Magnolia Dermatology, PLLC, DAB CR6676 (2025)

DECISION

The effective date of Medicare enrollment and billing privileges of Petitioner, Magnolia Dermatology, PLLC, is May 28, 2024.  The period for retrospective billing began April 28, 2024. 

I. Background and Procedural History

National Government Services, a Medicare administrative contractor (MAC), notified Petitioner by letter dated June 14, 2024, that its application to enroll in Medicare was approved.  The letter listed the effective date of enrollment and billing privileges as July 1, 2024.  Centers for Medicare & Medicaid Services (CMS) Exhibit (Ex.) 1 at 43-45; CMS Ex. 21. 

Petitioner requested a reconsidered determination by letter dated June 17, 2024.  Petitioner requested that the effective date of its Medicare enrollment and billing privileges be changed to August 1, 2023.  CMS Ex. 1 at 8. 

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On September 3, 2024, the MAC issued a reconsidered determination.  The MAC determined that the effective date of Petitioner’s Medicare enrollment and billing privileges was April 28, 2024.1  CMS Ex. 1 at 3. 

Petitioner requested a hearing (RFH) before an administrative law judge (ALJ) on October 18, 2024.  This case was assigned to me on October 22, 2024, and an Acknowledgment Letter and my Standing Order were issued at my direction. 

On November 20, 2024, CMS filed a motion for summary judgment (CMS Br.) and CMS Exs. 1 through 22.  On December 22, 2024, Petitioner filed a response in opposition to the CMS motion for summary judgment and a cross-motion for summary judgment (P. Br.) with Petitioner’s Exhibit (P. Ex.) 1.  On January 3, 2025, CMS filed a reply brief (CMS Reply) and objection to P. Ex. 1.  On January 27, 2025, Petitioner filed a sur-reply (P. Reply).  Petitioner has not objected to my consideration of CMS Exs. 1 through 22, which are admitted as evidence.  The CMS objection to P. Ex. 1 is sustained and P. Ex. 1 is not admitted as evidence.  CMS argues that P. Ex. 1 should not be considered as evidence citing 42 C.F.R. § 498.56(e)2 and arguing Petitioner has not shown good cause for offering P. Ex. 1 for the first time before me.  Pursuant to 42 C.F.R. § 498.56(e), I must examine any new documentary evidence submitted to determine if there is good cause for Petitioner to submit the evidence for the first time before me.  P. Ex. 1 is a declaration executed on December 22, 2024, submitted by Petitioner in support of its cross-motion for summary judgment.  A declaration is a testimony substitute rather than documentary evidence and is not subject to the limitation of 42 C.F.R. § 498.56(e).  Heartflow, Inc., DAB No. 2781 at 19 n.13 (2017).  Even if one considered P. Ex. 1 to be 

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documentary evidence simply because it is in the form of a document, it did not exist at the time of the reconsidered determination on September 3, 2024.  Therefore, there is good cause for submitting P. Ex. 1 for the first time before me.  But CMS also argues that P. Ex. 1 is not relevant to any issue that I may consider.  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 an issue I may decide more or less probable than without the evidence.  Fed. R. Evid. 401.  The CMS objection to P. Ex. 1 is sustained because P. Ex. 1 is not relevant to any issue that I may decide.  P. Ex. 1 attests that a paper application was sent to the MAC on November 14, 2023.  The date an application is sent is not material.  It is the date the MAC received the application it can process to completion that is determinative of the effective date of enrollment.  42 C.F.R. §§ 424.510(d)(1), 424.520(d)(1); 73 Fed. Reg. 69,725, 69,769 (Nov. 19, 2008); Alexander C. Gatzimos, MD, JD, LLC, DAB No. 2730 at 1 (2016).  P. Ex. 1 also states that the declarant had no contact with a CMS representative during processing of the application.  This information is also not material for reasons discussed in the following analysis.  Therefore, P. Ex. 1 is not relevant, and it is not admitted as evidence.  For purposes of summary judgment, I accept as true Petitioner’s assertions that a paper enrollment application was filed on or about November 14, 2023, and that Petitioner’s staff had no contact with CMS employees or officials during the processing of Petitioner’s enrollment applications. 

