Stroma Physical Therapy, LLC, DAB CR6813 (2026)

DECISION

Petitioner, Stroma Physical Therapy, LLC, is a non-physician practitioner organization, located in New York City, New York, that participates in the Medicare program as a supplier of services.  After the Medicare contractor deactivated the practice’s Medicare billing privileges, Petitioner submitted a new application, seeking to reactivate its enrollment.  Acting on behalf of the Centers for Medicare & Medicaid Services (CMS), the Medicare contractor approved the application, with a reactivation effective date of December 13, 2023.  As a result, Petitioner’s billing privileges lapsed from December 6 through 12, 2023. 

Petitioner challenges the Contractor’s action and asks that the practice’s billing privileges be restored, retroactively. 

Because Petitioner filed its subsequently-approved reactivation application on December 13, 2023, December 13 is the earliest possible effective date for its Medicare reactivation.  See 42 C.F.R. § 424.540(d)(2). 

I have no authority to review the deactivation nor to order retrospective reimbursement for services provided during the period of deactivation.  

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Background

The Medicare contractor, National Government Services, approved Petitioner’s reactivation enrollment application, effective December 13, 2023.  CMS Ex. 7.  In response, Petitioner requested reconsideration.  CMS Ex. 3.  In a reconsidered determination, dated April 29, 2024, a contractor enrollment specialist affirmed the December 13, 2023 effective date.  CMS Ex. 1. 

Petitioner appealed, and the matter has been reassigned to me. 

The parties have filed cross-motions for summary judgment.1  However, because neither party proffers any witnesses, an in-person hearing would serve no purpose.  I therefore decide this case based on the written record, without considering whether the standards for summary judgment are satisfied.  See, CMS Br. at 2. 

CMS submits its motion and brief (CMS Br.) with 19 exhibits (CMS Exs. 1-19).  Petitioner submits its argument in response (P. Br.) with two exhibits (P. Exs. 1-2).  In the absence of any objections, I admit into evidence CMS Exs. 1-19 and P. Exs. 1-2. 

Discussion

1. On December 13, 2023, Petitioner filed its subsequently-approved Medicare reactivation application, and the effective date of its reactivation can be no earlier than that date.  42 C.F.R. § 424.540(d)(2).2 

Enrollment.  Petitioner participates in the Medicare program as a “supplier” of services.  See Social Security Act § 1861(d); 42 C.F.R. §§ 400.202; 498.2.  To receive Medicare payments for the services furnished to program beneficiaries, a supplier must enroll in the program.  Act §§ 1834(j), 1835(a); 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. 

To enroll, a prospective supplier must complete and submit an enrollment application.  42 C.F.R. §§ 424.510(d)(1), 424.515(a).  An enrollment application is either a CMS-approved paper application or an electronic process approved by the Office of

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Management and Budget.  42 C.F.R. § 424.502.3   When CMS determines that a prospective supplier meets the applicable enrollment requirements, it grants Medicare billing privileges, which means that the supplier can submit claims and receive payments from Medicare for covered services provided to program beneficiaries.  For physician and non-physician practitioner organizations submitting a new enrollment application, the effective date for billing privileges “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).  

Because this case involves re-enrollment after a deactivation, additional regulations apply.  

Deactivation and reactivation.  To maintain its billing privileges, a supplier must resubmit and recertify the accuracy of its enrollment information every five years.  42 C.F.R. § 424.515.  CMS may perform off-cycle revalidations at any time.  42 C.F.R. § 424.515(d). 

CMS may reject a supplier’s enrollment application if the “supplier fails to furnish complete information on the . . . enrollment application within 30 days from the date of the contractor request for the missing information.  42 C.F.R. § 424.525(a)(1); Tosan Fregene, M.D. and Oncology Clinics, Inc., DAB No. 3018 at 2 (2020). 

To reactivate its billing privileges, the supplier must recertify that its enrollment information currently on file with Medicare is correct, furnish any missing information, as appropriate, and comply with all applicable enrollment requirements.  42 C.F.R. § 424.540(b)(1).  CMS may also require that a deactivated supplier submit a complete enrollment application.  42 C.F.R. § 424.540(b)(2).  The effective date of reactivation of billing privileges is the date on which the Medicare contractor received the supplier’s submissions that were processed to approval.  42 C.F.R. § 424.540(d)(2).

