Wayne K. Tsang, MD, Inc., DAB CR6762 (2025)

DECISION

July 19, 2024, is the effective date of reactivation of the Medicare enrollment and billing privileges of Petitioner.

I.  Background and Undisputed Facts

The material facts are undisputed.  Any reasonable inferences are drawn in favor of Petitioner.

On February 21, 2024, Noridian Healthcare Solutions, a Medicare administrative contractor (MAC), advised Petitioner that Petitioner needed to revalidate its Medicare enrollment record by May 31, 2024.  The MAC cautioned Petitioner that failure to timely respond could result in deactivation of Petitioner's billing privileges.  Centers for Medicare & Medicaid Services (CMS) Exhibit (Ex.) 1 at 22.

On June 5, 2024, the MAC advised Petitioner that it had placed a stay on Petitioner's Medicare enrollment record effective June 5, 2024, because Petitioner failed to respond to the February 21, 2024 revalidation request.  The MAC again advised Petitioner that failure to revalidate its Medicare enrollment record could result in deactivation of Petitioner's billing privileges.  CMS Ex. 1 at 24.

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On July 11, 2024, the MAC notified Petitioner that Petitioner's billing privileges were deactivated effective June 1, 2024, pursuant to 42 C.F.R. § 424.540(a)(3) because Petitioner failed to revalidate its Medicare enrollment record.  The MAC explained that due to the deactivation Petitioner's claims would not be paid.  CMS Ex. 1 at 27.

On July 19, 2024, the MAC received Petitioner's application to revalidate its Medicare enrollment and reactivate its billing privileges.  CMS Ex. 1 at 30-44.

On September 9, 2024, the MAC advised Petitioner that its revalidation application was approved.  But there was a gap in Petitioner's Medicare billing privileges from June 1 through July 18, 2024.  CMS Ex. 1 at 19, 64.

On October 9, 2024, Petitioner requested reconsideration.  CMS Ex. 1 at 9-18.

On January 7, 2025, a MAC hearing officer issued a reconsidered determination.  The hearing office upheld Petitioner's revalidation with a gap in billing privileges from June 1 through July 18, 2024.  CMS Ex. 1 at 1-8.

On March 6, 2025, Petitioner filed a request for hearing (RFH) before an administrative law judge (ALJ).  The case was assigned to me on March 11, 2025, and my Standing Order was issued.

On May 2, 2025, CMS filed its combined prehearing brief and motion for summary judgment (CMS Br.) with CMS Exs. 1 and 2.  On June 25, 2025, Petitioner filed its opposition to CMS' motion for summary judgment with no exhibits.  Petitioner has not objected to my consideration of CMS Exs. 1 and 2, and they are admitted as evidence.  CMS failed to file a timely reply or written waiver of a reply.

II.  Issues, Conclusions of Law, and Analysis

A.  Issues

Whether I have jurisdiction to review the reconsidered determination by CMS or a MAC of the effective date of reactivation of Medicare billing privileges, which are the right to file claims with and to receive payment from Medicare; and

The effective date of reactivation of Petitioner's billing privileges.

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B.  Conclusions of Law and Analysis

My conclusions of law are set forth in bold text followed by my analysis applying the law to the undisputed facts.

1.  Summary judgment is appropriate.

Petitioner is entitled to a hearing on the record before an ALJ under the Social Security Act (Act).  Act §§ 205(b); 1866(h)(1), (j); 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 Departmental Appeals Board (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 ¶¶ D and G 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.

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).  A test for whether an issue of fact is genuinely in dispute is whether "the evidence [as to that issue] is such that a reasonable jury could return a verdict for the nonmoving party."  477 U.S. at 248.  In evaluating whether there is a genuine issue as to a material fact, an ALJ must view the facts and the inferences to be drawn from the facts in the light most favorable to the nonmoving party, which I have done.  See Pollock v. American Tel. & Tel. Long Lines, 794 F.2d 860, 864 (3rd Cir. 1986).

