Stephen M. Cohen, O.D., P.C., DAB CR5578 (2020)

DECISION

Petitioner, 1Dr. Stephen Cohen, O.D., challenges the effective date of his practice's Medicare billing privileges based on an application received on November 10, 2017, following a period of deactivation resulting from a failure to revalidate.  As further explained herein, I find the Centers for Medicare & Medicaid Services (CMS) properly established November 10, 2017 as the effective date of Petitioner's billing privileges, as it is the date he filed an application the contractor was able to process to completion.

I. Background

On April 5, 2017, CMS contractor Noridian Healthcare Solutions (Noridian) advised Petitioner that he was obligated to revalidate his Medicare enrollment record by June 30, 2017.  CMS Exhibit (Ex.) 1.  On July 3, 2017, Noridian received a revalidation application from Petitioner.  CMS Ex. 2; CMS Ex. 12 at 2.

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On July 20, 2017, Noridian requested via fax that Petitioner provide additional information to complete his revalidation application.  CMS Ex. 3; CMS Ex. 12 at 2.  Noridian informed Petitioner that if he did not submit the requested information within 30 days, his application could be rejected.  CMS Ex. 3 at 1.  By letter dated August 22, 2017, Noridian advised Petitioner that his Medicare billing privileges were deactivated as of that date because he did not respond to Noridian's request for additional information.  CMS Ex. 4.

On September 11, 2017, Petitioner submitted a new revalidation application.  CMS Ex. 5. Noridian requested Petitioner provide additional information.  CMS Ex. 6.  Petitioner submitted some information on October 16, 2017 and October 31, 2017.  CMS Ex. 7; CMS Ex. 12 at 2.  On November 10, 2017, Noridian notified Petitioner that his application was rejected for failure to submit a complete application.  CMS Ex. 8.

On November 10, 2017, Noridian received a new revalidation application from Petitioner.  CMS Ex. 9; CMS Ex. 12 at 2.  Noridian approved this application and reactivated Petitioner's billing privileges effective November 10, 2017.  CMS Ex. 10.  This resulted in a lapse of Petitioner's billing privileges from August 22, 2017 through November 9, 2017.  Id.

Petitioner requested reconsideration of the effective date determination.  CMS Ex. 11.  He argued that he did not receive the July 20, 2017 fax notification requesting additional information.  Id.  On March 12, 2018, Noridian affirmed its initial effective date determination.  CMS Ex. 12.  Petitioner timely requested a hearing before an Administrative Law Judge.

II. Admission of Exhibits and Decision on the Record

CMS filed a motion for summary judgment and brief, as well as 13 proposed exhibits (CMS Exs. 1-13).  Petitioner filed a brief (P. Br.) opposing summary judgment.  Petitioner did not object to any of CMS's exhibits.  Therefore, I admit CMS Exs. 1-13 into the record.

My March 27, 2018 Acknowledgment and Prehearing Order (Pre-Hearing Order) advised the parties that an in-person hearing would only be necessary if a party submitted the written direct testimony of a proposed witness and the opposing party requested an opportunity to cross-examine a witness.  Prehearing Order ¶ 10; Civ. R. Div. P. §§ 16(b), 19(b).  Neither party submitted written direct testimony.  Therefore, a hearing in this case is unnecessary, and I decide this case based on the written record.  Civ. R. Div. P. §§ 16(b), 19(d).

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III. Issue

Whether CMS had a legitimate basis for establishing November 10, 2017 as the effective date of Petitioner's reactivated billing privileges.

IV. Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(15), 498.5(l)(2).

V. Findings of Fact, Conclusions of Law, and Analysis

A. Applicable Law

1. Enrollment

Petitioner participates in the Medicare program as a "supplier" of services.  Social Security Act § 1861(d); 42 C.F.R. § 498.2.  To receive Medicare payments for the services it furnishes to program beneficiaries, a prospective supplier must enroll in the program.  42 C.F.R. § 424.505.  "Enrollment" is the process by which CMS and its contractors:  1) identify the prospective supplier; 2) validate the supplier's eligibility to provide items or services to Medicare beneficiaries; 3) identify and confirm a supplier's owners and practice location; and 4) grant the supplier Medicare billing privileges.  42 C.F.R. § 424.502.

To enroll, a prospective supplier must complete and submit an enrollment application.  42 C.F.R. §§ 424.510(d)(1), 424.515(a).  An enrollment application is either a CMS‑approved paper application or an electronic process approved by the Office of Management and Budget.  42 C.F.R. § 424.502.  When CMS determines that a prospective supplier meets the applicable enrollment requirements, it grants Medicare billing privileges, which means that the supplier can submit claims and receive payments from Medicare for covered services provided to program beneficiaries.  The effective date for its billing privileges "is the later of the date of filing" a subsequently-approved enrollment application or "the date that the supplier first began furnishing services at a new practice location."  42 C.F.R. § 424.520(d) (emphasis added).  In this case, the date of filing of Petitioner's subsequently-approved enrollment application is relevant.  If a supplier satisfies certain requirements, CMS will allow a supplier to bill retrospectively for up to 30 days prior to the effective date.  42 C.F.R. § 424.521(a)(1).

2. Revalidation

To maintain its billing privileges, a supplier must, at least every five years, resubmit and recertify the accuracy of its enrollment information, a process referred to as "revalidation."  42 C.F.R. § 424.515.  In addition to periodic revalidations, CMS may, at

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other times and for its own reasons, ask a supplier to recertify the accuracy of its enrollment information.  42 C.F.R. § 424.515(d).  Within 60 days of receiving CMS's notice to recertify, the supplier must submit an appropriate enrollment application with complete and accurate information and supporting documentation.  42 C.F.R. § 424.515(a)(2).

