Radiology Group of Paducah PSC, DAB CR6705 (2025)

DECISION

CGS Administrators, LLC (CGS), a Medicare administrative contractor for the Centers for Medicare & Medicaid Services (CMS), approved the enrollment application of Radiology Group of Paducah PSC (Petitioner) effective September 6, 2024, a date which CGS also upheld in a reconsidered determination.  Petitioner requests a hearing before an administrative law judge (ALJ) because it does not want a gap in its billing privileges from July 5, 2024, through September 5, 2024. 

My jurisdiction in this matter is limited to determining whether CGS assigned the correct date for reactivation under the law.  I do not have jurisdiction to review CGS’s decision to deactivate Petitioner’s billing privileges or to issue equitable relief.  As to the issue before me, I affirm CGS’s determination that Petitioner’s effective date for reactivation of Medicare billing privileges is September 6, 2024, because that is the date CGS received Petitioner’s reactivation application that it processed to approval.

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I.    Procedural History and Decision on the Record

On February 3, 2025, CGS issued an unfavorable reconsidered determination related to the effective date of reactivation of Petitioner’s Medicare billing privileges.  On February 18, 2025, Petitioner timely requested a hearing to dispute the reconsidered determination.  On February 19, 2025, the Civil Remedies Division (CRD) acknowledged the hearing request and issued my Standing Prehearing Order (Prehearing Order).  On March 26, 2025, CMS timely filed a prehearing brief, which included a motion for summary judgment, and twelve proposed exhibits (CMS Exs. 1-12).  Petitioner did not file a prehearing brief or proposed exhibits.  

On May 6, 2025, I issued an Order to Show Cause explaining that Petitioner’s failure to file a prehearing exchange suggests it may have abandoned its request.  CRD Dkt. Entry No. 6.  I ordered Petitioner to file its prehearing exchange, along with a good cause explanation for filing the exchange late.  Id.  I also advised Petitioner that if it no longer wished to proceed with the hearing request, it could file a statement withdrawing the request.  Id.  Petitioner filed a response the same day, which was a resubmission of its request for hearing.  CRD Dkt. Entry No. 7.  On May 13, 2025, Petitioner confirmed by telephone with the Attorney-Advisor assisting me in this matter that it had no additional evidence or filings to submit.  Based on Petitioner’s submission and communication, I find Petitioner did not abandon its hearing request; therefore, the Order to Show Cause is discharged. 

Petitioner did not object to any of CMS’s proposed exhibits; therefore, I admit CMS’s exhibits 1 through 12 into the record.  Prehearing Order ¶ 10; Civ. Remedies Div. P. § 14(e).  Because neither party has proffered any witnesses, a hearing is not necessary.  I decide this case on the written record, meaning the parties’ written submissions and arguments, and without considering whether the standard for summary judgment is met.  Prehearing Order ¶ 13; Civ. Remedies Div. P. § 19(d).  

Therefore, I deny CMS’s summary judgment motion as moot.  In rendering this decision on the record, I address the matters raised by Petitioner in its hearing request.1

II.    Issue

Whether CGS, acting on CMS’s behalf, had a legitimate basis to assign September 6, 2024, as the effective date for the reactivation of Petitioner’s Medicare billing privileges.

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III.    Jurisdiction

I have jurisdiction to hear and decide this case.  42 C.F.R §§ 498.3(b)(15), 498.5(l)(2); see also 42 U.S.C. § 1395cc(j)(8). 

IV.    Findings of Fact

1. Petitioner is a medical group practice located in Kentucky.  Its NPI is 1295721454, and PTAN is 8679.  CMS Ex. 12 at 1.
2. On February 28, 2024, CGS mailed a revalidation letter to Petitioner’s PO Box and practice location addresses, informing Petitioner that it was required to revalidate its Medicare enrollment record by May 31, 2024.  CMS Ex. 1; CMS Ex. 2; see also CMS Ex. 12 at 5-6.
3. CGS notified Petitioner that it was placing a stay on Petitioner’s Medicare enrollment record effective June 4, 2024, because Petitioner failed to respond to CGS’s revalidation request, which was due on May 31, 2024.  CMS Ex. 3 at 1.
4. By notice dated July 5, 2024, CGS notified Petitioner that its Medicare billing privileges were deactivated effective May 31, 2024, because it did not timely revalidate its enrollment record.  CMS Ex. 4 at 1 (addressed to Petitioner’s practice location address); see also CMS Ex. 5 (addressed to Petitioner’s PO Box).  CGS advised Petitioner of its right to file a rebuttal if Petitioner did not believe the deactivation determination was correct.  CMS Ex. 4 at 1-2.  There is no evidence, and Petitioner does not contend, that it filed a rebuttal.
5. On September 6, 2024, Petitioner filed an enrollment application to reactivate its Medicare billing privileges.  CMS Ex. 6.
6. On October 30, 2024, CGS issued a notice of initial determination in which it approved Petitioner’s reactivation enrollment application with an effective date of September 6, 2024.  CMS Ex. 7.  The notice identified a gap “from July 5, 2024, through September 6, 2024,” but given Petitioner’s reactivation date, the notice should have identified the billing gap as continuing through September 5, 2024, instead.  Id.; CMS Br. at 1.
7. On December 3, 2024, Petitioner filed a reconsideration request, which required further development.  CMS Ex. 8; CMS Ex. 9.
8. On December 18, 2024, Petitioner filed a revised reconsideration request seeking removal of the billing gap.  CMS Ex. 10 at 3.  Petitioner stated that Change Healthcare, its billing agent, was subject to a cyberattack.  Id.; see also CMS Ex. 6 at

