John Johnson, Ph.D. d/b/a Alliance Counseling, DAB CR5124 (2018)

Department of Health and Human Services
Civil Remedies Division

Docket No. C-17-703
Decision No. CR5124


Noridian Healthcare Solutions, Inc. (Noridian), an administrative contractor for the Centers for Medicare & Medicaid Services (CMS), reactivated the Medicare billing privileges of John Johnson, Ph.D. (Petitioner or Dr. Johnson) as of December 1, 2016.  Petitioner requested a hearing before an administrative law judge to dispute this effective date.  As explained herein, Noridian correctly determined that Petitioner’s reactivated billing privileges became effective December 1, 2016.  Therefore, I affirm the effective date determination.

I. Background

On March 17, 2016, Noridian notified Petitioner by letter addressed to his private practice that he needed to revalidate his enrollment record by May 31, 2016.  CMS Exhibit (Ex.) 1.  Noridian warned Petitioner that “[f]ailure to respond to this notice will result in a hold on your payments, and possible deactivation of your Medicare enrollment.”  Id. at 1.

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On June 24, 2016, Noridian mailed another letter to Petitioner to a Post Office box in Sacramento, presumably the address of the California Department of State Hospitals, who employed him and to whom his billing was reassigned.  CMS Ex. 2; CMS Ex. 10 at 3.1   That notice advised Petitioner that his revalidation was past due.  CMS Ex. 2.  On August 16, 2016, Noridian issued a letter to Petitioner at his private practice address notifying him that it had deactivated his Medicare billing privileges as of August 4, 2016 because he did not revalidate his enrollment record.  CMS Ex. 3.

On August 22, 2016, Noridian received a Form CMS-855I2 to reactivate Petitioner’s Medicare billing privileges.  CMS Ex. 4.  On October 20, 2016, Noridian notified Petitioner by e-mail that it needed additional information to process his application and that it might reject his application if he failed to submit that information within thirty days.3 See CMS Ex. 5 at 1.  Noridian rejected Petitioner’s application on October 31, 2016 because he did not respond to this request.  CMS Ex. 7.  Meanwhile, on October 28, 2016, Noridian received a Form CMS-855R to reassign Petitioner’s Medicare billing privileges to Patton State Hospital; Petitioner subsequently withdrew the group application on December 16, 2016.  CMS Ex. 6 at 1-9; 11.

Noridian received a second Form CMS-855I to reactivate Petitioner’s Medicare enrollment on December 1, 2016.  CMS Ex. 8.  Noridian requested additional information from Petitioner on December 16, 2016, which he provided the same day.  CMS Ex. 6 at 12-13.  On December 27, 2016, Noridian informed Petitioner that his enrollment application was approved effective December 1, 2016.  CMS Ex. 9.  In its approval letter, Noridian informed Petitioner that there was a lapse in Medicare billing privileges from August 4, 2016, through November 30, 2016.  Id.

Petitioner requested reconsideration of the determination that his Medicare billing privileges were reactivated effective December 1, 2016.  CMS Ex. 10.  In response, Noridian issued a reconsidered determination confirming December 1, 2016 as the correct effective date of reactivation.  CMS Ex. 11.

Petitioner timely requested a hearing.  Administrative Law Judge Scott Anderson was designated to hear and decide this case; he issued an Acknowledgment and Pre-Hearing

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Order (Pre-Hearing Order) on May 26, 2017 that required each party to file a pre-hearing exchange consisting of a brief and any supporting documents.  Pre-Hearing Order ¶ 4.  CMS timely filed its brief (CMS Br.), which incorporated a motion for summary judgement, and twelve proposed exhibits (CMS Exs. 1-12).  Petitioner initially failed to file a pre-hearing exchange.  Judge Anderson issued an order to show cause, to which Petitioner filed a response incorporating arguments typically presented in a pre-hearing exchange brief (P. Resp.).  Judge Anderson found good cause to discharge that order on August 9, 2017.  On August 25, 2017, this matter was transferred to me after Judge Anderson became unavailable due to transfer out of this department.

II. Decision on the Record and Admission of Exhibits.

Petitioner offered no exhibits and did not object to the exhibits offered by CMS.  In the absence of objection, I admit CMS Exs. 1-12.  Neither party offered the written direct testimony of any witness as part of its pre-hearing exchange, meaning an in-person hearing is not necessary in this matter.  Pre-Hearing Order ¶ 10.  Therefore, I will decide this case on the record, based on the parties’ written submissions and arguments.  Civ. Remedies. Div. Pro. 19(d).  CMS’ motion for summary judgment is denied as moot.

III. Issue

The issue in this case is whether Noridian, acting on behalf of CMS, properly established December 1, 2016, as the effective date of reactivation of Petitioner’s Medicare enrollment and billing privileges.