The undisputed facts set forth above are the facts necessary to resolve this case.  There is no genuine dispute of material fact related to the effective date of the reactivation of Petitioner's billing privileges.  CMS is entitled to judgment as a matter of law and summary judgment is appropriate.

2.  Petitioner has no right to ALJ review of the determination of the MAC to deactivate its billing privileges.  42 C.F.R. § 424.546(f).

3.  There is authority for ALJ review in this case, but it is limited to the effective date of reactivation of Petitioner's Medicare enrollment and

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billing privileges, i.e., the date of reactivation of Petitioner's right to submit claims to and receive payment from Medicare for care and services delivered to Medicare-eligible beneficiaries.

4.  July 19, 2024, is the effective date of reactivation of Petitioner's billing privileges as that was the date the MAC received Petitioner's Medicare enrollment application that it could process to approval.  42 C.F.R. § 424.540(d)(2).

This case involves a gap in Petitioner's billing privileges from June 1 through July 18, 2024, the day before the day the MAC received Petitioner's Medicare enrollment application it processed to approval.  Petitioner's grievance is that CMS and the MAC decline to pay for services rendered to Medicare-eligible beneficiaries during the gap period, even though there is no dispute that Petitioner was enrolled in Medicare during the gap period.  For purposes of this decision, it is important to understand that there is a difference between deactivation of Medicare enrollment and billing privileges and revocation of Medicare enrollment and billing privileges.  Petitioner's billing privileges were deactivated or suspended rather than being revoked.

The Secretary of the U.S. Department of Health & Human Services (the Secretary) promulgated regulations at 42 C.F.R. pt. 424 that establish a process for enrolling providers and suppliers in Medicare.  Pursuant to the regulations, CMS or the MAC may deactivate the billing privileges of an enrolled provider or supplier for any of the eight reasons listed in 42 C.F.R. § 424.540(a).  Pursuant to 42 C.F.R. § 424.540(a)(3), Medicare billing privileges may be deactivated if a provider or supplier fails to revalidate its enrollment information within 90 calendar days from receipt of a notice from CMS to revalidate.  In this case, the July 11, 2024 notice of deactivation cited 42 C.F.R. § 424.540(a)(3) as the basis for deactivation because Petitioner failed to timely revalidate its Medicare enrollment information.  CMS Ex. 1 at 27.  Deactivation of billing privileges has no effect on a provider's or supplier's "participation agreement or any conditions of participation."  42 C.F.R. § 424.540(c).  But a provider or supplier may receive no payment from Medicare for items or services provided to a Medicare-eligible beneficiary during the period of deactivation.  42 C.F.R. § 424.540(e).

There is no dispute that the MAC deactivated Petitioner's billing privileges effective June 1, 2024.  CMS Ex. 1 at 4-5, 17-18, 19, 27, 64; RFH; P. Br. at 2-5 (document page counter).  The deactivation occurred pursuant to 42 C.F.R. § 424.540(a)(3) because Petitioner failed to timely revalidate its Medicare enrollment information.  CMS Ex. 1 at 27; P. Br.; RFH.  The deactivation determination is not subject to appeal or my review.  42 C.F.R. § 424.546(f).  Therefore, any alleged defects in the process followed by the MAC in deactivating Petitioner's Medicare enrollment and billing privileges are not subject to my review and are immaterial to this decision.  Petitioner argues that there were three challenges that prevented Petitioner from timely completing its revalidation:

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(1) its clearinghouse was the victim of cyberattacks that required that Petitioner switch to a new clearinghouse; (2) calls to the MAC did not resolve issues with completing the revalidation, resulted in inconsistent responses and misdirection, and Petitioner's staff member understood that so long as the revalidation process was started before the deadline it would be sufficient; and (3) Petitioner's staff had difficulty accessing the CMS online portal to timely complete the revalidation process.  Petitioner also argues that its income is approximately 70 percent from Medicare and the inability to bill for services from June 1 through July 18, 2024, is a significant financial hardship.  CMS Ex. 1 at 17-18; RFH; P. Br. at 1-5 (document page counter).  Petitioner's arguments challenge whether Petitioner's billing privileges were properly deactivated.  But I cannot review the MAC's decision to deactivate.  My review is limited to the reconsidered determination to uphold the reactivation effective date, and that determination is dictated by the regulations.

