Lawrence A. Osman, M.D., DAB CR5525 (2020)

DECISION

Petitioner, Lawrence A. Osman, M.D., challenges the effective date of his Medicare billing privileges based on an application received on August 7, 2017, following a period of deactivation resulting from a failure to revalidate.  As further explained herein, I find the Centers for Medicare & Medicaid Services (CMS) properly established August 7, 2017 as the effective date of Petitioner's billing privileges, as it is the date he filed an application the contractor was able to process to completion.  CMS Exhibit (Ex.) 9 at 1.

I. Background

On February 8, 2017, CMS contractor Noridian Healthcare Solutions (Noridian) advised Petitioner that he was obligated to revalidate his Medicare enrollment record by April 30, 2017.  CMS Ex. 2.  Petitioner subsequently submitted an electronic revalidation application via the Provider Enrollment, Chain and Ownership System (PECOS) on April 5, 2017.  CMS Ex. 1.  Petitioner listed himself as the contact person and provided drlosman@yahoo.com as his email address.  Id. at 3.

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On April 28, 2017, Noridian requested that Petitioner provide additional information to complete his revalidation application.  CMS Ex. 3.  Noridian informed Petitioner that if he did not submit the requested information within 30 days his application may be rejected.  Id.  By letter dated May 30, 2017, Noridian advised Petitioner that his Medicare billing privileges were deactivated as of May 30, 2017 because he did not respond to requests for more information.  CMS Ex. 4.

On August 7, 2017, Petitioner submitted a new revalidation application via PECOS that included the additional information requested.  CMS Ex. 6.  Noridian approved this application and reactivated Petitioner’s billing privileges effective August 7, 2017.  CMS Ex. 7.  This resulted in a lapse of Petitioner’s billing privileges from May 30, 2017 through August 6, 2017.  Id.

Petitioner requested reconsideration of the effective date determination, arguing he did not receive notifications requesting additional information.  CMS Ex. 8.  In a November 4, 2017 letter, Noridian affirmed the effective date determination.  CMS Ex. 9.  Petitioner then timely requested a hearing before an Administrative Law Judge.

II.  Admission of Exhibits and Decision on the Record

CMS filed a motion for summary judgment and brief (CMS Br.), as well as nine proposed exhibits (CMS Exs. 1-9).  Petitioner filed a brief (P. Br.) opposing summary judgment and two proposed exhibits (P. Exs. 10-11).  Neither party has objected to any exhibits.  Therefore, I admit CMS Exs. 1-9 and P. Exs. 10-11 into the record. Petitioner identified one witness and offered her written direct testimony.  CMS did not request to cross-examine this witness.  Consequently, I will not hold an in-person hearing in this matter, and I issue this decision based on the written record.  Civ. Remedies Div. P. 19(d).

III.  Issue

Whether CMS had a legitimate basis for establishing August 7, 2017 as the effective date of Petitioner’s reactivated billing privileges.

IV.  Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(15), 498.5(l)(2).

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

A.   Applicable Law

1. Enrollment

Petitioner participates in the Medicare program as a “supplier” of services.  Social Security Act § 1861(d); 42 C.F.R. § 498.2.  To receive Medicare payments for the services it furnishes to program beneficiaries, a prospective supplier must enroll in the program.  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 Management and Budget.  42 C.F.R. § 424.502.  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.  The effective date for its 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).  In this case, the date of filing of Petitioner's subsequently-approved enrollment application is relevant.  If a supplier satisfies certain requirements, CMS will allow a supplier to bill retrospectively for up to 30 days prior to the effective date.  42 C.F.R. § 424.521(a)(1).

2. Revalidation

To maintain its billing privileges, a supplier must, at least every five years, resubmit and recertify the accuracy of its enrollment information, a process referred to as “revalidation.”  42 C.F.R. § 424.515.  In addition to periodic revalidations, CMS may, at other times and for its own reasons, ask a supplier to recertify the accuracy of its enrollment information.  42 C.F.R. § 424.515(d).  Within 60 days of receiving CMS's notice to recertify, the supplier must submit an appropriate enrollment application with complete and accurate information and supporting documentation.  42 C.F.R. § 424.515(a)(2).

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3. Deactivation

The regulation authorizing deactivation explains that “[d]eactivation of Medicare billing privileges is considered an action to protect the provider or supplier from misuse of its billing number and to protect the Medicare Trust Funds from unnecessary overpayments.”  42 C.F.R. § 424.540(c).  CMS is authorized to deactivate an enrolled supplier's Medicare billing privileges if the enrollee does not “furnish complete and accurate information and all supporting documentation within 90 calendar days of receipt of notification from CMS to submit an enrollment application and supporting documentation, or resubmit and certify to the accuracy of its enrollment information.” 42 C.F.R. § 424.540(a)(3).  If CMS deactivates a supplier's 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).

The Departmental Appeals Board (Board) has unambiguously stated that a supplier “may not receive payment for claims for services during any period when [her] billing privileges were deactivated.”  Willie Goffney, Jr., M.D., DAB No. 2763 at 6 (2017); see Urology Grp. of NJ, LLC, DAB No. 2860 at 11 (2018) (“Taking these unique effects of revocation into consideration, it is reasonable to conclude that CMS intended for revocations and deactivations to share the feature of precluding a provider or supplier from collecting reimbursement for services rendered during the period of inactive Medicare billing privileges, while simultaneously intending for revocations to have more severe consequences on a provider's or supplier's ability to participate.”).