II. Discussion

A. Applicable Law

Section 1831 of the Social Security Act (the Act) (42 U.S.C. § 1395j) establishes the supplementary medical insurance benefits program for the aged and disabled known as Medicare Part B.  Payment under the program for services rendered to Medicare-eligible beneficiaries may only be made to eligible providers of services and suppliers.3  Act §§ 1835(a) (42 U.S.C. § 1395n(a)), 1842(h)(1) (42 U.S.C. § 1395u(h)(1)).  

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Administration of the Part B program is through the MACs.  Act § 1842(a) (42 U.S.C. § 1395u(a)).  

The Act requires the Secretary of Health and Human Services (the Secretary) to issue regulations that establish a process for the enrollment of providers and suppliers, including the right to a hearing and judicial review of certain enrollment determinations.  Act § 1866(j) (42 U.S.C. § 1395cc(j)). 

Pursuant to 42 C.F.R. § 424.505, a provider or supplier must be enrolled in the Medicare program and be issued a billing number to have billing privileges and to be eligible to receive payment for services rendered to a Medicare-eligible beneficiary.  The effective date of enrollment in Medicare of physicians, nonphysician practitioners, and physician and nonphysician practitioner organizations, such as Petitioner, is governed by 42 C.F.R. § 424.520(d).  The effective date of enrollment for physicians, nonphysician practitioners, or physician and nonphysician practice groups may only be the later of two dates:  (1) the date of receipt of the application for enrollment that was subsequently approved by a MAC charged with reviewing the application on behalf of CMS; or (2) the date when the physicians, nonphysician practitioners, or physician and nonphysician practice groups first began providing services at a new practice location.  42 C.F.R. § 424.520(d)(1).  An enrolled physician, nonphysician practitioner, or a physician or nonphysician group may retrospectively bill Medicare for services provided to 
Medicare-eligible beneficiaries up to 30 days prior to the effective date of enrollment, if circumstances precluded enrollment before the services were provided.  Retrospective billing for up to 90 days prior to the effective date of enrollment is permitted only in case of a Presidentially-declared disaster pursuant to 42 U.S.C. §§ 5121-5207.  42 C.F.R. § 424.521(a)(2).  

The Secretary has issued regulations that establish the right to a hearing and judicial review of certain enrollment determinations.  Act § 1866(j) (42 U.S.C. § 1395cc(j)).  Pursuant to section 1866(h)(1) and (j)(8), a provider or supplier whose enrollment application or renewal application is denied is entitled to an administrative hearing and judicial review.  Pursuant to 42 C.F.R. § 498.3(b)(15), a provider or supplier’s effective date of enrollment 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. 

B. Issues

Whether Petitioner’s effective date for Medicare enrollment is May 28, 2024, with retrospective billing privileges beginning April 28, 2024. 

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C. Findings of Fact, Conclusions of Law and Analysis

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

1. Summary judgment is appropriate.

The material facts, including the date the MAC received Petitioner’s enrollment application it processed to approval, are undisputed.  The issues raised by Petitioner are issues of law that must be resolved against Petitioner.  Based on the undisputed facts, CMS is entitled to judgment as a matter of law, and summary judgment is appropriate.  Petitioner’s cross-motion for summary judgment is denied. 

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 Prehearing Order that summary judgment is an available procedural device and that the law as it has developed under 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). 

In determining whether there are genuine issues of material fact for trial, the reviewer must view the evidence in the light most favorable to the non-moving party, drawing all reasonable inferences in that party’s favor.  The party requesting summary judgment bears the burden of showing that there are no genuine issues of material fact for trial and/or that it is entitled to judgment as a matter of law.  Generally, the non-movant may not defeat an adequately supported summary judgment motion by relying upon the denials in its pleadings or briefs but must furnish evidence of a dispute concerning a material fact, i.e., a fact that would affect the outcome of the case if proven.  See Anderson, 477 U.S. at 248; Mission Hosp. Reg’l Med. Ctr., DAB No. 2459 at 5; Experts Are Us, Inc., DAB No. 2452 at 5; Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300 at 3. 

