[Federal Register Volume 61, Number 148 (Wednesday, July 31, 1996)]
[Proposed Rules]
[Pages 39921-39926]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-19425]
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SOCIAL SECURITY ADMINISTRATION
20 CFR Part 498
RIN 0960-AE41
Hearings and Appeals for Civil Monetary Penalty Cases
AGENCY: Social Security Administration (SSA).
ACTION: Proposed rule.
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SUMMARY: We propose to add new rules that would establish hearing
procedures for the Social Security Administration's civil monetary
penalty cases. These proposed rules would implement the provisions of
section 1129 and section 1140 of the Social Security Act which require
an opportunity to be heard on the record before a determination to
impose penalties or assessments becomes final.
DATES: To be sure that your comments are considered, we must receive
them no later than September 30, 1996.
ADDRESSES: Comments should be submitted in writing to the Social
Security Administration, c/o Commissioner of Social Security, P.O. Box
1585, Baltimore, MD 21235, sent by telefax to (410) 966-2830, sent by
E-mail to ``[email protected]'' or delivered to 3-B-1 Operations
Building, 6401 Security Boulevard, Baltimore, MD 21235, between 8:00
a.m. and 4:30 p.m. on regular business days.
The electronic file of this document is available on the Federal
Bulletin Board (FBB) at 9 a.m. on the date of publication in the
Federal Register. To download the file, modem dial (202) 512-1387. The
FBB instructions will explain how to download the file and the fee.
This file is in WordPerfect and will remain on the FBB during the
comment period.
FOR FURTHER INFORMATION CONTACT: Regarding this Federal Register
document--Henry D. Lerner, Legal Assistant, Division of Regulations and
Rulings, Social Security Administration, 6401 Security Boulevard,
Baltimore, MD 21235, (410) 965-1762; regarding eligibility or filing
for benefits--our national toll-free number, 1-800-772-1213.
SUPPLEMENTARY INFORMATION:
Background
The Social Security Administration (SSA) was established as an
independent agency effective March 31, 1995, under Public Law 103-296,
the Social Security Independence and Program Improvements Act of 1994
(SSIPIA). The SSIPIA also created an independent Office of the
Inspector General (OIG), to which the Commissioner of Social Security
(Commissioner) delegated certain authority under the civil monetary
penalty (CMP) provisions on June 28, 1995. However, the Commissioner
retained the authority to conduct initial hearings and review initial
hearing decisions related to the imposition of CMPs and assessments.
On November 27, 1995, the OIG published a final rule at 60 FR 58225
establishing a new part 498 in title 20 of the Code of Federal
Regulations. This new part serves as a repository for the SSA's
existing CMP regulations which implemented section 1140 of the Social
Security Act (the Act). These regulations were previously located at 42
CFR part 1003.
In addition, the OIG published a final rule on April 24, 1996, at
61 FR 18078 to implement SSA's new CMP authority provided under section
206(b) of the SSIPIA, which added section 1129 to the Act, effective
October 1, 1994. This authority allows for the imposition of penalties
and assessments against any individual, organization, agency, or other
entity that makes or causes to be made a false or misleading statement
or representation of a material fact for use in determining initial or
continuing rights to Old-Age, Survivors, and Disability Insurance or
supplemental security income benefit payments if the person knew or
should have known that such statement or representation is false,
misleading, or omits a material fact.
When published in final form, these proposed hearing regulations
will complete the final phase of the implementation process for the
provisions of section 1129 and section 1140 of the Act which require
that a person be given an opportunity to be
[[Page 39922]]
heard on the record prior to a final determination to impose penalties
or assessments.
Hearing Process
The Commissioner has decided to retain the Departmental Appeals
Board (DAB) of the Department of Health and Human Services (HHS) on an
interim basis to conduct hearings and appeals, and to issue recommended
decisions in SSA's CMP cases. SSA intends to enter into a reimbursable
agreement with the DAB under the Economy Act, 31 U.S.C. 1535(a).
