Nick Paslidis/Nick Paslidis, MD PA Central Arkansas Internal Medicine Consulting, DAB CR6490 (2024)

DECISION

The effective date of the reactivated billing privileges of Petitioner, Nick Paslidis/Nick Paslidis, MD PA Central Arkansas Internal Medicine Consulting, is June 6, 2023. 

I.    Background and Procedural History

Petitioner is a physician and his practice.  Centers for Medicare & Medicaid Services (CMS) Ex. 5 at 1.  The parties both refer to Petitioner as a single entity, Dr. Paslidis, in their briefing, and I do the same throughout this decision.  

On November 15, 2022, Novitas Solutions (Novitas), a Medicare administrative contractor, informed Petitioner that his Medicare billing privileges were being deactivated effective November 16, 2022, pursuant to 42 C.F.R. § 424.540(a)(1), because a review of Medicare billing data “found [he had] not submitted any claims in more than

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twelve calendar months from the date of this letter.”¹  CMS Ex. 1 at 1.  Novitas informed Petitioner that, pursuant to 42 C.F.R. § 424.545(b), he could submit a written rebuttal within 15 days.  CMS Ex. 1 at 1.  The evidentiary record does not include evidence that Petitioner submitted a written rebuttal. 

On June 6, 2023, Novitas received a Form CMS-855B enrollment application from Petitioner that was submitted for the purpose of reactivating his Medicare enrollment.   CMS Ex. 2 at 5, 42.  In correspondence dated June 30, 2023, Novitas informed Petitioner that “[t]he CMS-855B is the incorrect application for fulfillment of [a] request of a sole owner,” and that he should “complete a CMS-855I application and re-submit” within 30 days.  CMS Ex. 3 at 1.  Petitioner submitted a Form CMS-855I that was received on June 30, 2023.  CMS Ex. 4. 

Novitas approved Petitioner’s reactivation enrollment application on June 30, 2023, with an effective date of reactivated billing privileges of May 1, 2023.  CMS Ex. 5 at 1.  On August 1, 2023, Novitas sent a letter to Petitioner explaining that “[t]his is a correction” because it had “revised the reassignment effective date for the provider and group.”  CMS Ex. 6 at 1.  The letter stated that the effective date assigned was June 6, 2023.  CMS Ex. 6 at 1. 

In a letter dated August 3, 2023, Petitioner requested reconsideration of the effective date of his reactivated enrollment.  Petitioner reported that he “did not ask for [his] number to be deactivated, as [he] was still seeing Medicare patients.”  CMS Ex. 7 at 3.  Petitioner stated that he “would like to be paid for the patients that [he had] seen so [he is] requesting the 5-1-23 that was the effective date of the original letter, or at least a 5-15-23 effective date as indicated on the application.”  CMS Ex. 7 at 3.  Petitioner also claimed that a Novitas representative informed him that his billing number would automatically be reactivated if he submitted Medicare claims.  CMS Ex. 7 at 3. 

On October 19, 2023, Novitas issued a reconsidered determination in which it explained the following:  

On the CMS-855I Medicare reactivation application received June 6, 2023, the requested effective dates was [sic] listed as May 15, 2023.  Per 42 C.F.R. § 424.520(d), the effective date of billing privileges is the later of (1) the date of a filing of a Medicare enrollment application that was subsequently approved by a Medicare contractor; or (2) the date that the supplier first began furnishing services at a new practice location.

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Per 42 C.F.R. § 424.540(d)(2), the effective date of a reactivation of billing privileges under this section is the date on which the contractor received the provider’s or supplier’s reactivation submission that the contractor processed to approval.  Under 42 C.F.R. § 424.540(e), the provider or supplier may not receive payment for services or items furnished while deactivated.  As clarified in [Medicare Program Integrity Manual] chapter 10, section 10.4.6(E), this means that the contractor shall not add a retroactive back-billing period (e.g., 30 days) to the reactivation effective date.  Therefore, the June 6, 2023 reactivation effective date was established correctly as this is the date Novitas Solutions received the reactivation application for [Petitioner].  

CMS Ex. 8 at 3. 

