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United States v. Henderson

United States Court of Appeals, Eleventh Circuit

June 27, 2018

UNITED STATES OF AMERICA, Plaintiff - Appellee,
v.
CATHEDRAL HENDERSON, Defendant-Appellant.

          Appeal from the United States District Court for the Southern District of Georgia D.C. Docket No. 1:15-cr-00072-JRH-BKE-1

          Before ROSENBAUM, JILL PRYOR and RIPPLE, [*] Circuit Judges.

          RIPPLE, Circuit Judge:

         After a federal investigation into recordkeeping practices at a Department of Veterans Affairs ("VA") hospital, Cathedral Henderson was charged with fifty counts of making false statements in connection with the delivery of, or payment for, healthcare services, in violation of 18 U.S.C. § 1035; and with one count of knowingly and willfully making a materially false statement to a federal agent, in violation of 18 U.S.C. § 1001. A jury convicted Mr. Henderson on all counts, and the district court sentenced him to twenty-seven months' imprisonment for each of the fifty-one counts, to be served concurrently. The district court also denied Mr. Henderson's motions for judgment of acquittal and for a sentence reduction. Mr. Henderson now challenges the sufficiency of the evidence supporting his convictions and separately challenges his sentence. Because his convictions are supported by legally sufficient evidence and because the district court did not err in applying the Sentencing Guidelines, we affirm his convictions and his sentence.

         I

         BACKGROUND

         A.

         At all relevant times, Mr. Henderson was the Chief of the Fee Division at Charlie Norwood VA Medical Center, which is a VA hospital in Augusta, Georgia. For various reasons, a VA patient sometimes needs healthcare that the VA cannot provide through its own facilities. When a VA healthcare provider determines that a patient needs treatment outside of the VA system, that provider enters a "consult" in the Computerized Patient Record System ("CPRS"). CPRS forwards all consults to the Fee Division, which reviews the consults to verify that they are appropriate for outside care and that the VA will pay the non-VA healthcare provider for the services. After providing an "authorization for care," an employee in the Fee Division schedules the patient's appointment with the non-VA provider.[1]

         The Fee Division also is responsible for paying the non-VA provider after the outside services are performed. Before paying for the services, an employee in the Fee Division must verify that the VA patient actually received the scheduled services. A Fee Division employee can verify that the services were performed by reviewing the patient's medical records for evidence of the services (such as test results, physician reports, or a signed consent form) or by speaking personally to the patient. The Fee Division employee "completes" the consult by paying the outside provider's bill and by adding an explanatory note to the patient's file in CPRS (such as the date that the outside services were rendered). Marking a consult as complete in CPRS triggers a notification to the VA provider who originally ordered the consult, allowing that provider to review the results and to make further decisions about patient care.

         In 2012, it became clear that the consult system had not been operating as it should; there were 2.1 million open consults in CPRS. This backlog made it difficult for VA physicians to know the status of a consult and to determine how they should proceed with patient care. The VA therefore instructed its facilities to engage in a CPRS clean-up project to resolve as many of the open consults as possible. The clean-up project proceeded in multiple steps. First, the VA automatically closed all consults that had been open for five or more years and deleted all duplicate consults. Then, for consults that had been open between ninety days and five years, the VA engaged in a more thorough review process. First, it examined each record. For patients who had died or had missed several appointments, the VA discontinued the consults. For all others, the VA directed all facilities to review the patient records to determine whether the patient had received the consult services.

         VA examiners employed several techniques to determine whether a patient had received the consult services. For instance, an examiner might find in the patient's medical records a progress report from the outside healthcare provider. VA employees working on the clean-up project also could call a patient to determine whether the patient had received the outside services. Once the VA had verified that the patient had received the services, the examiner closed the consult in CPRS with an explanatory comment. If the VA could not verify completion of the services, the examiner would send the consult to the VA provider who initially ordered the consult for further follow-up.

         Charlie Norwood VA Medical Center had 30, 000 open consults to address in the mandated consult clean-up process. Maribeth Bredehoft, its Chief of Health Administration Services, supervised the process. She instructed employees at all levels of the VA to participate, including non-clinical personnel (such as billers or schedulers). Bredehoft prepared detailed training and instructions for employees working on the clean-up project. Specifically, she instructed all employees on the project to examine each patient's medical records for documentary evidence that the services had been provided and to close each consult that had such documentation with an explanatory comment in CPRS. If the employee could not find such documentation or if it was not clear from the file whether the service had been provided, Bredehoft instructed that the employee should leave the consult open for further review.

