Southland Healthcare Services, Inc. D/B/A Ajoy Healthcare Services, DAB CR5244 (2019)

DECISION

I uphold the Centers for Medicare & Medicaid Services’ (CMS) revocation of the Medicare enrollment and billing privileges of Southland Healthcare Services, Inc. (Southland or Petitioner), based on 42 C.F.R. § 424.535(a)(8)(ii) (i.e., engaging in a pattern or practice of filing claims that do not meet Medicare requirements). I grant CMS’s Motion for Summary Judgment because the undisputed facts show that Southland filed numerous Medicare claims for reimbursement for hospice services over a prolonged amount of time without having physicians’ certifications that the beneficiaries in question only had six months or less to live.

I. Background and Procedure History

Southland was enrolled in the Medicare program as a hospice. A hospice is considered a “provider of services” or a “provider” in the Medicare program. 42 U.S.C. § 1395x(u); 42 C.F.R. § 400.202.

In a May 3, 2017 initial determination, CMS revoked Petitioner’s Medicare enrollment and billing privileges, effective June 2, 2017. CMS based the revocation on violations of 42 C.F.R. § 424.535(a)(8)(i) and (ii). CMS also barred Petitioner from re-enrollment in

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the Medicare program for three years. CMS Exhibit (Ex.) 1 at 95-97. Petitioner requested reconsideration of the revocation. CMS Ex. 1 at 11-14. In the reconsidered determination, a CMS hearing officer upheld the revocation; however, the hearing officer did so based only on Petitioner’s violation of 42 C.F.R. § 424.535(a)(8)(ii). CMS Ex. 1 at 1-10. Although the CMS hearing officer “overturned” the revocation based on an alleged violation of 42 C.F.R. § 424.535(a)(8)(i), the hearing officer concluded that the claims that formed the basis for that violation “were noncompliant” and used them as further support for the violation of 42 C.F.R. § 424.535(a)(8)(ii). CMS Ex. 1 at 7. The hearing officer concluded the following:

As a result, CMS finds that Southland engaged in a pattern of submitting claims that fail to meet Medicare requirements for a period of 16 months. Therefore, CMS finds that Southland engaged in a pattern of submitting claims that failed to meet Medicare requirements by submitting claims for services rendered for Medicare beneficiaries without the requisite hospice certifications and face to face evaluations.

CMS Ex. 1 at 9. The hearing officer stated that the Medicare requirement for hospice certifications and face to face evaluations, with which Southland failed to comply, was located in 42 C.F.R. § 418.22. CMS Ex. 1 at 7. The hearing officer summarized the relevant portions of that regulation to be that “the hospice must obtain written certification of terminal illness for each of the periods that a beneficiary receives hospice services. Also, where necessary, a face to face evaluation must be conducted.” CMS Ex. 1 at 7.

Petitioner timely requested administrative law judge (ALJ) review. On December 7, 2017, the case was assigned to Judge Keith Sickendick for hearing and decision. Judge Sickendick issued an Acknowledgement and Prehearing Order (Order). The parties complied with the requirements of the Order. On November 20, 2018, I was assigned to hear and decide this case.

In its prehearing exchange, CMS moved for summary judgment (CMS Br.) and submitted three exhibits. CMS Exs. 1-3. On February 15, 2018, Petitioner filed its prehearing brief (P. Br.) in which it also requested summary judgment. P. Br. at 1. Petitioner filed no proposed exhibits with its exchange. CMS did not file a reply brief.

In its brief, Petitioner objected to CMS Exs. 2-3. P. Br. at 9. CMS Exs. 2-3 are two statements by Dr. Larry B. Lipscomb. It is not disputed that Southland used Dr. Lipscomb’s National Provider Identifier (NPI) on claims that it filed with CMS. Petitioner questions the authenticity of these statements. Both statements are signed and initialed by Dr. Lipscomb and contain certification statements, although neither appear to be formally made under the penalty of perjury. The most legally salient portions of

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Dr. Lipscomb’s statements—that he formally resigned as Medical Director of Southland in November 2016 and that Southland billed under his NPI—are not disputed by the parties. Further, Southland cites one of Dr. Lipscomb’s statements as part of its factual statements in the case. See P. Br. at 2. Dr. Lipscomb’s statements are relevant and material to the issues in this case; therefore, I admit CMS Exs. 1-3 into the record. 42 C.F.R. §§ 498.60(b)(1), 498.61.

