Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
Group Health Plan, Inc. d/b/a Healthpartners Como Pharmacy,
(NPI: 1003977919 / PTAN: 4575810015),
Petitioner,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-23-418
Decision No. CR6508
DECISION
The Medicare enrollment and billing privileges of Petitioner are revoked pursuant to 42 C.F.R. §§ 424.57(e)(1) and 424.535(a)(l)1 based on a violation of 42 C.F.R. § 424.57(c)(2) (Supplier Standard 2). Revocation is effective November 17, 2022, 30 days after the date of the notice of the initial determination to revoke. 42 C.F.R. §§ 424.57(e), 424.535(g).
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I. Procedural History and Jurisdiction
On October 18, 2022, Palmetto GBA, the National Supplier Clearinghouse Medicare Administrative Contractor (MAC) for the Centers for Medicare & Medicaid Services (CMS), notified Petitioner that Petitioner’s Medicare enrollment and billing privileges were revoked effective 30 days from the postmark date of the notice letter.2 The MAC cited 42 C.F.R. §§ 405.800, 424.57(e), 424.535(a)(1), (a)(9), and (g),3 as authority for the revocation based on violations of 42 C.F.R. § 424.57(c)(l), (2), (10), (21), and (22) (Supplier Standards 1, 2, 10, 21, and 22). The MAC notified Petitioner that it was subject to a three-year bar to reenrollment pursuant to 42 C.F.R. § 424.535(c), effective 30 days from the postmark of the notice, i.e., October 18, 2022. The MAC advised Petitioner that it had the right to submit a corrective action plan (CAP) and to request a reconsidered determination. CMS Exhibit (Ex.) 1 at 38-42, 55-64.
On December 13, 2022, the MAC refused to accept and dismissed Petitioner’s CAP because it was not signed by an authorized or delegated official.4 CMS Ex. 1 at 22, 34-35.
On February 21, 2023, a MAC hearing officer issued a reconsidered determination
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upholding the revocation of Petitioner’s Medicare enrollment and billing privileges based on violations of 42 C.F.R. § 424.57(c)(l), (2), (10), (21) and (22) (Supplier Standards 1, 2, 10, 21, and 22). The three-year reenrollment bar was not changed by the hearing officer. CMS Ex. 1 at 1-7.
Petitioner requested a hearing before an administrative law judge (ALJ) on April 21, 2023 (RFH). The case was assigned to me for hearing and decision on April 25, 2023, and an Acknowledgment Letter and Standing Order (Standing Order) were issued at my direction. Petitioner’s request for hearing was timely and I have jurisdiction.
On May 22, 2023, CMS filed a motion for summary judgment (CMS Br.) with CMS Exs. 1 through 3. On July 24, 2023, Petitioner filed a prehearing brief and opposition to CMS’s motion for summary judgment (P. Br.) along with Petitioner’s Exhibits (P. Exs.) 1 through 6.
Petitioner did not object to my consideration of CMS Exs. 1 through 3 and they are admitted as evidence.
On August 8, 2023, CMS filed a reply brief and objections to Petitioner’s exhibits. CMS specifically objected to P. Ex. 5, pages 1 and 2, and P. Ex. 6 on grounds that Petitioner has not shown good cause for submitting those documents for the first time before me. 42 C.F.R. § 498.56(e). P. Ex. 5 pages 1 and 2 are related to Supplier Standard 10, which requires that a supplier of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) have comprehensive liability insurance. CMS Ex. 1 at 3, P. Br. at 20-21. P. Ex. 6 is related to Supplier Standard 22, which requires that a DMEPOS supplier be accredited by a CMS-approved accrediting organization. CMS Ex. 1 at 4; P. Br. at 21-23. The hearing officer on reconsideration concluded that there were violations of five Supplier Standards that were bases for revocation of Petitioner’s Medicare enrollment and billing privileges. CMS Ex. 1 at 1-5. However, the violation of a single Supplier Standard is a basis for revocation Medicare enrollment and billing privileges by CMS or the MAC. 1866ICPayday.com, DAB No. 2289 at 13 (2009). In this case, I conclude that there was a violation of 42 C.F.R. § 424.57(c)(2) (Supplier Standard 2) based on the undisputed facts. Therefore, it is not necessary for me to determine whether there was good cause to submit P. Ex. 5 pages 1 and 2 and P. Ex. 6 for the first time before me as they are simply not relevant to the violation of Supplier Standard 2. P. Ex. 5 pages 1 and 2 and P. Ex. 6 are not admitted. P. Exs. 1 through 4 and P. Ex. 5 pages 3 through 8 are admitted. Even if I accept as true for purposes of summary judgment Petitioner’s assertion that it had required comprehensive liability insurance and accreditation, it does not affect my conclusion that there was a violation of 42 C.F.R. § 424.57(c)(2) (Supplier Standard 2) that is a basis for revocation.