         Eventually, Bredehoft instructed Mr. Henderson to supervise his own subordinates in the clean-up project. Bredehoft did not include Mr. Henderson in the detailed training process that she provided for other employees participating in the clean-up. The Government presented evidence that, as Chief of the Fee Division, Mr. Henderson was familiar with the routine consult completion process and had supervised regularly Fee Division employees in the closing of consults after the outside bills were paid.

         Bredehoft emailed Mr. Henderson and instructed him that there were "thousands of consults" in CPRS that "need action."[2] She said that the consults "from the very beginning … [were] to be completed when the claim was processed and doc[umentation] received and that was not done."[3] Mr. Henderson responded that consults were "clinical" and that he did not believe his staff should be responsible for closing them.[4] Bredehoft responded that the consults were "past consults … that were to be closed when the claim was processed for payment. That meant that the services were rendered, documentation along with claim received, bill processed … that is the bottom line."[5] Despite his protests to Bredehoft, Mr. Henderson eventually acquiesced in her request that he join the clean-up process.

         As Chief of the Fee Division, Mr. Henderson oversaw two groups of employees: Fee Clerks and Revenue Clerks. Fee Clerks regularly closed consults as part of their job duties and were involved in the process of paying the bills from outside service providers. Revenue Clerks had different responsibilities related to the VA's provision of medical services to employees of other federal agencies. Specifically, the Revenue Division managed the process of billing those federal agencies for that medical care. The Revenue employees therefore had no experience with the VA consult process because they did not close consults as part of their regular job duties and, prior to working on the clean-up project, had no access to CPRS. Mr. Henderson nevertheless delegated the consult clean-up project to four Revenue employees.

         Mr. Henderson directed the Revenue employees to close consults opened from October 1, 2012, through September 30, 2013. He instructed them to close all of those consults with a comment in CPRS along the lines of "[s]ervices rendered or patient refused services."[6] He did not instruct them to examine each patient's medical records for evidence that the patient actually had received the services, an important step in the consult-closing process. Following Mr. Henderson's instructions, the Revenue employees closed 2, 725 open consults with the comment "services rendered or patient refused services."

         During the clean-up process, Bredehoft performed random checks of the closed consults to ensure that the closed consults indeed were accompanied by appropriate documentary evidence. During one of these checks, she discovered some of the consults closed by the Revenue employees. She confronted Mr. Henderson, because she suspected that the employees were closing consults without following the appropriate procedure to verify that the services had been rendered. She informed Mr. Henderson that the comments on the closed consults were incorrect and ordered him to fix them. Mr. Henderson did not follow this directive and did not instruct the Revenue employees to correct the improperly closed consults.

         The Government does not dispute that Mr. Henderson did not receive the full training that Bredehoft provided to other employees involved in the clean-up mandate. It emphasizes that, as Chief of the Fee Division, "Henderson was an expert in the responsibilities of the Fee Division and knew its regulations" and "knew the proper way to confirm that the patient had received the services before closing a consult."[7] However, the Revenue employees also did not receive Bredehoft's special training; they were limited to the instructions given to them by Mr. Henderson.

         At some point, the Office of the Inspector General received an anonymous tip that consults were being closed improperly at Charlie Norwood and sent Tracy Brumfield to investigate. Investigator Brumfield conducted some interviews but, due to the limited nature of the anonymous tip, was unable to uncover any wrongdoing in his initial investigation. Later, however, the Office of the Inspector General received a more detailed report from a VA employee. Specifically, the employee alerted the Inspector General that there were "four employees" who "were not familiar with the process of completing consults."[8] The employee also reported that she was concerned with the "verbiage" the group had used to close consults: "[s]ervices have been completed or patients refused services."[9]

         Investigator Brumfield conducted several more interviews. Notably, he interviewed the Revenue employees involved in the clean-up mandate.[10] During one of these interviews, he learned that one of the Revenue employees had written down Mr. Henderson's exact instructions at the time he had given them. Those instructions included a directive to include the comment "services have been completed or patient refused service" on each of the closed consults.[11]

         After Investigator Brumfield had conducted about thirty interviews, he interviewed Mr. Henderson. They had a discussion about what instructions Mr. Henderson had given the Revenue employees.

