Joint Technology, Inc., DAB CR6647 (2025)

DECISION

Petitioner, Joint Technology, Inc., requests an earlier effective date of enrollment of August 7, 2023.  Because Petitioner did not meet the enrollment requirements for a supplier of durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) on August 7, 2023, there is no basis to grant its request for an August 7, 2023 effective date of enrollment.

I.  Background and Procedural History

Petitioner is enrolled as a supplier of DMEPOS.  See Centers for Medicare & Medicaid Services (CMS) Ex. 10 at 1.

On August 7, 2023, Petitioner submitted an internet-based application to enroll as a supplier of DMEPOS in the Medicare program.  CMS Ex. 2 at 1.

In an email dated November 10, 2023, Novitas Solutions (NPEAST DMEPOS) (herein Novitas or NPE East), a Medicare administrative contractor, requested several corrections

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to Petitioner's enrollment application.  CMS Ex. 3 at 1.  Novitas informed Petitioner that the application lacked a certificate of liability insurance, a Medicare Participating Provider Agreement listing its business location, and a copy of bank information on bank letterhead or a voided check.  CMS Ex. 3 at 1.  Novitas further requested that Petitioner upload a copy of its actual surety bond and correct its surety bond information on its application.  CMS Ex. 3 at 1.  Additionally, Novitas informed Petitioner that it "[did] not meet the exemption for business location hours to be by appointment only with no fixed hours or days," and requested that it provide the hours of operation at its location.  CMS Ex. 3 at 1.  Novitas also explained that Petitioner would receive an unannounced site visit by CMS contractor personnel.  CMS Ex. 3 at 1.

Petitioner submitted a revised internet-based enrollment application on November 14, 2023 (CMS Ex. 4), and Novitas sent another request for development via email on November 21, 2023.  CMS Ex. 5.  Novitas again directed Petitioner to submit a copy of its certificate of liability insurance, explaining that the business location address must be listed on the certificate of liability and that the certificate holder address required revision.  CMS Ex. 5 at 1.  Novitas also explained that the information Petitioner provided on its enrollment application did not match the surety bond.  CMS Ex. 5 at 1.

Petitioner again submitted a revised internet-based enrollment application on November 21, 2023.  CMS Ex. 6.  On December 14, 2023, a site visit inspector conducted a site visit of Petitioner's location.  CMS Ex. 7.  After performing a fraud and risk of abuse assessment on January 4, 2024 (CMS Ex. 9), Novitas, in a letter dated January 5, 2024,  approved Petitioner's enrollment application, effective January 4, 2024.  CMS Ex. 10 at 1.

In an undated letter received on February 6, 2024, Petitioner requested an effective date of enrollment of August 7, 2023.  CMS Ex. 11 at 1.  Petitioner argued that "it would be fair and just to backdate our approval to the original submission date of August 7th, 2023, as this delay was beyond our control."  CMS Ex. 11 at 1.

Chags Health Information Technology, LLC (C-HIT), on behalf of CMS, issued a reconsidered determination on May 16, 2024, in which it upheld the August 7, 2023 effective date of Petitioner's enrollment.  CMS Ex. 1.  C-HIT stated the following, in pertinent part:

In its reconsideration request, [Petitioner] asserts that its initial enrollment application was submitted on August 7, 2023, however it did not receive an approval letter until January 5, 2024, with an effective date of January 4, 2024.  [Petitioner] asserts that NPE East took over 90 days to send out its initial correction letter to [Petitioner] which caused a significant delay in the processing of its application.  [Petitioner] further asserts that the

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effective date of its Medicare enrollment should be made retroactive to August 7, 2023. . . .

Pursuant to § 424.520(c), the effective date for enrollment and billing privileges for DMEPOS suppliers is specified in § 424.57(b) and § 1834(j)(1)(A) of the Act.  As general rule, under § 424.57(b)(6) a DMEPOS supplier must be in compliance with all conditions of payment in § 424.57(b), as well as with § 424.57(c)(1)(ii)(A), in order to be eligible to receive payment for a Medicare-covered item.

***

Furthermore, pursuant to MPIM chapter 10, section 10.6.2(D), the date the DMEPOS supplier was approved in PECOS shall be the supplier's effective date of enrollment and billing privileges.

