This Court agrees with defendant that the Secretary, once determining that Kahn had been convicted of a program-related offense, had no discretion over Kahn's exclusion. See 42 U.S.C. § 1320a-7(a)(1) ("The Secretary shall exclude . . . (emphasis added)). Therefore, this Court finds that the Secretary did not err by not considering the collateral circumstances of Kahn's conviction in determining to exclude him for five years. Kahn has failed, thus far, to state a claim upon which relief can be granted sufficient to withstand a Fed. R. Civ. P. 12(b)(6) motion. This Court must therefore uphold Kahn's exclusion, unless Kahn presents a successful legal challenge to the application of the statute in his case.
C. Kahn's Ex Post Facto Law Argument
Kahn makes four additional arguments attacking the Secretary's application of the exclusion statute in his case. The first of these is that the application of the 1987 amendment to the 1991 conviction for acts that occurred in 1985 and 1986 violated the constitutional prohibition against ex post facto laws, because the 1987 amendment was applied retroactively to offenses committed in 1985 and 1986. The United States Constitution prohibits the passing of ex post facto laws. See U.S. Const., Art. I, § 9, cl. 3. An ex post facto law is one that is "passed after the occurrence of a fact or commission of an act, which retroactively changes the legal consequences or relations of such fact or deed." See Black's Law Dictionary 520 (5th ed. 1979). An ex post facto law acts to inflict punishment on a person for an act that, when committed, imposed no punishment or less punishment. See id.
Defendant argues that Kahn is misinterpreting the prohibition against ex post facto laws. Defendant argues that Kahn's exclusion was a remedial sanction rather than a punitive sanction. The constitutional prohibition against ex post facto laws does not apply to remedial sanctions, but only to punitive sanction. See Flemming v. Nestor, 363 U.S. 603, 613, 4 L. Ed. 2d 1435, 80 S. Ct. 1367 (1960).
There apparently is no law in the Second Circuit on the issue of whether exclusion from the Medicare program is a remedial or punitive sanction. The Eleventh Circuit, however, recently decided this exact issue. After a lengthy examination of the legislative history and function of the statute, the Eleventh Circuit held that the five-year minimum exclusion imposed by section 1320a-7(c)(3)(B) of the Social Security Act is remedial in nature and does not violate the ex post facto law prohibition. See Manocchio v. Kusserow, 961 F.2d 1539, 1542 (11th Cir. 1992). The Eleventh Circuit reasoned that because the purpose of the statute was to protect the public, the exclusion was remedial. See id.
This Court agrees that the five-year exclusion is remedial rather than punitive. The prohibition against ex post facto laws therefore does not apply. As a result, Kahn's argument that the application of the amended statute in his case is unconstitutional is without merit.
D. The Double Jeopardy Argument
The next argument Kahn advances against upholding the Secretary's determination is that the exclusion constitutes punishment for a crime for which he was already punished, in violation of the constitutional prohibition against double jeopardy. The United States Constitution prohibits double jeopardy, which is a second prosecution after a first trial for the same offense. See U.S. Const., amend V.
The Court notes that the criminal and civil penalties Kahn received were imposed by different sovereigns--New York State and the United States, respectively. The double jeopardy clause does not apply to the imposition of penalties by different sovereigns. See United States v. Wheeler, 435 U.S. 313, 316-17, 55 L. Ed. 2d 303, 98 S. Ct. 1079 (1978). It is well established that a state prosecution does not bar subsequent federal action aimed at the same offense. See United States v. Coonan, 938 F.2d 1553, 1562 (2d Cir. 1991).
Moreover, this Court has already concluded that the exclusion here was a remedial sanction, rather than a punitive sanction. Defendant correctly points out that the constitutional prohibition against double jeopardy, like that against ex post facto laws, does not apply to the imposition of remedial sanctions. See United States v. Halper, 490 U.S. 435, 446-447, 104 L. Ed. 2d 487, 109 S. Ct. 1892 (1989).
For the foregoing reasons, this Court finds that Kahn's argument that his exclusion is an unconstitutional violation of the prohibition against double jeopardy is without merit.
E. The Collateral Estoppel Argument
Kahn next argues that he should not be excluded from the Medicare program or state health care programs because his criminal conviction is not entitled to collateral estoppel effect. Kahn seems to believe that it was the operation of collateral estoppel that caused his mandatory exclusion. Defendant maintains that collateral estoppel had nothing to do with Kahn's exclusion and is wholly inapplicable to this case.
The doctrine of collateral estoppel operates to bar the re-litigation of issues that have already been tried between the same parties. See Black's Law Dictionary 237 (5th ed. 1979). The Court agrees with defendant that collateral estoppel has no applicability to the circumstances of this case. It is sufficient to point out that Kahn's conviction pursuant to a guilty plea by Kahn to a New York State criminal charge does not involve the same parties as are involved in Kahn's exclusion from these health care programs and as are involved in this litigation.
F. The Unconstitutional Taking Argument
Kahn finally argues that his exclusion constitutes an unconstitutional "taking" without just compensation of his intangible right to practice medicine on Medicare patients. In order for the exclusion to be a taking, Kahn must have been deprived of a protected property interest. See Story v. Green, 978 F.2d 60, 62 (2d Cir. 1992).
Defendant contends that Kahn does not have such a property interest. The Second Circuit, in Plaza Health Laboratories, Inc. v. Perales, 878 F.2d 577, 582 (2d Cir. 1989), noted that the "structure of the State's Medicaid laws suggests that a provider does not have a property interest in continued participation in the program." The New York Court of Appeals concurs. See Schaubman v. Blum, 49 N.Y.2d 375, 380, 402 N.E.2d 1133, 426 N.Y.S.2d 230 (1980). This Court similarly finds that Kahn does not have a protected property interest in continued participation in the federal Medicare program. Therefore, Kahn's exclusion from these health care programs was not an unconstitutional taking and his argument is without merit.
For the reasons set forth above, defendant's motion to dismiss for plaintiff's failure to state a claim upon which relief can be granted, pursuant to Fed. R. Civ. P. 12 (b)(6), is granted. The Court orders this case closed and directs the Clerk of the Court to remove it from the Court's active docket.
Dated: New York, New York
March 14, 1994
JOHN P. KEENAN
United States District Judge