Celia R. Zuniga, DAB CR6478 (2024)

DECISION

The Medicare enrollment and billing privileges of Petitioner are revoked pursuant to 42 C.F.R. § 424.535(a)(3) and (4),¹ effective October 25, 2021, the effective date of Petitioner’s initial Medicare enrollment and reassignment of billing privileges.  There is a basis for listing Petitioner on the Centers for Medicare & Medicaid Services (CMS) preclusion list for the duration of her² 10-year reenrollment bar.

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I. Procedural History and Jurisdiction

Novitas Solutions, Inc., a Medicare administrative contractor (MAC), notified Petitioner by letter dated November 15, 2021, that her initial Medicare enrollment and reassignment applications were approved with an effective date of October 25, 2021.  CMS Exhibit (Ex.) 1 at 175-76.

The MAC notified Petitioner by letter dated July 5, 2022, of the MAC’s initial determination that Petitioner’s Medicare enrollment and billing privileges were revoked pursuant to 42 C.F.R. § 424.535(a)(3), effective October 25, 2021.  The MAC stated the revocation was based on Petitioner’s December 23, 2013 felony conviction by the U.S. District Court, Southern District of Texas (district court) for conspiracy to possess, with the intent to distribute, 100 kilograms (kg) (220.462 pounds) or more of marijuana in violation of federal law.  The MAC advised Petitioner that she was subject to a reenrollment bar until December 24, 2023, pursuant to 42 C.F.R. § 424.535(c).  The MAC also advised Petitioner that she would be listed on the CMS preclusion list as defined by 42 C.F.R. §§ 422.2, 422.222.  CMS Ex. 1 at 16-18.

On July 12, 2022, the MAC issued a reopened and revised initial determination that replaced and superseded the July 5, 2022 initial determination.  In the reopened and revised initial determination, the MAC advised Petitioner that her Medicare enrollment and billing privileges were revoked effective October 25, 2021, pursuant to 42 C.F.R. § 424.535(a)(3) and (4).  The MAC stated that the basis for revocation under 42 C.F.R. § 424.535(a)(3) was Petitioner’s December 23, 2013 district court felony conviction of conspiracy to possess with the intent to distribute 100 kg or more of marijuana.  The MAC stated that the basis for revocation under 42 C.F.R. § 424.535(a)(4) was that Petitioner failed to list her December 23, 2013 felony conviction on her Medicare enrollment application (CMS 855I) that she signed and certified October 25, 2021.  The MAC advised Petitioner that she was subject to a 10-year reenrollment bar beginning 30 days after the postmark date of the July 12, 2022 letter.  The MAC also advised Petitioner that her name would be placed on the CMS preclusion list.  CMS Ex. 1 at 12-15.

Petitioner requested reconsideration by letters dated July 18, 2022 and September 14, 2022.  CMS Ex. 1 at 20-21, 135-139.  On October 20, 2022, a CMS hearing officer issued a reconsidered determination upholding the revocation of Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3) and (4).  The hearing officer did not change the October 25, 2021 effective date of revocation.  The hearing officer also upheld the 10-year reenrollment bar and the addition of Petitioner’s name to the CMS preclusion list.  CMS Ex. 1 at 1-11.

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Petitioner requested a hearing before an administrative law judge (ALJ) on November 3, 2022 (RFH).  On November 7, 2022, the case was assigned to me for hearing and decision and my Standing Order (Standing Order) was issued.  Petitioner’s request for hearing was timely, the parties have not challenged my authority to decide this case, and I have jurisdiction.

On December 7, 2022, CMS filed a prehearing brief and motion for summary judgment (CMS Br.) and CMS Ex. 1.  On January 6, 2023, Petitioner filed her prehearing brief and opposition to CMS’s motion for summary judgment (P. Br.) with no exhibits.  CMS waived the filing of a reply brief on February 22, 2023.  Petitioner did not object to my consideration of CMS Ex. 1, and it is admitted as evidence.

II.    Discussion

A.  Applicable Law

Section 1831 of the Social Security Act (Act) (42 U.S.C. § 1395j) establishes the supplementary medical insurance benefits program for the aged and disabled known as Medicare Part B.  Administration of the Part B program is through the MACs.  Act § 1842(a) (42 U.S.C. § 1395u(a)).  Payment under the program for services rendered to Medicare-eligible beneficiaries may only be made to eligible providers of services and suppliers.³  Act §§ 1835(a) (42 U.S.C. § 1395n(a)), 1842(h)(1) (42 U.S.C. § 1395u(h)(1)).

The Act requires the Secretary of Health and Human Services (Secretary) to issue regulations that establish a process for the enrollment in Medicare of providers and suppliers, including the right to a hearing and judicial review of certain enrollment determinations, such as revocation of enrollment and billing privileges.  Act § 1866(j) (42 U.S.C. § 1395cc(j)).  Pursuant to 42 C.F.R. § 424.505, a supplier must be enrolled in

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the Medicare program and be issued a billing number to have billing privileges and to be eligible to receive payment for services rendered to a Medicare-eligible beneficiary.

The Secretary has delegated the authority to revoke enrollment and billing privileges to CMS and the MACs.  42 C.F.R. § 424.535.  CMS or a MAC may revoke an enrolled supplier’s Medicare enrollment and billing privileges and supplier agreement for any of the reasons listed in 42 C.F.R. § 424.535.  The effective date of the revocation is controlled by 42 C.F.R. § 424.535(g).  After a supplier’s Medicare enrollment and billing privileges are revoked, the supplier is barred from reenrolling in the Medicare program for a minimum of one year, but no more than ten years, except in limited circumstances that do not exist in this case.  42 C.F.R. § 424.535(c).

Effective June 15, 2018, CMS was required to establish a preclusion list as defined by 42 C.F.R. §§ 422.2 and 423.100.  There is only one preclusion list.  83 Fed. Reg. 16,440, 16,641-67 (Apr. 16, 2018).  CMS adds to the preclusion list individuals and entities as provided by the definition of the preclusion list:

Preclusion list means a CMS compiled list of individuals and entities that—

(1)  Meet all of the following requirements:

(i)  The individual or entity is currently revoked from Medicare for a reason other than that stated in § 424.535(a)(3) of this chapter.

