State v. Tuchman

Decision Date12 August 1997
Docket NumberNo. 15582,15582
Citation242 Conn. 345,699 A.2d 952
CourtConnecticut Supreme Court
PartiesSTATE of Connecticut v. Nelson TUCHMAN.

Hubert J. Santos, Hartford, with whom were Patrick Bristol, E. Greenwich, and, on the brief, Hope C. Seeley, Hartford, for appellant (defendant).

Carolyn K. Longstreth, Assistant State's Attorney, with whom were David E. Sullivan, Assistant State's Attorney, and, on the brief, John M. Bailey, Chief State's Attorney, and James E. Thomas, State's Attorney, for appellee (State).

Richard Blumenthal, Attorney General, and Richard J. Lynch, Arnold I. Menchel and Jennifer C. Jaff, Assistant Attorneys General filed a brief for the Attorney General as amicus curiae.

Before CALLAHAN, C.J., and BERDON, NORCOTT, KATZ and McDONALD, JJ.

CALLAHAN, Chief Justice.

The principal issue in this appeal is whether the double jeopardy clause of the fifth amendment to the United States constitution 1 or article first, § 9, of the Connecticut constitution 2 prohibits the criminal prosecution of the defendant, Nelson Tuchman, for wrongfully obtaining approximately $420,000 in medicaid reimbursement when the state of Connecticut, acting administratively through the department of social services (department), had already sanctioned him for his allegedly criminal conduct.

The following facts and procedural history are undisputed. The defendant was the owner and operator of Winthrop Health Care Center, Inc. (Winthrop), a nursing home facility participating in the medicaid program. The medicaid program, established in 1965 as Title XIX of the Social Security Act and codified at 42 U.S.C. § 1396 et seq., is a joint federal-state venture providing financial assistance to persons whose income and resources are inadequate to meet the costs of, inter alia, necessary nursing home care. See Burinskas v. Dept. of Social Services, 240 Conn. 141, 148, 691 A.2d 586 (1997). States wishing to participate in the medicaid program "must develop a plan, approved by the secretary of health and human services, containing reasonable standards ... for determining ... the extent of medical assistance ..." to be provided. 42 U.S.C. § 1396a (a)(17). Connecticut has elected to participate in the medicaid program and has assigned the task of its administration to the department. General Statutes § 17b-260.

Under the Connecticut medicaid plan, the rate of reimbursement a participating nursing home receives from the department is based on data submitted in the facility's annual report of long term care costs (cost report). General Statutes §§ 17b-238 (a) and 17b-340; Regs., Conn. State Agencies § 17-311-51. The department is authorized to reduce a provider's rate of reimbursement in order to recoup overpayments made to the provider based on false or misleading cost reports. General Statutes § 17b-238 (c) and Regs., Conn. State Agencies § 17-311-53(b). 3

In preparing its annual cost report, a medicaid provider is required to treat costs incurred by virtue of leases executed with a related entity differently from those incurred under leases resulting from arms length transactions. In particular, if the lessor is a related entity that exists solely for the purpose of executing the lease, the provider's cost cannot exceed the lessor's actual cost. Regs., Conn. State Agencies § 17-311-52; 42 C.F.R. § 413.17.

In 1993, the department conducted an investigation of Winthrop and determined that: (1) the defendant had submitted cost reports for fiscal years 1986, 1987, 1988 and 1989 that falsely reported Winthrop's actual expenses and falsely represented certain leases as arms length transactions; and (2) Winthrop thereby wrongfully had obtained approximately $420,000 in excess medicaid reimbursement. Those determinations resulted in the three administrative actions that form the basis of the defendant's double jeopardy claims. First, pursuant to § 17b-238 (c), the department initiated recoupment proceedings against Winthrop and subsequently withheld approximately $450,000 from Winthrop's ongoing reimbursement payments. Second, after the department of public health and addiction services placed Winthrop into receivership because it had sustained a serious financial loss that jeopardized patient welfare, the receiver was instructed by the department not to pay the defendant a salary. Third, when Winthrop subsequently was sold, the department included in the facility's new medicaid contract a restrictive covenant prohibiting Winthrop from doing business with the defendant.

Meanwhile, as a result of an independent police investigation, the defendant was charged with larceny in the first degree in violation of General Statutes §§ 53a-122 a) and 53a-11. 4 The specific theory of larceny charged by the state is that the defendant obtained property by false pretenses as defined by General Statutes § 53a-119 (2). 5 Claiming that the department's actions constituted punishment for purposes of double jeopardy under both the federal and state constitutions, the defendant filed a motion to dismiss. After conducting an evidentiary hearing, the trial court, Koletsky, J., denied the defendant's motion. The defendant took an interlocutory appeal to the Appellate Court, which we transferred to ourselves pursuant to Practice Book § 4023 and General Statutes § 51-199(c). 6 We affirm the trial court's denial of the defendant's motion to dismiss.