II. Issues

III. Jurisdiction

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

IV. Findings of Fact, Conclusions of Law, and Analysis

The Social Security Act (Act) authorizes the Secretary of Health and Human Services to establish regulations for enrolling providers and suppliers in the Medicare program. 42 U.S.C. § 1395cc(j)(1)(A). Providers must enroll in the Medicare program and receive a billing number in order to obtain payment for services rendered to Medicare beneficiaries. 42 C.F.R. § 424.505.

The regulations delegate to CMS the authority to revoke the enrollment and billing privileges of providers. 42 C.F.R. § 424.535. CMS or a Medicare contractor may revoke a provider’s Medicare enrollment and billing privileges for any of the reasons listed in 42 C.F.R. § 424.535(a). 42 C.F.R. §§ 405.800(b)(1), 424.535(a). If CMS revokes a provider’s Medicare enrollment and billing privileges, the revocation becomes effective 30 days after CMS or one of its contractors mails the revocation notice to the provider, subject to some exceptions not applicable in this case. 42 C.F.R. §§ 405.800(b)(2), 424.535(g). After CMS revokes a provider’s enrollment and billing privileges, CMS bars the provider from reenrolling in the Medicare program for a minimum of one year, but no more than three years. 42 C.F.R. § 424.535(c).

1. Summary judgment in CMS’s favor is appropriate.

When appropriate, an ALJ may decide a case arising under 42 C.F.R. part 498 by summary judgment. Livingston Care Ctr. v. U.S. Dep’t of Health & Human Servs., 388 F.3d 168, 172 (6th Cir. 2004) (citing Crestview Parke Care Ctr. v. Thomson, 373 F.3d

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743, 749-50 (6th Cir. 2004)). “Matters presented to the ALJ for summary judgment will follow Rule 56 of the Federal Rules of Civil Procedure and federal case law . . . .” Civil Remedies Division Procedures § 19(a).

As stated by the United States Supreme Court:

Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment ‘shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.’ By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986) (emphasis in original).

To determine whether there are genuine issues of material fact for an in-person hearing, the ALJ must view the evidence in the light most favorable to the non-moving party, drawing all reasonable inferences in that party’s favor. Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300 at 3 (2010) (citations omitted). To defeat a well-pleaded motion for summary judgment, the non-moving party must come forward with some evidence of a dispute concerning a material fact; mere denials in its pleadings are not sufficient. Id.

As discussed in detail below, Southland does not present a genuine dispute to the material facts necessary to uphold the basis for revocation. Specifically, Southland neither expressly asserts nor does it come forward with evidence that all of the claims CMS relies on to revoke Southland were properly certified by a physician, as required by 42 C.F.R. § 418.22.

CMS revoked Southland based on the following alleged facts:

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In response to the initial determination, Petitioner asserted the following facts in its request for reconsideration.

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In a Supplement to Request for Reconsideration, Petitioner stated the following:

In its request for ALJ review, Petitioner asserted the following (the last two items were expressly labeled as disputed facts):

In Petitioner’s prehearing brief, Petitioner stated the following facts:

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For purposes of summary judgment, I accept as true that Dr. Jahani did not provide services for Southland after January 2016; that Dr. Lipscomb provided services for Southland until March or April 2016; that Drs. Oretta and Ramos provided services after Drs. Jahani and Lipscomb ceased providing services; that Southland mistakenly billed Medicare under Drs. Jahani’s and Lipscomb’s “identifiers” for services provided by Drs. Oretta and Ramos; and that “Dr. Oretta and Dr. Ramos were the certifying and recommending physicians used by Southland during the pertinent time period.”

In regard to the primary issue in this case, that Petitioner failed to obtain physician certifications that beneficiaries had a life expectancy of six months or less, Petitioner has not directly disputed that it failed to obtain such certifications. To the extent that Petitioner generally asserts that physicians certified all of the beneficiaries, Petitioner only came forward with some evidence in support of that dispute during the reconsideration stage of this case. CMS Ex. 1 at 18-94. At that time, Petitioner stated that additional records would be submitted when obtained. CMS Ex. 1 at 17. However, Petitioner did not submit additional records and, when given an opportunity in this proceeding to submit more documentation (see Order at 3-4), Petitioner responded in the “Petitioner’s Pre-Hearing Exchange,” that “Petitioner will rely upon the exhibits proffered by CMS and will not provide additional documentation aside from CMS[’s] three exhibits.”