(ii)  The individual or entity is currently under a reenrollment bar under § 424.535(c).

(iii)  CMS determines that the underlying conduct that led to the revocation is detrimental to the best interests of the Medicare program.  In making this determination under this paragraph (1)(iii), CMS considers the following factors:

(A)  The seriousness of the conduct underlying the individual’s or entity’s revocation.

(B)  The degree to which the individual’s or entity’s conduct could affect the integrity of the Medicare program.

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(C)  Any other evidence that CMS deems relevant to its determination; or

(2)  Meet both of the following requirements:

(i)  The individual or entity has engaged in behavior, other than that described in § 424.535(a)(3) of this chapter, for which CMS could have revoked the individual or entity to the extent applicable had they been enrolled in Medicare.

(ii)  CMS determines that the underlying conduct that would have led to the revocation is detrimental to the best interests of the Medicare program.  In making this determination under this paragraph (2)(ii), CMS considers the following factors:

(A)  The seriousness of the conduct involved.

(B)  The degree to which the individual’s or entity’s conduct could affect the integrity of the Medicare program; and

(C)  Any other evidence that CMS deems relevant to its determination; or

(3)  The individual or entity, regardless of whether they are or were enrolled in Medicare, has been convicted of a felony under Federal or State law within the previous 10 years that CMS deems detrimental to the best interests of the Medicare program.  Factors that CMS considers in making such a determination under this paragraph (3) are—

(i) The severity of the offense;

(ii) When the offense occurred; and

(iii) Any other information that CMS deems relevant to its determination.

42 C.F.R. § 422.2 (italics in original, bold added).  The definition applicable to Medicare Part D at 42 C.F.R. § 423.100 is virtually identical except that the regulation refers to

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“prescriber” rather than “individual or entity.”  No payment under Medicare Parts C and D may be made to anyone on the preclusion list.  42 C.F.R. §§ 422.222-.224, 422.504(i)(2)(v), 423.120(c)(6).  CMS must notify a supplier in writing that the supplier is being added to the preclusion list, the basis for the action, and inform the supplier of the right to ALJ review and appeal pursuant to 42 C.F.R. pt. 498.  42 C.F.R. §§ 422.222(a)(2), 423.120(c)(6)(v).

A supplier whose enrollment and billing privileges have been revoked or who has been placed on the preclusion list may request reconsideration and review as provided by 42 C.F.R. pt. 498.  42 C.F.R. §§ 424.545(a), 422.222(a)(2), 423.120(c)(6)(v), 498.5(l).  A supplier submits a written request for reconsideration to CMS or its contractor.  42 C.F.R. § 498.22(a).  CMS or its contractor must give notice of its reconsidered determination to the supplier, giving the reasons for its determination and specifying the conditions or requirements the supplier failed to meet, and the right to an ALJ hearing.  42 C.F.R. § 498.25.  If the decision on reconsideration is unfavorable to the supplier, the supplier has the right to request a hearing by an ALJ and further review by the Board.  Act § 1866(j)(8) (42 U.S.C. § 1395cc(j)(8)); 42 C.F.R. §§ 424.545, 498.3(b)(17), (20), 498.5.  A hearing on the record, also known as an oral hearing, is required under the Act, unless waived.  Crestview Parke Care Ctr. v. Thompson, 373 F.3d 743, 748-51 (6th Cir. 2004).  CMS is also granted the right to request ALJ review of a reconsidered determination with which it is dissatisfied.  42 C.F.R. § 498.5(l)(2).  The supplier bears the burden to demonstrate that it meets enrollment requirements with documents and records.  42 C.F.R. § 424.545(c).

Revocation and preclusion list review is strictly limited to whether there is a basis for the revocation and for adding the supplier to the CMS preclusion list.  Douglas Bradley, M.D., DAB No. 2663 at 13 (2015); 83 Fed. Reg. at 16,642.  The Board has consistently held that ALJ review of the CMS revocation determination is limited to whether CMS had a legal basis for revocation.  Letantia Bussell, M.D., DAB No. 2196 at 10 (2008).  If CMS establishes the elements necessary for revocation, “revocation must be sustained, and neither the [ALJ] nor the Board may ‘substitute its discretion for that of CMS in determining whether revocation was appropriate.’”  Douglas, DAB No. 2663 at 13 (quoting Abdul Razzaque Ahmed, M.D., DAB No. 2261 at 19 (2008), aff’d, Ahmed v. Sebelius,710 F. Supp.2d 167 (D. Mass. 2010)).  The duration of a bar to reenrollment imposed by CMS is not subject to review by an ALJ or the Board.  Heidy Woody, NP, DAB No. 3102 at 19-21 (2013).

B.  Issues

Whether there was a basis for the revocation of Petitioner’s Medicare enrollment and billing privileges; and

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Whether there was a basis to include Petitioner on the CMS preclusion list.

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

My conclusions of law are set forth in bold followed by the undisputed facts and analysis.

1.  Summary judgment is appropriate.

CMS filed a motion for summary judgment.  Petitioner opposes CMS’s motion.  A supplier whose enrollment has been revoked and/or who has been placed on the preclusion list has a right to a hearing and judicial review, and a hearing on the record is required under the Act.  Act §§ 205(b) (42 U.S.C. § 405(b)), 1866(h)(1), (j) (42 U.S.C. §§ 1395cc(h)(1), (j)); 42 C.F.R. §§ 498.3(b)(17), 498.5; Crestview, 373 F.3d at 748-51.  A party may waive appearance at an oral hearing, but the party must do so affirmatively in writing.  42 C.F.R. § 498.66(a).  In this case, Petitioner requested and has not waived an oral hearing.  P. Br. at 1.  Accordingly, disposition on the written record alone is not permissible, unless summary judgment is appropriate as I conclude it is in this case.

