# Shannon Wagner, D.O.; Decision and Order
On August 13, 2024, the Drug Enforcement Administration (DEA or Government) issued an Order to Show Cause (OSC) to Shannon Wagner, D.O., of Green Bay, Wisconsin (Respondent). OSC, at 1, 3. The OSC proposed the denial of Respondent's application for a DEA Certificate of Registration (registration), Control No. W23130415C, alleging that Respondent has been mandatorily excluded from participation in Medicare, Medicaid, and all Federal health care programs pursuant to 42 U.S.C. 1320a-7(a). *Id.* at 1-2 (citing 21 U.S.C. 824(a)(5)).
A hearing was held before DEA Administrative Law Judge (ALJ) Teresa A. Wallbaum who, on February 21, 2025, issued her Recommended Rulings, Findings of Fact, Conclusions of Law, and Decision of the Administrative Law Judge (RD). The RD recommended that Respondent's application be granted. RD, at 20. The Government filed exceptions to the RD. Having reviewed the entire record, the Agency adopts and hereby incorporates by reference the entirety of the ALJ's rulings, credibility findings, [^1] findings of fact, conclusions of law, sanctions analysis, and recommended sanction in the RD, and summarizes, and expands upon portions thereof herein.
[^1] The Agency adopts the ALJ's summary of the witnesses' testimonies as well as the ALJ's assessment of the witnesses' credibility. RD, at 3- 19. The Agency agrees with the ALJ that the DEA Diversion Investigator (DI) was a credible, knowledgeable witness. *Id.* at 3. The testimony from the DI was primarily focused on the introduction of the Government's documentary evidence. *Id.*
**I. Applicable Law**
Pursuant to 21 U.S.C. 824(a)(5), the Attorney General is authorized to suspend or revoke a registration upon finding that the registrant “has been excluded (or directed to be excluded) from participation in a program pursuant to section 1320a-7(a) of Title 42.” The Agency has consistently held that it may also deny an application upon finding that an applicant has been excluded from a federal health care program. *See Arvinder Singh, M.D.,* 81 FR 8247, 8248 n.3 (2016) (“ `[W]here a registration can be revoked under [21 U.S.C.] 824, it can, *a fortiori,* be denied under [21 U.S.C.] 823 since the law would not require an agency to indulge in the useless act of granting a license on one day only to withdraw it on the next.' ” (quoting *Kwan Bo Jin, M.D.,* 77 FR 35021, 35021 n.2 (2012)).
**II. Findings of Fact**
On August 21, 2014, in the United States District Court for the Western District of Michigan, Respondent pleaded guilty to one count of conspiracy to pay and receive health care kickbacks, in violation of 42 U.S.C. 1320a-7b(b) and 18 U.S.C. 371; and one count of filing a false tax return, in violation of 26 U.S.C. 7206(1). [^2] RD, at 3; Government Exhibit (GX) 3. On November 28, 2014, the U.S. Department of Health and Human Services, Office of Inspector General (HHS/OIG), mandatorily excluded Respondent from participation in Medicare, Medicaid, and all federal health care programs pursuant to 42 U.S.C. 1320a-7(a) for a period of thirteen years. RD, at 3; GX 7. The exclusion became effective on December 18, 2014, and imposed an exclusion for a minimum period of thirteen years. [^3]*Id.* Accordingly, the Agency finds substantial record evidence that Respondent has been, and continues to be, excluded from participation in federal health care programs. [^4]
[^2] Respondent has stipulated to this fact. *See* ALJ Exhibit 9, at 2.
[^3] Respondent has stipulated to this fact. *See* ALJ Exhibit 9, at 3.
[^4] Where Respondent has stipulated to a fact, the Agency exceeds the substantial record evidence standard.
