Choi v. State

• Docket Number: Court of Appeals No. A-13273
• Decision Date: 07 April 2023
• Parties: Jong H. CHOI, Appellant, v. STATE of Alaska, Appellee.
• Court: Alaska Court of Appeals

528 P.3d 463

Jong H. CHOI, Appellant,

v.STATE of Alaska, Appellee.

Court of Appeals No. A-13273

Court of Appeals of Alaska.

April 7, 2023

Kelly Taylor, Assistant Public Defender, and Samantha Cherot, Public Defender, Anchorage, for the Appellant.

Donald Soderstrom, Assistant Attorney General, Office of Criminal Appeals, Anchorage, and Treg R. Taylor, Attorney General, Juneau, for the Appellee.

Before: Allard, Chief Judge, and Wollenberg and Harbison, Judges.

OPINION

Judge HARBISON.

Jong H. Choi was convicted, pursuant to a plea agreement, of two counts of medical assistance fraud.¹ As part of his sentence, Choi was ordered to pay restitution to the Alaska Department of Health and Social Services (DHSS). The restitution order required Choi to reimburse DHSS for payments it made for personal care assistance that Choi provided to Medicaid recipients at a time when he knew he was legally ineligible to provide these services.

Choi appeals, arguing that the restitution award exceeded DHSS's actual loss. Choi contends that he provided the personal care services despite being legally barred from doing so, and he asserts that, as a result, there is no evidence that DHSS suffered any actual damages or loss requiring restitution. In the alternative, he asserts that the superior court should have deducted the value of the services he provided from the restitution award. He also claims that the State bore the burden of proving both that he did not actually perform the personal care services and that DHSS did not already receive payments for its loss from another source.

For the reasons we explain in this opinion, we conclude that Choi was not entitled to an offset for any services he performed. We also conclude that, under the facts of this case, the superior court's failure to require the State to prove whether DHSS had already been reimbursed for the losses resulting from Choi's conduct was not plain error.

Facts and proceedings

Choi worked as a personal care assistant and was employed by C Care Services. In the charging document in this case, the State provided the following explanation of how Medicaid compensates personal care assistants (PCAs):

PCAs are health care providers that the Alaska Medicaid Program pays to provide home based healthcare services which will allow Medicaid recipients to stay in their home rather than be placed in a nursing home type setting. Medicaid recipients are evaluated for their healthcare needs and a PCA is then hired by the recipient to provide those needs in the recipient's home. The PCA fills out a timesheet for the work done and submits it to a PCA agency that in turn bills Medicaid [through DHSS]. Medicaid pays approximately $24 an hour to the agency and the agency must pay the PCA at least half of that amount.

In July 2008, DHSS informed C Care that Choi was barred from continuing to work as a personal care assistant because he had been charged with a barrier crime — i.e. , a crime that, by regulation, prevented him from being approved to work as a personal care assistant and from receiving payments from Medicaid.² In January 2010, Choi asked to return to work. He represented to C Care that the charge had been dismissed, and he provided C Care with dismissal paperwork. In fact, Choi had pleaded guilty to the crime, and the paperwork he provided was from a different, unrelated case. C Care then reinstated Choi, and Choi resumed working — including billing and receiving payments from DHSS.

In December 2010, DHSS informed C Care that Choi was still barred from working as a personal care assistant. After this, Choi continued to work as a personal care assistant, but he signed the name of his wife (who was also a personal care assistant employed by C Care) on his Medicaid billing timesheets. Choi submitted Medicaid billing timesheets under his wife's name through March 2012.

In 2013, the State launched an investigation into C Care and learned of Choi's conduct.³ The State charged Choi with three counts of medical assistance fraud.

The first count alleged that Choi "knowingly submit[ted] or authorize[d] the submission of a claim to a medical assistance agency for property, services, or a benefit with reckless disregard that [he was] not entitled to the property, services, or benefit."⁴ This count was based on his signing his wife's name on timesheets from December 2010 through March 2012.

The second count alleged that Choi "knowingly prepare[d] or assist[ed] another person to prepare a claim for submission to a medical assistance agency for property, services, or a benefit with reckless disregard that [he was] not entitled to the property, services, or benefit."⁵ This count was based on his submitting Medicaid timesheets from January 2010 through November 2010, at a time when he was barred from receiving Medicaid payments due to his conviction for a barrier crime.