The Commissioner's decision was based on a number of criteria,
including the DAB's expertise in handling CMP cases and its reputation
for rendering decisions in an efficient and timely manner. Moreover, in
light of the fact that the authority under section 1129 is new, this
will give SSA the opportunity to assess the volume of CMP cases and
projected resource requirements prior to establishing its own internal
hearing mechanism.
These proposed rules will require adherence to various deadlines to
ensure the expeditious conduct of proceedings and prompt resolution of
CMP cases. In accordance with Sec. 498.109, these proposed hearing
regulations will provide a person, upon whom the OIG seeks to impose
penalties and assessments, as applicable, the right to request an
initial hearing within 60 days of notification by the OIG. As described
in Sec. 498.202 of these proposed rules, the person's request for a
hearing must be in writing and contain a statement of the specific
issues and conclusions of law with which the person disagrees. These
proposed rules also provide that a hearing request must be dismissed if
not filed in a timely manner unless, upon a showing of good cause, an
extension is granted to the respondent.
Initial hearings in CMP cases will be conducted by an
administrative law judge. At the hearing, a person will be entitled to
be represented by counsel, to present witnesses, and to cross-examine
witnesses.
These proposed hearing regulations have been modeled on the HHS's
hearing regulations which govern CMP cases for which the DAB also
conducts hearings and appeals on behalf of the Secretary of the HHS. As
indicated in the final rule published on April 24, 1996, we have
reserved the issue of recommended exclusions of physicians and medical
providers from the Medicare program at this time.
Regulatory Procedures
Executive Order 12866
We have consulted with the Office of Management and Budget (OMB)
and have determined that these rules do not meet the criteria for a
significant regulatory action under Executive Order 12866. Thus, they
are not subject to OMB review.
Paperwork Reduction Act
These proposed regulations impose no new reporting or recordkeeping
requirements requiring OMB clearance.
Regulatory Flexibility Act
We have determined that no regulatory impact analysis is required
for these proposed regulations. Based on our determination, the
Commissioner certifies that these proposed regulations would not have a
significant economic impact on a number of small business entities.
Therefore, we have not prepared a regulatory flexibility analysis.
Effect of NPRM on Pending Actions
Until the promulgation of final regulations, the Commissioner
intends that these proposed regulations shall provide guidance with
respect to the hearing and appeals process to be used in CMP cases.
(Catalog of Federal Domestic Assistance Program Nos. 96.001, Social
Security--Disability Insurance; 96.002, Social Security--Retirement
Insurance; 96.004, Social Security--Survivors Insurance; 96.006,
Supplemental Security Income Program)
List of Subjects in 20 CFR Part 498
Administrative practice and procedure, Fraud, Penalties.
Approved: July 8, 1996.
Shirley S. Chater,
Commissioner of Social Security.
For reasons set forth in the preamble, part 498 of chapter III of
the Code of Federal Regulations would be amended by adding
Secs. 498.201 through 498.223 to read as follows.
PART 498--HEARINGS AND APPEALS FOR CIVIL MONETARY PENALTY CASES
Sec.
498.201 Definitions.
498.202 Hearing before an administrative law judge.
498.203 Rights of parties.
498.204 Authority of the administrative law judge.
498.205 Ex parte contacts.
498.206 Prehearing conferences.
498.207 Discovery.
498.208 Exchange of witness lists, witness statements and exhibits.
498.209 Subpoenas for attendance at hearing.
498.210 Fees.
498.211 Form, filing and service of papers.
498.212 Computation of time.
498.213 Motions.
498.214 Sanctions.
498.215 The hearing and burden of proof.
498.216 Witnesses.
498.217 Evidence.
498.218 The record.
498.219 Post-hearing briefs.
498.220 Initial decision.
498.221 Appeal to DAB.
498.222 Final decision of the Commissioner.
498.223 Stay of initial decision.
498.224 Harmless error.
Authority: Secs. 205(a), 205(b), 702(a)(5), 1129, and 1140 of
the Social Security Act (42 U.S.C. 405(a), 405(b), 902(a)(5), 1320a-
8, and 1320b-10).
Sec. 498.201 Definitions.
As used in this part--
ALJ refers to an Administrative Law Judge of the Departmental
Appeals Board.