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II. Discussion
A. Applicable Law
Section 1831 of the Social Security Act (the 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)). Only eligible providers of services and suppliers may enroll in Medicare to receive payments for services rendered to Medicare-eligible beneficiaries.5 Act §§ 1834(j)(1) (42 U.S.C. § 1395m(j)(1)); 1835(a) (42 U.S.C. § 1395n(a)); 1842(h)(1) (42 U.S.C. § 1395u(h)(1)). Petitioner is a DMEPOS supplier.
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)); 1871 (42 U.S.C. § 1395hh).
Pursuant to 42 C.F.R. §§ 424.57(b) and 424.505, a DMEPOS supplier such as Petitioner must be enrolled in the Medicare program to be reimbursed for DMEPOS sold or rented to Medicare beneficiaries. The regulations establish detailed requirements that suppliers must meet and maintain to enroll in Medicare and to receive and maintain Medicare billing privileges. 42 C.F.R. pt. 424, subpt. P. DMEPOS suppliers have additional requirements imposed by 42 C.F.R. § 424.57(b) and (c). To receive direct-billing privileges, a DMEPOS supplier must meet and maintain the Medicare application certification standards set forth in 42 C.F.R. § 424.57(c). One standard requires that a DMEPOS supplier not make or cause to be made “any false statement or misrepresentation of a material fact on its application for billing privileges.” 42 C.F.R. § 424.57(c)(2). The regulation further requires that a DMEPOS supplier report to CMS
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any changes in the information that was provided to CMS in an application for billing privileges within 30 days of the change of information. Id.
The Secretary has delegated authority to CMS or its MACs to revoke an enrolled supplier’s Medicare enrollment and billing privileges and any supplier agreement for any of the reasons listed in 42 C.F.R. § 424.535. Pursuant to 42 C.F.R. § 424.57(e)(1), the Secretary has also delegated authority to CMS and its MACs to revoke Medicare enrollment and billing privileges of DMEPOS suppliers for violation of any of the requirements of 42 C.F.R. § 424.57(b) and (c). When Medicare enrollment and billing privileges are revoked pursuant to 42 C.F.R. § 424.57(e)(1), revocation is effective 30 days after the DMEPOS supplier is sent notice of the revocation. If 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, with certain exceptions not relevant in this case. 42 C.F.R. § 424.535(c).
A supplier whose enrollment and billing privileges have been revoked may request reconsideration and review as provided by 42 C.F.R. pt. 498. 42 C.F.R. §§ 405.803; 424.545(a). 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 advising the supplier of its 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 Departmental Appeals Board (the Board). Act § 1866(j)(8) (42 U.S.C. § 1395cc(j)(8)); 42 C.F.R. §§ 424.545; 498.3(b)(17); 498.5(l)(2). 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). A hearing on the record, also known as an oral hearing, is required under the Act. Crestview Parke Care Ctr. v. Thompson, 373 F.3d 743, 748-51 (6th Cir. 2004). The DMEPOS supplier bears the burden to demonstrate that it meets enrollment requirements with documents and records. 42 C.F.R. § 424.545(c).
B. Issue
Whether there was a basis for the revocation of Petitioner’s billing privileges and Medicare enrollment.
