Concerto Delaware, LLC, DAB CR6635 (2025)

DECISION

The effective date of Petitioner’s enrollment in Medicare and Medicare billing privileges is January 12, 2023.

I.  Background and Undisputed Facts

Petitioner is an End-Stage Renal Disease (ESRD) facility providing renal dialysis services located in Newark, Delaware.  Centers for Medicare & Medicaid Services (CMS) Exhibit (Ex.) 1 at 1, 7.

On September 8, 2022, Petitioner submitted a CMS-855A Medicare enrollment application to Novitas Solutions, a Medicare administrative contractor (MAC).  CMS Ex. 1 at 2, 32, 73.

On October 10, 2022, the Delaware Department of Health and Social Services (state agency) issued Petitioner an initial dialysis center license with an expiration date of January 8, 2023.  CMS Ex. 1 at 14.  A provisional dialysis center license was issued for Petitioner on January 9, 2023, with an expiration date of April 9, 2023.  CMS Ex. 1 at 15.

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An annual dialysis center license was issued on January 12, 2023, with an expiration date of October 9, 2023.  CMS Ex. 1 at 16.

Petitioner asserts and I accept as true for purposes of summary judgment that Petitioner began performing dialysis in early November 2022.  P. Br. at 2.

On November 29, 2022, the Accreditation Commission for Health Care (ACHC)1 informed Petitioner that it recommended to CMS that Petitioner be deemed to meet Medicare participation requirements as an ESRD facility effective November 23, 2022 through November 23, 2025.  The ACHC letter informed Petitioner that CMS makes the final determination regarding the effective date of Petitioner’s participation in Medicare pursuant to 42 C.F.R. § 489.13.2  CMS Ex. 1 at 11-13, 42.

On December 13, 2022, the state agency completed an initial state licensure survey of Petitioner.  The state agency found that Petitioner was out of compliance with Delaware regulations governing dialysis centers.  CMS Ex. 1 at 57-72.  On January 12, 2023, the state agency certified Petitioner for participation in Medicare as an ESRD facility based on the state agency receiving from Petitioner an acceptable plan of correction for the standard-level deficiencies found during the survey completed on December 13, 2022.3  CMS Ex. 1 at 34-39.

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On April 14, 2023, the MAC notified Petitioner of its initial determination that Petitioner’s application to enroll in Medicare as an ESRD facility was approved effective January 12, 2023.  CMS Ex. 1 at 8-10, 17-19.

On April 17, 2023, Petitioner requested reconsideration of the initial determination.  Petitioner requested that the effective date of its Medicare enrollment be changed from January 12, 2023 to November 23, 2022, the date the ACHC granted Petitioner initial deemed status.  CMS Ex. 1 at 7.

On August 16, 2023, a CMS hearing officer issued a reconsidered determination.  The hearing officer upheld the determination that Petitioner’s effective date of Medicare enrollment was January 12, 2023.  CMS Ex. 1 at 1-6.

Petitioner requested a hearing before an administrative law judge on August 16, 2023.  The case was assigned to me to hear and decide on August 18, 2023.  On September 18, 2023, CMS filed a combined prehearing brief and motion for summary judgment (CMS Br.) with CMS Ex. 1.  On October 12, 2023, Petitioner filed a combined prehearing brief and response to CMS’s motion for summary judgment (P. Br.) with Petitioner’s Exhibit (P. Ex.) 1.  Petitioner’s pleading is treated as a cross-motion for summary judgment because Petitioner requested denial of the CMS motion for summary judgment, summary judgment in Petitioner’s favor, and remand to CMS for further action.  P. Br. at 2.  Petitioner did not object to my consideration of CMS Ex. 1 and it is admitted as evidence.