**III. Discussion**
The Agency agrees with the ALJ and finds substantial record evidence that Respondent has been, and remains, mandatorily excluded from federal health care programs pursuant to 42 U.S.C. 1320a-7(a), [^5] and Respondent has admitted to the same. RD, at 3, 18; GX 7. Accordingly, the Agency finds that substantial record evidence establishes the Government's *prima facie* case for denying Respondent's application under 21 U.S.C. 824(a)(5). *See also* 21 U.S.C. 823(g)(1).
[^5] The underlying conviction forming the basis for mandatory exclusion from participation in federal health care programs need not involve controlled substances to provide the grounds for revocation or denial pursuant to Section 824(a)(5). *Jeffrey Stein, M.D.,* 84 FR 46968, 46971-72 (2019); *see also Narciso Reyes, M.D.,* 83 FR 61678, 61681 (2018); *KK Pharmacy,* 64 FR 49507, 49510 (1999) (collecting cases).
**IV. Sanction**
Where, as here, the Government has met its *prima facie* burden of showing that Respondent's application for a registration should be denied, the burden shifts to Respondent to show why she can be entrusted with a registration. *Morall* v. *Drug Enf't Admin.,* 412 F.3d. 165, 174 (D.C. Cir. 2005); *Jones Total Health Care Pharmacy, LLC* v. *Drug Enf't Admin.,* 881 F.3d 823, 830 (11th Cir. 2018); *Garrett Howard Smith, M.D.,* 83 FR 18882 (2018). The issue of trust is necessarily a fact-dependent determination based on the circumstances presented by the individual respondent. *Jeffrey Stein, M.D.,* 84 FR 46968, 46972 (2019); *see also Jones Total Health Care Pharmacy,* 881 F.3d at 833. Moreover, as past performance is the best predictor of future performance, DEA Administrators have required that a respondent who has committed acts inconsistent with the public interest must accept responsibility for those acts and demonstrate that he or she will not engage in future misconduct. *Jones Total Health Care Pharmacy,* 881 F.3d at 833. A respondent's acceptance of responsibility must be unequivocal. *Id.* at 830-31. In addition, a respondent's candor during the investigation and hearing has been an important factor in determining acceptance of responsibility and the appropriate sanction. *Id.* Further, DEA Administrators have found that the egregiousness and extent of the misconduct are significant factors in determining the appropriate sanction. *Id.* at 834 & n.4. DEA Administrators have also considered the need to deter similar acts by the respondent and by the community of registrants. *Jeffrey Stein, M.D.,* 84 FR at 46972-73.
Here, the Agency agrees with the ALJ that Respondent unequivocally accepted responsibility for her conduct. Respondent acknowledged at every opportunity that her conduct was wrong. RD, at 12. Respondent testified directly and credibly that she had committed the charged crimes and that, in doing so, she made a significant mistake that had harmed her patients. *Id.* at 13. Respondent addressed, and accepted responsibility, for all her misconduct, including the illegal kickback conspiracy, the tax evasion, and her failure to take action to stop her husband. *Id.* Respondent testified credibly that she had learned to never allow anyone or anything to come between her and her patients. *Id.* Respondent directly and unequivocally acknowledged her crimes and her responsibility for her crimes during cross-examination and questioning from the ALJ. *Id.* Respondent acknowledged her fault and provided credible, persuasive clarifications as to other statements she had made. *Id.*
Having found that Respondent has unequivocally accepted responsibility for her conduct, the Agency considers whether Respondent has implemented sufficient remedial measures to demonstrate that she will not engage in future misconduct and can be trusted with a registration. [^6] The Agency considers the fact that Respondent is no longer married to her co-conspirator, a significant remedial measure. [^7] Tr. 39. Since Respondent's conviction and loss of license, Respondent has taken concrete steps to reestablish trust and rebuild her practice. RD, at 17.