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The standard for deciding a case on summary judgment and an ALJ’s decision-making in deciding a summary judgment motion differs from that used in resolving a case after a hearing.  On summary judgment, the ALJ does not make credibility determinations, weigh the evidence, or decide which inferences to draw from the evidence, as would be done when finding facts after a hearing on the record.  Rather, on summary judgment, the ALJ construes the evidence in a light most favorable to the non-movant and avoids deciding which version of the facts is more likely true.  Holy Cross Vill. at Notre Dame, Inc., DAB No. 2291 at 5 (2009).  The Board also has recognized that on summary judgment it is appropriate for the ALJ to consider whether a rational trier of fact could find that the party’s evidence would be sufficient to meet that party’s evidentiary burden.  Dumas Nursing & Rehab., L.P., DAB No. 2347 at 5 (2010).  The Secretary has not provided in 42 C.F.R. pt. 498 for the allocation of the burden of persuasion or the quantum of evidence required to satisfy the burden.  However, the Board has provided some persuasive analysis regarding the allocation of the burden of persuasion in cases subject to 42 C.F.R. pt. 498.  Batavia Nursing & Convalescent Ctr., DAB No. 1904 (2004), aff’d, Batavia Nursing & Convalescent Ctr. v. Thompson, 129 F. App’x 181 (6th Cir. 2005). 

I conclude that Petitioner has failed to show that there is a genuine dispute as to any fact material to determination of the correct effective date of Petitioner’s Medicare enrollment and billing privileges.  The determinations of the correct effective date and the beginning of the period for retrospective billing are based on application of the regulations to the undisputed facts.  CMS is entitled to judgment as a matter of law.  Accordingly, I conclude that summary judgment is appropriate. 

2. Pursuant to 42 C.F.R. § 424.520(d)(1)(i), Petitioner’s effective date of Medicare enrollment is May 28, 2024, the undisputed date of receipt of Petitioner’s Medicare enrollment application that was processed to approval by the MAC.

3. Pursuant to 42 C.F.R. § 424.521(a)(1), Petitioner is authorized to bill Medicare for services provided to Medicare-eligible beneficiaries up to 30 days prior to the effective date of its Medicare enrollment, which is April 28, 2024.

a. Undisputed Facts

On about November 14, 2023, Petitioner sent the MAC a paper enrollment application to enroll Petitioner in Medicare as a physician and/or nonphysician practice group.  P. Ex. 1 (not admitted); P. Br. at 1, 4, 6; CMS Ex. 1 at 115-16, 141, 143-44. 

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On January 3, 2024, the MAC received Petitioner’s paper enrollment application sent by Petitioner on or about November 14, 2023.  CMS Ex. 1 at 40, 88, 122; CMS Exs. 3-12; P. Br. at 4. 

On March 4, 2024, the MAC notified Petitioner that it rejected the application received on January 3, 2024.  CMS Ex. 1 at 88; CMS Ex. 12; P. Br. at 4. 

On March 25, 2024, the MAC received a second paper enrollment application from Petitioner.  CMS Ex. 1 at 59; CMS Exs. 13-18; P. Br. at 4. 

On May 22, 2024, the MAC notified Petitioner that the application the MAC received on March 25, 2024, was rejected.  CMS Ex. 1 at 35, 54; CMS Ex. 18; P. Br. at 4. 

On May 28, 2024, the MAC received an on-line enrollment application for Petitioner.  CMS Ex. 1 at 46; CMS Ex. 19; P. Br. at 5. 

On June 14, 2024, the MAC notified Petitioner its Medicare enrollment application was approved effective July 1, 2024.  CMS Ex. 1 at 43; CMS Ex. 21; P. Br. at 5. 

Petitioner requested reconsideration by letter dated June 17, 2024.  Petitioner requested that its effective date be changed to August 1, 2023.  CMS Ex. 1 at 8; CMS Ex. 22; P. Br. at 5. 

On September 3, 2024, the MAC issued the reconsidered determination changing Petitioner’s effective date of Medicare enrollment and billing privileges to April 28, 2024, stating: 

As CMS-855B Web application (casefolder ID PE0001420234) was received on May 28, 2024, 30 day of retrospective billing privileges under 42 Code of Federal Regulations (CFR) § 424.521(a) would accommodate for an effective date of April 28, 2024.  [National Government Services] has modified the effective date of PTAN J101112569 to April 28, 2024.  We are unable to grant the requested effective date of August 01, 2023. 