Summary judgment is not automatic upon request but is limited to certain specific conditions.  The Secretary’s regulations that establish the procedures to be followed in adjudicating Petitioner’s case are at 42 C.F.R. pt. 498.  42 C.F.R. §§ 405.800, 405.803(a), 424.545(a), 498.3(b)(17), (20).  The regulations do not establish a summary judgment procedure or recognize such a procedure.  However, the Board has long accepted that summary judgment is an acceptable procedural device in cases adjudicated pursuant to 42 C.F.R. pt. 498.  See, e.g., Ill. Knights Templar Home, DAB No. 2274 at 3-4 (2009); Garden City Med. Clinic, DAB No. 1763 (2001); Everett Rehab. & Med. Ctr., DAB No. 1628 at 3 (1997).  The Board also has recognized that the Federal Rules of Civil Procedure (Fed. R. Civ. Pro.) do not apply in administrative adjudications such as this.  However, the Board has accepted that Fed. R. Civ. Pro. 56 and related cases provide useful guidance for determining whether summary judgment is appropriate.  Furthermore, a summary judgment procedure was adopted as a matter of judicial economy within my authority to regulate the course of proceedings and made available to the parties in the litigation of this case by my Standing Order.  The parties were given notice by the Standing Order that summary judgment is an available procedural device and that the law as it has developed related to Fed. R. Civ. Pro. 56 will be applied.  Standing Order ¶¶ D, G.

Summary judgment is appropriate when there is no genuine dispute as to any issue of material fact for adjudication and/or the moving party is entitled to judgment as a matter of law.  The party requesting summary judgment bears the burden of showing that there are no genuine issues of material fact for trial and/or that it is entitled to judgment as a matter of law.  In determining whether there are genuine issues of material fact for trial,

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the reviewer must view the evidence in the light most favorable to the non-moving party, drawing all reasonable inferences in that party’s favor.  Generally, the non-movant may not defeat an adequately supported summary judgment motion by relying upon the denials in its pleadings or briefs but must furnish evidence of a dispute concerning a material fact, i.e., a fact that, if proven, would affect the outcome of the case.  Mission Hosp. Reg’l Med. Ctr., DAB No. 2459 at 4-5 (2012) (and cases cited therein); Experts Are Us, Inc., DAB No. 2452 at 5-6 (2012) (and cases cited therein); Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300 at 3 (2010) (and cases cited therein); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

The standard for deciding a case on summary judgment and an ALJ’s decision-making in deciding a summary judgment motion differ from that used in resolving a case on the merits after a hearing or when hearing is waived.  On summary judgment, the ALJ does not make credibility determinations, weigh the evidence, or decide which inferences to draw from the evidence, as would be done when finding facts after a hearing on the record.  Rather, on summary judgment, the ALJ construes the evidence in a light most favorable to the non-movant and avoids deciding which version of the facts is more likely true.  Holy Cross Vill. at Notre Dame, Inc., DAB No. 2291 at 5 (2009).  The Board also has recognized that on summary judgment, it is appropriate for the ALJ to consider whether a rational trier of fact could find that the party’s evidence would be sufficient to meet that party’s evidentiary burden.  Dumas Nursing & Rehab., L.P., DAB No. 2347 at 5 (2010).  The Secretary has not provided in 42 C.F.R. pt. 498 for the allocation of the burden of persuasion or the quantum of evidence required to satisfy the burden.  However, the Board has provided some persuasive analysis regarding the allocation of the burden of persuasion in cases subject to 42 C.F.R. pt. 498.  Batavia Nursing & Convalescent Ctr., DAB No. 1904 (2004), aff’d, Batavia Nursing & Convalescent Ctr. v. Thompson,129 F. App’x 181 (6th Cir. 2005).

Viewing the evidence before me in a light most favorable to Petitioner and drawing all inferences in Petitioner’s favor, I conclude as discussed in the following analysis that there are no genuine disputes as to any material facts pertinent to revocation under 42 C.F.R. § 424.535(a)(3) and (4) or the addition of Petitioner’s name to the CMS preclusion list that require a hearing in this case.  Issues raised by Petitioner must be resolved against her based on the application of law to the undisputed facts.  CMS is entitled to judgment as a matter of law.  Accordingly, summary judgment is appropriate.

2.  On September 25, 2013, a jury found Petitioner guilty of the felony offenses of conspiracy to possess, with intent to distribute, 100 kg or more of marijuana in violation of 21 U.S.C. §§ 846, 841(a)(1), (b)(1)(B), and possession, with intent to distribute, 100 kg or more, of marijuana in violation of 21 U.S.C. § 841(a)(1), (b)(1)(B) and 18 U.S.C. § 2.  The district court entered judgment against Petitioner on December 12,

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2013.  Therefore, Petitioner was convicted of a felony criminal offense on December 12, 2013, within the meaning of the regulations.  42 C.F.R. §§ 424.535(a)(3)(i), 1001.2.

3.  The Secretary has determined and provided by regulation that CMS may revoke the Medicare enrollment of a supplier who, within the preceding 10 years, was convicted of a felony that CMS determines is detrimental to the best interests of Medicare and its beneficiaries.  42 C.F.R. § 424.535(a)(3)(i) and (ii)(D).

4.  There is a basis for the revocation of Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3)(i) because Petitioner’s felony convictions, which were per se detrimental and determined by CMS to be detrimental to the best interests of the Medicare program and its beneficiaries, occurred within the 10 years preceding July 12, 2022, the date on which the MAC issued a reopened and revised initial determination revoking Petitioner’s Medicare enrollment and billing privileges.

5.  On October 25, 2021, Petitioner signed and filed a Medicare enrollment application (CMS-855I), and certified that the information in the application was true, correct, and complete.

6.  Certifying as true information on a Medicare enrollment application that is misleading or false is a basis for revocation of Medicare enrollment and billing privileges.  42 C.F.R. § 424.535(a)(4).