Based on a review of the documents that Petitioner submitted, there are physician certifications to support a number of the claims in question in this case. For purposes of summary judgment, I accept as true that Petitioner had physician certifications for the following claims in compliance with 42 C.F.R. § 418.22.

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Claim Submission Date	Dates of service	Beneficiary Initials	Certification Exhibit
05/02/2016	04/01/2016-04/30/2016	G.B.	CMS Ex. 1 at 91-93
06/04/2016	05/01/2016-05/31/2016	G.B.	CMS Ex. 1 at 91-93
07/02/2016	06/01/2016-06/30/2016	G.B.	CMS Ex. 1 at 91-93
08/04/2016	07/01/2016-07/31/2016	G.B.	CMS Ex. 1 at 84-86
09/02/2016	08/01/2016-08/31/2016	G.B.	CMS Ex. 1 at 94
10/04/2016	09/01/2016-09/30/2016	G.B.	CMS Ex. 1 at 94
05/03/2016	04/01/2016-04/30/2016	G.S	CMS Ex. 1 at 70-72
06/28/2016	05/01/2016-05/31/2016	G.S.	CMS Ex. 1 at 70-72
07/04/2016	06/01/2016-06/01/2016	G.S.	CMS Ex. 1 at 70-72
06/03/2016	05/01/2016-05/31/2016	L.A.	CMS Ex. 1 at 68-69
09/02/2016	08/01/2016-08/31/2016	G.W.	CMS Ex. 1 at 66-67
10/05/2016	09/01/2016-09/30/2016	G.W.	CMS Ex. 1 at 66-67
05/03/2016	04/01/2016-04/30/2016	W.M.	CMS Ex. 1 at 58-60
06/04/2016	05/01/2016-05/31/2016	W.M.	CMS Ex. 1 at 58-60
09/02/2016	08/01/2016-08/31/2016	W.M.	CMS Ex. 1 at 51-53
10/04/2016	09/01/2016-09/30/2016	W.M.	CMS Ex. 1 at 51-53
11/01/2016	10/01/2016-10/31/2016	E.B.	CMS Ex. 1 at 43-45
07/02/2016	06/01/2016-06/30/2016	D.B.	CMS Ex. 1 at 37
08/05/2016	07/01/2016-07/31/2016	D.B.	CMS Ex. 1 at 33-34, 37
09/02/2016	08/01/2016-08/31/2016	D.B.	CMS Ex. 1 at 33-34
10/04/2016	09/01/2016-09/30/2016	D.B.	CMS Ex. 1 at 26-28, 33-34
11/01/2016	10/01/2016-10/31/2016	D.B.	CMS Ex. 1 at 26-28
04/30/2016	04/05/2016-04/30/2016	J.A.	CMS Ex. 1 at 18-20

However, Petitioner has come forward with no evidence that it obtained physician certifications in compliance with 42 C.F.R. § 418.22 for the following claims. Therefore, I conclude that Petitioner has failed to raise a material dispute of fact as to whether Petitioner has the proper physician certifications for these claims.