3. Deactivation

The regulation authorizing deactivation explains that "[d]eactivation of Medicare billing privileges is considered an action to protect the provider or supplier from misuse of its billing number and to protect the Medicare Trust Funds from unnecessary overpayments."  42 C.F.R. § 424.540(c).  CMS is authorized to deactivate an enrolled supplier's Medicare billing privileges if the enrollee does not "furnish complete and accurate information and all supporting documentation within 90 calendar days of receipt of notification from CMS to submit an enrollment application and supporting documentation, or resubmit and certify to the accuracy of its enrollment information."  42 C.F.R. § 424.540(a)(3).  If CMS deactivates a supplier's 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).

The Departmental Appeals Board (Board) has unambiguously stated that a supplier "may not receive payment for claims for services during any period when [her] billing privileges were deactivated."  Willie Goffney, Jr., M.D., DAB No. 2763 at 6 (2017); see Urology Grp. of NJ, LLC, DAB No. 2860 at 11 (2018) ("Taking these unique effects of revocation into consideration, it is reasonable to conclude that CMS intended for revocations and deactivations to share the feature of precluding a provider or supplier from collecting reimbursement for services rendered during the period of inactive Medicare billing privileges, while simultaneously intending for revocations to have more severe consequences on a provider's or supplier's ability to participate.").

4. Reactivation

The reactivation of an enrolled supplier's billing privileges is governed by 42 C.F.R. § 424.540(b).  The process for reactivation is contingent on the reason for deactivation.  If CMS deactivates a supplier's billing privileges due to a reason other than non‑submission of a claim, the supplier must apply for CMS to reactivate its Medicare billing privileges by completing and submitting the appropriate enrollment application(s) or recertifying its enrollment information, if deemed appropriate.  42 C.F.R. § 424.540(a)(3), (b)(1).

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B. Analysis

1.  Petitioner filed a subsequently approved revalidation application on November 10, 2017 and the effective date can be no earlier than that date.

The record demonstrates beyond dispute that following the deactivation of his Medicare billing privileges, Petitioner submitted a revalidation application that was subsequently processed to approval on November 10, 2017.  CMS Ex. 9; CMS Ex. 12 at 2.  Pursuant to 42 C.F.R. § 424.520(d)(1), the date Petitioner filed his subsequently approved enrollment application – November 10, 2017 – is the correct effective date of enrollment.  Urology Grp., DAB No. 2860 at 7-9; Goffney, DAB No. 2763 at 7.

2.  I have no authority to review the deactivation of Petitioner's billing privileges and cannot afford him equitable relief.

On August 22, 2017, Noridian notified Petitioner that his Medicare billing privileges were deactivated because he did not respond to Noridian's request for more information.  CMS Ex. 4.  Petitioner argues that he did not receive Noridian's fax requesting additional information and that this amounted to "improper notification" on CMS's part.  P. Br. at 5.  Petitioner asserts that this lack of proper notification caused a delay in his response which led to his deactivation from the Medicare program.  Id.  However, the record shows that a successful fax was sent to Petitioner on July 20, 2017.  CMS Ex. 3 at 5.

Furthermore, Petitioner argues that no "substantive changes" needed to be made to his revalidation application and that therefore he did not fail to update his enrollment information.  P. Br. at 1.  Additionally, Petitioner states that once he was notified of his deactivation from the Medicare program, his efforts to make changes to his application were consistent and made in good faith.  Id.  Petitioner states that each time he spoke with a CMS representative, he was told to make different changes to his application.  Id. at 2.  Petitioner asserts that he spoke with a CMS representative who assured him that once he was approved in the Medicare program, he would be reimbursed for the billing gap.  Id. at 5.  Finally, Petitioner argues that his deactivation from the Medicare program should be reviewable.  Id.

Although it may be true that Petitioner received differing messages from CMS on how to proceed with his enrollment application, I have no authority to review CMS's decision to deactivate a supplier.  This is because deactivation is not an "initial determination" subject to review by an administrative law judge.  See 42 C.F.R. § 498.3(b)(6); Urology Grp., DAB No. 2860 at 6 ("The regulations do not grant suppliers the right to appeal deactivations."); Goffney, DAB No. 2763 at 7 ("Only facts relevant to the effective date

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resulting from the ... application were material to the ALJ decision.").2  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).

Furthermore, I have no authority to review CMS's revalidation process or otherwise grant Petitioner any form of equitable relief. See, e.g., US Ultrasound, DAB No. 2302 at 8 (2010) ("Neither 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."); Pepper Hill Nursing & Rehab. Ctr., LLC, DAB No. 2395 at 11 (2011) (holding that the ALJ and Board were not authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements); UpturnCare Co., DAB No. 2632 at 19 (2015) (providing the Board may not overturn denial of provider enrollment in Medicare on equitable grounds).

3.  CMS should exercise its discretion in Petitioner's favor and provide him 30 days of retrospective billing.

Finally, I note that while I am not able to provide equitable relief to Petitioner, CMS can and should do so.  CMS policy now explicitly requires its administrative contractors to grant reactivated suppliers like Petitioner 30 days of retrospective billing privileges.  MPIM, ch. 15, § 15.17(B) (rev. 865, eff. Mar. 12, 2019).  Thus, had Petitioner's reactivation taken place after March 12, 2019, he would have automatically received 30 days of retrospective billing, which would, in this instance, reduce his billing gap by almost half.  A contrary outcome based solely on the date of Petitioner's reactivation seems arbitrary and unjust.  I counsel CMS to consider exercising its discretion in this matter in favor of an otherwise honest biller who did not seek to defraud the Medicare program.

VI. Conclusion

CMS properly determined Petitioner's effective date of re‑enrollment to be November 10, 2017, the date he filed an enrollment application that was subsequently approved.