Patrick Toy, MD, DAB CR6259 (2023)

DECISION

The Medicare enrollment and billing privileges of Petitioner are revoked pursuant to 42 C.F.R. § 424.535(a)(3),¹ effective February 24, 2021.  There is a basis for listing Petitioner on the Centers for Medicare & Medicaid Services (CMS) preclusion list for the duration of his 10-year reenrollment bar.

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I.  Background

On November 29, 2021, Petitioner filed two separate requests for hearing by an administrative law judge (ALJ).  The cases were docketed as C-22-129 and C-22-130 and assigned to me for hearing and decision. 

In C-22-129, Petitioner requested review of a September 30, 2021 CMS hearing officer’s reconsidered determination upholding the April 6, 2021 initial determination of Novitas Solutions, Inc., a Medicare administrative contractor (MAC), revoking Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3), imposing a 10-year reenrollment bar, and adding Petitioner’s name to the CMS preclusion list.  Departmental Appeals Board Electronic Filing System (DAB E-File), C-22-129 ## 1-1_a at 2.²

In C-22-130, Petitioner requested review of a September 30, 2021 CMS hearing officer’s reconsidered determination upholding the April 8, 2021 initial determination of Palmetto revoking Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3), imposing a 10-year reenrollment bar, and adding Petitioner’s name to the CMS preclusion list.  DAB E-File C-22-130 ## 1-1_a at 2. 

Revocation by both MACs was effective February 24, 2021, based on Petitioner’s February 24, 2021 felony conviction in the United States District Court, Eastern District of Arkansas (district court) of making a false statement in violation of 18 U.S.C. § 1001(a)(2).  The MACs imposed a 10-year reenrollment bar pursuant to 42 C.F.R. § 424.535(c) and advised Petitioner that his name would be placed on the CMS preclusion list.  DAB E-File C-22-129 # 1_a at 2; CMS Exs. 1 at 2, 7 at 2.

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Reconsideration of both the Palmetto and Novitas initial determinations was requested by Petitioner.  The reconsidered determinations in C-22-129 and C-22-130 were issued by the same CMS hearing officer on September 30, 2021.  DAB E-File C-22-129 # 1_a; CMS Ex. 7.  The CMS hearing officer upheld the revocation of Petitioner’s Medicare enrollment and billing privileges under 42 C.F.R. § 424.535(a)(3) and the 10-year reenrollment bar.  The CMS hearing officer also concluded that Petitioner’s felony offense was detrimental to the best interests of the Medicare program and upheld adding Petitioner’s name to the CMS preclusion list effective September 30, 2021.  DAB E-File C-22-129 # 1_a; CMS Ex. 7.  The reconsidered determinations and the requests for hearing are substantively identical.  I concluded that there was no need for separate proceedings and the cases were consolidated under C-22-130, and C-22-129 was dismissed.  DAB E-File C-22-129 # 2; DAB E-File C-22-130 # 2. 

On December 30, 2021, CMS filed a motion for summary judgment and brief in support of its motion (CMS Br.) and CMS Exs. 1 through 7.  On January 31, 2022, Petitioner filed his response in opposition to the CMS motion for summary judgment (P. Br.) with Petitioner’s exhibits (P. Exs.) 1 through 7.  On February 10, 2022, CMS filed a reply brief (CMS Reply). 

Petitioner objected to my consideration of CMS Ex. 1 because it does not include the CMS reconsidered determination filed as a single exhibit with all the documents considered by the hearing officer on reconsideration in violation of my Standing Order para. D.1.  Petitioner offers P. Exs. 1, 2, 5, and 6 which are documents considered by the CMS hearing officer on reconsideration but not placed in evidence by CMS as part of CMS Ex. 1.  Petitioner argues there is good cause to admit P. Exs. 1, 2, 5, and 6.  Petitioner also offered P. Ex. 3 (a letter from the Inspector General (IG) for the United States Department of Health & Human Services (HHS) informing Petitioner he was not being excluded from federal health care programs based on his conviction), P. Ex. 4 (a letter from Tennessee Medicaid (TennCare) informing Petitioner he was reinstated in the TennCare), and P. Ex. 7 (a collection of letters of Petitioner’s colleagues addressing his value to the medical community and the need for his services).  P. Br. at 5-6.  CMS did not object to any of Petitioner’s exhibits.  CMS Reply at 1.  Nevertheless, I am required to examine any new documentary evidence filed by Petitioner to determine whether Petitioner “has good cause for submitting the evidence for the first time at the ALJ level.”  42 C.F.R. § 498.56(e)(1).  If I conclude there is good cause, I must include the documentary evidence and consider it in reaching a decision.  If I conclude there is not good cause, I must exclude the evidence and not consider it in reaching a decision.  The regulations in 42 C.F.R. pt. 498 do not define the term “good cause.”  I conclude there is