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• 17.  Petitioner further explained that due to the cyberattack, Change Healthcare had no access to CGS’s revalidation letter and that it was not aware that it failed to revalidate until September 3, 2024, when its claims were denied.  CMS Ex. 10 at 3.  Petitioner states that upon notice, it quickly submitted its revalidation application.  Id.  Because the circumstances that led to deactivation were beyond Petitioner’s control, Petitioner requested the gap in billing privileges be removed.  Id.

9. On February 3, 2025, CGS issued an unfavorable reconsidered determination.  CMS Ex. 11.  CGS reviewed the record and noted that the revalidation request was mailed to Petitioner on February 28, 2024, informing it of the May 31, 2024 deadline; a stay of enrollment was mailed on June 4, 2024; and a deactivation letter was mailed on July 5, 2024.  Id. at 2.  CGS further stated that Petitioner submitted its revalidation application on September 6, 2024.  Id.  Based on these facts, CGS concluded there was no error in the reactivation effective date resulting in the gap of billing privileges.  Id.

V.    Conclusions of Law

1. Based on the reactivation enrollment application that CGS approved in this case, the effective date for reactivation of Medicare billing privileges is the date the approved application was received by CGS, i.e., September 6, 2024.  42 C.F.R. § 424.540(d)(2).
2. Petitioner is not eligible for a retrospective billing period to July 5, 2024, because CMS may not make payment to a supplier for items or services furnished to Medicare beneficiaries while the supplier’s Medicare billing privileges are deactivated.  42 C.F.R. §§ 424.540(e), 424.555(b).

VI.    Analysis

Petitioner does not want a gap in its Medicare billing privileges from July 5, 2024, through September 5, 2024.  This gap was created when CGS deactivated Petitioner’s Medicare billing privileges because Petitioner failed to revalidate its enrollment records.  Petitioner asks that I consider, as it asked CGS, the circumstances around the time the revalidation request was sent to it.  P. Request for Hearing (RFH); CMS Ex. 10 at 3 (P. Reconsideration Request); CRD Dkt. Entry No. 7 (P. Response to Order to Show Cause). 

Petitioner explains that its billing agent, Change Healthcare, discovered it was subject to a significant cyberattack, which was discovered on February 21, 2024.  RFH; see also CMS Ex. 6 at 17.  As a result, it did not have access to CGS’s correspondence to the “Radiology Group of Paducah, PSC PO BOX and electronically scanned by Paducah Bank & Trust.”  Id.  Petitioner explains that Change Healthcare employees were issued new computer equipment in June and July of 2024 and only then began to receive access to electronically scanned correspondence.  RFH.

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Petitioner notes that the revalidation letter was sent to the PO Box on February 28, 2024, about a week after the cyberattack and during the time Change Healthcare did not have access to correspondence.  Id.  Petitioner further explains that it only learned of its deactivation on September 3, 2024, when it was informed its claims were being denied.  Id.  Petitioner explains that when it learned of its deactivation, it quickly remedied the issue by submitting its revalidation application.  Id.  Petitioner concludes that the “gap in billing [was] due to the unfortunate circumstance that took place back in February[,]” which Petitioner explains was “out of [its] control and should not disrupt [its] billing.”  Id. 

