Zompa Guderian Enterprises PLLC, DAB CR5140 (2018)

Department of Health and Human Services
Civil Remedies Division

Docket No. C-17-809
Decision No. CR5140


Novitas Solutions Inc. (Novitas), an administrative contractor for the Centers for Medicare & Medicaid Services (CMS), reactivated the Medicare billing privileges of Zompa Guderian Enterprises PLLC (Petitioner) effective January 9, 2017.  Petitioner requested a hearing before an administrative law judge to challenge this effective date.  Because Novitas subsequently approved Petitioner’s revalidation enrollment application that it received on January 9, 2017, it correctly determined that the effective date for Petitioner’s reactivated billing privileges is January 9, 2017.  Therefore, I affirm the effective date determination.

I.  Background

Petitioner is an urgent care facility doing business as West Isle Urgent Care in Galveston, Texas.  CMS Exhibit (Ex.) 1 at 7, 14; CMS Ex. 6 at 5.  By letter dated July 14, 2016, Novitas informed Petitioner that it must revalidate its Medicare enrollment record by September 30, 2016.  CMS Ex. 10 at 1.  In the letter, Novitas warned Petitioner that

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“[f]ailure to respond to this notice will result in a hold on your payments and possible deactivation of your Medicare enrollment.”  Id.  Petitioner responded to the revalidation request by submitting a CMS-855B enrollment application which Novitas received on September 28, 2016.  CMS Ex. 1.

Novitas requested additional information from Petitioner by letter dated October 25, 2016.  CMS Ex. 2.  This letter informed Petitioner that Novitas might reject Petitioner’s application if Petitioner failed to furnish complete information within 30 calendar days.  Id. at 1.  Petitioner did not respond to the October 25 request within 30 days.  By letter dated December 6, 2016, Novitas explained that it had stopped Petitioner’s billing privileges on December 5 because Petitioner did not revalidate its enrollment or did not respond to requests for more information.  CMS Ex. 3.  The letter also informed Petitioner that Novitas would not pay for any claims during the period of deactivation, causing a gap in reimbursement.  Id. at 2.  On December 16, 2016, Petitioner submitted the additional information that Novitas requested in the October 25 letter.  CMS Ex. 4.

On January 9, 2017, Novitas received a second Form CMS-855B from Petitioner.  CMS Ex. 9.  Novitas approved this application and reactivated Petitioner’s billing privileges effective January 9, 2017.  CMS Ex. 5.  Petitioner requested reconsideration of the effective date.  CMS Ex. 6.  In response, Novitas issued a reconsidered determination concluding that January 9, 2017, was the correct effective date.  CMS Ex. 7.

Petitioner requested a hearing before an administrative law judge, and the case was assigned to me.  I issued an Acknowledgment and Pre-Hearing Order, dated June 30, 2017 (Pre-Hearing Order), which required each party to file a pre-hearing exchange consisting of a brief and any supporting documents.  Pre-Hearing Order ¶ 4.  CMS filed its brief (CMS Br.), which incorporated a motion for summary judgment, and ten proposed exhibits (CMS Exs. 1-10).  Petitioner filed a brief (P. Br.) and two proposed exhibits (P. Exs. A-B).  Neither party has objected to the exhibits offered by the opposing party.  Therefore, in the absence of objection, I admit CMS Exs. 1-10 and P. Exs. A-B into the record.  CMS did not offer the written direct testimony of any witness; Petitioner offered the affidavit of its “authorized agent for Medicare and related matters and President of Corporate Medical Systems, Inc.”  P. Ex. A.  CMS did not request to cross-examine Petitioner’s witness, however.  As stated in my Pre-Hearing Order, “[a]n in-person hearing to cross-examine witnesses will be necessary only if a party files admissible, written direct testimony, and the opposing party asks to cross-examine.”  Pre-Hearing Order ¶ 10.  Therefore, an in-person hearing is not necessary, and I decide this case based on the parties’ written submissions, without regard to whether the standards for summary judgment are satisfied.

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II.  Issue

The issue in this case is whether Novitas, acting on behalf of CMS, properly established January 9, 2017, as the effective date of reactivation of Petitioner’s Medicare billing privileges.

III.  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)).

IV.  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 “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 may 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 a provider’s or supplier’s Medicare billing privileges, “[n]o payment may be made for otherwise Medicare covered items or

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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 Law1

1.  On January 9, 2017, Novitas received Petitioner’s application to reactivate its Medicare billing privileges and subsequently approved that application.

2.  The effective date of reactivation for Petitioner’s Medicare billing privileges is January 9, 2017.

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).

It is undisputed that Novitas received a Form CMS-855B to reactivate Petitioner’s Medicare enrollment and billing privileges on January 9, 2017.  CMS Ex. 5; CMS Ex. 9.  It is also undisputed that Novitas approved that application.  CMS Ex. 5 at 1.  Accordingly, as required by regulation, the effective date of reactivation of Petitioner’s Medicare enrollment is January 9, 2017.

3.  I have no authority to review the deactivation of Petitioner’s Medicare billing privileges on December 5, 2016.

Petitioner argues that its Medicare billing privileges should not have been deactivated because Petitioner did not receive Novitas’ October 25, 2016 request for additional information.  P. Br. at 2-3, 5.  Petitioner contends that it did not receive the letter by U.S. mail and the letter sent by fax was discarded as spam.  P. Br. at 3.

Even accepting as true that Petitioner did not receive Novitas’ request for additional information, this is not a basis to change the effective date of reactivation of Petitioner’s

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Medicare billing privileges.  Whether or not Petitioner received Novitas’ October 25 information request is relevant, if at all, to whether Novitas acted properly in deactivating Petitioner’s billing privileges.  However, I do not have jurisdiction to review CMS’s deactivation of Petitioner’s billing privileges because 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).  Thus, 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. § 498.3(b)(15).

Finally, to the extent Petitioner contends I should grant it an earlier effective date based on principles of equity or fairness, I may not set aside the lawful exercise of discretion by CMS or its contractor based on principles of equity.  See, e.g., Cent. Kansas Cancer Inst., DAB No. 2749 at 10 (2016); see also James Shepard, M.D., DAB No. 2793 at 9 (2017).

V.  Conclusion

For the reasons explained above, I affirm that the effective date of Petitioner’s Medicare enrollment and billing privileges is January 9, 2017.

  • 1. My findings of fact and conclusions of law appear as numbered headings in bold italic type.