The third count alleged that Choi "knowingly ma[de] a false entry in or falsely alter[ed] a medical assistance record."⁶ This count related to both his signing of his wife's name and his submitting Medicaid timesheets when he was barred from receiving Medicaid payments due to his criminal conviction.

Choi pleaded guilty, pursuant to a plea agreement, to the first and third counts. (The second count was dismissed.) The parties initially agreed that Choi would be ordered to pay $67,435.59 in restitution, and the prosecutor further agreed that if the State were to successfully recover any portion of DHSS's loss from C Care, Choi's restitution obligation would be reduced by that amount. But Choi later filed an application for post-conviction relief arguing that his defense attorney had provided him with ineffective assistance of counsel when litigating the restitution amount. The State and Choi ultimately stipulated that Choi would withdraw his application for post-conviction relief, and in exchange, the State would agree to a de novo restitution hearing in Choi's underlying criminal case.

The superior court accordingly conducted a de novo restitution hearing. At the hearing, the only witness was a forensic accountant for the Medicaid Fraud Control Unit of the Department of Law. This witness testified that Medicaid, through DHSS, paid C Care $62,043.77 based on timesheets that Choi submitted — either under his or his wife's name — beginning in January 2010 when he lied about his criminal charge being dismissed. The witness testified that Cecelia DeLeon, the owner of C Care, had also been convicted of a crime and ordered to pay restitution. However, the witness did not know whether DeLeon had paid any restitution and, if so, whether it was for the same loss as that caused by Choi's conduct.

The State argued that the court should award DHSS $62,043.77 in restitution because the payments to C Care reflected the actual damages or loss that DHSS suffered. The superior court agreed with the State's argument and entered a restitution judgment in that amount.

This appeal followed.

Why we conclude that the superior court did not err in determining the amount of loss caused by Choi's crimes

The purpose of the restitution statutes is to "make full restitution available to all persons who have been injured as a result of criminal behavior, to the greatest extent possible."⁷ Alaska's restitution statutes accordingly provide that, unless a victim declines restitution, a court must order restitution for the loss caused by the conduct for which the defendant was convicted.⁸

This Court has previously explained that restitution should be assessed according to the actual damages or loss arising from the defendant's crime, and not the amount of the defendant's unjust gain.⁹ We accordingly must determine what loss, if any, was caused by Choi's crimes, and we begin by considering how damages for fraud would be assessed in a civil fraud case.

In a civil case, a plaintiff who has been injured by fraud is entitled to general damages, which typically are measured in accordance with either the "benefit of the bargain" rule or the "out of pocket" rule.¹⁰ Under the "benefit of the bargain" rule, a plaintiff is entitled to recover the difference between the actual value of the purchase and the value the purchase would have had if the representations had, in fact, been true.¹¹ And under the "out of pocket" rule, a plaintiff will recover "the price paid for property [the plaintiff] was induced to buy as a result of the misrepresentation, less the market value of the property."¹² Thus, under both of these approaches for valuing damages, an injured party will recover the actual damages or loss arising from the defendant's conduct, rather than the amount of the defendant's unjust gain.¹³ We accordingly adopt these rules as an appropriate method of determining the amount of restitution that should be awarded when a defendant is convicted of medical assistance fraud.

We next consider how these rules apply to the present case. Under either method, DHSS is entitled to damages in the amount of the difference between what DHSS was induced to pay to Choi as a result of his misrepresentations (i.e. , the value of the service that Choi promised to provide, had his misrepresentations been true), and the market value of the work Choi performed (i.e. , the market value of Choi's work if he had disclosed that he had been convicted of a barrier crime and that it was he, and not his wife, who had done the work listed in some of the timesheets).

Choi contends that the services he provided to the Medicaid beneficiaries had value, and that the court should reduce his restitution obligation by an amount equal to the value of these services. He notes that the State did not establish that he failed to provide any of the personal care services that he was paid to provide, nor did it present any evidence that the services he provided were deficient in any way.

But Choi's argument misidentifies the victim of the crimes for which he was convicted. Choi pleaded guilty to defrauding DHSS by signing his wife's...