IV. Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(15), 498.5(l)(2); see also Social Security Act (Act) § 1866(j)(8) (codified at 42 U.S.C. § 1395cc(j)(8)).

V. Discussion

A. Applicable Legal Authority

The Social Security Act authorizes the Secretary of Health and Human Services to promulgate regulations governing the enrollment process for providers and suppliers.  Act §§ 1102, 1866(j) (42 U.S.C. §§ 1302, 1395cc(j)).  A “supplier” is “a physician or other practitioner, a facility, or other entity (other than a provider of services) that furnishes items or services” under the Medicare provisions of the Act.  Act § 1861(d) (42 U.S.C. § 1395x(d)); see also Act § 1861(u) (42 U.S.C. § 1395x(u)).

A supplier must enroll in the Medicare program to receive payment for covered Medicare items or services.  42 C.F.R. § 424.505.  The regulations define “Enroll/Enrollment” as

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“the process that Medicare uses to establish eligibility to submit claims for Medicare-covered items and services.”  42 C.F.R. § 424.502.  A provider or supplier seeking billing privileges under the Medicare program must “submit enrollment information on the applicable enrollment application.  Once the provider or supplier successfully completes the enrollment process . . . CMS enrolls the provider or supplier into the Medicare program.”  42 C.F.R. § 424.510(a).  CMS then establishes an effective date for billing privileges under the requirements stated in 42 C.F.R. § 424.520(d) and may permit limited retrospective billing under 42 C.F.R. § 424.521.

To maintain Medicare billing privileges, providers and suppliers must revalidate their enrollment information at least every five years.  42 C.F.R. § 424.515.  However, CMS reserves the right to perform revalidations at any time.  42 C.F.R. § 424.515(d), (e).  When CMS notifies a provider or supplier that it is time to revalidate, the provider or supplier must submit the appropriate enrollment application, accurate information, and supporting documentation within 60 calendar days of CMS’s notification.  42 C.F.R. § 424.515(a)(2).  CMS can deactivate an enrolled provider’s or supplier’s Medicare billing privileges if the enrollee fails to comply with revalidation requirements.  42 C.F.R. § 424.540(a)(3).  When CMS deactivates providers’ or suppliers’ Medicare billing privileges, “[n]o payment may be made for otherwise Medicare covered items or services furnished to a Medicare beneficiary.”  42 C.F.R. § 424.555(b).  If CMS deactivates a provider’s or supplier’s billing privileges due to an untimely response to a revalidation request, the enrolled provider or supplier may apply for CMS to reactivate its Medicare billing privileges by completing a new enrollment application or, if deemed appropriate, recertifying its enrollment information that is on file.  42 C.F.R. § 424.540(b)(1).

B. Findings of Fact and Conclusions of Law4

1. The application Dr. Johnson submitted that Noridian was able to process to approval was received on December 1, 2016.

2. The appropriate effective date of reactivation for Dr. Johnson’s Medicare billing privileges is December 1, 2016.

The effective date for Medicare billing privileges for physicians, non-physician practitioners, and physician or non-physician practitioner organizations is the later of the “date of filing” or the date the supplier first began furnishing services at a new practice location.  42 C.F.R. § 424.520(d).  The “date of filing” is the date that the Medicare contractor “receives” a signed enrollment application that the Medicare contractor is able to process to approval.  73 Fed. Reg. 69,726, 69,769 (Nov. 19, 2008); Donald Dolce, M.D., DAB No. 2685 at 8 (2016).

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Here, Petitioner submitted an application on August 22, 2016 to reactivate his Medicare enrollment.  CMS Ex. 4 at 1.  However, Noridian ultimately rejected that application because Petitioner did not timely respond to a request for more information.  CMS Ex. 7 at 1.  Noridian received another application from Dr. Johnson to reactivate his Medicare enrollment on December 1, 2017 that it eventually processed to approval.  See CMS Ex. 8, CMS Ex. 9.  Accordingly, the plain language of the governing regulations requires me to find the effective date of reactivation of Dr. Johnson’s Medicare enrollment is December 1, 2016.

3. I have no authority to review the deactivation of Dr. Johnson’s Medicare billing privileges on August 4, 2016, nor may I review Noridian’s rejection of Dr. Johnson’s August 22, 2016 revalidation application.

Petitioner points to several reasons his billing was deactivated.  P. Resp. at 1.  By way of explanation, Petitioner claims he provided the first notice he received to State Hospital staff and relied on that system to take care of his enrollment.  As a supplier, however, Petitioner “cannot shirk his responsibility through a faulty reliance” on the medical staff secretary and other state hospital administrative personnel.  See Howard B. Reife, D.P.M., DAB No. 2527 at 7 (2013).5 Petitioner is responsible for the timely submission of his revalidation.  Louis J. Gaefke, D.P.M., DAB No. 2554 at 5 (2013).

