Live & Let Live Pharmacy, LLC, ALJ Ruling 2024-4 (HHS CRD March 22, 2024)

DISMISSAL

Petitioner filed an untimely a request for a hearing (RFH) before an administrative law judge (ALJ) to contest the Centers for Medicare & Medicaid Services’ (CMS’s) decision to revoke its billing privileges due to noncompliance with Medicare requirements for suppliers of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS). Petitioner concedes the untimeliness of the hearing request and acknowledges receipt of both the February 23, 2023 initial determination notice and the June 13, 2023 reconsideration determination notice. However, Petitioner argues there is good cause for an extension of time because Petitioner, while not represented by counsel, unsuccessfully attempted to contact the Medicare Administrative Contractor (MAC) to request an extension. CMS objects to Petitioner’s untimely request for hearing and requests that the matter be dismissed. CMS’s motion to dismiss is granted. For the reasons stated below, I find that Petitioner has not shown good cause for the untimely hearing request.

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I. Procedural History

On January 18, 2024, Petitioner filed a request for hearing (RFH) to dispute CMS’s revocation of its Medicare billing privileges. The hearing request included a statement of good cause for filing an untimely request, an allegation that Petitioner previously requested an extension to file a request for an ALJ hearing, as well as documents supporting that request.1 The Civil Remedies Division docketed the case and assigned it to me.

On January 30, 2024, I issued an acknowledgment and order to show cause (Order), advising the parties that Petitioner’s hearing request appeared to be untimely and directing Petitioner to show good cause to extend the time for filing the request for hearing. I also directed Petitioner to provide a copy of the request for extension referenced in its RFH. Order at 2.

Petitioner filed a response to the order to show cause on February 9, 2024 (P. Response). In support of its response to the order to show cause, Petitioner filed an exhibit (P. Ex. 1), which is a series of emails with the MAC, including one dated August 15, 2023, where Petitioner advised the MAC that the notice letter was marked as spam and requested two additional weeks to file an appeal. P. Ex. 1 at 2.

On February 19, 2024, CMS filed a reply (Reply), disputing Petitioner’s allegations of good cause and contesting Petitioner’s request for an extension.

II. Legal Framework

A provider or supplier of Medicare services must be enrolled in the Medicare program to receive payment for items and services covered by Medicare. 42 C.F.R. § 424.505. A DMEPOS supplier, such as Petitioner, is “an entity or individual . . . which sells or rents Part B covered items to Medicare beneficiaries. . . .” 42 C.F.R. § 424.57(a). To maintain Medicare enrollment and associated “billing privileges,” a DMEPOS supplier must comply with the certification standards under 42 C.F.R. § 424.57(c). Relevant to this case, DMEPOS suppliers “must provide complete and accurate information in response to questions on its application for billing privileges” and “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). DMEPOS suppliers “must be accredited by a CMS-approved

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accreditation organization in order to receive and retain a supplier billing number.” 42 C.F.R. § 424.57(c)(22).

DMEPOS suppliers must also “meet the surety bond requirements specified in paragraph (d) of this section.” 42 C.F.R. § 424.57(c)(26). Section 424.57(d) requires, among other things, that each DMEPOS supplier “submit a bond that is continuous,” meets the minimum requirements of liability coverage ($50,000), guarantees that the surety will pay CMS “up to the full penal amount of the bond” within 30 days of receiving written notice, and provides that “[t]he surety is liable for unpaid claims, [civil money penalties (CMPs)], or assessments that occur during the term of the bond.” 42 C.F.R § 424.57(d)(4), (5). “CMS revokes the DMEPOS supplier’s billing privileges if an enrolled DMEPOS supplier fails to obtain, file timely, or maintain a surety bond as specified in [section 424.57(d)] and CMS instructions.” 42 C.F.R. § 424.57(d)(11)(i) (emphasis supplied). More generally, section 424.57 provides that “CMS revokes a supplier’s billing privileges if it is found not to meet” any of the supplier standards in section 424.57(b) or (c). 42 C.F.R. § 424.57(e)(1).

Additionally, CMS may revoke a supplier’s enrollment in the Medicare program if the supplier is determined to not be in compliance with the enrollment requirements for its supplier type. See 42 C.F.R. § 424.535(a)(1). “[F]ailure to comply with even one supplier standard is a sufficient basis for revoking a supplier’s billing privileges.” 1866ICPayday.com, L.L.C., DAB No. 2289, at 13 (2009) (citing 42 C.F.R. § 424.57(d)). Finally, DEMPOS suppliers must “maintain ordering and referring documentation consistent with the provisions found in section 424.516(f),” which includes “written and electronic documents . . . relating to written orders, certifications, referrals, prescriptions, and requests for payments for Part A or B services, items or drugs.” 42 C.F.R. §§ 424.57(c)(28), 424.516(f)(1)(ii).

If CMS revokes a supplier’s Medicare enrollment, the supplier is “barred from participating in the Medicare program from the effective date of the revocation until the end of the reenrollment bar.” 42 C.F.R. § 424.535(c)(1). At the time of the revocation in this case, CMS regulations set the reenrollment bar for a period between one and ten years, depending on the severity of the basis for the revocation. 42 C.F.R. § 424.535(c)(1)(i).

III. Findings

I base the findings below on the evidence that submitted by the parties.