[^6] The Agency disagrees with the Government's exception that the ALJ shifted the burden of proving unequivocal acceptance of responsibility and the taking of remedial measures onto the Government. Government Exceptions, at 2. Respondent had the burden to establish, and indeed did establish, unequivocal acceptance of responsibility and sufficient remedial measures; however, the Government disagreed. The portion of the RD that the Government calls burden shifting is actually the ALJ's assessment of the Government's argument that Respondent did not meet her burden. The Agency does not consider this shifting the burden of proof to the Government.
[^7] Respondent testified that her husband at the time managed the business. Tr. 38-39. Respondent admitted that she did not oversee her husband's activities. *Id.* When she did try to oversee, she was “shut down” and “suffered” if she interfered, as her husband was both verbally and physically abusive. Tr. 40-41. Moreover, if she attempted to supervise him, he would defy her and do what she told him not to do. Tr. 41. Respondent admitted her fault and that she should have had control of her own business. RD. at 6. Respondent testified that the abuse she suffered did not excuse her lack of oversight of the business because it was ultimately her practice. *Id.* Respondent testified that it was all her responsibility and that she should have interfered and stopped him. *Id.*
According to Respondent, her time in prison affected how she viewed medicine and her own past actions. Tr. 46-48; RD, at 6. Respondent testified that she saw multiple inmates receive inadequate medical care for serious conditions, and she herself was refused treatment. *Id.* Respondent testified that these experiences made her a better doctor and made her think more about health care in general in that there are segments of the population that are completely neglected. *Id.* Respondent candidly and credibly testified that her time in prison changed her and made her realize that medical care involved not just treatment, but all administrative duties. RD, at 13.
After Respondent's release from prison in 2016, she did not immediately return to the practice of medicine. RD, at 7. Respondent worked a variety of jobs such as food delivery, waitressing, trucking, and cleaning. *Id.;* Tr. 55-56. On multiple occasions, she had to wait on former colleagues and other doctors that she knew. *Id.* Respondent testified that working these positions humbled her and made her aware of how valuable her license was and what an honor it was to have it. *Id.* Respondent eventually secured a medical license in Wisconsin, for which she disclosed her criminal convictions and exclusion from federal health care programs. Tr. 56. To do so, she was required to work under a limited license for a year, with quarterly reports from a supervisor to the Wisconsin Medical Board. *Id.* After one year, she applied for and received a full medical license in Wisconsin. Tr. 57. Respondent obtained employment at a clinic in Wisconsin. Tr. 62-64. Respondent is seeking a DEA registration because she plans to work with incarcerated people and a DEA registration is required for a position within the corrections system. RD, at 7. Respondent has also taken approximately 240 hours of continuing medical education credits. [^8] Tr. 61. Finally, in terms of mitigation and remedial measures, Respondent has paid, and continues to pay, the ordered restitution of $270,000. [^9] RD, at 17. The Agency agrees with the ALJ that Respondent has taken “significant, concrete remedial steps” to ensure the misconduct will not reoccur. *Id.* at 18.
[^8] The state of Wisconsin requires 30 hours of Continuing Medical Education (CME) credits for physicians every two years. *See* American Medical Association Ed Hub, Wisconsin State CME Requirements, *https://edhub.ama-assn.org/state-cme/Wisconsin* . Since Respondent has gone over the minimum required hours of CME for physicians, the Agency accepts this as a sufficient remedial measure and rejects the Government's argument that Respondent needs to explain the subject matter of the courses taken. Government Exceptions, at 7-8.
[^9] The Agency also rejects the Government's argument that Respondent has failed to show sufficient remedial measures by paying $150 in restitution each month. Government Exceptions, at 6-7. Respondent has consistently paid restitution since being released from prison and continues to do so. RD, at 17. Respondent also testified that she will pay more once she obtains a higher paying job and intends to pay the amount in full. Tr. at 93.