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good cause to admit P. Exs. 1, 2, 5, and 6 to complete the record presented by CMS.  Furthermore, P. Exs. 1, 2, 5, and 6 are not new documentary evidence as they were part of the record before the CMS hearing officer that CMS failed to present to me as ordered.³  I also conclude that there is good cause to admit P. Exs. 3 and 4 as they are relevant to Petitioner’s theory and the documents were not available for submission at the time reconsideration was filed.  P. Ex. 7 is not admitted as the letters are not relevant to any issue that I may decide.⁴  Evidence is relevant if “it has any tendency to make a fact [of consequence, i.e., material] more or less probable than it would be without the evidence.”  Federal Rule of Evidence (Fed. R. Evid.) 401.  The narrow issue before me is whether CMS had a basis to revoke Petitioner’s Medicare enrollment and billing privileges and to add his name to the CMS preclusion list.  Dinesh Patel, MD, DAB No. 2551 at 10-11 (2013); Fady Fayad, MD, DAB No. 2266 at 16 (2009), aff’d, 803 F. Supp. 2d 699 (E.D. Mich. 2011); Abdul Razzaque Ahmed, MD, DAB No. 2261 at 16-17, 19 (2009), aff’d, 710 F. Supp. 2d 167 (D. Mass. 2010).  The letters of support marked as P. Ex. 7 are not relevant because they have no effect on the determination of whether CMS had a basis to revoke Petitioner’s Medicare enrollment and billing privileges and to add his name to the CMS preclusion list.  Accordingly, P. Ex. 7 is not admitted as evidence.  P. Exs. 1 through 6 are admitted as evidence.  Petitioner’s objection to CMS Ex. 1 is overruled.  The record considered by the CMS hearing officer is complete with the admission of P. Exs. 1, 2, 5, and 6 and CMS Exs. 1 through 7 as evidence. 

II.  Discussion

A.  Applicable Law

Section 1831 of the Social Security Act (the Act) (42 U.S.C. § 1395j) establishes the supplementary medical insurance benefits program for the aged and disabled known as Medicare Part B.  Administration of the Part B program is through the MACs.  Act § 1842(a) (42 U.S.C. § 1395u(a)).  Payment under the program for services rendered to Medicare-eligible beneficiaries may only be made to eligible providers of services and

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suppliers.⁵  Act §§ 1835(a) (42 U.S.C. § 1395n(a)), 1842(h)(1) (42 U.S.C. § 1395u(h)(1)).  Petitioner, a physician, is a supplier. 

The Act requires that the Secretary of Health and Human Services (Secretary) issue regulations that establish a process for the enrollment in Medicare of providers and suppliers, including the right to a hearing and judicial review of certain enrollment determinations, such as revocation of enrollment and billing privileges.  Act § 1866(j) (42 U.S.C. § 1395cc(j)).  Pursuant to 42 C.F.R. § 424.505, a supplier must be enrolled in the Medicare program and be issued a billing number to have billing privileges and to be eligible to receive payment for services rendered to a Medicare-eligible beneficiary.

The Secretary has delegated the authority to revoke enrollment and billing privileges to CMS.  42 C.F.R. § 424.535.  CMS or a MAC may revoke an enrolled supplier’s Medicare enrollment and billing privileges and supplier agreement for any of the reasons listed in 42 C.F.R. § 424.535.  The effective date of the revocation is controlled by 42 C.F.R. § 424.535(g).  After a supplier’s Medicare enrollment and billing privileges are revoked, the supplier is barred from reenrolling in the Medicare program for a minimum of one year to 10 years, except in limited circumstances that do not exist in this case.  42 C.F.R. § 424.535(c).

Effective June 15, 2018, CMS was required to establish a preclusion list as defined by 42 C.F.R. §§ 422.2 and 423.100.  There is only one preclusion list.  83 Fed. Reg. 16,440, 16,641-67 (Apr. 16, 2018).  The preclusion list is defined in both the Medicare Part C regulations and the Medicare Part D regulations.

Preclusion list means a CMS compiled list of individuals and entities that—

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(1)  Meet all of the following requirements:

(i)  The individual or entity is currently revoked from Medicare for a reason other than that stated in § 424.535(a)(3) of this chapter.

(ii)  The individual or entity is currently under a reenrollment bar under § 424.535(c). 