Petitioner filed a request for hearing on October 26, 2023.  The Civil Remedies Division issued my standing pre-hearing order (Pre-Hearing Order) on October 30, 2023.  CMS filed a pre-hearing brief and motion for summary judgment (CMS Br.), along with 10 proposed exhibits (CMS Exs. 1-10).  Petitioner filed a brief.  In the absence of any objections, I admit CMS Exs. 1-10 into the evidentiary record.  I consider the record in this case to be closed, and the matter is ready for a decision on the merits.² 

II.    Issue

Whether the effective date of Petitioner’s Medicare enrollment and billing privileges is June 6, 2023. 

III.  Jurisdiction

I have jurisdiction to hear and decide this case.  42 C.F.R. § 498.3(b)(15); Victor Alvarez, M.D., DAB No. 2325 at 8-12 (2010); see also 42 U.S.C. § 1395cc(j)(8).  

IV.   Findings of Fact, Conclusions of Law, and Analysis³

1. On November 15, 2022, Novitas informed Petitioner that it had deactivated his Medicare enrollment, effective November 16,

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2022, pursuant to 42 C.F.R. § 424.540(a)(1) because he had not submitted any Medicare claims in more than 12 months.

2. On June 6, 2023, Petitioner submitted an enrollment application to reactivate his deactivated billing privileges.
3. After Petitioner complied with the requested development of his June 6, 2023 application, Novitas approved Petitioner’s reactivated billing privileges.
4. Pursuant to 42 C.F.R. § 424.520(d)(1), the effective date of Petitioner’s reactivated billing privileges is June 6, 2023, which is the date of receipt of the Medicare enrollment application that Novitas was able to process and approve.
5. Because 42 C.F.R. § 424.540(e) prohibits payment to a provider or supplier for services or items furnished while billing privileges are deactivated, retrospective billing privileges cannot be granted prior to the date Petitioner’s billing privileges were reactivated on June 6, 2023.

As a physician and his clinic/group practice, Petitioner is a “supplier” for purposes of the Medicare program.  See CMS Ex. 5 at 1; see also 42 U.S.C. § 1395x(d); 42 C.F.R. §§ 400.202 (definition of supplier); 498.2.  A “supplier” furnishes items or services under Medicare and the term applies to physicians or other practitioners who are not included within the definition of the phrase “provider of services.”  42 U.S.C. § 1395x(d).  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 at 42 C.F.R. Part 424, subpart P, establish the requirements for a supplier to enroll in the Medicare program.  42 C.F.R. §§ 424.510-424.516; see also 42 U.S.C. § 1395cc(j)(1)(A) (authorizing the Secretary of the U.S. Department of Health and Human Services to establish regulations addressing the enrollment of providers and suppliers in the Medicare program).  A supplier that seeks billing privileges under Medicare “must submit enrollment information on the applicable enrollment application.”  42 C.F.R. § 424.510(a)(1).  “Once the provider or supplier successfully completes the enrollment process . . . CMS enrolls the provider or supplier into the Medicare program.”  Id.; see also 42 C.F.R. § 424.510(d) (listing enrollment requirements).  When the contractor approves an enrollment application, it sets the effective date for approval of billing privileges.  See Alexander C. Gatzimos, MD, JD, LLC, DAB No. 2730 at 2 (2016).  “The effective date of a physician’s or physician organization’s enrollment in Medicare is ‘the later of the date of filing of a Medicare enrollment application that was subsequently approved by a Medicare contractor or the date [the supplier] first began furnishing services at a new practice location.’”  Id. at 2-3 (citing 42 C.F.R. § 424.520(d) (Oct. 1, 2012)).

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Novitas deactivated Petitioner’s billing privileges effective November 16, 2022, after he did not submit any Medicare claims for more than 12 months.  CMS Ex. 1 at 1; see 42 C.F.R. 424.540(a)(1).  Petitioner has not claimed he submitted claims during that timeframe, nor has he disputed that Novitas was authorized to deactivate his billing privileges pursuant to 42 C.F.R. § 424.540(a)(1), which at that time allowed for deactivation when a provider or supplier “does not submit any Medicare claims for 12 consecutive calendar months.”  See Frederick Brodeur, M.D., DAB No. 2857 at 12 (2018) (“A contractor’s deactivation decision is not an initial determination subject to ALJ or Board review.”).  Rather, Petitioner disputes the effective date of his reactivated billing privileges and requests a May 1, 2023 effective date of reactivated billing privileges.  Request for Hearing at 1.  