On November 3, 2023, CMS filed a reply.  CMS objected to my consideration of P. Ex. 1 and the testimony of Petitioner’s proposed witness.  Because this case is resolved on summary judgment no witness testimony will be heard and the CMS objection to Petitioner’s proposed witness requires no consideration.  CMS objects to P. Ex. 1 on grounds it is irrelevant.  Pursuant to 42 C.F.R. § 498.60(b)(1), I am to receive as evidence any evidence that is relevant and material to the issues before me.  Relevant evidence is any evidence that has a tendency to make a fact of consequence to the issue I may decide more or less probable than without the evidence.  Fed. R. Evid. 401.  P. Ex. 1 is an email thread between Petitioner’s counsel and a state agency official.  The email thread is offered by Petitioner as evidence in support of its position that Petitioner met requirements for enrollment in Medicare as of November 23, 2022.  CMS does not challenge the authenticity of the exhibit and I conclude it is relevant.  CMS also objects to P. Ex. 1 on grounds Petitioner has not shown good cause for offering the email thread for the first time before me.  The objection is without merit as on its face the exhibit shows it did not exist prior to the date the reconsidered determination was issued.  The first email in the thread is dated August 17, 2023, the day after the reconsidered determination was issued.  P. Ex. 1; CMS Ex. 1.  I conclude good cause exists for P. Ex. 1 being presented for the first time before me, and I must include the evidence.  42 C.F.R. § 498.56(e)(2)(i).  P. Ex. 1 is admitted as evidence.

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II.  Discussion

A.  Applicable Law

The Medicare program is established by Title XVIII of the Social Security Act (Act) (42 U.S.C. §§ 1395-1395lll), and includes Medicare Parts A, B, C, and D.  The Medicare program pays for covered health care items and services furnished to Medicare beneficiaries by qualified providers and suppliers.4  Act §§ 1811-1860D-43.  Qualified providers and suppliers are those who have a provider agreement or supplier approval, if required; are enrolled in Medicare; and are granted billing privileges.  42 C.F.R. pt. 424, subpt. P; pt. 489.

Congress required the Secretary to prescribe regulations for the administration of Medicare, Medicaid, and other federal health care programs.  Act §§ 1866(h)(1), (j)(1)(a), (8); 1871(a) (42 U.S.C. §§ 1395cc(h)(1), (j)(1)(a), 1395hh).

The Secretary’s regulations establishing the conditions for coverage for ESRD facilities are at 42 C.F.R. Part 494.  The Secretary’s regulations governing the Medicare enrollment of providers and suppliers, including ESRD facilities, are found in 42 C.F.R. Part 424, subpart P.  Pursuant to 42 C.F.R. § 424.510(a), a provider or supplier must submit the applicable enrollment application and, if applicable, be surveyed and certified or accredited, before CMS can enroll the provider or supplier.  ESRD facilities are surveyed prior to enrollment to determine whether they meet the conditions for coverage established by 42 C.F.R. Part 494.  42 C.F.R. §§ 488.3; 494.1(b).

The effective date of Medicare enrollment and the date of eligibility for reimbursement for care and services rendered to an eligible Medicare-beneficiary is determined under 42 C.F.R. § 489.13 for providers and suppliers that require a survey and certification or accreditation.  42 C.F.R. §§ 424.510(b); 489.13(a).  If an ESRD facility meets all the conditions for coverage established by 42 C.F.R. Part 494 at the time of the required

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survey, the effective date of the facility’s approval to participate and its enrollment as a supplier in Medicare is effective the date on which the survey is completed or the date on which all other enrollment and participation requirements are met, whichever is later.  42 C.F.R. § 489.13(b).  If the ESRD facility does not meet all the conditions for coverage established by 42 C.F.R. Part 494 on the date the required survey is completed, assuming all other enrollment and participation requirements for supplier approval are met, the effective date of approval to participate and enrollment is the earlier of:  the date on which the ESRD facility meets all conditions for coverage; or the date on which the ESRD facility meets all conditions for coverage, but has lower-level deficiencies and CMS or the state receives an acceptable plan of correction for the lower-level deficiencies; or the date on which CMS receives an approvable waiver request.  42 C.F.R. § 489.13(c)(2)(i) and (ii).  If the ESRD facility does not meet other enrollment and participation requirements when it meets the conditions for coverage, the effective date of supplier approval and enrollment will be the date on which all other enrollment and participation requirements are met.  42 C.F.R. § 489.13(c)(2).

