Monasak Healthcare, PLLC d/b/a Pebble Heights Pharmacy, DAB CR7007 (2026)

DECISION

The Centers for Medicare & Medicaid Services (CMS), through a contractor, revoked the Medicare billing privileges of Petitioner, Monasak Healthcare, PLLC, based on a failure to comply with the standards applicable to durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) suppliers.  Petitioner requested a hearing to dispute the revocation.  Specifically, Petitioner alleges that it only became noncompliant with the DMEPOS supplier standards after it voluntarily terminated its Medicare enrollment.  Because Petitioner does not dispute that it became noncompliant with the DMEPOS supplier standards and did not submit evidence that it filed a voluntary termination of its enrollment before it became noncompliant, I affirm CMS’s determination to revoke Petitioner’s Medicare enrollment.

I.  Background and Procedural History

In an October 3, 2025 notice of initial determination, a CMS contractor revoked Petitioner’s DMEPOS supplier number/Medicare billing privileges and established a one-year bar to reenrollment.  The CMS contractor alleged Petitioner was noncompliant with

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42 C.F.R. § 424.57(c)(10) (i.e., Petitioner’s comprehensive liability insurance policy expired on June 21, 2025).  The CMS contractor also alleged noncompliance with 42 C.F.R. § 424.57(c)(22) (i.e., Petitioner’s accreditation with the Board of Certification/Accreditation International expired on July 31, 2025.)  The CMS contractor set June 21, 2025, as the effective date for the revocation because that is the date Petitioner’s liability insurance expired.  CMS Ex. 5 at 1-2.

On October 15, 2025, Petitioner filed a request for reconsideration/corrective action plan in which Petitioner requested that CMS deactivate its Medicare billing privileges rather than revoke them.  CMS Ex. 5.  In a January 29, 2026 reconsidered determination, a CMS contractor upheld the revocation for the reasons stated in the initial determination.  CMS Ex. 1.

On March 30, 2026, Petitioner requested a hearing to challenge the revocation.  On March 31, 2026, the Civil Remedies Division acknowledged the hearing request and issued my Standing Order and the Civil Remedies Division Procedures (CRDP).  Based on the prehearing submission procedures in the Standing Order, CMS filed a brief/motion for summary judgment (CMS Br.) and eight proposed exhibits.  Petitioner did not file a brief or any proposed exhibits.

II.  Admission of Evidence

Absent objection, I admit all of CMS’s proposed exhibits into the record.  See Standing Order ¶ 10; CRDP § 14(e).

III.  Decision on the Written Record

I directed the parties to submit written direct testimony for any witnesses they wanted to offer.  Standing Order ¶ 11; see also CRDP § 16(b).  I also informed the parties as follows: 

If the parties either do not file any written direct testimony or the parties do not request to cross-examine any of the witnesses from whom written direct testimony has been submitted, I will consider such actions by the parties to serve as a constructive request for a decision on the written record because there will be no reason to hold an in-person hearing.

Standing Order ¶ 7(g)(iii); see also CRDP § 19(b).  I further advised:  “Unless a hearing is required for cross-examination of a witness or witnesses, the record will be closed and

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the case will be ready for a decision after all the submission deadlines have passed.”  Standing Order ¶ 14.

Neither party submitted written direct testimony from any witnesses and all submission deadlines have passed.  Therefore, I decide this case based on the written record.  Anil Hanuman, D.O., DAB No. 3080 at 11-12 (2022); CRDP § 19(d).

IV.  Issue

Whether CMS had a legitimate basis to revoke Petitioner’s Medicare billing privileges.

V.  Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.1(g), 498.3(b)(17), 498.5(l)(2); see also 42 U.S.C. § 1395cc(j)(8).

VI.  Findings of Fact

1) Petitioner was primarily a pharmacy.  CMS Ex. 2 at 3; CMS Ex. 6 at 2; CMS Ex. 7 at 3.

2) In 2019, Petitioner enrolled in the Medicare program as a DMEPOS supplier.  CMS Ex. 7 at 3.