Civil monetary penalty cases refer to all proceedings arising under
any of the statutory bases for which the Inspector General, Social
Security Administration has been delegated authority to impose civil
monetary penalties.
DAB refers to the Departmental Appeals Board of the U.S. Department
of Health and Human Services.
Sec. 498.202 Hearing before an administrative law judge.
(a) A party under any criteria specified in Secs. 498.100 through
498.132 may request a hearing before an ALJ.
(b) In civil monetary penalty cases, the parties to a hearing will
consist of the respondent and the Inspector General.
(c) The request for a hearing must be:
(1) In writing and signed by the respondent or by the respondent's
attorney; and
(2) Filed within 60 days after the notice is received by the
respondent or upon a showing of good cause, the time permitted by an
ALJ as provided in accordance with Sec. 498.109.
(d) The request for a hearing shall contain a statement as to the:
(1) Specific issues or findings of fact and conclusions of law in
the notice letter with which the respondent disagrees; and
(2) Basis for the respondent's contention that the specific issues
or findings and conclusions were incorrect.
(e) For purposes of this section, the date of receipt of the notice
letter will be presumed to be five days after the date of such notice,
unless there is a reasonable showing to the contrary.
[[Page 39923]]
(f) The ALJ shall dismiss a hearing request where:
(1) The respondent's hearing request is not filed in a timely
manner and the respondent fails to demonstrate good cause for such
failure;
(2) The respondent withdraws or abandons respondent's request for a
hearing; or
(3) The respondent's hearing request fails to raise any issue which
may properly be addressed in a hearing.
Sec. 498.203 Rights of parties.
(a) Except as otherwise limited by this part, all parties may:
(1) Be accompanied, represented, and advised by an attorney;
(2) Participate in any conference held by the ALJ;
(3) Conduct discovery of documents as permitted by this part;
(4) Agree to stipulations of fact or law which will be made part of
the record;
(5) Present evidence relevant to the issues at the hearing;
(6) Present and cross-examine witnesses;
(7) Present oral arguments at the hearing as permitted by the ALJ;
and
(8) Submit written briefs and proposed findings of fact and
conclusions of law after the hearing.
(b) Fees for any services performed on behalf of a party by an
attorney are not subject to the provisions of section 206 of title II
of the Social Security Act, which authorizes the Commissioner to
specify or limit these fees.
Sec. 498.204 Authority of the administrative law judge.
(a) The ALJ will conduct a fair and impartial hearing, avoid delay,
maintain order and assure that a record of the proceeding is made.
(b) The ALJ has the authority to:
(1) Set and change the date, time, and place of the hearing upon
reasonable notice to the parties;
(2) Continue or recess the hearing in whole or in part for a
reasonable period of time;
(3) Hold conferences to identify or simplify the issues, or to
consider other matters that may aid in the expeditious disposition of
the proceeding;
(4) Administer oaths and affirmations;
(5) Issue subpoenas requiring the attendance of witnesses at
hearings and the production of documents at or in relation to hearings;
(6) Rule on motions and other procedural matters;
(7) Regulate the scope and timing of documentary discovery as
permitted by this part;
(8) Regulate the course of the hearing and the conduct of
representatives, parties, and witnesses;
(9) Examine witnesses;
(10) Receive, exclude, or limit evidence;
(11) Take official notice of facts;
(12) Upon motion of a party, decide cases, in whole or in part, by
summary judgment where there is no disputed issue of material fact; and
(13) Conduct any conference or argument in person, or by telephone
upon agreement of the parties.
(c) The ALJ does not have the authority to:
(1) Find invalid or refuse to follow Federal statutes or
regulations, or delegations of authority from the Commissioner;
(2) Enter an order in the nature of a directed verdict;
(3) Compel settlement negotiations;
(4) Enjoin any act of the Commissioner or the Inspector General; or
(5) Review the exercise of discretion by the Office of the
Inspector General to seek to impose a civil monetary penalty or
assessment under Secs. 498.100 through 498.132.
Sec. 498.205 Ex parte contacts.
