Vivekanand Neginhal, et al., DAB CR6656 (2025)

DECISION
 

Palmetto GBA (Palmetto), an administrative contractor acting on behalf of Respondent, the Centers for Medicare & Medicaid Services (CMS), determined the effective date of reassignment of Medicare billing privileges for Petitioners, Vivekanand Neginhal, et al., to be August 4, 2022, with retrospective billing permitted from May 6, 2022.  Petitioners challenge these effective date determinations, which, for the reasons explained herein, I affirm.

I.     Background

Petitioners are seven medical professionals 1 who sold their practice, Scott Orthopedic Center, to St. Mary’s Medical Management DBA Scott Orthopedic Center (St. Mary’s) on or about March 31, 2022.  P. Br. at 1.  That same day, St. Mary’s submitted a CMS-855B group enrollment application by mail to Palmetto to add the address of a new practice location, identify new owners and management, and change banking information.  CMS Ex. 1 at 16-17, 22-25, 51-52.  Palmetto approved this application on July 8, 2022.  P. Ex. 2.

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On August 4, 2022, St. Mary’s submitted reassignment applications via CMS’s online application system on behalf of Petitioners, who became employees of St. Mary’s on March 31, 2022 and thereafter provided services to St. Mary’s patients exclusively.  P. Br. at 2-3; CMS Exs. 1A at 1, 2A at 1, 3A at 1, 4A at 1, 5A at 1, 6A at 1, 7A at 1.  Palmetto deemed each application completed and received on the same day.  Id.  On August 16, 2022, Palmetto issued initial determinations approving Petitioners’ reassignment applications.  CMS Exs. 1B at 1, 2B at 1, 3B at 1, 4B at 1, 5B at 1, 6B at 1, 7B at 1.  Palmetto determined Petitioners’ effective date of reassignment to be May 6, 2022.2  Id.

St. Mary’s asked Palmetto to reconsider its effective date determinations for Petitioners because of the delays in approving St. Mary’s group enrollment application, which it submitted by mail on March 31, 2022 to reflect its acquisition of Petitioners’ practice and their hiring.  St. Mary’s asserted Palmetto did not process its application in a timely manner and was slow to communicate with St. Mary’s contact person, who spent hours tracking the application and failed to receive timely responses from the Palmetto employee assigned to its claim.  CMS Exs. 1C at 1, 2C at 1, 3C at 1, 4C at 1, 5C at 1, 6C at 1, 7C at 1; see also P. Ex. 1.  On November 8, 2022, Palmetto summarily affirmed its effective date determinations.  CMS Exs. 1F at 3, 2F at 3, 3F at 3, 4F at 3, 5F at 3, 6F at 3, 7F at 3.

Petitioners each timely requested a hearing to challenge this determination in the Civil Remedies Division, resulting in my designation to hear and decide their cases.  On December 19, 2022, I acknowledged the Petitioners’ hearing requests and issued a Notice of Intent to Consolidate and Standing Order that advised the parties I intended to consolidate all seven hearing requests and required them to file their pre-hearing exchanges and supporting documents by dates certain.  Standing Order at 1-2, 4-5.

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Without objection from the parties, I issued an order on January 3, 2023 consolidating Petitioners’ hearing requests under one docket number, C-23-144.  CMS subsequently filed a Motion for Summary Judgment and pre-hearing brief (CMS Br.), along with 43 proposed exhibits (CMS Exs. 1, 1A-F, 2A-F, 3A-F, 4A-F, 5A-F, 6A-F, 7A-F).  Petitioners filed its pre-hearing exchange that included a pre-hearing brief (P. Br.) and two proposed exhibits (P. Exs. 1-2).

II.     Decision on the Written Record and Admission of Exhibits

Neither party filed objections to the opposing party’s proposed exhibits.  I therefore admit CMS Exs. 1, 1A-F, 2A-F, 3A-F, 4A-F, 5A-F, 6A-F, 7A-F and P. Exs. 1-2 into evidence.  Neither party identified witnesses for whom the opposing party could request cross-examination.  Consequently, I will not hold an in-person hearing in this matter and issue this decision based on the written record.  Standing Order at 8; Civ. Remedies Div. P. § 19(d).  CMS’s motion for summary judgment is denied as moot.

III.     Issue

Whether Palmetto, acting on behalf of CMS, properly established August 4, 2022 as the effective date of enrollment and reassignment for Petitioners’ Medicare billing privileges.