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C. Findings of Fact, Conclusions of Law, and Analysis
1. Summary judgment is appropriate.
CMS filed a motion for summary judgment that Petitioner opposes. A provider or supplier denied enrollment in Medicare or whose enrollment has been revoked has a right to a hearing and judicial review pursuant to sections 1866(h)(1) and (j)(8) of the Act and 42 C.F.R. §§ 498.3(b)(17) and 498.5(l). A hearing on the record, also known as an oral hearing, is required under the Act. Act §§ 205(b); 1866 (h)(1) and (j)(8); Crestview, 373 F.3d at 748-51. A party may waive appearance at an oral hearing but must do so affirmatively in writing. 42 C.F.R. § 498.66. In this case, Petitioner has not waived the right to oral hearing or otherwise consented to a decision based only upon the documentary evidence or pleadings. Accordingly, disposition on the written record alone is not permissible, unless the CMS motion for summary judgment has merit.
Summary judgment is not automatic upon request but is limited to certain specific conditions. The Secretary’s regulations that establish the procedure 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)(5), (6), (15), (17). 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. A summary judgment procedure was also 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, 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
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denials in its pleadings or briefs but must furnish evidence of a dispute concerning a material fact, i.e., a fact that would affect the outcome of the case if proven. Mission Hosp. Reg’l Med. Ctr., DAB No. 2459 at 4 (2012) (and cases cited therein); Experts Are Us, Inc., DAB No. 2452 at 4 (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 differs 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 & Conv. Ctr., DAB No. 1904 (2004), aff’d, Batavia Nursing & Conv. Ctr. v. Thompson, 129 Fed. App’x 181 (6th Cir. 2005).
There is no genuine dispute as to any material fact pertinent to revocation under 42 C.F.R. §§ 424.57(e)(1) and 424.535(a)(1) based on violation of 42 C.F.R. § 424.57(c)(2) (Supplier Standard 2) that requires a trial in this case. There is no dispute that on September 6, 2018, CMS received a Medicare enrollment application from Petitioner updating its enrollment information. According to Petitioner’s enrollment information maintained by CMS and the MAC, Petitioner was enrolled in Medicare since July 1, 2003, primarily as a pharmacy, with DMEPOS listed as Petitioner’s secondary supplier type beginning in February 2005. CMS Ex. 3 at 1, 12; P. Br. at 2; P. Ex. 1 ¶ 5. Petitioner does not dispute that in April 2020, it terminated its retail pharmacy operations and its Minnesota retail pharmacy license. Petitioner does not dispute that it failed to report the changed information to CMS within 30 days of the changes. CMS Ex. 1 at 3-4, 10, 65; CMS Ex. 3 at 12; P. Br. at 2-3, 10-11; P. Ex. 1 ¶¶ 6-8; P. Ex. 4. Because there is no dispute that Petitioner did not report the changed information within 30 days of the change, there was a basis to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.57(e)(1) and 42 C.F.R. § 424.535(a)(1) for violation of Supplier Standard 2 (42 C.F.R. § 424.57(c)(2)), effective November 17, 2022, 30 days after the date on which the initial determination to revoke was mailed to
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Petitioner. This case is resolved based on application of the regulations to the undisputed facts as discussed hereafter. Petitioner’s arguments must be resolved against Petitioner as matters of law. Accordingly, summary judgment is appropriate.
2. There was a basis to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. §§ 424.57(e)(1) and 424.535(a)(1) for a violation of 42 C.F.R. § 424.57(c)(2) (Supplier Standard 2).
3. The effective date of revocation of Petitioner’s Medicare enrollment and billing privileges based on a violation of 42 C.F.R. § 424.57(c)(2) (Supplier Standard 2) is November 17, 2022, 30 days after the date on which notice of the initial determination to revoke was mailed to Petitioner.
a. Undisputed Facts
The material facts relevant to revocation for violation of 42 C.F.R. § 424.57(c)(2) are not disputed, and any inferences are drawn in Petitioner’s favor on summary judgment.
According to a Medicare enrollment application updating enrollment information that was received by CMS on September 6, 2018, Petitioner was enrolled in Medicare since July 1, 2003, primarily as a pharmacy, with DMEPOS listed as Petitioner’s secondary supplier type beginning in February 2005. CMS Ex. 3 at 1, 12; P. Br. at 2; P. Ex. 1 ¶ 5; RFH at 2.
Petitioner asserts that it was initially enrolled in Medicare as a DMEPOS supplier effective July 1, 2003, an assertion of fact I accept as true for purposes of summary judgment. P. Br. at 2; P. Ex. 1 at 2 ¶ 5.