The regulations also allow a supplier or provider to be deemed to meet participation requirements based upon accreditation by an approved accrediting organization, such as ACHC, in lieu of a state agency or CMS survey.  42 C.F.R. § 489.13(a)(ii).

Congress provided a right to a hearing on the record for certain enrollment determinations.  Act § 1866(h)(1), (j)(8).  The Secretary has issued regulations that establish the right to a hearing and judicial review of certain enrollment determinations.  Pursuant to 42 C.F.R. § 498.3(b)(15), the effective date of a provider agreement or supplier approval is an initial determination that is subject to administrative review by an ALJ after a reconsidered determination.  42 C.F.R. § 498.5(l)(1)-(2).  Appeal and review rights are specified by 42 C.F.R. § 498.5.

The hearing before an ALJ is a de novo proceeding.  Anesthesiologists Affiliated, et al., DAB CR65 (1990), aff’d, 941 F.2d 678 (8th Cir. 1991); Emerald Oaks, DAB No. 1800 at 11 (2001); Beechwood Sanitarium, DAB No. 1906 (2004); Cal Turner Extended Care, DAB No. 2030 (2006); The Residence at Salem Woods, DAB No. 2052 (2006).  The Board has previously ruled upon the allocation of the burden of persuasion and the burden of coming forward with the evidence in cases subject to 42 C.F.R. Part 498.  The Board has held that CMS must make a prima facie showing of the basis for its action.  “Prima facie” means that the evidence is “(s)ufficient to establish a fact or raise a presumption unless disproved or rebutted.”  Black’s Law Dictionary 1228 (8th ed. 2004); see also Hillman Rehabilitation Ctr., DAB No. 1611 at 8 (1997), aff’d Hillman Rehabilitation Ctr. v. U.S. Dep’t of Health and Human Services, No. 98-3789 (GEB), 1999 WL 34813783 at 14 (D.N.J. May 13, 1999).  To prevail, a petitioner must overcome CMS’s showing by a preponderance of the evidence.  Batavia Nursing and Convalescent Ctr., DAB No. 1904 (2004); Batavia Nursing and Convalescent Inn, DAB No. 1911 (2004) aff’d sub nom. Batavia Nursing & Convalescent Ctr. v. Thompson, 129 Fed.

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Appx. 181 (6th Cir. 2005); Emerald Oaks, DAB No. 1800; Cross Creek Health Care Ctr., DAB No. 1665 (1998); Hillman Rehabilitation Ctr., DAB No. 1611.

B.  Issue

The issue in this case is:

Whether the effective date of Petitioner’s provider agreement, enrollment in Medicare, and billing privileges may or should be changed from January 12, 2023 to November 23, 2022.

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

My conclusions of law are set forth in bold text followed by my findings of undisputed fact and analysis.

1.  Summary judgment is appropriate in this case.

Petitioner is entitled to a hearing on the record before an ALJ under the Act.  Act §§ 205(b); 1866(h)(1), (j)(8); Crestview Parke Care Ctr. v. Thompson, 373 F.3d 743, 748-51 (6th Cir. 2004).  However, when summary judgment is appropriate, no hearing is required.  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., Crestview Parke, 373 F.3d at 748-51; 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 has accepted that Fed. R. Civ. P. 56 and related cases provide useful guidance for determining whether summary judgment is appropriate.  I advised the parties in the Standing Order that summary judgment is an available procedural device and that the law as it has developed related to Fed. R. Civ. P. 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.  See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Mission Hosp. Reg’l Med. Ctr., DAB No. 2459 at 5 (2012) (and cases cited therein); Experts Are Us, Inc., DAB No. 2452 at 5 (2012) (and cases cited therein); Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300 at 3 (2010) (and cases cited therein).

CMS requested summary judgment.  Petitioner opposes summary judgment for CMS but requests summary judgment in its favor.  The material facts are not in dispute.  This case must be resolved against Petitioner by application of the law to the undisputed facts.  Accordingly, I conclude summary judgment in favor of CMS is appropriate, the CMS motion for summary judgment is granted, and Petitioner’s cross-motion for summary judgment is denied.