IV.     Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(15), 498.5(l)(2).

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

1. Applicable Law

The Social Security Act (Act) authorizes the Secretary of Health and Human Services to promulgate regulations governing the enrollment process for providers and suppliers.  Act §§ 1102, 1866(j); 42 U.S.C. §§ 1302, 1395cc(j).  “[S]upplier[s],” like Petitioners, are defined as “a physician or other practitioner, a facility, or other entity (other than a provider of services) that furnishes items or services” under the Medicare provisions of the Act.  Act § 1861(d) (42 U.S.C. § 1395x(d)); see also Act § 1861(u) (42 U.S.C. § 1395x(u)).

To receive payments from the Medicare program for services furnished to its beneficiaries, a prospective supplier must enroll in the program.  42 C.F.R. § 424.505.  “Enrollment” is the process by which CMS and its contractors:  (1) identify the prospective supplier; (2) validate the supplier’s eligibility to provide items or services to Medicare beneficiaries; (3) identify and confirm a supplier’s owners and practice location; and (4) grant the supplier Medicare billing privileges.  42 C.F.R. § 424.502.

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After a prospective supplier submits an approved Medicare enrollment application, CMS establishes an effective date for billing privileges and may permit retrospective billing pursuant to 42 C.F.R. § 424.521(a).

The effective date for billing privileges for suppliers like Petitioner is “the later of the date of filing” a subsequently approved enrollment application or “the date that the supplier first began furnishing services at a new practice location.”  42 C.F.R. § 424.520(d) (emphasis added).  The “date of filing” is the date that the Medicare contractor “receives” a signed enrollment application that the Medicare contractor can process to approval.  73 Fed. Reg. 69,726, 69,769 (Nov. 19, 2008); Donald Dolce, M.D., DAB No. 2685 at 8 (2016).  The regulations allow suppliers to “retrospectively bill,” meaning CMS permits a supplier to bill Medicare for services occurring up to 30 or 90 days before the effective date of enrollment if certain circumstances apply.  42 C.F.R § 424.521(a)(1).

For Medicare Part B claims, a beneficiary may assign his or her benefits to an enrolled physician or non‑physician supplier providing services to that beneficiary.  Act § 1842(b)(3)(B)(ii) (42 U.S.C. § 1395u(b)(3)(B)(ii)).  In certain circumstances, a supplier who has received an assignment of benefits may reassign those benefits to an employer, or to an individual or entity with which the supplier has a contractual arrangement.  Act § 1842(b)(6) (42 U.S.C. § 1395u(b)(6)); 42 C.F.R. § 424.80(b)(1)‑(2).

To reassign Medicare benefits, a supplier must submit and obtain CMS’s approval of a reassignment application.  Gaurav Lakhanpal, MD, DAB No. 2951 at 1-2 (2019) (citing 71 Fed. Reg. 20,754, 20,756 (Apr. 21, 2006)).  CMS applies the effective date rules at 42 C.F.R. §§ 424.520(d) and 424.521(a)(1) to applications to reassign Medicare benefits.  See Medicare Program Integrity Manual (MPIM) (CMS Pub. 100-08) §§ 15.5.20(E)(3), 15.17.

The determination of the effective date of a supplier’s Medicare enrollment is an “initial determination” subject to administrative review under 42 C.F.R. Part 498.  See 42 C.F.R. §§ 498.3(a)(1), (b)(15); Victor Alvarez, M.D., DAB No. 2325 at 3 (2010).

2. Analysis

1. The effective date of Petitioners’ reassignment applications is August 4, 2022.

St. Mary’s submitted reassignment applications on behalf of Petitioners, received by Palmetto on August 4, 2022, that the contractor ultimately processed to approval.  CMS Exs. 1A at 1, 2A at 1, 3A at 1, 4A at 1, 5A at 1, 6A at 1, 7A at 1.  The record before me does not reflect receipt of earlier reassignment applications that Palmetto subsequently approved.  August 4, 2022 is therefore the correct effective date of reassignment for

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Petitioners’ billing privileges to St. Mary’s.  42 C.F.R. § 424.520(d); Urology Grp. of NJ, LLC, DAB No. 2860 at 7-9 (2018); Willie Goffney, Jr., M.D., DAB No. 2763 at 7 (2017); MPIM §§ 15.5.20(E)(3), 15.17.

2. I have no authority to consider Petitioners’ equitable arguments to establish earlier effective dates for their reassignment applications.

Petitioners argue the effective date of their reassignment applications should be March 31, 2022, the date St. Mary’s acquired their practice and hired them as employees.  P. Br. at 4.  Petitioners assert Palmetto caused unreasonable delays in approving St. Mary’s own group application, filed on March 31, 2022 to reflect its acquisition of Petitioners’ practice, thus causing a concordant delay in approving Petitioners’ reassignment applications.  Id. at 4-6.  Because of Palmetto’s lackadaisical processing of St. Mary’s application, Petitioners assert the 90-day retrospective billing period was insufficient to cover reassignment of payment for legitimate services they provided to St. Mary’s patients between March 31, 2022 and May 6, 2022, amounting to over $600,000 in unjust enrichment to CMS.  Id. at 4-6.