CMS Ex. 1 at 3; P. Br. at 5.  This language from the reconsidered determination shows that the MAC determined the effective date of enrollment was May 28, 2024, the date the enrollment application was received, and Petitioner was entitled to a period of retrospective billing beginning April 28, 2024. 

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I accept as true for purposes of summary judgment that all processing of Petitioner’s various applications was by the MAC and not by CMS, including the rejections of two applications, the initial determination, and the reconsidered determination.  P. Br. at 5. 

b. Analysis

Petitioner argues that the MAC had no authority to reject the application mailed by Petitioner on about November 14, 2023, and received by the MAC on January 3, 2024.  Petitioner reasons that because the November 14, 2023 application was improperly rejected, it should be treated as having been processed to completion and Petitioner should be granted retrospective billing privileges beginning October 15, 2023.  P. Br. at 5-7.  As explained in this decision, the MAC clearly had authority as a matter of law to reject Petitioner’s applications.  Petitioner is also in error in calculating the effective date of Medicare enrollment and the period for retrospective billing, which are dictated by the regulations.  Therefore, Petitioner’s arguments must be rejected as matters of law.  Petitioner has identified no genuine disputes of material fact that require a trial; all Petitioner’s assertions of fact are accepted as true for purposes of summary judgment; all reasonable inferences are drawn in Petitioner’s favor; but CMS is entitled to judgment as a matter of law. 

The regulation controlling the effective date of enrollment of physicians, nonphysician practitioners, and physician or nonphysician practice groups (such as Petitioner) is 42 C.F.R. § 424.520(d).  The effective date of enrollment and billing privileges for a physician or nonphysician practitioner or a physician or nonphysician practice group may only be the later of two dates:  (1) the date when the physician, nonphysician practitioner, or group filed an application for enrollment that was subsequently approved by a MAC charged with reviewing the application on behalf of CMS; or (2) the date when the physician, nonphysician practitioner, or group first began providing services at a new practice location.  42 C.F.R. § 424.520(d). 

The date of filing of an enrollment application is the date on which the Medicare contractor receives a signed enrollment application that the MAC can process to approval.  42 C.F.R. § 424.510(d)(1); 73 Fed. Reg. 69,725, 69,769 (Nov. 19, 2008); Alexander C. Gatzimos, MD, JD, LLC, DAB No. 2730 at 1.  The burden is on Petitioner, not the government, to demonstrate that the MAC or CMS received the requisite enrollment forms, and that Petitioner met all enrollment requirements.  42 C.F.R. § 424.545(c). 

Petitioner’s argument that it sent the application on or about November 14, 2023, is not material and of no weight as it is the date of receipt by the MAC that is treated as the date of filing, which was January 3, 2024.  CMS Ex. 1 at 40, 88, 122; CMS Exs. 3-12; P. Br. at 4. 

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There is no dispute that the MAC notified Petitioner that it rejected the application it received on January 3, 2024.  CMS Ex. 1 at 88; CMS Ex. 12; P. Br. at 4.  Pursuant to 42 C.F.R. § 424.525(d), enrollment applications that are rejected are not subject to appeal.  Because the application received on January 3, 2024, was rejected, it was not processed to approval by the MAC. 

Petitioner argues that 42 C.F.R. § 424.525(a) provides that CMS may reject an enrollment application but that no authority is granted to the MACs to do so.  Petitioner reasons that because the MAC had no authority to reject its first enrollment application, all subsequent filings by Petitioner simply supplemented its first application, and the date of filing the first application should determine the effective date of Petitioner’s enrollment and billing privileges.  Petitioner however fails to recognize that under section 1842(a) of the Act, Medicare Part B is administered by the MACs.  Therefore, 42 C.F.R. part 424 must be read consistently with section 1842(a) of the Act.  Secretarial grants of authority in the regulations for administering Medicare Part B must be read to authorize either CMS or the appropriate MAC to take an action whether the regulation specifically mentions action by CMS, the MAC, or both, unless the Secretary or CMS specifically provide by regulation or policy that an action is reserved only to CMS.4 Cf. Brian O’Connor, DAB No. 3140 at 7-15 (2024) (Persuasive Board analysis of the application of section 1842(a) of the Act and detailed discussion of delegations of authority to MACs throughout regulations related to the administration of Medicare Part B).  I conclude, contrary to Petitioner’s arguments, that the MAC clearly had authority to reject the application it received on January 3, 2024, and I have no authority to review the basis for the rejection.  I further conclude that the MAC also had authority to reject the application received on March 25, 2024, and I have no authority to review the basis for that rejection.  CMS Ex. 1 at 35, 54, 59; CMS Exs. 13-18; P. Br. at 4. 