Effective April 1, 2020, Petitioner terminated its retail pharmacy operations and surrendered its Minnesota retail pharmacy license but failed to report the changes in that information to CMS within 30 days of the changes. CMS Ex. 1 at 3-4, 10, 65; CMS Ex. 3 at 12; P. Br. at 2-3, 10-11; P. Ex. 1 ¶¶ 6-8; P. Ex. 4 at 3; RFH at 7 ¶ 21.
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I accept as true for purposes of summary judgment, that Petitioner failed to notify CMS of the closure of its retail pharmacy operations due to an administrative oversight. RFH at 7 ¶ 21.
I accept as true for purposes of summary judgment, that Petitioner continued the operation of its primary care and dental clinics and continued to supply DMEPOS to clinic patients under the same Provider Transaction Access Number (PTAN)6 as was used by the closed retail pharmacy. RFH at 6 ¶ 20.
I accept as true for purposes of summary judgment, that Petitioner attempted to correct information on file with CMS regarding the closure of its retail pharmacy when Petitioner became aware of its oversight upon receiving the October 18, 2022 notice of initial determination. RFH at 7 ¶ 21.
I accept as true for purposes of summary judgment that Petitioner did not receive the MAC’s January 10, 2022 letter, which required Petitioner to submit evidence that its DMEPOS sales were less than five percent of total pharmacy sales. RFH at 7; CMS Ex. 1 at 67-688.
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b. Analysis
It is well established that even a single violation of a supplier standard is a sufficient basis for revocation of Medicare enrollment and billing privileges under 42 C.F.R. § 424.57(e)(1). 1866ICPayday.com, L.L.C., DAB No. 2289 at 13. Pursuant to 42 C.F.R. § 424.57(e)(1), CMS or the MAC revokes a DMEPOS supplier’s enrollment and billing privileges if it is determined that the supplier does not meet the Supplier Standards established by 42 C.F.R. § 424.57(b) and (c). Revocation is effective 30 days after the supplier is sent notice of the revocation. 42 C.F.R. § 424.57(e)(1) CMS and the MAC also have authority to revoke under 42 C.F.R. § 424.535(a)(1) after permitting a provider or supplier the opportunity to submit a CAP. Revocation under 42 C.F.R. § 424.535(a)(1) is effective 30 days after the date of the initial determination to revoke. 42 C.F.R. § 424.535(g)(1).
A DMEPOS supplier must meet and certify in its application for Medicare enrollment and billing privileges that it meets and will continue to meet the 30 Supplier Standards established by 42 C.F.R. § 424.57(c). Supplier Standard 2 (42 C.F.R. § 424.57(c)(2) requires that a DMEPOS supplier certify that it:
(2) Has not made, or caused to be made, any false statement or misrepresentation of a material fact on its application for billing privileges. (The supplier must provide complete and accurate information in response to questions on its application for billing privileges. The supplier must report to CMS any changes in information supplied on the application within 30 days of the change.)
42 C.F.R. § 424.57(c)(2) (emphasis added).7 The substantive requirements or elements of 42 C.F.R. § 424.57(c)(2) that Petitioner, as a DMEPOS supplier, must meet at the time of application for Medicare enrollment and billing privileges and must continue to meet are:
Petitioner must not have made or caused to be made any false statement or misrepresentation of material fact in its enrollment application:
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Petitioner must have provided complete and accurate information in response to questions on the enrollment application; and
Petitioner must have reported any changes to information on the enrollment application to CMS within 30 days of the change.
The MAC revoked in this case after concluding that Petitioner did not give CMS notice within 30 days of April 1, 2020, that it had terminated its retail pharmacy operation on that date. Although Petitioner’s application for Medicare enrollment and billing privileges has not been placed in evidence, Petitioner does not dispute that when it enrolled in Medicare it was required by the application questions to disclose that it was operating as a pharmacy. The application data report placed in evidence by CMS without objection from Petitioner shows that Petitioner was enrolled in Medicare with billing privileges and its primary supplier type was pharmacy with a secondary type being a DMEPOS supplier. CMS Ex. 3 at 12. Petitioner concedes it stopped its retail pharmacy operation and surrendered it Minnesota pharmacy license effective April 1, 2020. P. Br. at 2; P. Ex. 1 at 2 ¶ 6. Petitioner admits it did not notify the MAC of the change due to administrative oversight until it received the MAC’s initial determination to revoke more than two years after the change. P. Br. at 11 n. 2; RFH at 7 ¶ 21. The undisputed material facts show that Petitioner violated Supplier Standard 2 (42 C.F.R. § 424.57(c)(2)). The violation provides a basis for revocation of Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.57(e)(1).