Petitioner further contends that his Medicare enrollment should not have been deactivated because the revalidation past due notice was not sent to his business address, so he did not know that the medical staff attorney had not revalidated his enrollment.  P. Br. 1.  Certainly, CMS has failed to explain Noridian’s decision to send Petitioner initial notice of his possible deactivation to his office, but then send the next notice (the imminent deactivation of his individual billing privileges) to a Post Office box for California’s State Department of Hospitals.  But whether or not I agree with Petitioner, I have no jurisdiction to consider whether Noridian acted properly in deactivating Petitioner’s Medicare enrollment.  Deactivation is not an “initial determination,” and deactivation decisions have a separate review process.  See 42 C.F.R. §§ 424.545(b), 498.3(b); see also Willie Goffney, Jr., M.D., DAB No. 2763 at 4-5 (2017).  Similarly, the regulations preclude administrative law judge review of a contractor’s decision to reject an application.  42 C.F.R. § 424.525(d).  My jurisdiction in this case is limited to reviewing the effective date of the approval of Petitioner’s reactivation enrollment application.  42 C.F.R. § 493.3(b)(15).

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Petitioner also contends that Noridian should not have rejected his first Form CMS-855I reactivation application because the letter from Noridian stated he had thirty days to reply with the requested additional information.  CMS Ex. 5 at 1; CMS Ex. 10 at 2.  I am sympathetic to Petitioner’s argument here.  CMS omitted from its “undisputed material facts” timeline that Noridian initially requested information from Petitioner as to his pending August 22, 2016 application on September 7, 2016, alluded to in the October 20, 2016 “secondary request.”  CMS Br. at 2-3; CMS Ex. 5 at 1.

It is curious that CMS does not cite to the existence of this initial September 7, 2016 request in the record, nor even mention it in its timeline.  And as Petitioner reasonably notes, Noridian’s October 20, 2016 request for information provided him both a thirty-day period to supplement his application (which expired before the email was even sent to him), and advised him to submit the requested information within seven days to “ensure timely processing.”  CMS Ex. 5 at 1.  Yet a mere eleven days later, Noridian rejected his application outright.  CMS Ex. 7.  No reasonable person could read that notice to mean Noridian intended to reject the application after seven days had passed.  Finally, the record demonstrates sufficient evidence of Petitioner’s ongoing attempts to communicate with Noridian staff during that period to rebut the notion that he had simply failed to interact with Noridian.  CMS Ex. 10 at 1-2.

Under any imaginable principle of fairness, this should be sufficient for CMS to consider modifying Petitioner’s effective date to an earlier one.  Noridian caused unnecessary delay by rejecting Petitioner’s first application without providing him adequate opportunity to provide the information it desired.  However, I am not allowed to change CMS’ determination of Petitioner’s effective reactivation date; as I explained above, the regulations allow CMS to determine an effective reactivation date based on the first application processed to approval.  42 C.F.R. § 424.520(d); Dolce, DAB No. 2685 at 8.

And, as CMS never fails to remind, I do not have the authority to provide equitable relief.  CMS Br. at 7 (quoting US Ultrasound, DAB No. 2302 at 8 (2010) (“[n]either the ALJ nor the Board is authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements.”)).

CMS, on the other hand, may exercise its discretion based on principles of equity.  See, e.g., Central Kansas Cancer Inst., DAB No. 2749 at 10 (2016); see also James Shepard, M.D., DAB No. 2793 at 9 (2017).  That being the case, I urge CMS counsel to consider my observations above and advise his client to better exercise that discretion to provide Petitioner an outcome more consistent with the interests of justice.

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VI. Conclusion

For the reasons explained above, I affirm CMS’ determination that the effective date of Dr. Johnson’s Medicare enrollment and billing privileges is December 1, 2016.

  • 1. Petitioner asserts in his briefing that he had no knowledge of the correspondence sent to this Sacramento address.  P. Resp. to Order to Show Cause at 1.
  • 2. Form 855I is the enrollment application for individual practitioners, while Form 855B is the enrollment application for group practices.  See Ctrs. for Medicare & Medicaid Servs., Enrollment Applications, available at (last updated Jan. 31, 2018).
  • 3. The garbled syntax of this notice is quite unclear.  In fact, Noridian’s email message states that Petitioner had thirty days from the initial request for information, apparently Sep. 7, 2016, meaning until October 7, 2016.  But the email was not sent until October 20, 2016.  This perhaps explains the next sentence fragment, bereft of subject, verb, or object, which reads “7 days after any secondary request.”  CMS Ex. 5 at 1.
  • 4. My findings of fact and conclusions of law appear as numbered headings in bold italic type.
  • 5. Although Reife deals with revocation of Medicare enrollment, the theory that the supplier is responsible for the actions of others with regard to his Medicare billing privileges is applicable here.