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Claim Submission Date	Dates of service	Beneficiary Initials	Certification Exhibit
05/02/2016	03/30/2016-03/31/2016	N.P.	CMS Ex. 1 at 98
05/10/2016	04/01/2016-04/30/2016	N.P.	CMS Ex. 1 at 98
06/09/2016	05/01/2016-05/06/2016	N.P.	CMS Ex. 1 at 98
05/02/2016	04/01/2016-04/30/2016	L.O.	CMS Ex. 1 at 98
05/02/2016	04/01/2016-04/30/2016	A.P.	CMS Ex. 1 at 98
06/02/2016	05/01/2016-05/05/2016	A.P.	CMS Ex. 1 at 98
05/02/2016	04/01/2016-04/30/2016	T.C.	CMS Ex. 1 at 73-74 (no certification), 98
06/04/2016	05/01/2016-05/31/2016	T.C.	CMS Ex. 1 at 73-74 (no certification), 98
07/07/2016	06/01/2016-06/26/2016	T.C.	CMS Ex. 1 at 73-74 (no certification), 98
04/30/2016	04/01/2016-04/30/2016	L.A.	CMS Ex. 1 at 68-69 (certifies only part of claim), 98
07/01/2016	06/01/2016-06/30/2016	L.A.	CMS Ex. 1 at 68-69 (certifies only part of claim), 98
08/03/2016	07/01/2016-07/31/2016	L.A.	CMS Ex. 1 at 98
09/03/2016	08/01/2016-08/16/2016	L.A.	CMS Ex. 1 at 98
08/15/2015	07/01/2015-07/31/2015	J.A.	CMS Ex. 1 at 99
09/03/2015	08/01/2015-08/05/2015	J.A.	CMS Ex. 1 at 99
10/19/2015	08/01/2015-08/31/2015	H.C.	CMS Ex. 1 at 99
02/02/2016	01/22/2016-01/31/2016	G.W.	CMS Ex. 1 at 99
03/03/2016	02/01/2016-02/29/2016	G.W.	CMS Ex. 1 at 99
04/01/2016	03/01/2016-03/31/2016	G.W.	CMS Ex. 1 at 99
05/03/2016	04/01/2016-04/30/2016	G.W.	CMS Ex. 1 at 99
06/04/2016	05/01/2016-05/31/2016	G.W.	CMS Ex. 1 at 99
07/04/2016	06/01/2016-06/30/2016	G.W.	CMS Ex. 1 at 99
08/03/2016	07/01/2016-07/31/2016	G.W.	CMS Ex. 1 at 66-67 (certifies only part of claim), 99
11/04/2016	10/01/2016-10/31/2016	G.W.	CMS Ex. 1 at 66-67 (certifies only part of claim), 99
10/07/2015	09/01/2015-09/30/2015	W.M.	CMS Ex. 1 at 99
11/04/2015	10/01/2015-10/31/2015	W.M.	CMS Ex. 1 at 99
12/04/2015	11/01/2015-11/30/2015	W.M.	CMS Ex. 1 at 99
01/16/2016	12/01/2015-12/31/2016	W.M.	CMS Ex. 1 at 99
02/01/2016	01/01/2016-1/31/2016	W.M.	CMS Ex. 1 at 99
03/03/2016	02/01/2016-02/29/2016	W.M.	CMS Ex. 1 at 99
04/04/2016	03/01/2016-03/31/2016	W.M.	CMS Ex. 1 at 99
07/04/2016	06/01/2016-06/30/2016	W.M.	CMS Ex. 1 at 99
08/04/2016	07/01/2016-07/31/2016	W.M.	CMS Ex. 1 at 99

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Claim Submission Date	Dates of service	Beneficiary Initials	Certification Exhibit
11/04/2016	10/01/2016-10/31/2016	W.M.	CMS Ex. 1 at 100
03/03/2016	02/07/2016-02/18/2016	A.H.	CMS Ex. 1 at 100
02/03/2016	01/22/2016-01/31/2016	E.B.	CMS Ex. 1 at 100
03/02/2016	02/01/2016-02/29/2016	E.B.	CMS Ex. 1 at 100
04/01/2016	03/01/2016-03/31/2016	E.B.	CMS Ex. 1 at 100
05/02/2016	04/01/2016-04/30/2016	E.B.	CMS Ex. 1 at 100
06/04/2016	05/01/2016-05/31/2016	E.B.	CMS Ex. 1 at 100
07/02/2016	06/01/2016-06/30/2016	E.B.	CMS Ex. 1 at 100
08/06/2016	07/01/2016-07/31/2016	E.B.	CMS Ex. 1 at 100
09/03/2016	08/01/2016-08/31/2016	E.B.	CMS Ex. 1 at 100
10/04/2016	09/01/2016-09/30/2016	E.B.	CMS Ex. 1 at 43-45 (certifies only part of claim), 100
10/07/2015	09/01/2015-09/30/2015	C.G.	CMS Ex. 1 at 100
11/04/2015	10/01/2015-10/31/2015	C.G.	CMS Ex. 1 at 100
12/04/2015	11/01/2015-11/30/2015	C.G.	CMS Ex. 1 at 100
01/21/2016	12/01/2015-12/31/2015	C.G.	CMS Ex. 1 at 100
01/07/2016	12/09/2015-12/31/2015	A.T.	CMS Ex. 1 at 100
02/03/2016	01/01/2016-01/31/2016	A.T.	CMS Ex. 1 at 100
03/03/2016	02/01/2016-02/29/2016	A.T.	CMS Ex. 1 at 100
09/03/2015	08/01/2015-08/31/2015	A.H.	CMS Ex. 1 at 100
02/05/2016	01/29/2016-01/31/2016	D.B.	CMS Ex. 1 at 100
03/02/2016	02/01/2016-02/29/2016	D.B	CMS Ex. 1 at 100
04/06/2016	03/01/2016-03/31/2016	D.B.	CMS Ex. 1 at 100
04/30/2016	04/01/2016-04/30/2016	D.B.	CMS Ex. 1 at 100
06/04/2016	05/01/2016-05/31/2016	D.B.	CMS Ex. 1 at 37 (certifies only part of claim), 100
12/10/2015	11/25/2015-11/30/2015	G.B.	CMS Ex 1 at 101
12/31/2015	12/01/2015-12/31/2015	G.B.	CMS Ex. 1 at 101
02/04/2016	01/01/2016-01/31/2016	G.B.	CMS Ex. 1 at 101
04/04/2016	03/28/2016-03/31/2016	G.B.	CMS Ex. 1 at 101
09/03/2015	08/09/2015-08/31/2015	O.D.	CMS Ex. 1 at 101
06/07/2016	09/01/2015-09/01/2015	O.D.	CMS Ex. 1 at 101
02/01/2016	01/09/2016-01/31/2016	L.H.	CMS Ex. 1 at 101
09/03/2015	08/13/2015-08/31/2015	R.S.	CMS Ex. 1 at 101
11/04/2015	10/01/2015-10/31/2015	R.S.	CMS Ex. 1 at 101
12/11/2015	11/01/2015-11/30/2015	R.S.	CMS Ex. 1 at 101
10/07/2015	09/26/2015-09/30/2015	L.J.	CMS Ex. 1 at 101
03/30/2016	01/20/2016-01/31/2016	J.M-M	CMS Ex. 1 at 101
08/14/2015	07/26/2015-07/30/2015	B.C	CMS Ex. 1 at 101
02/02/2016	01/10/2016-01/31/2016	M.L.	CMS Ex. 1 at 101
09/09/2015	08/30/2015-08/31/2015	M.M.	CMS Ex. 1 at 101
10/07/2015	09/04/2015-09/30/2015	S.A.	CMS Ex. 1 at 101
09/22/2015	08/31/2015-08/31/2015	R.E.	CMS Ex. 1 at 101