There is no dispute that the MAC received a third application on May 28, 2024, and that the MAC processed that application to approval.  CMS Ex. 1 at 43, 46; CMS Exs. 19, 21; P. Br. at 4. 

Pursuant to 42 C.F.R. § 424.520(d), it is the later of the date that the MAC received the application it processed to approval or the date on which services were first provided to patients.  Petitioner’s first and second applications received by the MAC on January 3 

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and March 25, 2024, state that Petitioner’s staff first saw Medicare patients on October 1, 2023.  CMS Ex. 1 at 69, 129; CMS Ex. 3 at 8; CMS Ex. 13 at 11.  The application the MAC processed to completion was filed May 28, 2024, which is later than October 1, 2023.  Therefore, the regulation requires that May 28, 2024, be the effective date of Petitioner’s enrollment and billing privileges. 

An enrolled physician, nonphysician practitioner, and physician and nonphysician organizations may retrospectively bill Medicare for services provided to Medicare-eligible beneficiaries up to 30 days prior to the effective date of enrollment, if circumstances precluded enrollment before the services were provided, or up to 90 days prior only in case of a Presidentially-declared disaster pursuant to 42 U.S.C. §§ 5121-5207, the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act).  42 C.F.R. § 424.521(a)(1), (2).  There is no allegation or evidence that there was a Presidentially-declared disaster when Petitioner began providing services or submitted its applications to enroll in Medicare.  The MAC reconsidered determination indicates that the MAC determined Petitioner was entitled to a 30-day period of retrospective billing beginning April 28, 2024.  CMS Ex. 1 at 3.  Pursuant to 42 C.F.R. § 424.521(a)(1), I conclude Petitioner is entitled to a period of retrospective billing beginning April 28, 2024. 

The regulation requires that Petitioner’s effective date of Medicare enrollment and billing privileges be the date that the MAC received his enrollment application that could be processed to approval.  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).  As the Board stated in Sentinel Medical Laboratories, Inc.,

It is well established that administrative forums, such as this Board and the Department’s ALJs, do not have the authority to ignore unambiguous statutes or regulations on the basis that they are unconstitutional.  A legislative rule is binding on the agency that issues it.  1 Kenneth Culp Davis and Richard J. Pierce, Jr., Administrative Law Treatise, § 6.5 (3rd ed. 1994), citing U.S. v. Nixon, 418 U.S. 683 (1974) (where the court noted that the executive branch was bound by the terms of a regulation it had issued, even though it was within its power to change that regulation).  Federal courts have refused “to recognize in administrative officers any inherent power to nullify legislative [or executive] enactments because of personal belief that they contravene the [C]onstitution.”  Gibas v. Saginaw Mining Co., 748 F.2d 1112, at 1117 (6th Cir. 1984) (citation omitted).  Thus, courts have noted that challenges to the constitutionality of an agency regulation lie 

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outside the cognizance of that agency, and that generally, an ALJ is bound by the regulations promulgated by his administrative agency.  Howard v. FAA, 17 F.3d 1213, 1218 (9th Cir. 1994); Stieberger v. Heckler, 615 F.Supp. 1315, 1386 (S.D.N.Y. 1985), citing D’Amico v. Schweiker, 698 F.2d 903 (7th Cir. 1983).  

Sentinel Med. Labs., Inc., DAB No. 1762 at 9 (2001), aff’d sub nom., Teitelbaum v. Health Care Fin. Admin., 32 F. App’x 865 (9th Cir. 2002). 

Petitioner denies seeking equitable relief.  P. Br. at 7.  Indeed, I have no authority to grant Petitioner equitable relief in the form of an earlier effective date of enrollment and billing privileges, even if I were inclined to do so.  US Ultrasound, DAB No. 2302 at 8 (2010). 

III.  Conclusion

For the foregoing reasons, the effective date of Petitioner’s Medicare enrollment and billing privileges is May 28, 2024, with a period for retrospective billing beginning April 28, 2024.