No party or person (except employees of the ALJ's office) will
communicate in any way with the ALJ on any matter at issue in a case,
unless on notice and opportunity for all parties to participate. This
provision does not prohibit a person or party from inquiring about the
status of a case or asking routine questions concerning administrative
functions or procedures.
Sec. 498.206 Prehearing conferences.
(a) The ALJ will schedule at least one prehearing conference, and
may schedule additional prehearing conferences as appropriate, upon
reasonable notice to the parties.
(b) The ALJ may use prehearing conferences to address the
following:
(1) Simplification of the issues;
(2) The necessity or desirability of amendments to the pleadings,
including the need for a more definite statement;
(3) Stipulations and admissions of fact as to the contents and
authenticity of documents and deadlines for challenges, if any, to the
authenticity of documents;
(4) Whether the parties can agree to submission of the case on a
stipulated record;
(5) Whether a party chooses to waive appearance at a hearing and to
submit only documentary evidence (subject to the objection of other
parties) and written argument;
(6) Limitation of the number of witnesses;
(7) The time and place for the hearing and dates for the exchange
of witness lists and of proposed exhibits;
(8) Discovery of documents as permitted by this part;
(9) Such other matters as may tend to encourage the fair, just, and
expeditious disposition of the proceedings; and
(10) Potential settlement of the case.
(c) The ALJ shall issue an order containing the matters agreed upon
by the parties or ordered by the ALJ at a prehearing conference.
Sec. 498.207 Discovery.
(a) For the purpose of inspection and copying, a party may make a
request to another party for production of documents which are relevant
and material to the issues before the ALJ.
(b) Any other form of discovery, such as requests for admissions,
written interrogatories and depositions, is not authorized.
(c) For the purpose of this section, the term documents includes
information, reports, answers, records, accounts, papers, memos, notes
and other data and documentary evidence. Nothing contained in this
section will be interpreted to require the creation of a document,
except that requested data stored in an electronic data storage system
will be produced in a form accessible to the requesting party.
(d)(1) A party who has been served with a request for production of
documents may file a motion for a protective order. The motion for
protective order shall describe the document or class of documents to
be protected, specify which of the grounds in Sec. 498.207(d)(2) are
being asserted, and explain how those grounds apply.
(2) The ALJ may grant a motion for a protective order if he or she
finds that the discovery sought:
(i) Is unduly costly or burdensome;
(ii) Will unduly delay the proceeding; or
(iii) Seeks privileged information.
(3) The burden of showing that discovery should be allowed is on
the party seeking discovery.
Sec. 498.208 Exchange of witness lists, witness statements and
exhibits.
(a) At least 15 days before the hearing, the parties shall
exchange:
(1) Witness lists;
(2) Copies of prior written statements of proposed witnesses; and
(3) Copies of proposed hearing exhibits, including copies of any
written statements that the party intends to offer in lieu of live
testimony in accordance with Sec. 498.216.
(b)(1) Failure to comply with the requirements of paragraph (a) of
this
[[Page 39924]]
section may result in the exclusion of evidence or testimony upon the
objection of the opposing party.
(2) When an objection is entered, the ALJ shall determine whether
good cause justified the failure to timely exchange the information
listed under paragraph (a) of this section. If good cause is not found,
the ALJ shall exclude from the party's case-in-chief:
(i) The testimony of any witness whose name does not appear on the
witness list, and
(ii) Any exhibit not provided to the opposing party as specified in
paragraph (a) of this section.
(3) If the ALJ finds that good cause exists, the ALJ shall
determine whether the admission of such evidence would cause
substantial prejudice to the objecting party due to the failure to
comply with paragraph (a) of this section. If the ALJ finds no
substantial prejudice, the evidence may be admitted.
(4) If the ALJ finds substantial prejudice, the ALJ may exclude the
evidence, or at his or her discretion, may postpone the hearing for
such time as is necessary for the objecting party to prepare and
respond to the evidence.
(c) Unless a party objects by the deadline set by the ALJ's
prehearing order pursuant to Sec. 498.206 (b)(3) and (c), documents
exchanged in accordance with paragraph (a) of this section will be
deemed authentic for the purpose of admissibility at the hearing.
