Kimberly Mackanic, LCSW, LCADC, ICSW, DAB CR6624 (2025)

DECISION

Petitioner, Kimberly Mackanic, a licensed clinical social worker, participated in the Medicare program in New Jersey until she opted out effective January 8, 2024.  More than five months later, Petitioner sought to cancel her opt-out status.  Because Petitioner missed the April 7, 2024 regulatory deadline for terminating her opt-out status, the Centers for Medicare & Medicaid Services (CMS) denied her request.  Petitioner appeals that determination.  CMS had a legitimate basis to deny Petitioner’s request to terminate her Medicare opt-out status because she missed the April 7, 2024 deadline.  42 C.F.R. § 405.445(b)(2).

I. Background

On January 8, 2024, Petitioner completed and executed a pre-printed “Opt-Out Affidavit” furnished by Novitas Solutions (Novitas), a Medicare administrative contractor, in which she opted out of the Medicare program for a period of two years.  CMS Ex. 1 at 6.  Petitioner agreed that during the opt-out period, she would not submit any claims to Medicare for services furnished to Medicare beneficiaries, and she acknowledged that the two-year opt-out period would automatically renew unless cancelled in writing at least 30 days prior to the start of the next opt-out period.  CMS Ex. 1 at 6.

On February 8, 2024, Novitas approved Petitioner’s opt-out affidavit, effective January 8, 2024.  Novitas explained the following:

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Since you are opting out for the first time, you have a one-time, 90 day period to change your mind about opting out.  If you decide to terminate during this 90 day period, you must submit your request, in writing and signed, no later than APRIL 07, 2024.  After this 90 day period ends, you can only cancel the opt-out at the end of a 2 year opt-out period.

CMS Ex. 2 at 1.

Petitioner, via a June 17, 2024 email message, requested “cancellation of [her] Medicare Opt-Out status.”  CMS Ex. 3.  Petitioner explained that her contract with Horizon Managed Care Plans had been cancelled because of her opt-out status and the cancellation was inhibiting her from providing care to 12 existing clients.  CMS Ex. 3.  CMS accepted this correspondence as a request for reconsideration of the February 8, 2024 approval of Petitioner’s opt-out affidavit.  See CMS Ex. 4 at 1-2.  Thereafter, on July 8, 2024, Petitioner sent a follow-up email in which she explained that she had opted out of Medicare “upon advice from a United Healthcare representative” and had not anticipated “12 active clients suddenly becoming out of network (more than half [her] caseload).”  CMS Ex. 4 at 3.

CMS issued a reconsidered determination on October 11, 2024, in which it determined that Petitioner did not meet the 90-day deadline (April 7, 2024) for terminating her Medicare opt-out status set forth in 42 C.F.R. § 405.445(b)(2).  CMS Ex. 5 at 2-3.

Petitioner submitted a request for an administrative law judge (ALJ) hearing on November 7, 2024, in which she challenged the determination that she “fail[ed] to meet the standard 90-day deadline to request termination of [her] opt-out status.”  The Civil Remedies Division issued my standing pre-hearing order (Pre-Hearing Order) on November 12, 2024.  Consistent with that order, CMS filed a combined motion for summary judgment and pre-hearing brief and five exhibits (CMS Exs. 1-5) and Petitioner filed a brief (P. Br.).  In the absence of any objections, I admit CMS Exhibits 1-5 into the evidentiary record.

The record is closed, and this case is ready for a decision on the merits.1  See Pre-Hearing Order § 14 (“An in-person hearing to cross-examine witnesses will be necessary only if a party files admissible, written direct testimony, and the opposing party asks to cross-examine the witness(es).”).

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II. Issue

Whether CMS had a legitimate basis to deny Petitioner early termination of her opt-out status.

III. Jurisdiction

I have jurisdiction to hear and decide this case.  42 C.F.R. §§ 405.450(a), 498.3(b)(19).

IV. Discussion2

1. On January 8, 2024, Petitioner executed an affidavit to opt out of Medicare.
2. In a letter dated February 8, 2024, Novitas approved Petitioner’s opt‑out, effective January 8, 2024, at which time it instructed that she could terminate her opt-out within 90 days, no later than April 7, 2024.
3. On June 17, 2024, Petitioner requested termination of her opt-out.
4. Because Petitioner’s request to terminate her opt-out was received more than 90 days after she opted out of the Medicare program, CMS, pursuant to 42 C.F.R. § 405.445(b), had a legitimate basis to deny her request for early termination of her opt-out status.