4. Reactivation

The reactivation of an enrolled supplier's billing privileges is governed by 42 C.F.R. § 424.540(b).  The process for reactivation is contingent on the reason for deactivation.  If CMS deactivates a supplier's billing privileges due to a reason other than nonsubmission of a claim, the supplier must apply for CMS to reactivate its Medicare billing privileges by completing and submitting the appropriate enrollment application(s) or recertifying its enrollment information, if deemed appropriate.  42 C.F.R. § 424.540(a)(3), (b)(1).

B.   Analysis

1.    Petitioner filed a subsequently approved revalidation application on August 7, 2017 and the effective date can be no earlier than that date.

The record demonstrates beyond dispute that following the May 30, 2017 deactivation of his Medicare billing privileges, Petitioner submitted a revalidation application on August 7, 2017.  CMS Ex. 6.  Noridian approved this application on September 21, 2017.  CMS Ex. 7.  Pursuant to 42 C.F.R. § 424.520(d)(1), the date Petitioner filed his subsequently

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approved enrollment application – August 7, 2017 – is the correct effective date of enrollment.  Urology Grp., DAB No. 2860 at 7-9; Goffney, DAB No. 2763 at 7.

2.    I have no authority to review the deactivation of Petitioner’s billing privileges and cannot afford him equitable relief.

 Noridian advised Petitioner on May 30, 2017 that his Medicare billing privileges were deactivated as of that date because he did not respond to requests for more information.  CMS Ex. 4.  Petitioner argues that he did not receive Noridian’s correspondence regarding his revalidation because Noridian sent the correspondence to an email address he no longer used.  P. Br. at 2.  Petitioner also argues that he did not consent to receive formal notifications from Noridian via email.  Id. at 1.  He points out that Noridian made no effort to contact him following the initial revalidation notice, which his billing staff declares to be the contractor’s typical practice.  Id. at 2-3, citing P. Ex. 10.   

Petitioner may reasonably believe that Noridian erred in sending revalidation notices to an email address from a much older application, rather than his more recently submitted mailing address.  He may also reasonably believe Noridian acted “precipitously” in deactivating his enrollment without following up with him following the initial revalidation notice.  However, I have no authority to review CMS’s decision to deactivate a supplier.  This is because deactivation is not an “initial determination” subject to review by an administrative law judge.  See 42 C.F.R. § 498.3(b)(6); Urology Grp., DAB No. 2860 at 6 (“The regulations do not grant suppliers the right to appeal deactivations.”); Goffney, DAB No. 2763 at 7 (“Only facts relevant to the effective date resulting from the . . . application were material to the ALJ decision”).1   My jurisdiction in this case is limited to reviewing the effective date of the approval of Petitioner’s reactivation enrollment application.  42 C.F.R. § 498.3(b)(15).

In any case, Petitioner concedes that the email address to which Noridian sent the revalidation notice was fully active and in his control.  P. Br. at 2.  And, while Petitioner claims he used a different email address, id. at 4, there is no evidence to suggest he made the effort to notify Noridian of that change.  Thus, I cannot say the circumstances resulting in Petitioner’s deactivation were entirely unjust, though in any case, I must accept the fact of his deactivation for purposes of this decision and cannot overturn it.

Petitioner also attacks Noridian’s actions in the revalidation process, observing Noridian notified him by mail that his billing privileges were stopped, although CMS policy is to notify suppliers by email.  P. Br. at 4.  He also complains that Noridian requested Petitioner re-submit documents he had already provided in earlier applications.  Id.

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But I have no authority to review CMS’s revalidation process, or otherwise grant Petitioner any form of equitable relief.  See, e.g., US Ultrasound, DAB No. 2302 at 8 (2010) (“Neither the ALJ nor the Board is authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements.”); Pepper Hill Nursing & Rehab. Ctr., LLC, DAB No. 2395 at 11 (2011) (holding that the ALJ and Board were not authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements); UpturnCare Co., DAB No. 2632 at 19 (2015) (providing the Board may not overturn denial of provider enrollment in Medicare on equitable grounds).  Therefore, the effective date of August 7, 2017 must stand.

3.    CMS should exercise its discretion in Petitioner’s favor and provide him 30 days of retrospective billing.   

Finally, I note that CMS policy now explicitly requires its administrative contractors to grant reactivated suppliers like Petitioner 30 days of retrospective billing privileges.  MPIM, ch. 15, § 15.17(B) (rev. 865, eff. Mar. 12, 2019).  Thus, had Petitioner’s reactivation taken place after March 12, 2019, he would have automatically received thirty days of retrospective billing, which would, in this instance, significantly reduce his billing gap.  A contrary outcome based solely on the date of Petitioner’s reactivation seems arbitrary and unjust.  I counsel CMS to consider exercising its discretion in this matter in favor of an otherwise honest biller who did not seek to defraud the Medicare program, but simply made a clerical error.  

VI.  Conclusion

CMS properly determined Petitioner's effective date of his Medicare billing privileges to be August 7, 2017, the date he filed an enrollment application that was subsequently approved.

1. Deactivation decisions in fact have a separate review process that requires a provider or supplier dissatisfied with their deactivation to file a rebuttal with CMS’s administrative contractor. 42 C.F.R. § 424.545(b). It is not clear from the record whether Petitioner sought relief from Noridian through the rebuttal process.
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