Sec. 498.209 Subpoenas for attendance at hearing.
(a) A party wishing to procure the appearance and testimony of any
individual, whose appearance and testimony are relevant and material to
the presentation of a party's case at a hearing, may make a motion
requesting the ALJ to issue a subpoena.
(b) A subpoena requiring the attendance of an individual may also
require the individual to produce evidence at the hearing in accordance
with Sec. 498.207.
(c) A party seeking a subpoena will file a written motion not less
than 30 days before the date fixed for the hearing, unless otherwise
allowed by the ALJ for good cause shown. Such request will:
(1) Specify any evidence to be produced;
(2) Designate the witness(es); and
(3) Describe the address and location with sufficient particularity
to permit such witness(es) to be found.
(d) Within 20 days after the written motion requesting issuance of
a subpoena is served, any party may file an opposition or other
response.
(e) If the motion requesting issuance of a subpoena is granted, the
party seeking the subpoena will serve the subpoena by delivery to the
individual named, or by certified mail addressed to such individual at
his or her last dwelling place or principal place of business.
(f) The subpoena will specify the time and place at which the
witness is to appear and any evidence the witness is to produce.
(g) The individual to whom the subpoena is directed may file with
the ALJ a motion to quash the subpoena within 10 days after service.
(h) When a subpoena is served by a respondent on a particular
individual or particular office of the Office of the Inspector General,
the OIG may comply by designating any of its representatives to appear
and testify.
(i) In the case of contumacy by, or refusal to obey a subpoena duly
served upon any person, the exclusive remedy is specified in section
205(e) of the Social Security Act (42 U.S.C. 405(e)).
Sec. 498.210 Fees.
The party requesting a subpoena will pay the cost of the fees and
mileage of any witness subpoenaed in the amounts that would be payable
to a witness in a proceeding in United States District Court. A check
for witness fees and mileage will accompany the subpoena when served,
except that when a subpoena is issued on behalf of the Inspector
General, a check for witness fees and mileage need not accompany the
subpoena.
Sec. 498.211 Form, filing and service of papers.
(a) Form. (1) Unless the ALJ directs the parties to do otherwise,
documents filed with the ALJ will include an original and two copies.
(2) Every document filed in the proceeding will contain a caption
setting forth the title of the action, the case number, and a
designation of the pleading or paper.
(3) Every document will be signed by, and will contain the address
and telephone number of the party or the person on whose behalf the
document was filed, or his or her representative.
(4) Documents are considered filed when they are mailed.
(b) Service. A party filing a document with the ALJ will, at the
time of filing, serve a copy of such document on every other party.
Service upon any party of any document will be made by delivering a
copy, or placing a copy of the document in the United States mail,
postage prepaid and addressed, or with a private delivery service, to
the party's last known address. When a party is represented by an
attorney, service will be made upon such attorney. Proof of service
should accompany any document filed with the ALJ.
(c) Proof of service. A certificate of the individual serving the
document by personal delivery or by mail, setting forth the manner of
service, will be proof of service.
Sec. 498.212 Computation of time.
(a) In computing any period of time under this part or in an order
issued thereunder, the time begins with the day following the act,
event or default, and includes the last day of the period unless it is
a Saturday, Sunday or legal holiday observed by the Federal Government,
in which event it includes the next business day.
(b) When the period of time allowed is less than 7 days,
intermediate Saturdays, Sundays and legal holidays observed by the
Federal Government will be excluded from the computation.
(c) Where a document has been served or issued by placing it in the
mail, an additional 5 days will be added to the time permitted for any
response. This paragraph does not apply to requests for hearing under
Sec. 498.202.
Sec. 498.213 Motions.
(a) An application to the ALJ for an order or ruling will be by
motion. Motions will:
(1) State the relief sought, the authority relied upon and the
facts alleged; and
(2) Be filed with the ALJ and served on all other parties.
(b) Except for motions made during a prehearing conference or at a
hearing, all motions will be in writing.
(c) Within 10 days after a written motion is served, or such other
time as may be fixed by the ALJ, any party may file a response to such
motion.
(d) The ALJ may not grant or deny a written motion before the time
for filing responses has expired, except upon consent of the parties or
following a hearing on the motion.