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2.  The effective date of Petitioner’s enrollment in Medicare, and billing privileges is January 12, 2023, the date Petitioner was determined to meet all federal requirements by CMS.

The analysis is uncomplicated.  Petitioner wants its effective date of Medicare enrollment and billing privileges to be November 23, 2022, the effective date ACHC recommended to CMS.  P. Br. at 2.

Petitioner argues that it sought accreditation by ACHC in lieu of survey by CMS or the state agency; it received its Delaware license in October 2022; it began treating patients in early November 2022; ACHC conducted its survey and accepted Petitioner’s plan of correction for deficiencies found; and ACHC recommended to CMS that Petitioner be enrolled in Medicare effective November 23, 2022.  P. Br. at 1-2.  None of the facts cited by Petitioner are in dispute.  Petitioner acknowledges that the state agency completed its licensing survey of Petitioner on December 13, 2022.  Petitioner also acknowledges that it was on January 12, 2023, that the state agency accepted Petitioner’s plan of correction for standard-level deficiencies found during the December 13, 2022 licensure survey.  But Petitioner argues that the December 13, 2022 state agency survey was strictly a licensure survey and not a federal certification survey on behalf of CMS.  P. Br. at 2-3.  Petitioner’s arguments must be resolved against Petitioner as a matter of law.

Petitioner must meet all conditions of participation established by the Secretary under 42 C.F.R. Part 494 and other enrollment requirements to be accepted for participation in Medicare as an ESRD facility.  42 C.F.R. § 489.10(a).  The state agency is required to determine whether Petitioner meets the conditions of participation and then recommends to CMS whether Petitioner should be granted a provider agreement, enrolled in Medicare, and granted billing privileges.  42 C.F.R. § 489.10(c).  The Secretary and his delegee CMS, may accept accreditation by a national accreditation body such as ACHC as evidence that Petitioner meets all conditions for coverage.  Act § 1865(a); 42 C.F.R. § 489.13(a)(1)(ii).  Under section 1865(a)(1) of the Act, “[i]f the Secretary finds that accreditation of a provider entity . . . demonstrates that all of the applicable conditions or requirements” of Title 18 (Medicare) are met or exceeded, the Secretary will treat the provider entity (if not a skilled nursing facility) as meeting Medicare requirements.  Section 1865(a)(1) of the Act clearly requires a finding by the Secretary or CMS that accreditation shows that all applicable Medicare requirements are met.  Under sections 1864(c) and 1865(d) of the Act, the Secretary is required to do selective validation surveys of provider entities who have deemed status under section 1865(a)(1) of the Act.  Based on these provisions of the Act it is clear that the Secretary and CMS are not bound to accept accreditation to establish that conditions or requirements for participation in Medicare are met.

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ACHC conducted its survey of Petitioner and accepted Petitioner’s plan of correction for deficiencies identified during the survey.  ACHC then recommended to CMS that Petitioner be permitted to enroll in Medicare effective November 12, 2022.  The ACHC did warn Petitioner in its notice that CMS would make the final determination as to the effective date of Petitioner’s enrollment.  CMS Ex. 1 at 11-13, 42.  However, before CMS accepted the ACHC accreditation, the state agency conducted its licensing survey of Petitioner and found that Petitioner was not in compliance with state requirements for an ESRD.  CMS Ex. 1 at 57-72.  After the state received an acceptable plan of correction for standard-level deficiencies on January 12, 2023, it then recommended that CMS enroll Petitioner in Medicare.  CMS Ex. 1 at 34-36.

Petitioner’s argument that the Secretary and CMS must accept the ACHC certification, even though the state agency determined after the ACHC that Petitioner was not in compliance with state law requirements for an ESRD, overlooks the fact that the Secretary’s first condition for coverage of an ESRD is that:

The facility and its staff must operate and furnish services in compliance with applicable Federal, State, and local laws and regulations pertaining to licensure and any other relevant health and safety requirements.