The pertinent regulation with respect to the effective date of reactivation is 42 C.F.R. § 424.520(d)(1).  Urology Grp. of NJ, LLC, DAB No. 2860 at 7 (2018) (“The governing authority to determine the effective date for reactivation of Petitioner’s Medicare billing privileges is 42 C.F.R. § 424.520(d).”) (italics omitted).  As relevant here, section 424.520(d)(1)(i) states that the effective date of billing privileges is the date of filing of a Medicare enrollment application that was subsequently approved by a Medicare contractor.  The Departmental Appeals Board (DAB) has explained that the “date of filing” is the date “that an application, however sent to a contractor, is actually received.”  Gatzimos, DAB No. 2730 at 5 (emphasis omitted). 

Novitas deactivated Petitioner’s billing privileges because he did not submit any Medicare claims for more than 12 months.  CMS Ex. 1 at 1.  In November 9, 2021 rulemaking, CMS explained the following regarding deactivation: 

Deactivation means that the provider’s or supplier’s billing privileges are stopped but can be restored (or “reactivated”) upon the submission of information required under § 424.540.  As stated in § 424.540(c), deactivation is intended to protect the provider or supplier from the misuse of its billing number and to protect the Medicare Trust Funds from unnecessary overpayments.  A deactivated provider or supplier is not revoked from Medicare and remains enrolled in the program; also, per § 424.540(c), deactivation does not impact the provider’s or supplier’s existing provider or supplier agreement.  However, the provider’s or supplier’s ability to bill Medicare is halted pending its compliance with § 424.540’s requirements for reactivation. 

*        *        *        *

To reactivate one’s billing privileges, § 424.540(b) states that the provider or supplier must: (1) Recertify that their enrollment information currently

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on file with Medicare is correct and furnish any missing information as appropriate; or (2) submit a complete Form CMS-855 application if required by CMS.[⁴] 

86 Fed. Reg. 62,240, 62,359. 

On June 6, 2023, Novitas received an enrollment application submitted for the purpose of reactivating Petitioner’s billing privileges.  CMS Ex. 2 at 5, 42.  Based on the June 6, 2023 receipt date of the enrollment application, Novitas did not err in assigning a June 6, 2023 effective date for reactivated billing privileges.  42 C.F.R. § 424.520(d)(1)(i) (addressing that the effective date of billing privileges is the date of filing of the enrollment application that the contractor processed to approval); see Urology Grp., DAB No. 2860 at 9 (“Moreover, the fact that a supplier must file a new enrollment application in order to reactivate its billing privileges is consistent with the language of section 424.520(d) and compelling evidence that the provision should apply to reactivations.”); Willie Goffney, Jr., M.D., DAB No. 2763 at 6 (2017) (“It is certainly true that [the petitioner] may not receive payment for claims for services during any period when his billing privileges were deactivated.”); Brodeur, DAB No. 2857 at 16 (“Petitioner remained enrolled in Medicare, but his deactivated status made [him] ineligible for payment for any covered services he furnished to otherwise eligible Medicare beneficiaries, pursuant to section 424.555(b), until he provided the information necessary to reactivate his billing privileges.”). 

Petitioner explained that he had been “a Medicare provider in Arkansas since 1995” and had “traveled from [his] current home base in Arizona to see . . . patients [who] were in a nursing home facility.”  P. Br.  Petitioner reported that he “saw these patients acting in

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good faith based upon [his] phone interactions with CMS Novartis” and that he had been told, “‘As long as [he sees] patients within the 1 year period from [his] ‘deactivation notice’ that [he] would be immediately reactivated.’”  P. Br.  Petitioner further reported that a Novitas manager “confirmed this information.”  Petitioner explained that he “found out that the information [he] had been given was incorrect when CMS denied all payments based on [his] inactivity with them.”  P. Br.  Petitioner stated that he “based [his] appeal upon the misinformation given to [him] by CMS Novartis employees.”  P. Br.  

