusion when the ALJ
dismissed
her
appeal.
Id.
at
13–14.
The
Appeals
Board
acknowledged that there had been no state hearing or findings of
fact issued on the cash payment allegations, but concluded that
MDHS’ investigative allegations were sufficient for the OIG to
exercise its permissive exclusionary authority given that she had
withdrawn her appeal.
On
February
23,
Id. at 16.
2018,
Nomo-Ongolo
commenced
this
action
seeking judicial review of the Secretary’s final decision excluding
her from participation in all federal health care programs.5
5
The
The Appeals Board’s decision is the Secretary’s final
agency decision. See 42 C.F.R. § 1005.21(j). Judicial review of
the Secretary’s final decision is authorized under Sections
1128(f)(1) and 205(g) of the Social Security Act. Section 205(g)
permits the court to reverse, modify, or affirm the Secretary’s
final decision “with or without remanding the cause for a
rehearing.” A court may review the OIG’s exclusion to determine:
6
parties now cross move for summary judgment.
Nomo-Ongolo seeks
reversal of the Secretary’s final decision and reinstatement in all
federal health programs and the Secretary seeks affirmance.
DISCUSSION
I.
Standard of Review
“The court shall grant summary judgment if the movant shows
that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed. R. Civ.
P. 56(a); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
A fact is material only when its resolution affects the outcome of
the case.
(1986).
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
A dispute is genuine if the evidence is such that it could
cause a reasonable jury to return a verdict for either party.
See
id. at 252 (“The mere existence of a scintilla of evidence in
support of the plaintiff’s position will be insufficient ....”).
On a motion for summary judgment, the court views all evidence
and inferences in a light most favorable to the nonmoving party.
Id. at 255.
The nonmoving party, however, may not rest upon mere
denials or allegations in the pleadings, but must set forth
specific facts sufficient to raise a genuine issue for trial.
Celotex, 477 U.S. at 324. A party asserting that a genuine dispute
(1) whether the basis for the imposition of the sanction exists;
and (2) whether the length of exclusion is reasonable.
See 42
C.F.R. § 1001.2007(a)(1).
7
exists - or cannot exist - about a material fact must cite
“particular parts of materials in the record.”
56(c)(1)(A).
Fed. R. Civ. P.
If a plaintiff cannot support each essential element
of a claim, the court must grant summary judgment because a
complete
failure
of
proof
regarding
an
essential
necessarily renders all other facts immaterial.
element
Celotex, 477 U.S.
at 322-23.
“The findings of the Secretary with respect to questions of
fact, if supported by substantial evidence on the record considered
as a whole, shall be conclusive.” Horras v. Leavitt, 495 F.3d 894,
900 (8th Cir. 2007)(internal citations omitted); see also 42 U.S.C.
§ 405(g).
“Substantial evidence is such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion
....”
Horras,
495
F.3d
at
900
(internal
citations
omitted).
“Therefore, if it is possible to draw two inconsistent positions
from the evidence and one of those positions represents the
agency’s findings, [the court must] affirm the decision.”
Id.
A reviewing court holds unlawful and sets aside agency action
that
is
“arbitrary,
capricious,
an
otherwise not in accordance with law.”
abuse
of
discretion,
or
5 U.S.C. § 706(2)(A); see
also 42 U.S.C. § 1395oo(f)(1). “To withstand judicial review under
this
standard,
an
agency
must
‘articulate
a
satisfactory
explanation for its action including a rational connection between
the facts found and the choice made.’”
8
Grace Healthcare of Benton
v. U.S. Dep’t of Health and Human Servs., 603 F.3d 412, 422 (8th
Cir. 2009)(quoting Motor Vehicle Mfrs. Ass’n v. State Farm Mut.
Auto. Ins. Co., 463 U.S. 29, 42 (1983)).
II.
Federal Exclusion
Federal law permits the Secretary to permissively exclude
individuals from participation in federal health programs who have
been excluded, suspended, or otherwise sanctioned by a state health
care program as follows:
(b)Permissive Exclusion .... The Secretary may exclude
the following individuals and entities from participation
in any Federal health care program ....
(5) Any individual or entity which has been suspended or
excluded from participation, or otherwise sanctioned,
under ...
(B) a State health care program, for reasons bearing on
the individual’s or entity’s professional competence,
professional performance, or financial integrity.
Section 1128(b)(5)(B); see also 42 U.S.C. § 1320a–7(b)(5)(B).
The
Secretary has delegated its exclusionary authority to the OIG. See
42 C.F.R. § 1001.601(a)(1)(ii).
There is no dispute that Nomo-Ongolo was excluded from MHCP.
See ECF No. 24 at 13.