Regarding egregiousness, there is no dispute that the conduct that led to Respondent's conviction and subsequent exclusion from all federal health care programs was egregious. In a case brought under 21 U.S.C. 824(a)(5), the length of the exclusion, the nature of the misconduct, and the period of incarceration are relevant considerations in determining egregiousness. *George Roussis, M.D.,* 86 FR 61316, 61322-23 (2021) (citing *Michael Jones, M.D.,* 86 FR 20728, 20732 (2021)). In the instant case, Respondent has been excluded for 13 years, with that exclusion ending in 2027. RD, at 18. As for the underlying conviction, Respondent pleaded guilty to a seven-year conspiracy, to commit health care fraud and filed a false tax return. *Id.* The egregious nature of Respondent's lengthy exclusion from federal health care programs and the egregious nature of the criminal conduct underlying the conviction would typically weigh in favor of denial of her application. *Id.* However, the conspiracy ended in April 2011, and the tax offense occurred in March 2012. GX 3, at 3. Thus, Respondent's criminal conduct ended over 13 years ago. RD, at 18, and Respondent has taken significant remedial measures during that time. *Id.*
In addition to acceptance of responsibility, the Agency considers both specific and general deterrence when determining an appropriate sanction. *Daniel A. Glick, D.D.S.,* 80 FR 74800, 74810 (2015). Because these administrative proceedings are intended to be remedial, rather than punitive, the Agency has previously found that, under appropriate circumstances, “criminal convictions and sanctions by state licensing authorities can sufficiently deter physicians from engaging in misconduct, making the denial of an application . . . unnecessary to achieve the goal of general deterrence.” *Gilbert Y. Kim, D.D.S.,* 87 FR 21139, 21145 (2022) (citing *Kansky J. Delisma, M.D.,* 85 FR 23845, 23854 (2020)). The Agency has also held that, sometimes, “such punitive measures can suffice to deter the registrant or applicant from future misconduct, making revocation or denial of an application unnecessary to achieve specific deterrence.” *Id.*
Here, the Agency does not find that imposing further sanction is necessary to deter Respondent from engaging in future misconduct. Respondent received significant criminal punishment for her criminal conduct. RD, at 19. Respondent's plea agreement imposed a significant price for her crimes, 24 months of imprisonment, the forfeiture of thirteen real properties and cash, and detailed obligations for cooperation in her case. *Id.* Respondent served 17 months of her 24-month prison sentence, successfully completed supervised release, forfeited two clinics along with other properties, and continues to pay restitution for her crimes of conviction. Thus, the Agency finds that the punitive, remedial, and personal consequences that Respondent suffered are sufficient to deter her from engaging in future misconduct. The Agency also finds that the significant consequences that Respondent has faced are sufficient to deter the general registrant community from committing similar misconduct.
Ultimately, the determination of the appropriate sanction turns on whether the Agency can trust Respondent with a registration and that Respondent will not repeat her misconduct. *See Heavenly Care Pharmacy,* 85 FR 53402, 53420 (2020). Respondent testified candidly, unequivocally accepted responsibility, and demonstrated genuine insight into the nature and scope of her criminal misconduct. RD, at 19. In sum, Respondent's candid, genuine testimony, coupled with her concrete remedial actions, convince the Agency that she can be trusted with a registration. Therefore, the Agency will grant her application.
**Order**
Pursuant to 28 CFR 0.100(b) and the authority vested in me by 21 U.S.C. 823 and 824, I hereby dismiss the Order to Show Cause issued to Shannon Wagner, D.O., and grant the pending application for a DEA Certificate of Registration, Control No. W23130415C, submitted by Shannon Wagner, D.O. This Order is effective *immediately.*
**Signing Authority**
This document of the Drug Enforcement Administration was signed on October 1, 2025, by Administrator Terrance Cole. That document with the original signature and date is maintained by DEA. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DEA Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of DEA. This administrative process in no way alters the legal effect of this document upon publication in the *Federal Register* .
Heather Achbach,
Federal Register Liaison Officer, Drug Enforcement Administration.