(iii)  CMS determines that the underlying conduct that led to the revocation is detrimental to the best interests of the Medicare program.  In making this determination under this paragraph (1)(iii), CMS considers the following factors: 

(A)  The seriousness of the conduct underlying the individual’s or entity’s revocation.
(B)  The degree to which the individual’s or entity’s conduct could affect the integrity of the Medicare program.
(C)  Any other evidence that CMS deems relevant to its determination; or

(2)  Meet both of the following requirements: 

(i)  The individual or entity has engaged in behavior, other than that described in § 424.535(a)(3) of this chapter, for which CMS could have revoked the individual or entity to the extent applicable had they been enrolled in Medicare. 

(ii)  CMS determines that the underlying conduct that would have led to the revocation is detrimental to the best interests of the Medicare program.  In making this determination under this paragraph (2)(ii), CMS considers the following factors: 

(A)  The seriousness of the conduct involved.
(B)  The degree to which the individual’s or entity’s conduct could affect the integrity of the Medicare program; and

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(C)  Any other evidence that CMS deems relevant to its determination; or

(3)  The individual or entity, regardless of whether they are or were enrolled in Medicare, has been convicted of a felony under Federal or State law within the previous 10 years that CMS deems detrimental to the best interests of the Medicare program.  Factors that CMS considers in making such a determination under this paragraph (3) are—

(i) The severity of the offense;

(ii) When the offense occurred; and

(iii) Any other information that CMS deems relevant to its determination.

42 C.F.R. § 422.2 (italics in original, bold added).  The definition applicable to Medicare Part D at 42 C.F.R. § 423.100 is virtually identical except that the regulation refers to “prescriber” rather than “individual or entity.”  No payment under Medicare Parts C and D may be made to anyone on the preclusion list.  42 C.F.R. §§ 422.222-.224, 422.504(i)(2)(v), 423.120(c)(6).  CMS must notify a supplier in writing that the supplier is being added to the preclusion list, the basis for the action, and inform the supplier of the right to ALJ review and appeal pursuant to 42 C.F.R. pt. 498.  42 C.F.R. §§ 422.222(a)(2); 423.120(c)(6)(v).  The regulations establish three independent grounds for placing an individual, entity, or prescriber on the CMS preclusion list.  Neither of the first two grounds listed in the regulations can apply in this case because revocation of Petitioner’s Medicare enrollment and billing privileges was pursuant to 42 C.F.R. § 424.535(a)(3).  Whether CMS had a basis to place Petitioner on the preclusion list under 42 C.F.R. §§ 422.2 and 423.100 must, therefore, be resolved on the third ground considering whether:  (1) Petitioner was convicted of a felony under federal or state law; (2) the conviction occurred within the 10 years prior to the CMS action; and (3) CMS deems the offense of which Petitioner was convicted detrimental to the best interests of the Medicare program based on severity of the offense, when the offense occurred, and any other information that CMS deems relevant. 

A supplier whose enrollment and billing privileges have been revoked or who has been placed on the preclusion list may request reconsideration and review as provided by 42 C.F.R. pt. 498.  42 C.F.R. §§ 424.545(a); 422.222(a)(2); 423.120(c)(6)(v).  A supplier submits a written request for reconsideration to CMS or its contractor.  42 C.F.R. § 498.22(a).  CMS or its contractor must give notice of its reconsidered determination to the supplier, giving the reasons for its determination and specifying the conditions or

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requirements the supplier failed to meet, and the right to an ALJ hearing.  42 C.F.R. § 498.25.  If the decision on reconsideration is unfavorable to the supplier, the supplier has the right to request a hearing by an ALJ and further review by the Board.  Act § 1866(j)(8) (42 U.S.C. § 1395cc(j)(8)); 42 C.F.R. §§ 424.545, 498.3(b)(17), (20), 498.5.  A hearing on the record, also known as an oral hearing, is required under the Act, unless waived.  Crestview Parke Care Ctr. v. Thompson, 373 F.3d 743, 748-51 (6th Cir. 2004).  CMS is also granted the right to request ALJ review of a reconsidered determination with which it is dissatisfied.  42 C.F.R. § 498.5(l)(2).  The supplier bears the burden to demonstrate that it meets enrollment requirements with documents and records.  42 C.F.R. § 424.545(c). 

Revocation and preclusion list review is strictly limited to whether there is a basis for the revocation and for adding the supplier to the CMS preclusion list.  Douglas Bradley, MD, DAB No. 2663 at 13 (2015); 83 Fed. Reg. at 16,642.  The Board has consistently held that ALJ review of the CMS revocation determination is limited to whether CMS had a legal basis for revocation.  Letantia Bussell, MD, DAB No. 2196 at 10 (2008).  If CMS establishes the elements necessary for revocation, “revocation must be sustained, and neither the [ALJ] nor the Board may ‘substitute its discretion for that of CMS in determining whether revocation was appropriate.’”  Abdul Razzaque Ahmed, MD, DAB No. 2261 at 19.