7.  There is a basis for the revocation of Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(4) because Petitioner failed to specifically list final adverse action on the October 25, 2021 enrollment application, specifically, her December 12, 2013 felony conviction.

8.  The effective date of revocation of Petitioner’s Medicare enrollment and billing privileges is October 25, 2021, the effective date of her Medicare enrollment and billing privileges.  42 C.F.R. § 424.535(g).

a.  Undisputed Facts

The parties were advised in the Standing Order ¶ G that, for purposes of ruling on a motion for summary judgment, a fact alleged and not specifically denied would be accepted as true and offered evidence would be considered admissible and true absent a

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specific objection.  The following findings of fact are based upon the undisputed or conceded facts.  I do not make credibility determinations, weigh the evidence, or decide which inferences to draw from the evidence in deciding a summary judgment motion.  The evidence is viewed in the light most favorable to Petitioner, the nonmovant, with all inferences drawn in Petitioner’s favor.

On December 7, 2012, Petitioner was charged in the district court by criminal complaint of committing the following felony ⁴ offense:

Conspire and agree to intentionally possess with the intent to distribute approximately 243 kilograms / 536 pounds of marijuana, a controlled substance listed under Schedule I, of the Controlled Substance Act [i]n violation of Title 21 United States code [sic], Section(s) 841 & 846.

CMS Ex. 1 at 216.  On January 2, 2013, Petitioner was indicted by a grand jury for one count of conspiracy to possess, with intent to distribute, 100 kilograms (kg) (220.462 pounds) or more of marijuana in violation of 21 U.S.C. §§ 846, 841(a)(1) and (b)(1)(B).  Petitioner was also charged with one count of possession with intent to distribute 100 kg or more, approximately 243 kg of a mixture or substance containing marijuana in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B) and 18 U.S.C. § 2.  CMS Ex. 1 at 218‑19.  A jury found Petitioner guilty of both counts on September 25, 2013.  CMS Ex. 1 at 220.  On December 12, 2013, the district court entered judgment finding Petitioner guilty of both counts.  The district court sentenced Petitioner to confinement for 78 months, followed by four years of probation, and a $10,000 fine.  CMS Ex. 1 at 32-38, 221-26.

Petitioner surrendered her registered nurse and vocational nurse licenses to the Texas Board of Nursing on February 21, 2014, due to her conviction and sentence.  CMS Ex. 1 at 180-84, 187.  Petitioner was released from prison on May 11, 2018.  Petitioner

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requested reinstatement of her Texas nursing licenses on about January 17, 2019.  The Texas Board of Nursing reinstated her registered nurse and vocational nurse licenses with stipulations on December 10, 2019.  CMS Ex. 1 at 107, 185-204, 228.

On October 25, 2021, Petitioner signed, and by doing so certified, an initial enrollment application (CMS-855I) to enroll in Medicare as a nurse practitioner.  CMS Ex. 75, 81, 85, 100, 102.  In Section 3C of the application titled “Final Adverse Legal Actions,” Petitioner listed that she had voluntarily surrendered her nurse licenses in Texas on February 21, 2014.  CMS Ex. 1 at 88.  The instructions for Section 3 state that “[a]ll applicable final adverse legal actions must be reported . . . .”  CMS Ex. 1 at 88.  The instructions clearly indicate that convictions within the preceding 10 years must be reported.  The instructions contain the following:

NOTE:  To satisfy the reporting requirement, section 3 must be filled out in its entirety, and all applicable attachments must be included.

CMS Ex. 1 at 88.

Petitioner signed the certification statement for the CMS-855I indicating the information contained in the application was true and complete and agreeing that she understood that any “deliberate omission, misrepresentation, or falsification of information contained in the application” could subject her to denial or revocation of Medicare billing privileges.  CMS Ex. 1 at 100.  Petitioner submitted a second enrollment application (CMS-855I) she signed on November 11, 2021, but also failed to report her felony conviction.  CMS Ex. 1 at 110-33.

I accept as true for purposes of summary judgment that Petitioner’s conviction was discussed in documents from the Texas Board of Nursing related to Petitioner’s voluntary surrender of her Texas licenses that were filed with Petitioner’s enrollment application.  RFH at 1; P. Br. at 5; CMS Ex. 1 at 20-61, 139-40.  I also accept as true for purposes of summary judgment that Petitioner did not intend to hide or conceal her conviction by failing to list it in Section 3C of the enrollment application.  CMS Ex. 1 at 22.

The MAC notified Petitioner on November 15, 2021, that her initial Medicare enrollment application as a nurse practitioner and her application to reassign her right to file claims with Medicare were approved effective October 25, 2021.  CMS Ex. 1 at 4, 175.

The MAC notified Petitioner by letter dated July 5, 2022, of the initial determination to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3) for her December 23, 2013 felony conviction.  The effective date of revocation was October 25, 2021, the effective date Petitioner enrolled in Medicare.

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CMS Ex. 1 at 16-19.  However, on July 12, 2022, the MAC issued a reopened and revised initial determination revoking Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3), based on her felony conviction, and 42 C.F.R. § 425.535(a)(4) based on failure to report her felony conviction on her October 25, 2021 enrollment application.  The MAC imposed a 10-year reenrollment bar and informed Petitioner that her name was being added to the CMS preclusion list.⁵  CMS Ex. 1 at 12-15.

Petitioner requested a reconsidered determination on July 18, 2022 and September 14, 2022.  CMS Ex. 1 at 20-74, 135-40.

On October 20, 2022, a CMS hearing officer upheld revocation pursuant to 42 C.F.R. § 424.535(a)(3) and (4) effective October 25, 2021, a reenrollment bar of 10 years, and adding Petitioner’s name to the CMS preclusion list.  CMS Ex. 1 at 1-11.

b.  Analysis

Congress granted the Secretary authority to revoke the enrollment of a provider or supplier convicted under federal or state law of a felony offense that the Secretary determines is detrimental to the program or its beneficiaries.  Act § 1866(b)(2)(D).  CMS is delegated authority by the Secretary to revoke a provider’s or supplier’s Medicare enrollment and billing privileges for any of the reasons listed in 42 C.F.R. § 424.535(a).  CMS needs only one basis under 42 C.F.R. § 424.535(a) to revoke a provider’s or supplier’s Medicare enrollment and billing privileges.  I conclude CMS had bases to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3) and (4).