42 C.F.R. § 494.20.  Based on the state agency survey, CMS, the MAC, and the state agency knew that Petitioner did not meet the conditions and requirements for participation despite the ACHC accreditation that it did.

Under 42 C.F.R. § 489.13(b) and (c), the effective date of Petitioner’s Medicare enrollment and billing privileges cannot be before it is determined by CMS that Petitioner met all conditions for coverage as an ESRD facility under 42 C.F.R. Part 494, as well as the enrollment requirements of 42 C.F.R. Part 424 and 42 C.F.R. §§ 489.10 and 489.12.  As a matter of law, CMS could not enroll Petitioner prior to January 12, 2023, when the state agency accepted Petitioner’s plan of correction for the state licensure survey, because Petitioner was not in compliance with 42 C.F.R. § 494.20 prior to that date.5  The

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ACHC accreditation is simply not controlling based on these facts.  Petitioner’s argument that the state agency, the MAC, and CMS were confused about the nature of the December 2022 state licensure survey resulting in January 12, 2023 being selected as Petitioner’s effective date is not credible.  P. Br. at 3, 6-9.  Contrary to Petitioner’s arguments, there is a clear link between the licensure survey and the CMS determination that January 12, 2023 was the date Petitioner met all requirements to enroll in Medicare.  The state agency determined that Petitioner was not in compliance with state law applicable to an ESRD facility.  Until the state agency accepted Petitioner’s plan of correction on January 12, 2023, CMS could not conclude that Petitioner met the conditions for certification, specifically 42 C.F.R. § 494.20.

It is undisputed that Petitioner did have a Delaware license to operate as a dialysis center effective October 10, 2022.  Although not addressed by the parties, I note that 42 C.F.R. § 489.13 was amended in 2010 to clarify that a provider may not bill for care and services provided before CMS determines that all applicable federal requirements are met.  CMS explained in rulemaking that eliminated 42 C.F.R. § 489.13(d) and reorganized the remainder of the section to eliminate and clarify provisions that had caused the Board confusion in a separate case:

[T]he intent of the existing regulations is to require that all applicable Federal requirements, including a determination of whether the enrollment requirements have been satisfied, must be met before a provider agreement or supplier approval may be effective.  Any other reading of the regulations could result in a provider or supplier being permitted to bill the Medicare program for services provided at a time when its compliance with Medicare’s requirements is unknown and possibly deficient.  For example, in the event a State survey precedes the CMS contractor’s review of the enrollment application of a prospective provider or supplier, it might be possible that the application originally submitted to the CMS contractor is not complete or accurate, or both, and the applicant must provide additional information to the CMS contractor to demonstrate compliance with the enrollment requirements.  It would not be consistent with our duty to

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protect the Medicare Trust Funds from unsupported claims against it to permit payment for services furnished by a health care facility after it has passed a State survey or been accredited, but before it has satisfied all other Medicare participation requirements, including enrollment requirements.

75 Fed. Reg. 50,041, 50,401 (Aug. 16, 2010).  The 2010 change to 42 C.F.R. § 489.13 eliminated any confusion about the possibility of retroactive certification of a provider and retroactive billing, which were implied to be possible in the Board’s decisions in Puget Sound Behavioral Health, DAB No. 1944 (2004) and Renal Care Partners of Delray Beach, LLC, DAB No. 2271 (2009).  CMS has made it clear that the regulations do not grant CMS discretion to base an effective date on the date a provider meets state licensure requirements even though the state agency conducted the licensure survey.

Petitioner asserts that I have authority to provide appropriate equitable relief.  However, I have no authority to grant equitable relief.  US Ultrasound, DAB No. 2302 at 8 (2010).  I am bound to follow the Act and regulations, 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) (noting that “[a]n ALJ is bound by applicable laws and regulations and may not invalidate either a law or regulation on any ground”).

III.  Conclusion

For the foregoing reasons, the effective date of Petitioner’s provider agreement, Medicare enrollment, and billing privileges is January 12, 2023.