I am not able to grant Petitioner’s requested relief.  Petitioner’s situation involves CGS’s determination to deactivate Petitioner’s Medicare billing privileges effective July 5, 2024, and to reactivate Petitioner’s billing privileges effective September 6, 2024.  Of these actions, only the date of reactivation is an initial determination that may be appealed to an administrative law judge.  42 C.F.R. § 498.3(b)(15).  I have no authority to review CMS’s deactivation of Petitioner’s billing privileges, because that action is not an “initial determination” under the Secretary of Health and Human Services’ (Secretary) regulations which can be appealed and subject to ALJ review.  See 42 C.F.R. §§ 424.545(b), 498.3(b). 

The Social Security Act (Act) authorizes the Secretary to promulgate regulations governing the enrollment process for providers and suppliers.  42 U.S.C. §§ 1302, 1395cc(j).  Pertinent here, a “supplier” is “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.  42 U.S.C. § 1395x(d); see also 42 U.S.C. § 1395x(u).  

A supplier must enroll in the Medicare program to receive payment for covered Medicare items or services.  42 C.F.R. § 424.505.  The term “Enroll/Enrollment means the process that Medicare uses to establish eligibility to submit claims for Medicare-covered items and services, and the process that Medicare uses to establish eligibility to order or certify Medicare-covered items and services.”  42 C.F.R. § 424.502.  A supplier seeking Medicare billing privileges must “submit enrollment information on the applicable enrollment application.”  42 C.F.R. § 424.510(a)(1).  

To maintain Medicare billing privileges, suppliers must revalidate their enrollment information at least every five years.  42 C.F.R. § 424.515.  However, CMS reserves the right to perform revalidations at any time.  42 C.F.R. § 424.515(d), (e).  When CMS notifies providers and suppliers that it is time to revalidate, the providers or suppliers must submit the appropriate enrollment application, accurate information, and supporting documentation within 60 calendar days of CMS’s notification.  42 C.F.R. § 424.515(a)(2).

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CMS can deactivate an enrolled supplier’s Medicare billing privileges if the enrollee fails to comply with revalidation requirements.  42 C.F.R. § 424.540(a)(3).  When CMS deactivates Medicare billing privileges, “[n]o payment may be made for otherwise Medicare covered items or services furnished to a Medicare beneficiary.”  42 C.F.R. § 424.555(b).  

Here, CGS, by notice letter dated July 5, 2024, deactivated Petitioner’s billing privileges because it failed to timely revalidate.  CMS Ex. 5 (July 5 notice letter addressed to Petitioner’s PO Box); CMS Ex. 4 (July 5 notice letter addressed to Petitioner’s practice location).  CGS notified Petitioner of its rebuttal rights if it disagreed with the deactivation.  CMS Ex. 5 at 1-2; CMS Ex. 4 at 1-2.  There is no evidence, and Petitioner does not contend, that it filed a rebuttal with CGS.  See, e.g., RFH.  I reiterate that I do not have the authority to review CMS’s decision to deactivate because it is not an initial determination.  See 42 C.F.R. §§ 424.545(b), 498.3(b). 

On the other hand, the effective date of reactivation is an action over which I have authority to review.  If CMS deactivates a supplier’s billing privileges due to an untimely response to a revalidation request, the enrolled supplier may apply for CMS to reactivate its Medicare billing privileges by recertifying its enrollment information that is on file or, if deemed appropriate by CMS, complete a new enrollment application.  42 C.F.R. § 424.540(b)(1), (2).  The effective date of reactivation is the date on which the Medicare contractor received the supplier’s reactivation submission that was processed to approval.  42 C.F.R. § 424.540(d)(2).  

In this case, I find no error in CGS’s determination.  The evidence shows that CGS received Petitioner’s application on September 6, 2024, and this application was processed to approval.  CMS Ex. 6.  Therefore, the effective date is September 6, 2024.  Moreover, the effective date provision for reactivation does not provide for a retrospective or retroactive period of billing.  See 42 C.F.R. § 424.540(d)(2). 

I have no basis to doubt Petitioner’s contentions regarding the disruption that occurred because of the cyberattack on Change Healthcare.  However, Petitioner’s explanation amounts to a request for equitable relief.  An administrative law judge is not authorized to provide equitable relief by reimbursing or enrolling a supplier that does not meet statutory or regulatory requirements.  US Ultrasound, DAB No. 2302 at 8 (2010) (citing Regency on the Lake, DAB No. 2205 (2008)).  Put another way, I may not set aside CMS’s lawful exercise of its discretion based on principles of equity or fairness.  See 42 C.F.R. § 498.3(b)(15); see also, e.g., Cent. Kan. Cancer Inst., DAB No. 2749 at 10 (2016); James Shepard, M.D., DAB No. 2793 at 9 (2017).

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VII. Conclusion

For the reasons explained above, the reactivation effective date for Petitioner’s Medicare billing privileges is September 6, 2024.