(e) The ALJ will make a reasonable effort to dispose of all
outstanding motions prior to the beginning of the hearing.
(f) There is no right to appeal to the DAB any interlocutory ruling
by the ALJ.
Sec. 498.214 Sanctions.
(a) The ALJ may sanction a person, including any party or attorney,
for:
(1) Failing to comply with an order or procedure;
(2) Failing to defend an action; or
[[Page 39925]]
(3) Misconduct that interferes with the speedy, orderly or fair
conduct of the hearing.
(b) Such sanctions will reasonably relate to the severity and
nature of the failure or misconduct. Such sanction may include--
(1) In the case of refusal to provide or permit discovery under the
terms of this part, drawing negative factual inferences or treating
such refusal as an admission by deeming the matter, or certain facts,
to be established;
(2) Prohibiting a party from introducing certain evidence or
otherwise supporting a particular claim or defense;
(3) Striking pleadings, in whole or in part;
(4) Staying the proceedings;
(5) Dismissal of the action; or
(6) Entering a decision by default.
(c) In addition to the sanctions listed in paragraph (b)of this
section, the ALJ may:
(1) Order the party or attorney to pay attorney's fees and other
costs caused by the failure or misconduct; or
(2) Refuse to consider any motion or other action that is not filed
in a timely manner.
(d) In civil monetary penalty cases commenced under section 1129 of
the Act, the ALJ may also order the party or attorney who has engaged
in any of the acts described in paragraph (a) of this section to pay
attorney's fees and other costs caused by the failure or misconduct.
Sec. 498.215 The hearing and burden of proof.
(a) The ALJ will conduct a hearing on the record in order to
determine whether the respondent should be found liable under this
part.
(b) In civil monetary penalty cases under Secs. 498.100 through
498.132:
(1) The respondent has the burden of going forward and the burden
of persuasion with respect to affirmative defenses and any mitigating
circumstances; and
(2) The Inspector General has the burden of going forward and the
burden of persuasion with respect to all other issues.
(c) The burden of persuasion will be judged by a preponderance of
the evidence.
(d) The hearing will be open to the public unless otherwise ordered
by the ALJ for good cause.
(e)(1) A hearing under this part is not limited to specific items
and information set forth in the notice letter to the respondent.
Subject to the 15-day requirement under Sec. 498.208, additional items
or information may be introduced by either party during its case-in-
chief, unless such information or items are inadmissible under
Sec. 498.217.
(2) After both parties have presented their cases, evidence may be
admitted on rebuttal as to those issues presented in the case-in-chief,
even if not previously exchanged in accordance with Sec. 498.208.
Sec. 498.216 Witnesses.
(a) Except as provided in paragraph (b) of this section, testimony
at the hearing will be given orally by witnesses under oath or
affirmation.
(b) At the discretion of the ALJ, testimony (other than expert
testimony) may be admitted in the form of a written statement. Any such
written statement must be provided to all other parties along with the
last known address of such witness, in a manner that allows sufficient
time for other parties to subpoena such witness for cross-examination
at the hearing. Prior written statements of witnesses proposed to
testify at the hearing will be exchanged as provided in Sec. 498.208.
(c) The ALJ will exercise reasonable control over the mode and
order of witness direct and cross examination and evidence presentation
so as to:
(1) Make the examination and presentation effective for the
ascertainment of the truth;
(2) Avoid repetition or needless waste of time; and
(3) Protect witnesses from harassment or undue embarrassment.
(d) The ALJ may order witnesses excluded so that they cannot hear
the testimony of other witnesses. This does not authorize exclusion of:
(1) A party who is an individual;
(2) In the case of a party that is not an individual, an officer or
employee of the party appearing for the entity pro se or designated as
the party's representative; or
(3) An individual whose presence is shown by a party to be
essential to the presentation of its case, including an individual
engaged in assisting the attorney for the Inspector General.
Sec. 498.217 Evidence.
(a) The ALJ will determine the admissibility of evidence.
(b) Except as provided in this part, the ALJ will not be bound by
the Federal Rules of Evidence, but may be guided by them in ruling on
the admissibility of evidence.