CMS and the MAC clearly have the discretion not to revoke a supplier’s Medicare enrollment and billing privileges under 42 C.F.R. § 424.535(a)(1) which states “CMS may revoke.” However, 42 C.F.R. § 424.57(e)(1), which applies specifically to DMEPOS suppliers, provides that CMS revokes the Medicare enrollment and billing privileges of a DMEPOS supplier for violation of supplier standards. Therefore, 42 C.F.R. § 424.57(e)(1) seems to grant CMS or the MAC no discretion to not revoke once a supplier standard violation is found. In either case, I have no authority to review the exercise of discretion by CMS to revoke a DMEPOS supplier’s Medicare enrollment and billing privileges once I have found that a basis for revocation exists, in this case, the violation of Supplier Standard 2. My authority is limited to determining whether there is a legal basis for revocation of Petitioner’s Medicare enrollment and billing privileges. If I conclude that there is a basis for revocation, I have no authority to review the exercise of discretion by CMS or the MAC to revoke and must uphold the revocation. Abdul Razzaque Ahmed, M.D., DAB No. 2261 at 19 (2009), aff’d, Ahmed v. Sebelius, 710 F. Supp. 2d 167 (D. Mass. 2010).
Petitioner advances several arguments, all without merit. Petitioner has not rebutted the prima facie showing of a basis for revocation pursuant to 42 C.F.R. §§ 424.57(e)(1) and
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424.535(a)(1) based on violation of 42 C.F.R. § 424.57(c)(2), established an affirmative defense, or shown any other grounds for relief from the revocation.
Petitioner argues there may have been confusion or miscommunication about the closure of its pharmacy. RFH at 1 ¶ 3, at 6 ¶ 20. Petitioner states that it wants to maintain its ability to supply DMEPOS to the patients of its clinic. Petitioner explains that its pharmacy was closed. However, Petitioner did not close its business and continued to operate a primary care clinic and dental clinic “under the same PTAN” as the pharmacy. RFH at 6 ¶ 20; P. Br. at 2-3. Petitioner argues that it did not close its business operations, there was no change in address, no change of authorized official, no change of hours of operation, no change in corporate structure, and no change in ownership. P. Br. at 10. Petitioner argues that even though its retail pharmacy operations ceased, clinical operations did not, and practitioners continued to provide DMEPOS to their clinical patients. P. Br. at 2-3, 10-11; P. Ex. 1 at 2 ¶ 7. Even though I accept these assertions of fact as true for purposes of summary judgment and draw favorable inferences for Petitioner, they do not rebut the material facts that Petitioner was enrolled in Medicare as a pharmacy and DMEPOS supplier and Petitioner failed to notify CMS or the MAC within 30 days to update its enrollment information as required by 42 C.F.R. § 424.57(c)(2) when Petitioner shutdown it pharmacy.
Petitioner argues it was denied a meaningful opportunity to submit a CAP and to request reconsideration. The MAC notified Petitioner that it had authority to revoke Petitioner’s Medicare enrollment and billing privileges under 42 C.F.R. §§ 424.57(e) and 424.535(a)(1). CMS Ex. 1 at 38. Pursuant to 42 C.F.R. § 424.535(a)(1), CMS or the MAC must give a provider or supplier an opportunity to submit a CAP before revocation occurs. There is no such requirement under 42 C.F.R. § 424.57(e)(1). The MAC had authority to revoke under either 42 C.F.R. § 424.57(e)(1) or 42 C.F.R. § 424.535(a)(1) and it was not necessary for the MAC to proceed under both. The MAC did advise Petitioner that it could submit a CAP and request reconsideration. CMS Ex. 1 at 40-41. Petitioner argues it was denied a meaningful opportunity to submit its CAP and to request reconsideration because when staff learned of the initial determination to revoke, they attempted to engage in informal discussions with the MAC staff, which the MAC treated as Petitioner’s submission of its CAP and request for reconsideration. RFH at 2-6 ¶¶ 3, 6-12, 15-16; RFH at 9 ¶¶ 30-32; P. Br. at 2, 7, 16-20. Whether the MAC committed any error by treating informal communication from Petitioner as a CAP and reconsideration request need not be resolved.8 Even if the MAC committed some errors in the CAP or
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reconsideration processes, Petitioner has articulated no prejudice due to those errors indicating that those errors are harmless. Indeed, Petitioner has now received ALJ review and a decision in satisfaction of the due process requirements of 42 C.F.R. pt. 498, including the opportunity to submit documentary evidence and written argument regarding all facts and issues for my consideration, curing any defects in the due process accorded to Petitioner under the Act and regulations.