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2. There is a legitimate basis to revoke Petitioner’s Medicare enrollment and billing privileges under 42 C.F.R. § 424.535(a)(8)(ii).

CMS revoked Petitioner’s enrollment and billing privileges based on 42 C.F.R. § 424.535(a)(8)(ii), which allows CMS to revoke a provider that 1) has filed claims that do not meet Medicare requirements and 2) the filing of such claims constitute a “pattern or practice.” The regulation states several factors that CMS considers “as appropriate or applicable” in order to determine if there is a “pattern or practice.”

a. Petitioner filed 74 Medicare claims for hospice services for which Petitioner did not have a certification as required by 42 U.S.C. § 1395f(a)(7) and 42 C.F.R. § 418.22.

The Act requires the following:

[I]n the case of hospice care provided an individual—

(A)(i) in the first 90-day period—

(I) the individual’s attending physician (as defined in section 1395x(dd)(3)(B) of this title) (which for purposes of this subparagraph does not include a nurse practitioner), and

(II) the medical director (or physician member of the interdisciplinary group described in section 1395x(dd)(2)(B) of this title) of the hospice program providing (or arranging for) the care,

each certify in writing at the beginning of the period, that the individual is terminally ill (as defined in section 1395x(dd)(3)(A) of this title), based on the physician’s or medical director’s clinical judgment regarding the normal course of the individual’s illness,

(ii) in a subsequent 90- or 60-day period, the medical director or physician described in clause (i)(II) recertifies at the beginning of the period that the individual is terminally ill based on such clinical judgment.

42 U.S.C. § 1395f(a)(7) (emphasis added). An individual is terminally ill “if the individual has a medical prognosis that the individual’s life expectancy is 6 months or less.” Id. § 1395x(dd)(3)(A). Further, the “term ‘attending physician’ means, with

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respect to an individual, the physician (as defined in subsection (r)(1)) or nurse practitioner (as defined in subsection (aa)(5)), who may be employed by a hospice program, whom the individual identifies as having the most significant role in the determination and delivery of medical care to the individual at the time the individual makes an election to receive hospice care.” Id. § 1395x(dd)(3)(B).