Revocation Pursuant to 42 C.F.R. § 424.535(a)(3)

Pursuant to 42 C.F.R. § 424.535(a)(3)(i), CMS has the authority to revoke a supplier’s billing privileges if CMS determines that the “supplier was, within the preceding 10 years, convicted (as that term is defined in 42 CFR 1001.2) of a Federal or State felony offense that CMS determines is detrimental to the best interests of the Medicare program and its beneficiaries.”  The Secretary has specified crimes that are per se detrimental to

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the best interests of the program and its beneficiaries in 42 C.F.R. § 424.535(a)(3)(ii).  The listing of per se detrimental felonies in 42 C.F.R. § 424.535(a)(3)(ii) is not exhaustive, but specifically permits revocation for detrimental felonies like the crimes listed.  Abdul Razzaque Ahmed, M.D., DAB No. 2261 at 10.

The elements necessary for revocation pursuant to 42 C.F.R. § 424.535(a)(3) are:  (1) the supplier was convicted of a federal or state felony offense; (2) the conviction occurred within the 10 years preceding the revocation action; and (3) the Secretary has specified that the conviction is per se detrimental in 42 C.F.R. § 424.535(a)(3)(ii) or CMS has determined on a case-by-case basis under 42 C.F.R. § 424.535(a)(3)(i) that the supplier’s felony offense is detrimental to the best interests of the Medicare program and its beneficiaries.  Fady Fayad, M.D., DAB No. 2266 at 7-8 (2009); Michael Scott Edwards, OD, & M. Scott Edwards, OD, PA, DAB No. 2975 at 9-11 (2019); Neil Niren, M.D. & Neil Niren, M.D., P.C., DAB No. 2856 (2018).

Pursuant to 42 C.F.R. § 424.535(a)(3)(i), whether one has been convicted is determined pursuant to 42 C.F.R. § 1001.2.  The regulation provides one is convicted in a federal, state, or local court when:  (1) a judgment of conviction is entered; (2) a finding of guilt has been made; (3) a guilty plea or no contest plea has been accepted, or (4) an individual or entity enters into a first offender, deferred adjudication, or other program or arrangement where a judgment of conviction is withheld.  42 C.F.R. § 1001.2.  A jury found Petitioner guilty on September 25, 2013.  CMS Ex. 1 at 220.  Judgment of conviction was imposed on December 12, 2013, but not signed until December 23, 2021.  CMS Ex. 1 at 32-33, 221‑22.  The MAC indicates that Petitioner was convicted on December 23, 2013, when the district court judgment was signed rather than December 12, 2013, the date on which judgment was entered.  CMS Ex. 1 at 12, 16.  The CMS hearing office found Petitioner’s conviction occurred on December 12, 2013, the date the district court entered judgment.  CMS Ex. 1 at 3.  I accept December 12, 2013, as the date Petitioner was convicted as found by the hearing officer based on the definition of convicted in 42 C.F.R. § 1001.2(a).  I note that September 25, 2013, the date of the jury verdict, also arguably satisfies the definition of convicted under 42 C.F.R. § 1001.2(b) but, in this case selecting the earlier date has no impact on the outcome because the effective date of revocation is October 25, 2021, Petitioner’s Medicare enrollment date.

I conclude that the undisputed facts satisfy the elements necessary to establish a basis for revocation of Petitioner’s Medicare enrollment under 42 C.F.R. § 424.535(a)(3):

(1)  Judgment of conviction was entered by the district court on December 12, 2013, against Petitioner for two felony offenses.

(2)  The MAC issued its revised and reopened initial determination to revoke Petitioner’s Medicare enrollment and billing privileges on July 12, 2022, within

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the 10‑year period that began on the date of Petitioner’s conviction – December 12, 2013.

(3)  Petitioner’s felony conviction was per se detrimental to the best interests of the Medicare program under 42 C.F.R. § 424.535(a)(3)(ii)(D) because it was a felony conviction relating to the unlawful distribution of a controlled substance that occurred after August 21, 1996, for which one could be exclude under section 1128(a)(4) of the Act.  The CMS hearing officer also made a fact specific determination that Petitioner’s conviction was detrimental to the best interests of the Medicare program and its beneficiaries.  The hearing officer concluded that Petitioner’s illegal possession of such a large amount of marijuana (a Schedule I controlled substance) demonstrated a lack of integrity and poor judgment.  The hearing officer also concluded Petitioner’s conviction raised questions about her trustworthiness and veracity in relation to her ability to abide by governmental rules.  The hearing officer concluded that Petitioner’s conviction was detrimental to Medicare and Medicare beneficiaries based on her case-by-case analysis.

CMS Ex. 1 at 5, 12-19, 32-33, 221-22.  Petitioner does not dispute that she was convicted of a felony on December 12, 2013, within 10 years of the MAC’s initial determination to revoke.

Revocation Pursuant to 42 C.F.R. § 424.535(a)(4)

CMS is also authorized to revoke Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(4) when a provider or supplier “certified as ‘true’ misleading or false information on the enrollment application.”  42 C.F.R. § 424.535(a)(4).

The CMS hearing officer concluded that Petitioner failed to list her December 12, 2013 felony conviction in Section 3C of the Medicare enrollment application she signed on October 25, 2021.  Because Petitioner did not list her felony conviction, the information she provided was incomplete, but she certified that the application was true, correct, and complete which made the application false or misleading.  CMS Ex. 1 at 5-6.

