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Second Acts: Exclusion, Reinstatement, and Revocation Oh My!

OIG Monitor David Blank, Christopher Guthrie

There are no second acts in American lives.” – F. Scott Fitzgerald

When the long-thought-dead career of some famous (or even quasi-famous) individual is inexplicably revived, it is almost inevitable that a smattering of news articles covering the story will invoke Fitzgerald’s commentary—and then proceed to gleefully point out just how wrong he was about one’s chances for redemption. The quote has been used so often in this manner, it is almost as if Fitzgerald’s rule has become the exception. But unfortunately for some people, including in this case a Florida doctor named Brenton Lee Morgan, not everyone can be so lucky as to prove Fitzgerald wrong.

A Brief History of Dr. Brenton Lee Morgan

Prior to his time practicing medicine in Florida, Dr. Brenton L. Morgan had been a physician in West Virginia. On multiple occasions during his time practicing in West Virginia, Dr. Morgan obtained free samples of hydrocodone from pharmaceutical representatives. Although Dr. Morgan claimed that the samples would be given to patients for treatment purposes, he instead kept the hydrocodone for his own personal use. Dr. Morgan’s practices were eventually uncovered, and in March 2007 he pled guilty to one count of obtaining a controlled substance by “misrepresentation, fraud, forgery, or subterfuge.” 

In addition to serving 30 days in jail and having three months of supervised release, the Inspector General (I.G.) of the Department of Health and Human Services (DHHS) also excluded Dr. Morgan from participating in Medicare, Medicaid, and all other federal health-care programs for five years pursuant to the Social Security Act. This five-year exclusion from participation in the federal health care programs was the minimum length of exclusion permitted under the law. Morgan appealed the I.G.’s decision; however, the courts ultimately denied his appeals, ruling that “the I.G. had a sufficient basis to exclude Morgan and that the five-year term of the exclusion was not unreasonable in light of applicable law.” Morgan v. Sebelius.

By 2013, Dr. Morgan had moved to Florida and, in an attempt to begin his second act, had applied for reenrollment (for both himself and his practice) in the Medicare program. When submitting his Medicare reenrollment application, Dr. Morgan disclosed that he had been excluded from the Medicare program for a period of five years, beginning on May 30, 2008, with reinstatement occurring on June 19, 2013. Breton L. Morgan, M.D., Inc. & Breton L. Morgan, M.D. Dr. Morgan submitted copies of the I.G. letter reinstating his eligibility to participate in the Medicare program, and signed the application’s certification statement attesting that the information he provided in the application was “true, correct, and complete.” Dr. Morgan’s application was accepted, and both he and his practice were reenrolled in Medicare, effective July 17, 2013. It appeared that Morgan’s second act was poised to take off—yet, it was not meant to be.

The Court Ends Morgan’s Second Act

Although Dr. Morgan reported his five-year exclusion from participation in the federal health-care programs when submitting his reenrollment application, Dr. Morgan failed to disclose his previous felony conviction. Id. at 6. Providing information regarding “all applicable final adverse actions” is explicitly required by the application. Adverse action is defined to require the disclosure of “any felonies that would result in a mandatory exclusion under Section 1128(a) of the Social Security Act” within the past ten years. In certifying that the information in his application was “true, correct, and complete,” yet failing to report his prior conviction, Dr. Morgan had submitted an enrollment application that was misleading or false. A false or misleading application is a basis for revocation of Medicare enrollment and billing privileges.

Dr. Morgan’s second act ended on November 7, 2016, as quickly as it had started, when both his and his practice’s Medicare enrollment and billing privileges were revoked. Dr. Morgan appealed this revocation to the DHHS Departmental Appeals Board (DAB), arguing that his failure to report his prior conviction when applying for reenrollment in Medicare was not, in fact, false or misleading because CMS was on notice of his conviction, because it formed the basis of the I.G.'s exclusion action, which was disclosed in the application. The DAB, however, disagreed with the argument and ruled that Dr. Morgan’s application for reenrollment in the Medicare program was not “true, correct, and complete but rather incomplete, false, and misleading.”  According to the DAB, applicants have an affirmative duty to submit a true and accurate application. Morgan violated this duty and did not have a valid explanation or reason for doing so. As such, the DAB upheld the CMS’s three-year reenrollment bar on Dr. Morgan, thus bringing a swift close to Dr. Morgan’s second act.

The Takeaway

In addition to showing that Fitzgerald was (at least occasionally) correct about second chances in American life, this case also highlights the potential pitfalls of the Medicare enrollment process and the importance of taking immediate action to mitigate the damages of previous errors and omissions. 

Suppliers and providers that are applying for enrollment or contesting an exclusion action must be aware of the requirements for each of these processes. With the consequence of failing to accurately and completely address these requirements being what is in essence a professional death sentence, it is imperative to seek guidance from counsel well-versed in the intricacies of the system. Regardless of which “act” you are at in the enrollment process, the Health Law Group at Quarles & Brady can help. Please feel free to reach out to David Blank, Christopher Guthrie, or your local Quarles & Brady attorney, to learn more about this or other OIG enforcement initiatives.

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