SPECIAL AGENT BRUMFIELD: So as I understand what you've just said is that they went into the system and they did not contact any of the patients, however it was noted.
Now, the directions that you specifically gave them, do you recall what those directions were?
MR. HENDERSON: To administratively close the consult by Chief of H.A.S. That's the statement. That's all.
SPECIAL AGENT BRUMFIELD: Was there any other comments that they were to put into the system?
MR. HENDERSON: Not that I remember, no.[12]

         Later, Investigator Brumfield confronted Mr. Henderson with the instructions one of the Revenue employees had written down and given to Investigator Brumfield, which matched the statement the Revenue employees had entered on the closed consults. Mr. Henderson confirmed that the directions "sound[ed] familiar to what [he] shared with them [for] how to process" the consults.[13] Mr. Henderson's explanation for giving the instructions that he did was that the Revenue employees "shouldn't have been [handling consults] in the first place," that they "wouldn't know how to find" documentary evidence in CPRS that the consult had been completed, and that he did not want to "explain to them something clinically that they would never be able to find."[14]

         B.

         A grand jury indicted Mr. Henderson on fifty counts of making false statements in connection with the delivery of or payment for healthcare services, in violation of 18 U.S.C. § 1035, based on the statement entered on each of the closed consults. It also indicted him on one count of making a false statement to a federal agent, in violation of 18 U.S.C. § 1001, based on his statement to Investigator Brumfield. After the Government presented its evidence at trial, Mr. Henderson moved for a judgment of acquittal on all counts, which the district court denied. A jury convicted Mr. Henderson on all counts. After the conviction, Mr. Henderson filed a written renewed motion for judgment of acquittal or, in the alternative, for a new trial. The district court denied that motion.

         At sentencing, the Government asked the district court to apply U.S.S.G. § 2B1.1(b)(15)(A), for a theft offense involving "the conscious or reckless risk of death or serious bodily injury." Mr. Henderson's probation officer had not included this guideline in Mr. Henderson's sentencing recommendation. Mr. Henderson objected to the application of § 2B1.1(b)(15)(A), contending that he did not consciously or recklessly disregard any risk. The district court noted that Mr. Henderson had expressed concern to Bredehoft about the consult clean-up project, specifically "about the lack of his medical training and that of his employees who were being tasked with the job of reviewing and closing the old consultations."[15] Mr. Henderson also "initially refused to comply with the orders to close" the consults.[16] The fact that Mr. Henderson carried out Bredehoft's commands anyway led the district court to conclude that Mr. Henderson was "aware of the risk and that notwithstanding that risk, he disregarded it and gave the instructions to his employees to summarily close the consultations."[17] The district court calculated the guidelines range as twenty-seven to thirty-three months' imprisonment and ultimately sentenced Mr. Henderson to twenty-seven months for each of the fifty-one counts, all to be served concurrently.

         The district court entered the judgment of conviction on October 21, 2016.[18]On November 2, 2016, Mr. Henderson filed a motion under Federal Rule of Criminal Procedure 35 to reduce his sentence.[19] On November 4, 2016, Mr. Henderson timely filed a notice of appeal specifically as to the district court's October 21 judgment.[20] The district court denied Mr. Henderson's motion to reduce his sentence on November 14, 2016. Mr. Henderson did not appeal separately the November 14 denial or amend his original notice of appeal to incorporate the district court's November 14 denial.

         II DISCUSSION

         Mr. Henderson now challenges the sufficiency of the evidence supporting each of his convictions. He also contends that the district court improperly applied U.S.S.G. § 2B1.1(b)(15)(A) to increase his offense level to fourteen. For the reasons stated below, we cannot accept Mr. Henderson's arguments and accordingly affirm the judgment of the district court.

         A.

         Mr. Henderson was convicted of fifty counts of violating 18 U.S.C. § 1035, which prohibits the making of any "materially false, fictitious, or fraudulent statements or representations … in connection with the delivery of or payment for health care benefits, items, or services."[21] He now contends that the Government failed to prove that the ...


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