Section 3C of the application Petitioner signed on October 25, 2021, required that she list each final adverse legal action, when it occurred, and who took or imposed the adverse action.  CMS Ex. 1 at 88.  The application explains that final adverse legal action included convictions, which must be reported even if records were expunged or appeals were pending.  The application also provided a definition of convictions that were to be reported.  A final adverse action is defined in the regulations as:

Final adverse action means one or more of the following actions:

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(1) A Medicare-imposed revocation of any Medicare billing privileges;

(2) Suspension or revocation of a license to provide health care by any State licensing authority;

(3) Revocation or suspension by an accreditation organization;

(4) A conviction of a Federal or State felony offense (as defined in § 424.535(a)(3)(i)) within the last 10 years preceding enrollment, revalidation, or re-enrollment; or

(5) An exclusion or debarment from participation in a Federal or State health care program.

42 C.F.R. § 424.502.⁶

Petitioner’s December 12, 2013 felony conviction, occurred within the 10 years preceding her signing and filing her October 25, 2021 enrollment application and satisfies the fourth definition of final adverse action under 42 C.F.R. § 424.502.

Petitioner does not dispute that she completed Section 3C of the enrollment application she signed on October 25, 2021, by checking “yes” indicating that she had final adverse legal action to report.  Petitioner does not dispute that the voluntary surrender of her Texas nursing licenses was listed but she failed to list her December 12, 2013 felony conviction by the district court.  CMS Ex. 1 at 88.  Petitioner does not dispute that she signed the enrollment application in Section 15B on October 15, 2021.  She also does not dispute that Section 15A required that she certify, subject to penalty for perjury, that she read the application and that the information provided was true, correct, and complete.  CMS Ex. 1 at 100.  I conclude that the omission of information regarding Petitioner’s December 12, 2013 felony conviction in Section 3C made the information provided to the MAC and CMS by that section false and misleading and a basis for revocation of Petitioner’s Medicare enrollment and billing privileges.  I accept as true Petitioner’s

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assertion that she did not intend to hide or conceal her criminal conviction.  CMS Ex. 1 at 22.  However, it need not be shown for revocation under 42 C.F.R. § 424.535(a)(4) that Petitioner intended to convey false or misleading information.  Acute Care Homenursing Servs., Inc., DAB No. 2837 at 7 (2017); Sandra E. Johnson, CRNA, DAB No. 2708 at 15 (2016).

Effective Date of Revocation

Generally, revocation is effective 30 days after CMS or the MAC mails notice of its determination to revoke, with some exceptions, such as when the revocation is based on a felony conviction.  The effective date of revocation based on a felony conviction is the date of the felony conviction.  42 C.F.R. § 424.535(g).  On December 12, 2013, the district court entered judgment that Petitioner was guilty of two felony offenses (CMS Ex. 1 at 32-33, 221-22), making December 12, 2013 Petitioner’s date of conviction under 42 C.F.R. § 1001.2.  Therefore, the effective date of revocation pursuant to 42 C.F.R. § 424.535(a)(3) would normally be December 12, 2013.  However, CMS determined that the effective date of revocation should be October 25, 2021, the effective date of Petitioner’s initial enrollment in Medicare (CMS Ex. 1 at 175) rather than the earlier date of Petitioner’s conviction.  I have no reason to disturb the CMS determination of the correct effective date as it would be error to determine revocation occurred before enrollment.

Petitioner’s Arguments

Petitioner raised several legal arguments that I conclude have no merit.

Petitioner asserts that CMS’s authority to revoke a supplier’s Medicare enrollment and billing privileges is permissive, not mandatory and CMS has not demonstrated that it exercised its discretion appropriately.  RFH at 2; P. Br. at 3-4.  Specifically, Petitioner contends CMS should have considered that Petitioner was only a little over a year away from not having to disclose the conviction on the enrollment application.  RFH at 2; CMS Ex. 1 at 21.  Petitioner claims summary judgment is not appropriate because CMS asks the ALJ to weigh if CMS reasonably exercised its discretion.  P. Br. at 4.

The Board has narrowly construed the scope of review of the ALJ and the Board in cases involving provider and supplier enrollment, denial of enrollment, and revocation of enrollment cases.  The Board has concluded that so long as the Board or an ALJ finds that CMS had a regulatory basis for revocation under 42 C.F.R. § 424.535(a), the ALJ  and the Board on appeal may not refuse to apply the regulation and must sustain the revocation.  Stanley Beekman, D.P.M., DAB No. 2650 at 10 (2015) (an ALJ and the Board must sustain a revocation “[i]f the record establishes that the regulatory elements are satisfied”); Douglas Bradley, M.D., DAB No. 2663 at 13 (CMS’s revocation

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authority is discretionary, but an ALJ and the Board are limited to deciding whether CMS had a legal basis for revocation and may not substitute their discretion for that of CMS in determining whether revocation is appropriate under all the circumstances); Letantia Bussell, M.D., DAB No. 2196 at 13 (the only issue before an ALJ and the Board in enrollment cases is whether CMS has “established a legal basis for its actions”).

My scope of review is limited to determining whether CMS established a lawful basis to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3) and (4).  Sonjay Fonn, D.O. & Midwest Neurosurgeons, DAB No. 3086 at 10 (2023) (citing Cornelius M. Donohue, DPM, DAB No. 2888 at 4 (2018)).My authority does not extend to “second-guessing whether CMS properly exercised its discretion in deciding to revoke” if a basis for revocation is found to exist.  Acute Care Homenursing Servs., Inc., DAB No. 2837 at 9.  Thus, the Board’s view, which I conclude is correct, is that it is not my prerogative to review the CMS exercise of discretion to revoke once I have concluded that there is a basis for revocation.