Petitioner asserts that it was not aware that the “MAC expected to be informed of its operational changes” until it received the October 18, 2022, initial determination from the MAC. P. Br. at 11 n.2 (italics in original). Petitioner does not assert that 42 C.F.R. § 424.57(c)(2) was not published or that Petitioner was not aware, i.e., did not have proper notice, of the legal requirement created by that regulation to report changes in information Petitioner provided on its Medicare enrollment application. Petitioner does not specifically assert ignorance of the law as a defense, but if Petitioner did, that issue would have to be resolved against Petitioner as an issue of law and not an issue of material fact. The issue of law must be resolved against Petitioner as Petitioner does not argue that 42 C.F.R. § 424.57(c)(2) was not properly promulgated and published, thereby providing public notice of the substantive legal requirement as required by section 1871 of the Act (42 U.S.C. § 1395hh) and 5 U.S.C. § 553.
Petitioner argues it became aware of its failure to notify CMS and the MAC of the changed information regarding the operation of its pharmacy when it received the October 18, 2022 initial determination to revoke. Petitioner asserts, and I accept the assertion as true for purposes of summary judgment, that Petitioner immediately attempted to correct information on file through communication with the MAC. However, Petitioner asserts that the MAC was not responsive. Petitioner asserts that
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revocation of its Medicare enrollment and billing privileges is a “disproportionately severe penalty.” RFH at 7 ¶ 21. Although not specifically mentioned, Petitioner’s argument may be construed to be that CMS should be estopped from revoking Petitioner’s Medicare enrollment and billing privileges. However, estoppel against the federal government, if available at all, is presumably unavailable absent “affirmative misconduct,” such as fraud. See, e.g., Pac. Islander Council of Leaders, DAB No. 2091 at 12 (2007); Office of Pers. Mgmt. v. Richmond, 496 U.S. 414, 421-22 (1990). Petitioner points to no evidence of affirmative misconduct such as fraud by the MAC or CMS.
Many of Petitioner’s arguments, including those related to the impact of COVID-19 on its operations, may be construed to be requests for equitable relief. However, I have no authority to grant equitable relief. US Ultrasound, DAB No. 2302 at 8 (2010). 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.
Pursuant to 42 C.F.R. § 424.57(e), revocation for noncompliance with the Supplier Standards established by 42 C.F.R. § 424.57(c) is effective 30 days after the supplier is sent notice of the revocation. Therefore, the effective date for revocation of Petitioner's Medicare enrollment and billing privileges is 30 days after the notice of the initial determination to revoke was issued. Accordingly, I conclude that the effective date of the revocation of Petitioner’s Medicare enrollment and billing privileges was November 17, 2022 – 30 days after the October 18, 2022 notice of the initial determination to revoke.
A provider or supplier whose Medicare enrollment and billing privileges is revoked, is barred from reenrolling in the Medicare program for one to 10 years. 42 C.F.R. § 424.535(c)(1). In this case, the MAC imposed a three-year reenrollment bar. CMS Ex. 1 at 42. Contrary to Petitioner’s argument (RFH at 4 ¶ 12), the February 21, 2023 reconsidered determination upheld the initial determination to impose a three-year bar to reenrollment concluding that there was no error in the revocation of Petitioner’s Medicare enrollment and billing privileges. CMS Ex. 1 at 2, 5.
There is no statutory or regulatory language establishing a right to review of the duration of the reenrollment bar CMS imposes, when it commences, or when it 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).