Petitioners otherwise contend their individual reassignment applications should be considered as supplements to St. Mary’s group application, making the appropriate effective date for their reassignments March 31, 2022, the date Palmetto received the group application from St. Mary’s it subsequently approved.  Id. at 6.  Finally, Petitioners argue Palmetto should have simply denied St. Mary’s group enrollment application and given it 30 days to cure any defects, specifically its failure to include Petitioners’ reassignment applications with its group enrollment application.  Id. at 7.

I acknowledge the efforts of St. Mary’s credentialing coordinator to follow up with Palmetto concerning its March 31, 2022 group enrollment application, and that some of the delay in approval stemmed from Palmetto’s inattention or poor communication.  See P. Ex. 1.  I also question CMS’s characterization of Palmetto’s delay in processing a change-of-information application received on March 31, 2022 until July 8, 2022 as “commonplace.”  CMS Br. at 6.

Nevertheless, Petitioners’ argument that Palmetto’s delay in processing St. Mary’s group application justifies modifying the effective dates of their own reassignments is a plea for equitable relief, which I cannot provide.  See, e.g., US Ultrasound, DAB No. 2302 at 8 (2010) (“Neither the ALJ nor the Board is authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements.”); Pepper Hill Nursing & Rehab. Ctr., LLC, DAB No. 2395 at 11 (2011).

The regulations specify the effective date of an enrollment application to be the date it is received or when the suppliers seeking enrollment began furnishing services, whichever is later.  42 C.F.R. § 424.520(d)(1).  I cannot modify Petitioners’ effective date to

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accommodate delays purportedly caused by CMS’s contractor in processing and approving St. Mary’s group enrollment application.3

Petitioners’ claim that their individual reassignment applications should be considered “supplements” to St. Mary’s group enrollment application is also without legal basis.  As CMS points out, its standard group enrollment application form includes a “Supporting Documentation Information” section that identifies necessary documents to be submitted with the application, among them completed individual reassignment enrollment applications “for the individual practitioner(s) who will be rendering services as part of your group/clinic or other health care organization.”  CMS Br. at 6 (citing Form CMS‑855B, Medicare Enrollment Application, Clinics/Group Practices and Other Suppliers at 26, available at https://www.cms.gov/Medicare/CMS-Forms/CMS-Forms/Downloads/cms855b.pdf (last rev. Apr. 2, 2021)); see also Yakup Akyol, M.D., DAB No. 3017 at 5 (2020) (whether the reassignment application is accompanied by an initial application for enrollment or is submitted as a “stand-alone” form, the effective date of reassignment is the “later of the date of filing [of the reassignment application] or the date the reassignor first began furnishing services at the new location.”).

In other words, CMS provided St. Mary’s the option to include the individual reassignment applications for Petitioners with its group enrollment application, which would have resulted in the effective dates of reassignment it now seeks.  MPIM § 15.5.20(E)(3).  St. Mary’s chose not to do so.  There is no statutory or regulatory basis to afford Petitioners relief on this basis.

Petitioners’ claim that St. Mary’s failure to include their reassignment applications with its own group enrollment application amounted to a “defect” CMS or Palmetto should have identified is similarly without merit.  St. Mary’s failure to include Petitioners’ reassignment applications as part of its group application was a choice, not a “defect” CMS or its contractor were obligated to identify for St. Mary’s to correct, or a basis to deny St. Mary’s application.

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In sum, August 4, 2022, the date Palmetto received Petitioners’ reassignment applications it subsequently approved, is the correct effective date of enrollment and reassignment for Petitioners’ Medicare billing privileges.  Urology Grp. of NJ, LLC, DAB No. 2860 at 7-9; Willie Goffney, Jr., M.D., DAB No. 2763 at 7; see also MPIM §§ 15.5.20(E)(3), 15.17.  I have no authority to modify Petitioners’ effective dates of reassignment on the equitable bases proffered by Petitioners, whatever their merits.  See US Ultrasound, DAB No. 2302 at 8; Pepper Hill Nursing & Rehab. Ctr., LLC, DAB No. 2395 at 11.

VI.     Conclusion

I affirm CMS, acting through its administrative contractor, properly determined the effective date for the reassignment of Petitioners’ Medicare billing privileges to St. Mary’s to be August 4, 2022, with retrospective billing permitted from May 6, 2022.

ⁱ Each Petitioner whose initial request for hearing was consolidated in this decision is identified below.