In her hearing request, Petitioner argues that CMS discussed that Petitioner’s conviction was per se detrimental, but CMS did not determine that her offenses were crimes of moral turpitude or involved fraud that compromised the integrity of the Medicare program.  RFH at 2.  Moral turpitude and fraud are not required findings for revocation under 42 C.F.R. § 424.535(a)(3)(i).  The Secretary has determined that certain types of offenses are per se detrimental to the best interests of the Medicare program and its beneficiaries, including crimes against persons, financial crimes, any crime that places the Medicare program or its beneficiaries at immediate risk; and crimes that would result in exclusion under section 1128(a) of the Act.  42 C.F.R. § 424.535(a)(3)(ii).  Petitioner’s December 12, 2013 felony conviction for offenses related to controlled substances would trigger mandatory exclusion from Medicare, Medicaid, and all federal health care programs pursuant to section 1128(a)(4) of the Act, making her conviction per se detrimental under 42 C.F.R. § 424.535(a)(3)(ii)(D).  Although unnecessary, the CMS hearing officer also did a case-by-case analysis and concluded Petitioner’s crimes were detrimental to Medicare and its beneficiaries.  CMS Ex. 1 at 4-5.

Petitioner argues she answered “yes” to the question on the enrollment application asking whether she ever had a final adverse legal action imposed against her and reported the voluntary surrender of her nursing licenses, which was based on her December 12, 2013 felony conviction.  RFH at 1; CMS Ex. 1 at 20; P. Br. at 5.  Petitioner maintains CMS should have known about her conviction because she submitted documentation reflecting her felony conviction with the enrollment application.  For example, the conviction was discussed in the records Petitioner submitted related to the loss of Petitioner’s Texas nursing licenses.  RFH at 1; CMS Ex. 1 at 20, 22, 27; P. Br. at 5.

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The enrollment application states that “all applicable final adverse legal actions must be reported” and specifically requires reporting of “any federal or state felony conviction(s).”  CMS Ex. 1 at 88.  To ensure Medicare enrolls only qualified and trustworthy suppliers, the regulations require suppliers to provide “complete, accurate, and truthful responses to all information requested within each section” of the application, on the application, and sign the application, attesting that the information submitted is accurate.  Sonjay Fonn, D.O. & Midwest Neurosurgeons, DAB No. 3086 at 11 (citing 42 C.F.R. § 424.510(a)(1), (d)(2)(i), (d)(3)).  Therefore, information requested must be included in the appropriate section of the enrollment application and reference to a final adverse action in attached documents is insufficient.

The Board has concluded that there is a basis for exclusion under 42 C.F.R. § 424.535(a)(4), even if a supplier discloses a final adverse legal action indirectly in a separate document in lieu of listing it on the application, because permitting the indirect reference would “undermine the supplier’s obligation to provide complete and accurate information ‘on the enrollment application.’”  William Garner, M.D., DAB No. 3026 at 10 (2020).  By failing to list a final legal adverse action on a signed enrollment application, a supplier certifies as true information about final legal adverse actions that is false or misleading.  William Garner, M.D., DAB No. 3026 at 9.  The Board’s view is that “[a]n incomplete response certified to be ‘true, correct, and complete’ is, by definition, ‘false’ because it is incomplete. . . . [and] an incomplete response may be ‘misleading’ because it has a tendency to ‘create a false impression.’”  William Garner, M.D., DAB No. 3026 at 13 (citations omitted).

Petitioner did not disclose all the final legal adverse actions imposed against her because she did not report her December 12, 2013 felony conviction on the October 25, 2021 enrollment application.  Further, although it was incomplete, Petitioner certified the application was true and complete.  Therefore, CMS was authorized to revoke Petitioner’s billing privileges pursuant to 42 C.F.R. § 424.535(a)(4) because she certified as true false and misleading information on her enrollment application.

Petitioner also claims in her reconsideration request, but not her hearing request or brief, that she provided information about the conviction and surrender of her nursing licenses to the credentialing staff who completed the enrollment application.  Petitioner failed to notice the conviction was not included in the list of final adverse legal actions, which was a clerical error by the credentialing staff.  CMS Ex. 1 at 21.  I accept Petitioner’s assertion as true for purposes of summary judgment.  However, a clerical error is not a defense to revocation.  Mark Koch, D.O., DAB No. 2610 at 4 (2014) (unintentional or inadvertent omission is not a defense).  Further, no specific intent to provide false information is required for revocation to be authorized pursuant to 42 C.F.R. § 424.535(a)(4).  Acute Care Homenursing Servs., Inc., DAB No. 2837 at 7; Sandra E. Johnson, CRNA, DAB No. 2708 at 15.  The regulations clearly require that a supplier, or

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an individual authorized to bind the supplier both legally and financially to the conditions of Medicare enrollment, sign an enrollment application, attesting to the fact that the information submitted is accurate and that the supplier is aware of, and abides by, all applicable statutes, regulations, and program instructions.  42 C.F.R. § 424.510(d)(3).  Petitioner, not the credentialing staff, had the duty to review what the credentialing staff was submitting on Petitioner’s behalf to Medicare.  Petitioner authorized filing of the October 25, 2021 application and certified the application was true, correct, and complete, despite the omission of the felony conviction.  Petitioner cannot argue that the credentialing staff was to blame because Petitioner failed to ensure that the application she certified as true and correct was in fact true and correct.  Brenda Lee Jackson, DAB No. 2903 at 9-11 (2018); Sandra E. Johnson, CRNA, DAB No. 2708 at 15 (Petitioner was solely responsible for reviewing the content of her application before attesting to its accuracy and she averred by her signature that she performed such a review); Mark Koch, D.O., DAB No. 2610 at 4 (a supplier is responsible for the application that others submit on their behalf where the supplier certifies the information contained in the application as true).

With her reconsideration request, Petitioner submitted letters of support that appear to have been addressed to the Texas Board of Nursing, attesting to Petitioner’s skill and knowledge as a practitioner, her good character, work ethic, and dedication, her service to the community, and her work to rehabilitate herself.  CMS Ex. 1 at 63-74.  To the extent Petitioner relies on these letters to support her argument that revocation and placement on the preclusion list were not warranted, and even accepting the assertions of fact in the letters as true for purposes of summary judgment, Petitioner’s arguments are requests for equitable relief that I have no authority to grant.  When I determine, as I have here, that CMS has a basis for revocation, I have no authority to substitute my judgment for that of CMS and void the revocation based on equitable considerations.  US Ultrasound, DAB No. 2302 at 8 (2010).  Furthermore, I am required to follow the Act and regulations and have no authority to declare statutes or regulations invalid.  1866ICPayday.com, L.L.C., DAB No. 2289 at 14 (2009).