3) On June 21, 2022, CMS deactivated Petitioner’s Medicare billing privileges because Petitioner billed the Medicare program too infrequently.  CMS Ex. 7 at 1.

4) On May 29, 2024, Petitioner submitted an enrollment application to reactivate its Medicare billing privileges.  CMS Ex. 2 at 1; CMS Ex. 7 at 12.

5) In the reactivation enrollment application, Petitioner stated that its accreditation through the Board of Certification/Accreditation International would expire on July 31, 2025.  CMS Ex. 2 at 3.

6) Along with the reactivation enrollment application, Petitioner submitted a certificate of insurance for comprehensive liability.  CMS Ex. 2 at 8; CMS Ex. 3.  The effective dates for the liability insurance were from June 21, 2024 to June 21, 2025.  CMS Ex. 3.

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7) CMS reactivated Petitioner’s Medicare enrollment on May 29, 2024.  CMS Ex. 7 at 1.

8) Petitioner allowed the comprehensive insurance policy to lapse on June 21, 2025.  H’rg Req. at 1.

9) Petitioner allowed its accreditation as a DMEPOS supplier to expire on July 31, 2025.  CMS Ex. 4 at 3; H’rg Req. at 1.

VII.  Conclusions of Law and Analysis

The Social Security Act (Act) authorizes the Secretary of Health and Human Services (Secretary) to establish regulations for enrolling providers and suppliers in the Medicare program and establishing requirements for DMEPOS suppliers to obtain a supplier number.  42 U.S.C. §§ 1395m(j)(1)(B), 1395cc(j)(1)(A).  DMEPOS suppliers must enroll in the Medicare program and receive a supplier number to obtain payment for items and services provided to Medicare beneficiaries.  42 U.S.C. § 1395m(j)(1)(A); 42 C.F.R. §§ 424.57(b)-(c), 424.505.  The Secretary established DMEPOS supplier standards that must be met to enroll and remain enrolled in the Medicare program.  42 C.F.R. § 424.57(b)-(c).  CMS revokes a DMEPOS supplier’s billing privileges if the supplier fails to meet the DMEPOS supplier standards.  42 C.F.R. § 424.57(e)(1).

1. Petitioner’s DMEPOS liability insurance lapsed on June 21, 2025, and Petitioner did not renew that insurance.  Therefore, Petitioner was not compliant with 42 C.F.R. § 424.57(c)(10).

The Act requires that the DMEPOS supplier standards include requirements that the supplier “have proof of appropriate liability insurance.”  42 U.S.C. § 1395m(j)(1)(B)(ii)(III).  The Secretary effectuated this requirement by promulgating the following standard: 

Has a comprehensive liability insurance policy in the amount of at least $300,000 that covers both the supplier’s place of business and all customers and employees of the supplier.  In the case of a supplier that manufactures its own items, this insurance must also cover product liability and completed operations.  Failure to maintain required insurance at all times will result in revocation of the supplier’s billing privileges retroactive to the date the insurance lapsed.

42 C.F.R. § 424.57(c)(10).

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Petitioner’s liability insurance lapsed on June 21, 2025, and Petitioner admits that it intentionally did not renew the liability insurance.  CMS Ex. 3; H’rg Req. at 1.  Therefore, I conclude that Petitioner was not compliant with 42 C.F.R. § 424.57(c)(10).

2. Petitioner’s DMEPOS accreditation expired on July 31, 2025, and Petitioner did not renew that accreditation.  Therefore, Petitioner was not compliant with 42 C.F.R. § 424.57(c)(22).