Here, on October 26, 2023, Petitioner filed, with the Medicare contractor, an enrollment revalidation application.  CMS Ex. 18.  However, the Contractor determined that the application was incomplete, and, in a letter, dated November 1, 2023, directed Petitioner to submit, within 30 days, the missing information.  The Contractor attached to the letter a lengthy list of the sections missing from the application.  Citing 42 C.F.R. § 424.525, the letter cautioned that, if Petitioner did not provide complete information within 30 calendar days from the postmarked date of the letter, the Contractor might reject the application.  CMS Ex. 15. 

Petitioner responded on November 29, 2023, submitting some of the requested information.  CMS Ex. 13 at 3-15; CMS Ex. 14.  However, significant sections of the

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application remained unanswered.  In a letter dated December 8, 2023, the Contractor advised Petitioner that, because it had not timely revalidated its enrollment record or timely responded to the Contractor’s request for more information, its Medicare billing privileges were deactivated, effective December 6, 2023, pursuant to 42 C.F.R. § 424.540(a)(3).  The Contractor would not pay any claims after that date.  CMS Ex. 12. 

On December 13, 2023, the Medicare contractor received Petitioner’s Medicare application (Form CMS-855B), which, after some additional development, it processed to approval.  CMS Exs. 7, 10.  December 13, 2023 is therefore the effective date for reactivating Petitioner’s billing privileges.  See 42 C.F.R. § 424.540(d)(2). 

Petitioner does not dispute any of this but complains that the November 1, 2023 letter did not clearly communicate that supplying incorrect information or failing to make the requested corrections would result in immediate deactivation.  P. Br. at 1.  It points out that, in good faith, the practice submitted some corrections within the 30-day time period and should have been given the opportunity to correct the remaining errors before deactivation.  P. Br. at 1-2.  While I agree that CMS has the discretion to extend the 30-day time period, I do not.  42 C.F.R. § 424.525(b).  In fact, I have no authority to review a deactivation.  Jeffrey K. McIlroy, MD, Inc., DAB No. 3143 at 3-4 (2024); Tosan Fregene, MD and Oncology Clinics, Inc., DAB No. 3918 at 3 (2020); see 42 C.F.R. § 498.3(b) (defining “initial determinations” that are subject to review by an ALJ and the Departmental Appeals Board). 

Nor may I grant Petitioner an earlier effective date based on any equitable or policy arguments.  Howard M. Sokoloff, DPM, MS, Inc., DAB No. 2972 at 6, 9 (2019); Wishon Radiological Med. Grp., Inc., DAB No. 2941 at 6-7 (2019); Ark. Health Grp. d/b/a Baptist Health Family Clinic Lakewood, DAB No. 2929 at 7-9 (2019); James Shepard, M.D., DAB No. 2793 at 8 (2017).  

Finally, I may not direct the Contractor to allow retrospective reimbursement.  A supplier may not receive payment for services or items furnished while deactivated.  42 C.F.R. §§ 424.540(e), 424.555(b).  This represents a departure; CMS previously permitted retrospective billing after reactivation.  In promulgating the new regulation, the Secretary explained the change: 

After careful reflection . . . the most sensible approach from a program integrity perspective is to prohibit such payments altogether.  In our view, a provider or supplier should not be effectively rewarded for its non-adherence to enrollment requirements (for example, failing to respond to a revalidation request or failing to timely report enrollment information changes) by receiving payment for services or items furnished while out of compliance. 

86 Fed. Reg. 62,240, 62,359-60 (Nov. 9, 2021); see Michael B. Zafrani, M.D., DAB No. 3075 at 2 n.1 (2022).

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Conclusion

Because Petitioner filed its subsequently-approved reactivation application on December 13, 2023, December 13 is the earliest possible effective date for its reactivation.  See 42 C.F.R. § 424.540(d)(2).  

I may not review the deactivation, and retrospective reimbursement is not available for those whose enrollment has been deactivated.  42 C.F.R. § 424.540(e).