Drug Convictions: Any Effect on Social Security or Medicare Eligibility?

March 21, 2011

Author: Louise M. Tarantino| Catherine M. Callery (Kate)

An interesting case scenario was recently posted on the DAP listserv.  An advocate was working with a severely disabled SSI/SSD client charged with selling her pain medication on the street.  The District Attorney (DA) was willing to reduce the charge to a class A misdemeanor drug offense, criminal diversion of prescription medications, as part of a plea bargain.  If the client did not agree to the plea, the DA was planning to indict her on felony drug sale charges. Because this client depended on her SSI/SSD and Medicare for her survival, the advocate wanted to make sure that the client’s plea deal would not jeopardize the client’s benefits.

The federal Medicare statute at 42 U.S.C. §1320a-7 (“Exclusion of Certain Individuals and Entities from Participation in Medicare and State Health Care Programs") states that a misdemeanor drug conviction relating to the unlawful manufacture, distribution, prescription or dispensing of a controlled substance can serve as a basis for exclusion (disqualification) from Medicare.  However, written guidance from the Department of Health and Human Services (HHS) Office of Inspector General (OIG) clarifies that the exclusion provisions apply only to Medicare providers, not Medicare recipients.  See OIG Exclusions Program Q&A.

Moreover, the federal regulations at 42 C.F.R. §§407.10 and 406.11(c) specify the categories of Medicare beneficiaries who are subject to disqualification.  This list is limited to individuals convicted of espionage, censorship, sabotage, treason, sedition or subversive activities.  These are the same categories of individuals who can be disqualified from receiving Social Security benefits based on “subversive activities” as per 20 C.F.R.  §404.465.

Although a misdemeanor drug conviction in this case could conceivably raise other issues for this client (i.e., whether the drug sale constituted work activity), the advocate was able to reassure the client that accepting the plea deal on a lesser drug charge would not jeopardize her SSI/SSD or Medicare benefits.  Thanks to Cathy Roberts from the Empire Justice Center for pulling together this excellent response to the DAP listserv query. Cathy knows that she always has a home in the DAP world.