Here, NPE East approved [Petitioner's] Medicare enrollment with an effective date of January 4, 2024.  This was the date that NPE East determined that [Petitioner] was in compliance with all conditions listed in § 424.57(b).  Therefore, C-HIT finds that January 4, 2024, is the earliest possible effective date for [Petitioner's] Medicare enrollment.

In its reconsideration request, [Petitioner] asserts that NPE East took over 90 days to send out its initial correction letter to [Petitioner] which caused a significant delay in the processing of its application.  [Petitioner's] initial application was submitted on August 7, 2023.  On November 10, 2023, NPE East informed [Petitioner] of corrections needed to process its application.  On November 14, 2023, [Petitioner] submitted a corrected application.  On November 21, 2023, [Petitioner] was informed that it required further corrections in order for its application to be processed.  A site inspection was conducted on December 14, 2023, at [Petitioner's] facility.  The site inspector did not find any issues at the facility.  Subsequently, on January 4, 2024, [Petitioner's] Medicare enrollment application was approved and become effective.  Section 424.57(b) requires that the supplier furnish complete and accurate applications for CMS to process in a timely manner.  [Petitioner] was required to make corrections to its originally submitted application multiple times.  [Petitioner] fails to provide any more information but its claim that due to the delay in processing of its application [Petitioner's] beneficiaries are experiencing difficulties with accessing medical necessary products.  Thus, C-HIT finds that [Petitioner] has not submitted sufficient evidence to determine that the

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effective date of its Medicare billing privileges should be made retroactive to August 7, 2023.1

CMS Ex. 1 at 3-4 (internal citations omitted).

Petitioner filed a request for an administrative law judge (ALJ) hearing on July 2, 2024, in which it did not raise any specific challenges to the May 16, 2024 reconsidered determination that was the subject of its request for hearing.  The Civil Remedies Division issued my standing pre-hearing order (Pre-Hearing Order) on July 8, 2024.  CMS filed a motion for summary judgment (CMS Br.), along with 11 proposed exhibits (CMS Exs. 1-11).  Petitioner filed a one-page statement that I accept as its brief in response to CMS's motion for summary judgment, in which it requested an August 7, 2023 effective date of enrollment.

In the absence of any objections, I admit CMS Exs. 1-11 into the evidentiary record.  CMS Exs. 1-11 constitute the full evidentiary record that is the basis for this decision.  See Civil Remedies Division Procedures § 14(a) ("Documents that are intended to prove facts as alleged by a party must be offered as exhibits."); Pre-Hearing Order § 8 ("If an argument relies upon a particular exhibit, the party must provide a pinpoint citation to the exhibit and page number in its brief," and "[e]vidence submitted should be relevant and support a party's arguments and it will be unnecessary to consider evidence that is neither cited by a party in its brief or by any witnesses.").

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 (directing the parties to submit the written direct testimony of proposed witnesses, and explaining that an in-person hearing will be held only if a party submits a request to cross-examine a witness for whom written direct testimony has been submitted).  See Jeffrey K. McIlroy, MD, Inc., DAB No. 3143 at 19 (2024) (citing George Yaplee Med. Ctr., DAB No. 3003 at 5 (2020) ("Where no witness testimony is proffered, or all witness testimony is submitted in writing and no cross-examination is sought, there is no need to convene an in-person hearing.")).

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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 Petitioner is entitled to an August 7, 2023 effective date of enrollment.

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 Analysis 3

1. On August 7, 2023, Novitas received Petitioner's internet-based application to enroll in the Medicare program.
2. Petitioner's application required a number of "corrections," to include correction of the listed business hours and the surety bond company information.  In addition, Petitioner was required to submit additional documentation, to include a certificate of liability insurance, a copy of a surety bond, a provider agreement (Form CMS-460), and a copy of account information on bank letterhead or a voided check.
3. After Petitioner submitted documentation and revised its enrollment application, Novitas requested further corrections to the application, to include additional documentation.  After Petitioner complied with the second development request, a CMS contractor conducted a site visit in December 2023.
4. On January 4, 2024, Novitas completed a fraud and abuse index of risk, and on January 5, 2024, Novitas approved Petitioner's enrollment application effective January 4, 2024.