The regulations promulgated to implement this portion of the Act state that the two most basic requirements for hospice care eligibility are: 1) the beneficiaries must be entitled to Medicare Part A and 2) they must be certified as terminally ill in accordance with 42 C.F.R. § 418.22. 42 C.F.R. § 418.20. Beneficiaries may elect to have hospice care for an initial 90-day period and for subsequent 90- or 60-day periods. 42 C.F.R. § 418.21. For each of these periods the hospice “must obtain written certification of terminal illness.” 42 C.F.R. § 418.22(a)(1). For an initial period, both the hospice medical director and the beneficiary’s attending physician must sign the certification, but for subsequent periods, only one or the other need certify. 42 C.F.R. § 418.22(c). The certification must indicate that the beneficiary’s life expectancy is six months or less, and the physician must include a narrative supporting that prognosis. 42 C.F.R. § 418.22(b). At various times, the hospice’s physician or nurse practitioner must have face-to-face encounters with the beneficiary. 42 C.F.R. § 418.22(a)(4). Finally, the physician or physicians must sign the certification. 42 C.F.R. § 418.22(b)(5).

As expressed in the second chart provided above, Petitioner did not have a physician certification for 74 Medicare claims involving 26 beneficiaries. The physician certification is not only required by the Act, but is identified by the regulations as one of two basic requirements for a beneficiary to obtain hospice services. 42 C.F.R. § 418.20. Further, the regulations expressly state that: “the hospice must obtain the written certification before it submits a claim for payment.” 42 C.F.R. § 418.22(a)(2) (emphasis added). The regulations also require hospice staff to enter the certification in the beneficiary’s medical record. 42 C.F.R. § 418.22(d). Finally, a failure to have a proper certification is grounds for denying a claim for hospice care as not being medically reasonable or necessary. See Continuum Hospice Care, MAC at 5 (Oct. 28, 2009) available at https://www.hhs.gov/sites/default/files/static/dab/decisions/council-decisions/continuum_hospicecare.pdf.

Petitioner’s failure to have all of the certifications for the claims referenced in this case is exactly the type of scenario that was envisioned for a revocation under 42 C.F.R. § 424.535(a)(8)(ii). As stated in the preamble to the final rule:

We believe it is the responsibility of the provider submitting the claim to ensure that all requirements—including, as necessary, proper and compliant supporting documentation—have been met prior to the claim’s submission.

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79 Fed. Reg. 72,500, 72,516 (Dec. 5, 2014). Therefore, in this case, the undisputed facts show that Petitioner filed claims that did not comply with Medicare requirements.

b. Petitioner engaged in a pattern or practice of submitting claims for hospice services that were not in compliance with Medicare requirements under 42 C.F.R. § 424.535(a)(8)(ii).

In determining whether a provider has engaged in a pattern or practice of submitting claims that are not in compliance with Medicare requirements, CMS will consider the following factors “as appropriate or applicable”:

42 C.F.R. § 424.535(a)(8)(ii).

In its reconsidered determination, CMS’s hearing officer discussed four case-specific circumstances under 42 C.F.R. § 424.535(a)(8)(ii)(A)-(F) when determining that Southland’s billing errors constituted a pattern or practice. The reconsidered determination considered the length of time over which the pattern continued by noting that the noncompliant billing occurred for services provided from July 2015 through October 2016 (CMS Ex. 1 at 8) and concluded that, “[a]s a result, CMS finds that Southland engaged in a pattern of submitting claims that fail to meet Medicare requirements for a period of 16 months.” CMS Ex. 1 at 9. CMS next observed that Southland had been enrolled in the Medicare program since April 19, 2013, and that the improper billing started a little more than two years later. CMS Ex. 1 at 8. The reconsidered determination showed that CMS also considered other information that it

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found to be “particularly significant.” Specifically, it noted Dr. Lipscomb had his Medicare enrollment and billing privileges deactivated in October 2015. CMS Ex. 1 at 8. Further, the reconsidered determination stated:

CMS also deemed i[t] particularly significant in determining a pattern of noncompliant claims submission that Dr. Jahani was incarcerated from March 9, 2016 to October 17, 2016. During this time it was impossible for him to have made face to face evaluations or certified hospice services. While Southland indicates that his inclusion on the claims underlying the revocation were [sic] due to an error by billing personnel, CMS finds that the negligent submission of multiple erroneous claims for services that are noncompliant with Medicare requirements amounts to abuse. Further, Dr. Jahani's medical license was suspended by the Texas Medical Board on April 12, 2016. After this time, until his license was restored he was not legally authorized to practice medicine, and therefore, could not have provided a valid hospice certification.