The Act requires DMEPOS suppliers to submit to the Secretary evidence of accreditation by an approved accreditation organization.  42 U.S.C. § 1395m(a)(20)(F)(i).  DMEPOS supplies requiring accreditation include “catheters, catheter supplies, ostomy bags, and supplies related to ostomy care,” “blood-testing strips and blood glucose monitors for individuals with diabetes without regard to whether the individual has Type I or Type II diabetes or to the individual’s use of insulin,” and “custom molded shoes with inserts for an individual with diabetes”  42 U.S.C. § 1395x(m)(5), (n), (s)(12); see also 42 U.S.C. § 1395m(a)(13), (20)(D)(i), (h)(4).  The implementing regulations provide the following statndard: 

All suppliers of DMEPOS and other items and services must be accredited by a CMS-approved accreditation organization in order to receive and retain a supplier billing number.  The accreditation must indicate the specific products and services, for which the supplier is accredited in order for the supplier to receive payment for those specific products and services.

42 C.F.R. § 424.57(c)(22).  Under limited circumstances, pharmacies may not need to receive accreditation.  42 U.S.C. § 1395m(a)(20)(G).

Petitioner’s accreditation expired on July 31, 2025, and Petitioner admits that it intentionally did not renew its accreditation.  CMS Ex. 4 at 3; H’rg Req. at 1.  Petitioner does not assert that it is exempt from the accreditation requirement.  See Tammy Dobbin, APN & Ebony Wellness, LLC, DAB No. 3136 at 12 (2024) (The pharmacy has the burden to show that it was exempt from the accreditation requirement.).  Finally, Petitioner sold blood glucose monitors, diabetic shoes with custom inserts, and urological supplies, all of which require Petitioner to have accreditation.  CMS Ex. 7 at 8.  Therefore, I conclude that Petitioner was not compliant with 42 C.F.R. § 424.57(c)(22).

3. CMS had a legitimate basis to revoke Petitioner’s DMEPOS supplier number/Medicare enrollment and billing privileges based on Petitioner’s failure to comply with DMEPOS supplier standards.

In its request for reconsideration, Petitioner argued that CMS should not have revoked its Medicare enrollment but instead should have deactivated Petitioner’s enrollment under

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42 C.F.R. §§ 424.540(a)(1) (submitting no claims for six consecutive months) and 424.540(a)(7) (voluntary withdrawal from Medicare program).  CMS Ex. 6  at 2.  In its hearing request, Petitioner again argues that deactivation based on its withdrawal of its Medicare enrollment was the most appropriate action for CMS to take because “Medicare and other insurances were timely notified via CMS-855S and other appropriate means” that Petitioner was closing its business.  H’rg Req. at 1.  CMS denies that Petitioner submitted a CMS-855S application to withdraw from the Medicare program.  CMS Ex. 1 at 3.

For there to be a “voluntary termination” of a supplier’s Medicare enrollment, the supplier “submits written confirmation to CMS of its decision to discontinue enrollment in the Medicare program.”  42 C.F.R. § 424.502.  However, Petitioner did not submit any evidence that it informed CMS, in writing, prior to becoming noncompliant with 42 C.F.R. § 424.57(c)(10), that it was voluntarily terminating its Medicare enrollment.  See 42 C.F.R.§ 424.535(j) (CMS will only revoke the Medicare enrollment of a supplier that voluntarily terminates enrollment when the supplier knew it was or would be out of compliance, or the voluntarily termination is made to avoid revocation).  Therefore, there is no evidentiary basis to conclude that Petitioner voluntarily terminated its Medicare enrollment before becoming noncompliant and subject to revocation.

When CMS finds that a DMEPOS supplier is not compliant with a DMEPOS standard, CMS revokes the supplier’s billing privileges.  42 C.F.R. § 424.57(e)(1); see also Experts Are Us, Inc., DAB No. 2452 at 5 (2012); 1866ICPayday.com, LLC, DAB No. 2289 at 13 (2009) (“failure to comply with even one supplier standard is a sufficient basis for revoking a supplier’s billing privileges.”).  I have concluded that Petitioner failed to comply with two DMEPOS supplier standards.  Therefore, CMS had a legitimate basis to revoke Petitioner’s Medicare billing privileges.

VIII.  Conclusion

I affirm CMS’s determination to revoke Petitioner’s Medicare billing privileges.