The only question is whether substantial
evidence supports the OIG’s determination that the state exclusion
was for reasons that bear on her financial integrity.
Nomo-Ongolo
argues that substantial evidence does not support the Appeals
Board’s decision affirming the OIG’s exclusion because there was no
actual administrative finding, and the record does not show, that
9
she, rather than the Clinic, was responsible for the alleged
improper cash payments.
The court agrees.
The uncontroverted record shows that the termination notice
alleged forty-six cash payments in violation of MHCP.
Nomo-Ongolo
denied responsibility with respect to those payments and appealed
the termination notice.
The day before the preconference hearing,
Nomo-Ongolo withdrew her appeal because she reached an agreement
with Kjos that the case would be dropped and she would not treat
MHCP-covered patients until reinstated. The following day, the ALJ
dismissed her appeal without making specific findings of fact
regarding the underlying allegations.
The Secretary argues that the court’s review of a derivative
agency decision is narrow and the court should avoid reexamining
the
underlying
state
proceeding.
However,
under
Section
1128(b)(B)(5) and § 1001.601(a)(1)(ii), the court is required to
consider whether Nomo-Ongolo’s state exclusion was for reasons
bearing on her financial integrity.
The only evidence adversely
bearing on Nomo-Ongolo’s financial integrity in the record is MHDS’
vague and unsubstantiated investigative allegations, which she has
steadfastly denied.
Indeed, the majority of the evidence in the whole record
supports Nomo-Ongolo’s claim that she was not involved with patient
billing as a Clinic employee and was not responsible for the
billing errors. The record shows that the Clinic acknowledged that
10
it was responsible for the billing errors and the parties do not
dispute that the Clinic was independently sanctioned by MDHS.
In
addition, nothing in the record contradicts Nomo-Onogolo’s claim
that she withdrew her appeal because she and Kjos entered into an
agreement whereby the state agreed to drop her case.
In fact,
there is no evidence in the record that Nomo-Ongolo dropped her
appeal as an admission of guilt or wrongdoing. Moreover, the ALJ’s
dismissal order does not contain any findings of fact regarding
Nomo-Ongolo’s
conduct.
In
this
case,
there
was
simply
no
adjudicatory proceeding evaluating MDHS’ allegations.
The Secretary’s reliance on Quayum v. U.S. Dep’t of Health and
Human Servs., 34 F. Supp. 2d 141, 143-144 (E.D.N.Y. 1998), is
misplaced.
Quayum included a far more developed state-level
evidentiary record on the underlying perjury charge supporting the
OIG’s permissive exclusion, and the defendant-dentist, “admitted
that he knowingly testified falsely before the grand jury under
oath ....”
Id. at 142.
In contrast, Nomo-Ongolo has consistently
maintained that she was not responsible for the Clinic’s billing
errors,
and
the
Secretary
offers
no
actual
evidence
to
the
contrary. The Secretary simply points to the termination notice as
conclusive evidence of Nomo-Ongolo’s guilt.
In addition, in
Quayum, the defendant was represented by counsel at the time he
pleaded guilty and “was on notice that his conviction would be
reported to the [OIG] ....”
Id. at 144.
11
Nomo-Ongolo was not
represented by counsel when she entered into an agreement with Kjos
and she was not on notice that withdrawing her appeal would result
in
federal
exclusion.
Under
the
circumstances,
Nomo-Ongolo
reasonably assumed that no additional sanctions or proceedings
would be forthcoming.
The court concludes that the termination notice alone does not
constitute substantial evidence of wrongdoing bearing on NomoOngolo’s financial integrity in light of the record as a whole.
The court specifically finds that MHDS’ unsubstantiated and vague
investigative allegations fail to establish a nexus between the
state exclusion and
Nomo-Ongolo’s financial integrity.6
As a
result, the court must reverse the Secretary’s final decision.
CONCLUSION
Accordingly, because the Secretary’s final decision is not
supported by substantial evidence in the record as a whole, the
court reverses.
1.
Based on the above, IT IS HEREBY ORDERED that:
The Secretary’s motion for summary judgment [ECF No. 17]
is denied;
6
Because the court concludes that there is not substantial
evidence bearing on Nomo-Ongolo’s financial integrity, permissive
exclusion is also not warranted under the “otherwise sanctioned”
language of Section 1128(b)(5).
12
2.
Nomo-Ongolo’s motion for summary judgment [ECF No. 21] is
granted;
3.
The Secretary’s final decision is reversed; and
4.
Nomo-Ongolo
is eligible for reinstatement as a
participant in all federal health programs.
LET JUDGMENT BE ENTERED ACCORDINGLY.
Dated: November 27, 2018
s/David S. Doty
David S. Doty, Judge
United States District Court
13
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