CMS Ex. 1 at 8. The reconsidered determination expressly stated “[t]he percentage of claims denials and reasons for claims denials is not relevant in this case because claims were not denied, rather they were inappropriately submitted and paid because hospice services were rendered without the requisite certification and face to face evaluation.” CMS Ex. 1 at 8. CMS did not mention whether Petitioner had a history of final adverse actions.

In response to the finding of a pattern or practice, Petitioner argued in its brief the following:

15. Likewise, 42 CFR §424.535(a)(8)[(ii)] allows for revocation for the abuse of billing privileges once CMS has considered the following: (A) the percentage of submitted claims that were denied; (B) the reasons for the claim denials; (C) any history of final adverse actions (as defined by §424.502) and the nature of such actions; (D) the length of time over which the pattern has continued; (E) how long the provider or supplier has been enrolled in Medicare; and (F) any other information regarding the provider's specific circumstances that CMS deems relevant to its determination. CMS has not shown it considered any of these elements, or if it did, what the provider's performance in each element was. CMS claims the preamble gives it all the authority required for a determination of “pattern or abuse” in order to revoke a

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provider’s billing number when the elements are not necessarily met. See CMS Motion for Summary Judgment, page 9. While CMS has stated therein that a “pattern” of improper billing can be proved with as little as three improperly filed claims (CMS Brief page 9), CMS does not get to ignore the regulation that must be followed prior to noticing the revocation, even if there are more than 3 claims at issue.

16. CMS does claim to have calculated the length of time the claims were submitted under the incorrect physician NPI and information, however, Dr. Lipscomb indicates in his statement (CMS Ex. 2) that he formally resigned as medical director in November 2016. On the patient charts (pages 98-101 in CMS Ex. 1) the dates of service for Dr. Lipscomb do not exceed his late November 2016 termination date. Dr. Lipscomb did not have to perform the encounter in person if the Physician Assistant/Nurse Practitioner physically saw the hospice patient. That Dr. Lipscomb did not see the patient does not necessarily negate the propriety of the service, and does not prove the billing was abusive. During this time period, another physician, and the advanced practitioner were seeing patients. CMS Ex. 1, p. 18-94 and CMS Ex. 2.

P. Br. at 5-6.

As an initial matter, I agree with Petitioner that three instances of misconduct do not automatically show a pattern or practice of abusive billing practices. It is true that when the original language for § 424.535(a)(8) was promulgated, the preamble to the final rule indicated that CMS would not revoke a provider unless there were at least three instances of abusive billing practices. See 73 Fed. Reg. 36,448, 36,455 (June 27, 2008). However, when § 424.535(a)(8)(ii) was added, the original text of § 424.535(a)(8) became § 424.535(a)(8)(i). 79 Fed. Reg. at 72,520. Therefore, the preamble language that states CMS will not revoke unless there were at least three abusive claims only directly applies section 424.535(a)(8)(i).

The determination as to whether there is a pattern or practice should be informed by six enumerated factors. See 42 C.F.R. § 424.535(a)(8)(ii)(A-F). However, no factor is considered more important than another and all factors need not be considered.

We have decided not to give certain factors greater weight in our § 424.535(a)(8)(ii) determinations than other[s], for the importance of each factor may vary based on the particular situation. We have also decided not to establish a minimum

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percentage threshold for claim denials; as stated earlier, we need flexibility to address a variety of scenarios.

79 Fed. Reg. at 72,517.

Further, in the preamble to the December 2014 final rule, CMS repeatedly refers to “a careful and thorough consideration of the factors” outlined in the new regulation to determine whether a pattern or practice is present. 79 Fed. Reg. at 72,519. As opposed to a hard threshold, CMS indicated that it would judge cases based on the “specific facts.” Id. It is instructive that “[t]he term ‘abusive,’ as used in the context of § 424.535(a)(8)(ii), is meant to capture a variety of situations in which a provider or supplier regularly and repeatedly submits non-compliant claims over a period of time.” 79 Fed. Reg. at 72,515.

The undisputed facts in this case show that Petitioner filed 74 deficient claims involving 26 beneficiaries from August 2015 to November 2016. This is a significant number of claims that Petitioner filed without the necessary physician certification. It also shows a pattern of noncompliant billing over a meaningful period of time, as opposed to “sporadic instances providers . . . may submit claims in error.” 79 Fed. Reg. at 72,520. It averages to almost five deficient claims per month for a sustained period of time.