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III. Conclusion
For the foregoing reasons, I conclude that there is a basis to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. §§ 424.57(e)(1) and 424.535(a)(1) for a violation of 42 C.F.R. § 424.57(c)(2) (Supplier Standard 2). The effective date of revocation is November 17, 2022.
Endnotes
1 Citations are to the 2022 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 9 (2014).
2 Petitioner has not questioned or challenged that the postmark date was the same as the date on the letter – October 18, 2022. CMS Ex. 1 at 38, 55, 60.
3 Authority to revoke is not found in 42 C.F.R. §§ 405.800 and 424.535(g). A provider or supplier must be notified of the basis for and right to request review of an initial determination to deny or revoke Medicare enrollment and billing privileges or the decision to add years to a reenrollment bar under42 C.F.R. § 405.800. The effective date of a revocation is addressed by 42 C.F.R. § 424.535(g). The effective date of revocation is also addressed by 42 C.F.R. § 424.57(e)(1), which applies specifically to revocation of Medicare enrollment and billing privileges of a DMEPOS supplier.
4 A provider or supplier is granted the right to submit a CAP for consideration by the MAC only in the case of revocation under 42 C.F.R. § 424.535(a)(1). A DMEPOS supplier revoked under 42 C.F.R. § 424.57(e)(1) has no right to submit a CAP. In this case, the MAC could revoke under either or both 42 C.F.R. §§ 424.535(a)(1) or 424.57(e)(1), and action related to Petitioner’s CAP is not material to my decision. Further, denial of a CAP is denial of reinstatement of a provider’s or supplier’s billing privileges and is not an initial determination for which there is a right to ALJ or Board review under 42 C.F.R. pt. 498. 42 C.F.R. § 405.809(b)(2).
5 A “supplier” furnishes services and supplies under Medicare. The term supplier applies to 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) and 1835(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.
6 CMS Pub. 100-08, Medicare Program Integrity Manual (MPIM), chap. 10, § 10.1.2 provides that the PTAN is the Medicare identification number issued to suppliers such as Petitioner. A PTAN is assigned to a supplier by a MAC. A supplier may be issued more than one PTAN, but the MAC only assigns the minimum number of PTANs to ensure proper payment is made by Medicare. MPIM, chap. 10, § 10.6.10B. The PTAN is not a Medicare billing number but reflects that a supplier has been granted Medicare billing privileges for care and services rendered within the jurisdiction of a MAC. “[A] DMEPOS supplier number conveying billing privileges” is referred to in 42 C.F.R. § 424.57(b)(2), and the supplier number seems to be the same as a PTAN. The reconsidered determination lists Petitioner’s PTAN as 4575810015 but does not list a supplier number. CMS Ex. 1 at 1. The initial determination refers to Petitioner’s Medicare supplier number as 4575810015 (CMS Ex. 1 at 38), which is the same number as Petitioner’s PTAN listed in the reconsidered determination. Why CMS refers to a supplier number rather than a PTAN is not apparent. However, the different terms do not affect the outcome in this case.
7 It is not clear why the last two sentences of the subsection are enclosed by parentheses. The regulatory history for the subsection provides no explanation. However, I do not consider the use of parentheses to indicate that the language enclosed does not establish substantive requirements with which a DMEPOS supplier must comply.
8 The October 18, 2022 initial determination clearly stated Petitioner had 35 days to submit a CAP and 60 days to submit a request for reconsideration and described in detail the requirements for submitting both. CMS Ex. 1 at 40-42. The communication between the MAC and Petitioner clearly shows that the MAC treated Petitioner’s communications as the submission of a CAP and request for reconsideration and Petitioner was aware of that fact. The MAC and Petitioner actively engaged in discussion of Petitioner’s CAP and request for reconsideration. CMS Ex. 1 at 8-53. The MAC refused to accept Petitioner’s CAP because it was not signed by an authorized or delegated official. CMS Ex. 1 at 34. A reconsidered determination was issued on February 21, 2023, which shows that Petitioner submitted minimal evidence with the reconsideration request. CMS Ex. 1 at 1-7. The evidence shows that Petitioner was accorded the due process required related to the submission of a CAP and requesting reconsideration, even though Petitioner may not have exercised those rights to Petitioner’s best advantage.
Keith W. Sickendick Administrative Law Judge