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5. Pursuant to 42 C.F.R. § 424.520(c), the effective date of billing privileges for DMEPOS suppliers is specified in 42 C.F.R. § 424.57(b) and 42 U.S.C. § 1395m(j(1)(A).
6. Pursuant to 42 C.F.R. § 424.57(b), as referenced by 42 C.F.R. § 424.520(c), a supplier is eligible to receive payment for Medicare-covered items only after it has, inter alia, submitted a completed application.
7. Among the requirements listed in 42 C.F.R. § 424.57(c), a supplier's application must list the posted hours of operation when it is staffed and accessible and demonstrate compliance with the requirements for both a comprehensive liability insurance policy and surety bond.
8. Because Petitioner's August 7, 2023 application did not comply with several application requirements listed in 42 C.F.R. § 424.57(c), to include that it be accessible and staffed during posted hours of operation, maintain a comprehensive liability policy, and comply with surety bond requirements, Petitioner has not demonstrated that it was entitled to Medicare enrollment dating back to the date of submission of its August 7, 2023 application.

Petitioner is a "supplier" for purposes of the Medicare program.  See 42 U.S.C. § 1395x(d); 42 C.F.R. §§ 400.202 (definition of supplier), 498.2 (definition of supplier).  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).  Pursuant to section 1834(j)(1)(A) of the Social Security Act, to receive Medicare payments for items furnished to a Medicare beneficiary, a supplier of DMEPOS must have a supplier number issued by the Secretary of Health and Human Services.  42 U.S.C. § 1395m(j)(1)(A); 42 C.F.R. § 424.505.  To obtain and retain its supplier number, a DMEPOS supplier must meet the standards set forth in 42 C.F.R. § 424.57(c).  These standards include maintaining a physical location that is accessible and staffed during posted hours of operation.  42 C.F.R. § 424.57(c)(7)(i)(C).  The standards also include that the supplier maintain a comprehensive liability insurance policy and meet surety bond requirements.  42 C.F.R. § 424.57(c)(10), (26); see 42 C.F.R. § 424.57(d) (surety bond requirements).  Pursuant to 42 C.F.R. § 424.520(c), the effective date of billing privileges for a supplier of DMEPOS is specified by 42 C.F.R. § 424.57(b) and 42 U.S.C. § 1834m(j)(1)(A).

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Petitioner's brief states that its "request to back date the approved enrollment date to August 7, 2023, is based on the premise that the duration taken to approve the application was excessive and has adversely impacted the continuity of patient care."  Petitioner claims the "unforeseen delay not only affected the approval date but also had severe consequences for beneficiaries relying on timely access to medically necessary products."

Petitioner has not demonstrated that its application should have been approved effective August 7, 2023.  The application Petitioner submitted on August 7, 2023, was incomplete and required a number of corrections, to include, but not limited to, that it listed "by appointment only" hours in contravention of 42 C.F.R. § 424.57(c)(7), did not include acceptable documentation of a comprehensive liability insurance policy as required by 42 C.F.R. § 424.57(c)(10), and did not include acceptable documentation that it maintained a surety bond as required by 42 C.F.R. § 424.57(c)(26).  See CMS Exs. 2, 3; see also 42 C.F.R. § 424.57(d).

Pursuant to 42 C.F.R. § 424.520(c), the effective date of billing privileges of a DMEPOS supplier is specified by 42 C.F.R. § 424.57(b), and pursuant to 42 C.F.R. § 424.57(b)(1), a DMEPOS supplier must comply with the aforementioned requirements listed in 42 C.F.R. § 424.57(c).  Inasmuch as Petitioner has not demonstrated that its August 7, 2023 submission complied with DMEPOS requirements set forth at 42 C.F.R. § 424.57(c)(7), (10), and (26) for enrollment on August 7, 2023, it is not entitled to an August 7, 2023 effective date of enrollment.

I recognize that it took Petitioner several attempts to submit an enrollment application that was ultimately processed to approval.  I also recognize that the initial processing of Petitioner's application took several months.  Unfortunately, the regulations applicable to DMEPOS suppliers do not allow an ALJ to take into account the amount of time it took for the contractor to process the application.  Because a supplier of DMEPOS may only be paid for Medicare-covered items when certain conditions are met, I lack the authority to grant Petitioner's request for an August 7, 2023 effective date of Medicare enrollment.  42 C.F.R. §§ 424.57(b), (c); 424.520(c).  To the extent that 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 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 . . . .").

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V.  Conclusion

For the foregoing reasons, there is no basis to grant an August 7, 2023, effective date for Petitioner's enrollment as a supplier of DMEPOS.