(c) Although relevant, evidence may be excluded if its probative
value is substantially outweighed by the danger of unfair prejudice,
confusion of the issues, or by considerations of undue delay or
needless presentation of cumulative evidence.
(d) Although relevant, evidence must be excluded if it is
privileged under Federal law, unless the privilege is waived by a
party.
(e) Evidence concerning offers of compromise or settlement made in
this action will be inadmissible to the extent provided in Rule 408 of
the Federal Rules of Evidence.
(f)(1) Evidence of crimes, wrongs or acts other than those at issue
in the instant case is admissible in order to show motive, opportunity,
intent, knowledge, preparation, identity, lack of mistake, or existence
of a scheme.
(2) Such evidence is admissible regardless of whether the crimes,
wrongs or acts occurred during the statute of limitations period
applicable to the acts which constitute the basis for liability in the
case, and regardless of whether they were referenced in the IG's notice
sent in accordance with Sec. 498.109.
(g) The ALJ will permit the parties to introduce rebuttal witnesses
and evidence as to those issues raised in the parties' case-in-chief.
(h) All documents and other evidence offered or taken for the
record will be open to examination by all parties, unless otherwise
ordered by the ALJ for good cause.
Sec. 498.218 The record.
(a) The hearing shall be recorded and transcribed. Transcripts may
be obtained following the hearing from the ALJ.
(b) The transcript of testimony, exhibits and other evidence
admitted at the hearing, and all papers and requests filed in the
proceeding constitute the record for the decision by the ALJ.
(c) The record may be inspected and copied (upon payment of a
reasonable fee) by any person, unless otherwise ordered by the ALJ for
good cause.
Sec. 498.219 Post-hearing briefs.
(a) Any party may file a post-hearing brief.
(b) The ALJ may require the parties to file post-hearing briefs and
may permit the parties to file reply briefs.
(c) The ALJ will fix the time for filing briefs, which is not to
exceed 60 days from the date the parties receive the transcript of the
hearing or, if applicable, the stipulated record.
(d) The parties' briefs may be accompanied by proposed findings of
fact and conclusions of law.
Sec. 498.220 Initial decision.
(a) The ALJ will issue an initial decision, based only on the
record, which will contain findings of fact and conclusions of law.
[[Page 39926]]
(b) The ALJ may affirm, deny, increase, or reduce the penalties or
assessments proposed by the Inspector General.
(c) The ALJ will issue the initial decision to all parties within
60 days after the time for submission of post-hearing briefs or reply
briefs, if permitted, has expired. The decision will be accompanied by
a statement describing the right of any party to file a notice of
appeal with the DAB and instructions for now to file such appeal. If
the ALJ cannot issue an initial decision within the 60 days, the ALJ
will notify the parties of the reason for the delay and will set a new
deadline.
(d) Unless an appeal or request for extension pursuant to
Sec. 498.221(a) is filed with the DAB, the initial decision of the ALJ
becomes final and binding on the parties 30 days after the ALJ serves
the parties with a copy of the decision. If service is by mail, the
date of service will be deemed to be five days from the date of
mailing.
Sec. 498.221 Appeal to DAB.
(a) Any party may appeal the decision of the ALJ to the DAB by
filing a notice of appeal with the DAB within 30 days of the date of
service of the initial decision. The DAB may extend the initial 30-day
period for a period of time not to exceed 30 days if a party files with
the DAB a request for an extension within the initial 30-day period and
shows good cause.
(b) If a party files a timely notice of appeal with the DAB, the
ALJ will forward the record of the proceeding to the DAB.
(c) A notice of appeal will be accompanied by a written brief
specifying exceptions to the initial decision and reasons supporting
the exceptions, and identifying which finding of fact and conclusions
of law the party is taking exception to. Any party may file a brief in
opposition to exceptions, which may raise any relevant issue not
addressed in the exceptions, within 30 days of receiving the notice of
appeal and accompanying brief. The DAB may permit the parties to file
reply briefs.
(d) There is no right to appear personally before the DAB, or to
appeal to the DAB any interlocutory ruling by the ALJ.