Petitioner did not dispute that it was enrolled in the Medicare program in April 2013. See CMS Ex. 1 at 8. Having been enrolled for more than two years before the improper billing started gave Petitioner sufficient time to learn all of the requirements necessary to properly bill for hospice services. Therefore, Petitioner cannot claim ignorance as an excuse. It is also worth noting that by the time Petitioner was revoked in June 2017, it had submitted improper claims during 30% of the time it had been an enrolled provider.

Petitioner did not dispute that it had filed many claims indicating that Dr. Jahani or Dr. Lipscomb were the physicians who saw or certified the beneficiaries, but had done so while Dr. Jahani was in prison or after March or April 2016, when Dr. Lipscomb was no longer actively seeing Petitioner’s patients. Even accepting as true that Dr. Lipscomb continued to see patients until March or April 2016, Petitioner did not come forward with the certifications from other physicians to show that Petitioner simply misidentified the physician on billing documents after the March/April 2016 time-period. Petitioner failed to come forward with the physician certifications for each claim or other evidence to support its contention that it simply misidentified the true physicians who saw Petitioner’s patients. There is no dispute that Petitioner’s improper billing involved a criminally convicted physician (Dr. Jahani) and another physician who was noncompliant with Medicare enrollment requirements (Dr. Lipscomb). Petitioner’s billing in this case for over a year was not the kind of “innocuous” and “isolated” errors contemplated in the final rule. 79 Fed. Reg. at 72,520. Based on the specific undisputed facts of this case, I conclude that CMS was warranted in concluding that a pattern or practice of abusive

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billing was present, and that, therefore, CMS had a basis to revoke Petitioner’s enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(8)(ii).

3. It is no defense to a revocation action for abuse of billing privileges under 42 C.F.R. § 424.535(a)(8)(ii) that the noncompliant claims were due to inadvertent or unintentional errors of Petitioner’s billing company or others.

Petitioner asserts that its billing practices were not abusive since it discovered that the referrals and certifications mistakenly attributed to Dr. Jahani and Dr. Lipscomb by their billing company were actually performed by two other physicians. RFH at 2. Petitioner has provided at least some evidence of this, and I have credited that evidence for purposes of summary judgment. CMS Ex. 1 at 18-93. However, even if it were true that the noncompliant claims were due to the actions of its billing company, Southland cannot use this as a defense to avoid revocation. The plain language of 42 C.F.R. § 424.535(a)(8)(ii) contains no reference to the culpability of the provider or any requirement of fraudulent intent. Cf. Louis J. Gaefke, D.P.M., DAB No. 2554 at 7-8 (2013) (finding that revocation was proper under 42 C.F.R. § 424.535(a) even if the improper claims were attributed to actions of a billing agent or reckless indifference by the provider); see also 79 Fed. Reg. at 72,516, 72,520 (declining to incorporate an intent or knowledge standard into 42 C.F.R. § 424.535(a)(8)(ii)). Further, the preamble to the final rule stated:

Proposed new paragraph (a)(8)(ii) would permit revocation if we determine that the provider or supplier has a pattern or practice of billing for services that do not meet Medicare requirements such as, but not limited to, the requirement that the service be reasonable and necessary. We explained that a provider or supplier should be responsible for submitting valid claims at all times and that the provider or supplier’s repeated failure to do so poses a risk to the Medicare Trust Funds. We note that the responsibility for submitting valid claims exists irrespective of whether the provider or supplier itself submits the claims or hires a billing agency to perform this function; in either case, the claims are submitted on behalf of the provider or supplier.

79 Fed. Reg. at 72,513. Southland is responsible under the regulations for ensuring that its submitted claims comply with Medicare requirements.

4. Petitioner’s due process arguments are without merit.

Petitioner asserts that “CMS made no findings in relation to the elements of the regulation,” and that as a result it was deprived of due process. P. Br. at 7, 9. Petitioner

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is incorrect. As explained above, CMS considered some of the factors in the regulations to conclude that there was pattern or practice of filing claims that did not meet Medicare requirements. CMS also expressly stated why two other factors were not relevant. CMS was only required to consider those factors that were appropriate and applicable. CMS did this by explicitly addressing the elements of 42 C.F.R. § 424.535(a)(8)(ii) in its reconsidered decision. CMS Ex. 1 at 8.

V. Conclusion

For the foregoing reasons, I grant CMS’s Motion for Summary Judgment, deny Petitioner’s Motion for Summary Judgment, and affirm CMS’s revocation of Petitioner’s Medicare enrollment and billing privileges under 42 C.F.R. § 424.535(a)(8)(ii), effective June 2, 2017.