1. Petitioner is a DMEPOS supplier located in Miami, Florida, that participates in the Medicare program. See RFH at 2.

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2. By letter dated February 23, 2023, Novitas Solutions, a MAC, informed Petitioner it was determined that Petitioner was not in compliance with DMEPOS supplier standards at 42 C.F.R. § 424.57(c)(2), (5), (7), (12), (19), (22), (26), and (28). RFH Ex. 1 at 11-14. The initial determination notice advised Petitioner that its DMEPOS Medicare supplier number was revoked, retroactive to January 9, 2023, the date that Petitioner’s surety bond was cancelled, and that a two-year re-enrollment bar was imposed. RFH Ex. 1 at 11. The initial determination notice included information on how Petitioner could request reconsideration, listed Petitioner’s further appeal rights, and listed the MAC’s mailing and email addresses if Petitioner had questions, decided to request reconsideration, or wanted to appeal the initial determination. RFH Ex. 1 at 14-17.
3. On April 10, 2023, Petitioner emailed a request for reconsideration to the MAC, along with supporting documents. RFH Ex. 1 at 21-83.
4. On June 13, 2023, Palmetto GBA, a MAC, mailed 2 a letter to Petitioner upholding the revocation determination due to Petitioner’s noncompliance with 42 C.F.R. § 424.57(c)(2), (22), (26), and (28). RFH Ex. 1 at 2, 7. The reconsideration determination notice advised Petitioner that Palmetto had reviewed Petitioner’s supporting documentation and determined that Petitioner provided proof of compliance with 42 C.F.R. § 424.57(c)(5), (7), (12), and (19). RFH Ex. 1 at 4-6. The reconsideration determination notice advised Petitioner of its right to appeal the reconsideration determination to an ALJ, where to find the appeal rights, and the deadline for Petitioner to file a hearing request. RFH Ex. 1 at 7, 9. The reconsideration determination notice also included information on how to request a hearing, what to include in the hearing request, how to use the e-filing system, and how to proceed if it was unable to use e-filing. RFH Ex. 1 at 7-9. Finally, the reconsideration determination notice letter listed the telephone number and mailing and email addresses for the MAC if Petitioner had any questions. RFH Ex. 1 at 8-9.
5. On August 15, 2023, Petitioner sent an email to its contact at National Supplier Clearinghouse stating that the “Rebuttal Determination letter” went to its spam email. Ex. 1 at 2. Petitioner requested two additional weeks to appeal. P. Ex. 1 at 2.

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6. On January 18, 2024, Petitioner filed a request for an ALJ hearing.

IV. Analysis

A supplier may request reconsideration of the revocation by a contractor hearing officer and may then request a hearing on the reconsideration determination before an ALJ. 42 C.F.R. §§ 424.545(a), 498.5(l), 498.22, 498.40. The supplier, its legal representative, or other authorized official must request a hearing within 60 days from receipt of the notice of the initial, reconsidered, or revised determination unless that period is extended. 42 C.F.R. § 498.40(a)(2). If the request was not filed within 60 days, the supplier, its legal representative, or other authorized official may file with the ALJ a request for extension of time with a showing of good cause for failure to timely file the hearing request. 42 C.F.R. § 498.40(c)(1) (emphasis supplied). Only when there is good cause shown may an ALJ extend the time for filing the hearing request. 42 C.F.R. § 498.40(c)(2).

The regulations do not define what the term “good cause” means. Nor has the Departmental Appeals Board (DAB) definitively defined that term. Day Op of North Nassau, Inc., DAB No. 2818 at 6-7 (2017) (citing cases). Therefore, I will consider all of the facts and circumstances based on the information before me.

In this case, I must determine whether Petitioner had good cause for failing to timely file its hearing request. More specifically, I must determine whether Petitioner’s effort to seek an extension from the Medicare contractor as a pro se party is sufficient good cause to extend its 60-day deadline.

Petitioner asserts that there is good cause to extend the deadline to file its hearing request. P. Response at 1. Petitioner does not dispute that it received the reconsideration determination notice letter. To the contrary, Petitioner acknowledges receiving the notice letter, but argues that it was not represented by counsel when the notice letter was received and did not “fully appreciate the time frame for requesting the hearing.” RFH at 1. Petitioner claims, without support, that it unsuccessfully attempted to call its contact at National Supplier Clearinghouse before sending the August 15, 2023 email. P. Response at 1.

CMS notes that the reconsideration determination stated that the Departmental Appeals Board should be contacted to request an ALJ hearing. CMS Reply at 2. However, Petitioner requested an extension from the CMS contractor. Additionally, CMS notes that Petitioner did not request a hearing within the two additional weeks requested from the CMS contractor but waited instead until January 18, 2024 to file its RFH. CMS Reply at 2. Finally, CMS argues that Petitioner’s pro se status does not relieve it of its obligation to meet filing deadlines and that Petitioner has failed to establish good cause for the untimely request for hearing. CMS Reply at 2-3.

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I find that Petitioner has not shown good cause to extend the time for filing the request for hearing. Even as a pro se party, Petitioner was still aware of its deadline to appeal the reconsideration determination. See, e.g., RFH Ex. 1 at 14-17 (advising Petitioner of its appeal rights and deadlines to submit requests for further review); P. Ex. 1 at 2 (Petitioner’s request for National Supplier Clearinghouse to “. . . please give us [an] additional [two] weeks to [a]ppeal.”). While I understand that Petitioner may have misunderstood which agency it should have contacted for an extension, it failed to file a hearing request for nearly five months. Petitioner requested a two-week extension, i.e., until August 29, 2023, to file its hearing request. P. Ex. 1 at 2. However, Petitioner did not file its RFH until January 18, 2024, 142 days later. Petitioner’s hearing request and response to the order to show cause fails to provide any explanation for the delay.

Petitioner’s pro se status and its inability to reach its contact at the MAC to request an extension are not bases to find good cause to extend the deadline for Petitioner to request a hearing.

An administrative law judge may dismiss a hearing request when the petitioner “did not file a hearing request timely and the time for filing has not been extended.” 42 C.F.R. § 498.70(c). Because Petitioner’s hearing request is five months late and I have not extended the date for filing, I dismiss Petitioner’s hearing request.

It is so ordered.