Accepting that Petitioner either received misinformation or misunderstood information provided by Novitas, there is no legal authority authorizing me to approve an effective date of reactivated billing privileges prior to the date the enrollment application for purposes of reactivation was received on June 6, 2023.  The scope of my review is limited, in that I can only review whether CMS had a legitimate basis to reactivate Petitioner’s billing privileges effective June 6, 2023.  See 42 C.F.R. § 498.3(b)(15).  Novitas deactivated Petitioner’s billing privileges based on claims inactivity effective November 16, 2022, and Petitioner did not submit an enrollment application to reactivate his billing privileges until June 6, 2023.  Pursuant to 42 C.F.R. § 424.520(d)(1), the effective date of reactivated billing privileges is the later of the date a provider or supplier filed the application that was approved by Novitas or the date a provider or supplier first began furnishing services at a new practice location.  In the instant circumstance, there is simply no provision under law that allows for an effective date of reactivated billing privileges prior to the date Petitioner submitted the enrollment application that is processed to approval.  42 C.F.R. § 424.520(d)(1)(i); see Michael B. Zafrani, M.D., DAB No. 3075 at 10 (2022) (“Deactivation means that a supplier’s billing privileges ‘can be restored upon,’ not before, ‘the submission of updated information.’ 42 C.F.R. § 424.502 (emphasis added).”).

I recognize that Petitioner treated a number of patients while under the belief that he would receive Medicare reimbursement for those services.  However, I am not empowered with the discretion to grant an effective date of enrollment earlier than the date Petitioner submitted the June 6, 2023, enrollment application that was processed to approval.  42 C.F.R. §§ 424.520(d)(1)(i), 424.540(a)(1), (e); see Zafrani, DAB No. 3075 at 15 n.1 (2022) (“[E]ffective January 1, 2022, CMS adopted . . . 42 C.F.R. § 424.540(e), which . . . prohibit[s] retrospective billing privileges during a period of deactivation.”  See 86 Fed. Reg. [62,240,] 62,420-21 [(Nov. 9, 2021)].”).  Moreover, the authorization of retrospective billing is not an appealable “initial determination” that is subject to review by an ALJ.  42 C.F.R. §§ 424.521, 498.3(b).

To the extent Petitioner’s request for relief is based on principles of equitable relief, I cannot grant such relief.  US Ultrasound, DAB No. 2302 at 8 (2010) (“Neither the ALJ nor the [DAB] is authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements.”).  Petitioner points to

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no authority by which I may grant it relief from the applicable regulatory requirements, and I have no authority to declare statutes or regulations invalid or ultra vires.  1866ICPayday.com, L.L.C., DAB No. 2289 at 14 (2009) (“An ALJ is bound by applicable laws and regulations and may not invalidate either a law or regulation on any ground . . . .”).

Novitas did not receive the reactivation enrollment application that it processed to approval until June 6, 2023; therefore, the pertinent regulation, 42 C.F.R. § 424.520(d)(1)(i), mandates that the effective date of Petitioner’s reactivated billing privileges is June 6, 2023. 

V.    Conclusion

For the foregoing reasons, I uphold the June 6, 2023 effective date of Petitioner’s reactivated billing privileges.

Endnotes

¹  Effective January 1, 2024, 42 C.F.R. § 424.540(a)(1) provides that CMS may deactivate billing privileges when a provider or supplier has not submitted any Medicare claims for six consecutive months.  88 Fed. Reg. 77,676, 77,847-48 (Nov. 13, 2023).

²  Because the parties have not submitted the written direct testimony of any witnesses, a hearing is unnecessary for purposes of cross-examination.  Pre-Hearing Order §§ 12-14.  Therefore, I need not rule on CMS’s motion for summary judgment.

³  Findings of fact and conclusions of law are in italics and bold font.

⁴  The rulemaking included revisions to these provisions of 42 C.F.R § 424.540(b), which states the following, effective January 1, 2022:

(1) In order for a deactivated provider or supplier to reactivate its Medicare billing privileges, the provider or supplier must recertify that its enrollment information currently on file with Medicare is correct, furnish any missing information as appropriate, and be in compliance with all applicable enrollment requirements in this title.  
(2) Notwithstanding paragraph (b)(1) of this section, CMS may, for any reason, require a deactivated provider or supplier to, as a prerequisite for reactivating its billing privileges, submit a complete Form CMS-855 application.

86 Fed. Reg. at 62,359.