As a threshold matter, we must determine the applicable standard of review. Because the issue of whether an administrative sanction constitutes punishment for purposes of double jeopardy is a question of law, we review it de novo. See United States v. Morgan, 51 F.3d 1105, 1110 (2d Cir.1995). The factual findings of the trial court that underlie the determination of that question, however, are entitled to the same deference on appeal that other factual findings command. See State v. Geisler, 222 Conn. 672, 610 A.2d 1225 (1992). Thus, those findings must stand unless they are clearly erroneous. Practice Book § 4061. 7

The double jeopardy clause of the fifth amendment to the United States constitution provides that no person shall "be subject for the same offense to be twice put in jeopardy of life or limb...." The double jeopardy clause protects against a second prosecution for the same offense after acquittal a second prosecution for the same offense after conviction and multiple punishments for the same offense. North Carolina v. Pearce, 395 U.S. 711, 717, 89 S.Ct. 2072, 2076, 23 L.Ed.2d 656 (1969). In the present case, the third of these protections is at issue. We must determine, therefore, whether any of the three administrative actions taken by the department against the defendant constituted punishment that bars subsequent criminal prosecution.

I

The defendant first maintains that the department's withholding of approximately $450,000 in medicaid reimbursement from Winthrop constituted punishment to him for purposes of double jeopardy. 8 In State v. Hickam, 235 Conn. 614, 668 A.2d 1321 (1995), cert. denied, --- U.S. ----, 116 S.Ct. 1851, 134 L.Ed.2d 951 (1996), we utilized a two-pronged approach for determining whether administrative action constitutes punishment for purposes of double jeopardy. Under that approach, which is based on the United States Supreme Court's explicit holding in United States v. Halper, 490 U.S. 435, 109 S.Ct. 1892, 104 L.Ed.2d 487 (1989), we assess: (1) the purpose the sanction is designed to serve; and (2) the nature of the particular sanction as applied to the defendant. A sanction that primarily serves a legitimate remedial purpose and is related rationally to that purpose does not give rise to a double jeopardy violation. State v. Hickam, supra, at 623, 668 A.2d 1321. 9

The defendant does not dispute the applicability of the Hickam approach to his federal claims but argues rather that the withholding of funds does not pass muster under either prong of the Hickam test. In particular, he maintains that: (a) the purpose of the statutory recoupment authorization, § 17b-238 (c), is primarily punitive rather than remedial; and (b) the nature of the particular recoupment at issue in this case was punitive. We disagree.

A

On the basis of the language of § 17b-238 (c), the language of its implementing regulation, § 17-311-53(b) of the Regulations of Connecticut State Agencies, and the legislative history of § 17b-238 (c), we conclude that the legislature intended recoupment to serve a remedial, rather than punitive, purpose.

The language of § 17b-238 (c) strongly suggests that the legislature intended recoupment to be remedial. The subsection consists of two sentences. The language authorizing the department to recoup overpayments is found in the first sentence: "[t]he submission of any false or misleading fiscal information or data ... shall be grounds for suspension of payments ... in accordance with regulations adopted by [the] commissioner." The absence of any reference to wrongful intent in that sentence seriously undercuts the defendant's argument that recoupment is intended to serve a punitive purpose. The fact that recoupment applies to providers who inadvertently submit incorrect information as well as to those who do so with wrongful intent indicates that the legislature intended it to serve a remedial, not a punitive purpose. See Kansas v. Hendricks, --- U.S. ----, ----, 117 S.Ct. 2072, 2082, 138 L.Ed.2d 501 (1997) ("[t]he existence of a scienter requirement is customarily an important element in distinguishing criminal ... statutes"); Kennedy v. Mendoza-Martinez, 372 U.S. 144, 168, 83 S.Ct. 554, 567, 9 L.Ed.2d 644 (1963) (tests traditionally applied to determine whether statute serves penal purpose include "whether [the sanction] comes into play only on a finding of scienter").

Moreover, the language of the implementing regulation, § 17-311-53(b), also indicates that the legislature intended recoupment to serve a remedial...

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    • United States
    • Connecticut Supreme Court
    • 18 Mayo 1999
    ...Ct. 2456, 91 L. Ed. 2d 131 (1986); Harris v. McRae, 448 U.S. 297, 301, 100 S. Ct. 2671, 65 L. Ed. 2d 784 (1980); State v. Tuchman, 242 Conn. 345, 347-48, 699 A.2d 952 (1997); Burinskas v. Dept. of Social Services, 240 Conn. 141, 148, 691 A.2d 586 (1997). The federal government shares the co......
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