A physician or other practitioner may participate in the Medicare program as a supplier of services.  Social Security Act (Act) § 1861(d) (42 U.S.C. § 1395x(d)); 42 C.F.R. § 498.2.  A practitioner may also enter into one or more private contracts with Medicare beneficiaries “for the purpose of furnishing items or services that would otherwise be covered by Medicare” if certain conditions are met.  42 C.F.R. § 405.405(a).  Among those conditions, the practitioner must submit one or more affidavits opting out of the Medicare program.  42 C.F.R. § 405.405; see Act § 1802(b)(3) (42 U.S.C. § 1395a(b)(3)).

If a practitioner opts out, Medicare will not pay for the services that practitioner provides to beneficiaries (with the exception of emergency or urgent care circumstances).  42 C.F.R. §§ 405.405, 405.440.  To opt out, the practitioner must sign an affidavit declaring that, during the two-year opt-out period, the practitioner “will provide services to Medicare beneficiaries only through private contracts” and “will not submit a claim to Medicare for any service furnished to a Medicare beneficiary during the opt-opt period . . . nor will . . . permit any entity acting on his or her behalf to submit a claim to Medicare for services furnished to a Medicare beneficiary,” except for emergency and

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urgent care services.  42 C.F.R. § 405.420; see 42 C.F.R. § 405.440.  Inasmuch as Petitioner executed the affidavit on January 8, 2024 (CMS Ex. 1), the two-year opt-out period began on January 8, 2024.  42 C.F.R. § 405.400.

Pursuant to 42 C.F.R. § 405.445(b), a practitioner must meet all of the following conditions in order to properly terminate an opt-out from Medicare:

1) Not have previously opted out of Medicare;

2) Notify all Medicare Administrative Contractors, with which he or she filed an affidavit, of the termination of the opt-out no later than 90 days after the effective date of the initial 2-year period;

3) Refund to each beneficiary with whom he or she has privately contracted all payment collected in excess of:

(i) The Medicare limiting charge (in the case of physicians); or
(ii) The deductible and coinsurance (in the case of practitioners).

4) Notify all beneficiaries with whom the physician or practitioner entered into private contracts of the physician’s or practitioner’s decision to terminate opt-out and of the beneficiaries’ right to have claims filed on their behalf with Medicare for the services furnished during the period between the effective date of the opt-out and the effective date of the termination of the opt-out period.

Petitioner does not dispute that she executed the opt-out affidavit on January 8, 2024, and that she requested termination of her opt-out status more than five months later on June 17, 2024.  See P. Br.  Because Petitioner did not request termination of her opt-out status within 90 days of January 8, 2024, she does not meet the above-stated requirements of 42 C.F.R. § 405.445(b).  Neither statute nor regulation allows for an early termination of opt-out status when a practitioner has not opted out within 90 days; therefore, Petitioner is bound by her current opt-out status.  See 42 U.S.C. § 1395a(b)(3); 42 C.F.R. § 405.445(b).

Petitioner argues that she relied on the advice of United Healthcare and was unaware that opting out would render her unable to obtain reimbursement from Horizon Blue Cross Blue Shield.  P. Br. at 1.  Petitioner requests that I exercise “discretion” to grant her request to terminate her opt-out status.  The scope of my review is whether CMS erred when it denied Petitioner’s request for an early termination of her opt-out from Medicare.  The pertinent regulation is clear:  to properly terminate an opt-out, a practitioner must “[n]otify all Medicare Administrative Contractors, with which he or she filed an affidavit, of the termination of the opt-out no later than 90 days after the effective date of the initial 2-year period.”  42 C.F.R. § 405.445(b)(2).  The regulation neither includes a good cause exception to the timeliness requirement, nor empowers an ALJ with the discretion to

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disregard its plain requirements.  See 42 C.F.R. § 405.445(b)(2).  Further, the affidavit advised Petitioner of the consequences of an opt-out (CMS Ex. 1), and Novitas, in its February 2024 correspondence, informed Petitioner that she could “change [her] mind” and terminate her opt-out no later than April 7, 2024.  CMS Ex. 2.

Although Petitioner requests that I exercise discretion to authorize an early termination of her opt-out, I am not empowered with the discretion to terminate an opt-out that is not authorized by law and I cannot grant equitable relief.  See, e.g., US Ultrasound, DAB No. 2302 at 8 (2010) (stating an ALJ cannot grant “equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements”).  Petitioner points to no authority by which I may grant her 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 . . . .”).

V. Conclusion

Petitioner did not ask to terminate her opt-out status within 90 days after the effective date of the opt-out period.  I affirm CMS’s determination because CMS had a legitimate basis to deny Petitioner’s request for early termination.