The Secretary has not specifically stated that a provider or supplier has a right to ALJ review of CMS or MAC determinations related to the reactivation of billing privileges.  42 C.F.R. §§ 424.545, 498.3(b), 498.5.  However, 42 C.F.R. § 498.3(b)(15) provides that "[t]he effective date of a Medicare provider agreement or supplier approval" is an initial determination subject to review by an ALJ.  The Board has given an expansive interpretation to 42 C.F.R. § 498.3(b)(15) and found a right to ALJ review of the effective date of enrollment in Medicare as well as the effective date of the reactivation of billing privileges.  See, e.g., Victor Alvarez, M.D., DAB No. 2325 at 3-12 (2010) (determination of effective date of enrollment in Medicare is an initial determination subject to ALJ review and Board appeal); Urology Grp. of NJ, LLC, DAB No. 2860 at 6-7 (2018) (no right to review of a CMS or MAC determination to deactivate billing privileges but right to review of the determination of the effective date of reactivation).

Applying the reasoning of the Board in Alvarez and Urology, I conclude that a supplier has the right to ALJ review of the CMS or MAC determination of the effective date of reactivation of billing privileges.  Furthermore, the only determination of CMS or the MAC that is subject to my review in a provider or supplier enrollment case is the reconsidered determination.  42 C.F.R. § 498.5(l)(1)-(2); Neb Grp. of Ariz. LLC, DAB No. 2573 at 7.

Billing privileges may be reactivated in accordance with 42 C.F.R. § 424.540(b).  The provider or supplier must recertify the accuracy of its enrollment information, submit any missing information, and certify it is in compliance with all applicable Medicare enrollment requirements.  42 C.F.R. § 424.540(b)(1).  CMS may for any reason require a deactivated provider or supplier to submit a complete Medicare enrollment application (CMS-855) to reactivate billing privileges.  42 C.F.R. § 424.540(b)(2).  The regulation clearly gives CMS and the MAC discretion to accept a certification and partial application with missing information provided or require that Petitioner submit a complete Medicare enrollment application.

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According to 42 C.F.R. § 424.540(d)(2), the effective date of reactivation of billing privileges is the date the MAC or CMS received the Medicare enrollment application that was processed to approval.  Therefore, by operation of 42 C.F.R. § 424.540(d)(2), the effective date of the reactivation of Petitioner's Medicare billing privilege must be July 19, 2024, the date the MAC received the application it processed to approval.  CMS Ex. 1 at 30.  The regulations grant no discretion to the MAC, CMS, or me to select a different reactivation effective date.

Petitioner's arguments can be construed to be that the government is estopped from treating July 19, 2024, as Petitioner's reactivation effective date.  But as a matter of law, estoppel against the federal government, if available at all, is presumably unavailable absent "affirmative misconduct," such as fraud.  See, e.g., Pac. Islander Council of Leaders, DAB No. 2091 at 12 (2007); Office of Pers. Mgmt. v. Richmond, 496 U.S. 414, 421 (1990).  There is no evidence suggesting fraud or affirmative misconduct on the part of the MAC or CMS.  Petitioner's assertions that it received confusing responses from the MAC that resulted in misdirection are not allegations of fraud or affirmative misconduct.  I find no allegation that any MAC or CMS representative acted fraudulently or engaged in any affirmative misconduct that Petitioner acted in detrimental reliance upon.  I conclude that estoppel is not an issue.

Petitioner's argument it was unable to bill Medicare for services to Medicare beneficiaries during the gap period which will cause financial hardship for Petitioner may also be viewed as a request for equitable relief.  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, I conclude that the effective date of reactivation of Petitioner's billing privileges is July 19, 2024.