9.  I have no authority to review CMS’s determination to impose a 10‑year bar to Petitioner’s reenrollment in Medicare.

10.  As a matter of law, the 10-year bar to reenrollment began 30 days after July 12, 2022, the date on which the MAC mailed the notice of the initial determination to revoke in this case.  42 C.F.R. § 424.535(c)(1)(i).

When a supplier’s Medicare enrollment and billing privileges are revoked, the supplier is barred from reenrolling in the Medicare program for one to 10 years.  42 C.F.R. § 424.535(c).  In this case, CMS determined that a 10-year reenrollment bar was

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appropriate.  There is no statutory or regulatory language establishing a right to review the duration of the reenrollment bar CMS imposes, or when it commences or ends.  Act § 1866(j)(8); 42 C.F.R. §§ 424.535(c), 424.545, 498.3(b), 498.5.  The Board has held that the duration of a revoked supplier’s reenrollment bar is not an appealable initial determination listed in 42 C.F.R. § 498.3(b) and is not subject to ALJ review.  Vijendra Dave, M.D., DAB No. 2672 at 11 (2016); Heidy Woody, NP, DAB No. 3102 at 19-21.

11.  There is a basis for adding Petitioner to the CMS preclusion list for the duration of her reenrollment bar.

Finally, because I have found that there is a basis for revocation, and Petitioner is subject to a reenrollment bar, CMS has a basis for adding Petitioner to the CMS preclusion list for the duration of her reenrollment bar.  The CMS hearing officer reviewed the determination to place Petitioner on the CMS preclusion list.  The hearing officer concluded that Petitioner’s Medicare enrollment was revoked pursuant to 42 C.F.R. § 424.535(a)(3) and (4) and concluded that Petitioner was subject to a 10-year reenrollment under 42 C.F.R. § 424.535(c).  The hearing officer further determined that Petitioner’s conduct that caused the revocation was detrimental to the best interests of the Medicare program.  CMS Ex. 1 at 6-8.  Accordingly, I conclude that there is a prima facie showing of a basis for placing Petitioner’s name on the CMS preclusion list.

Petitioner argues CMS placed Petitioner on the preclusion list using the same rationale it did to determine Petitioner’s felony conviction was detrimental to the best interests of the Medicare program and its beneficiaries.  RFH at 2.  Petitioner again claims CMS failed to consider the time between her conviction and her October 25, 2021 enrollment application and that she provided information of her December 12, 2013 felony conviction with her enrollment application in submitted documents related to the loss of her Texas nursing licenses.  RFH at 2.

I find no authority that permits my review of CMS’s exercise of discretion in determining that Petitioner’s underlying conduct was detrimental to Medicare and in adding Petitioner’s name to the preclusion list.  42 C.F.R. §§ 422.2, 423.100 (2018) (definition of preclusion list); 83 Fed. Reg. 16,440, 16,641-67.

I conclude that CMS has a basis for adding Petitioner’s name to the CMS preclusion list for the duration of her reenrollment bar.

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III.  Conclusion

For the foregoing reasons, the Medicare enrollment and billing privileges of Petitioner are revoked pursuant to 42 C.F.R. § 424.535(a)(3) and (4), effective October 25, 2021.  There is a basis for listing Petitioner on the CMS preclusion list for the duration of her 10‑year bar to reenrollment.

Endnotes

¹ Citations are to the 2021 revision of the Code of Federal Regulations (C.F.R.), which was in effect at the time of the initial determination, unless otherwise indicated.  An appellate panel of the Departmental Appeals Board (Board) concluded in Mark A. Kabat, D.O., DAB No. 2875 at 9-11 (2018) that the applicable regulations are those in effect at the time of the initial determination.  The Board previously concluded that the only determination subject to my review in a provider and supplier enrollment case such as this is the reconsidered determination.  Neb Grp. of Ariz. LLC, DAB No. 2573 at 7 (2014).

² The pronouns she and her are used as Petitioner expressed no preference.

³ Petitioner, a nurse, is a supplier.  A “supplier” furnishes services under Medicare and includes physicians or other practitioners and facilities that are not included within the definition of the phrase “provider of services.”  Act § 1861(d) (42 U.S.C. § 1395x(d)).  A “provider of services,” commonly shortened to “provider,” includes hospitals, critical access hospitals, skilled nursing facilities, comprehensive outpatient rehabilitation facilities, home health agencies, hospice programs, and a fund as described in sections 1814(g) (42 U.S.C. § 1395f(g)) and 1835(e) (42 U.S.C. § 1395n(e)) of the Act.  Act § 1861(u) (42 U.S.C. § 1395x(u)).  The distinction between providers and suppliers is important because they are treated differently under the Act for some purposes.

⁴ The maximum sentence for violation of 21 U.S.C. § 841(a)(1) is 20 years imprisonment.  21 U.S.C. § 841(b)(1)(C).  Pursuant to 21 U.S.C. § 846, any person who “attempts or conspire to commit any offense” under 21 U.S.C. chap. 13 is subject to the same penalty as prescribed for the offense that was the object of the attempt or conspiracy.  21 U.S.C. § 846.  A federal criminal offense with an authorized term of imprisonment of less than 25 years but 10 or more years is a Class C felony.  18 U.S.C. § 3559.  Therefore, Petitioner was charged with a felony criminal offense under federal law.  She was ultimately convicted of two felony criminal offenses.

⁵ An individual’s, entity’s, or prescriber’s name is added to the preclusion list after the 60-day period for requesting reconsideration of the initial determination has expired or the date of a reconsidered determination if reconsideration is requested.  42 C.F.R. §§ 422.222(a)(3)(ii), 423.120(c)(6)(v)(C).

⁶ The regulatory definition of final adverse action was the same when Petitioner was convicted, when she filed her enrollment application, at the time of the initial determination, at the time of the reconsidered determination, and now.