(e) No party or person (except employees of the DAB) will
communicate in any way with members of the DAB on any matter at issue
in a case, unless on notice and opportunity for all parties to
participate. This provision does not prohibit a person or party from
inquiring about the status of a case or asking routine questions
concerning administrative functions or procedures.
(f) The DAB will not consider any issue not raised in the parties'
briefs, nor any issue in the briefs that could have been, but was not,
raised before the ALJ.
(g) If any party demonstrates to the satisfaction of the DAB that
additional evidence not presented at such hearing is relevant and
material and that there were reasonable grounds for the failure to
adduce such evidence at such hearing, the DAB may remand the matter to
the ALJ for consideration of such additional evidence.
(h) The DAB may remand a case to an ALJ for further proceedings, or
may issue a recommended decision to decline review or affirm, increase,
reduce, or reverse any penalty or assessment determined by the ALJ.
(i) When the DAB reviews a case, it will limit its review to
whether the ALJ's initial decision is supported by substantial evidence
on the whole record or contained error of law.
(j) Within 60 days after the time for submission of briefs or, if
permitted, reply briefs has expired, the DAB will issue to each party
to the appeal and to the Commissioner a copy of the DAB's recommended
decision and a statement describing the right of any respondent who is
found liable to seek judicial review upon a final determination.
Sec. 498.222 Final decision of the Commissioner.
(a) Except with respect to any penalty or assessment remanded to
the ALJ, the DAB's recommended decision, including a recommended
decision to decline review of the initial decision, shall become the
final decision of the Commissioner 60 days after the date on which the
DAB serves the parties to the appeal and the Commissioner with a copy
of the recommended decision, unless the Commissioner reverses or
modifies the DAB's recommended decision within that 60-day period. If
the Commissioner reverses or modifies the DAB's recommended decision,
the Commissioner's decision is final and binding on the parties. If
service is by mail, the date of service will be deemed to be five days
from the date of mailing.
(b) There shall be no right to personally appear before or submit
additional evidence, pleadings or briefs to the Commissioner.
(c)(1) Any petition for judicial review must be filed within 60
days after the parties are served with a copy of the final decision. If
service is by mail, the date of service will be deemed to be five days
from the date of mailing.
(2) In compliance with 28 U.S.C. 2112(a), a copy of any petition
for judicial review filed in any U.S. Court of Appeals challenging a
final action of the Commissioner will be sent by certified mail, return
receipt requested, to the SSA General Counsel. The petition copy will
be time-stamped by the clerk of the court when the original is filed
with the court.
(3) If the SSA General Counsel receives two or more petitions
within 10 days after the DAB issues its decision, the General Counsel
will notify the U.S. Judicial Panel on Multidistrict Litigation of any
petitions that were received within the 10-day period.
Sec. 498.223 Stay of initial decision.
(a) The filing of a respondent's request for review by the DAB will
automatically stay the effective date of the ALJ's decision.
(b)(1) After issuance of the final decision, the respondent may
file a request for stay of the effective date of any penalty or
assessment with the ALJ. The request must be accompanied by a copy of
the notice of appeal filed with the Federal court. The filing of such a
request will automatically act to stay the effective date of the
penalty or assessment until such time as the ALJ rules upon the
request.
(2) The ALJ may not grant a respondent's request for stay of any
penalty or assessment unless the respondent posts a bond or provides
other adequate security.
(3) The ALJ will rule upon a respondent's request for stay within
10 days of receipt.
Sec. 498.224 Harmless error.
No error in either the admission or the exclusion of evidence, and
no error or defect in any ruling or order or in any act done or omitted
by the ALJ or by any of the parties is ground for vacating, modifying
or otherwise disturbing an otherwise appropriate ruling or order or
act, unless refusal to take such action appears to the ALJ or the DAB
to be inconsistent with substantial justice. The ALJ and the DAB at
every stage of the proceeding will disregard any error or defect in the
proceeding that does not affect the substantial rights of the parties.
[FR Doc. 96-19425 Filed 7-30-96; 8:45 am]
BILLING CODE 4190-29-P