B.  Issues

Whether there was a basis for the revocation of Petitioner’s billing privileges and enrollment in Medicare; and

Whether there is a basis to list Petitioner on the CMS preclusion list.

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

My conclusions of law are set forth in bold followed by the undisputed facts and analysis. 

1.  Summary judgment is appropriate.

CMS filed a motion for summary judgment.  Petitioner requests a favorable decision on the documentary record but states that if a decision in his favor on the record is not possible, he argues that there are material facts in dispute and CMS is not entitled to judgment as a matter of law.  P. Br. at 1-2.  I conclude Petitioner has not waived an oral hearing.  Accordingly, I consider whether summary judgment is appropriate or whether an oral hearing is necessary to receive evidence to resolve any genuine disputes of material fact. 

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A supplier whose enrollment has been revoked and/or who has been placed on the preclusion list has a right to a hearing and judicial review, and a hearing on the record is required under the Act.  Act §§ 205(b) (42 U.S.C. § 405(b)), 1866(h)(1), (j) (42 U.S.C. §§ 1395cc(h)(1), (j)); 42 C.F.R. §§ 498.3(b)(17), 498.5; Crestview, 373 F.3d at 748-51.  A party may waive appearance at an oral hearing but must do so affirmatively in writing.  42 C.F.R. § 498.66(a).  In this case, I conclude that Petitioner did not waive his right to an oral hearing by attempting to make his waiver contingent on receiving a favorable decision on the merits.

Summary judgment is not automatic upon request but is limited to certain specific conditions.  The Secretary’s regulations that establish the procedure to be followed in adjudicating Petitioner’s case are at 42 C.F.R. pt. 498.  42 C.F.R. §§ 405.800; 405.803(a); 424.545(a); 498.3(b)(17), (20).  The regulations do not establish a summary judgment procedure or recognize such a procedure.  However, the 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., 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 also has recognized that the Federal Rules of Civil Procedure (Fed. R. Civ. Pro.) do not apply in administrative adjudications such as this.  However, the Board has accepted that Fed. R. Civ. Pro. 56 and related cases provide useful guidance for determining whether summary judgment is appropriate.  Furthermore, a summary judgment procedure was adopted as a matter of judicial economy within my authority to regulate the course of proceedings and made available to the parties in the litigation of this case by my Standing Order.  The parties were given notice by the Standing Order that summary judgment is an available procedural device and that the law as it has developed related to Fed. R. Civ. Pro. 56 will be applied.  Standing Order ¶¶ D, G.

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.  The party requesting summary judgment bears the burden of showing that there are no genuine issues of material fact for trial and/or that it is entitled to judgment as a matter of law.  In determining whether there are genuine issues of material fact for trial, the reviewer must view the evidence in the light most favorable to the non-moving party, drawing all reasonable inferences in that party’s favor.  Generally, the non-movant may not defeat an adequately supported summary judgment motion by relying upon the denials in its pleadings or briefs but must furnish evidence of a dispute concerning a material fact, i.e., a fact that, if proven, would affect the outcome of the case.  Mission Hosp. Reg’l Med. Ctr., DAB No. 2459 at 4 (2012) (and cases cited therein); Experts Are Us, Inc., DAB No. 2452 at 4 (2012) (and cases cited therein); Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300 at 3 (2010) (and cases cited therein); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

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The standard for deciding a case on summary judgment and an ALJ’s decision-making in deciding a summary judgment motion differs from that used in resolving a case on the merits after a hearing or when hearing is waived.  On summary judgment, the ALJ does not make credibility determinations, weigh the evidence, or decide which inferences to draw from the evidence, as would be done when finding facts after a hearing on the record.  Rather, on summary judgment, the ALJ construes the evidence in a light most favorable to the non-movant and avoids deciding which version of the facts is more likely true.  Holy Cross Vill. at Notre Dame, Inc., DAB No. 2291 at 5 (2009).  The Board also has recognized that on summary judgment it is appropriate for the ALJ to consider whether a rational trier of fact could find that the party’s evidence would be sufficient to meet that party’s evidentiary burden.  Dumas Nursing & Rehab., L.P., DAB No. 2347 at 5 (2010).  The Secretary has not provided in 42 C.F.R. pt. 498 for the allocation of the burden of persuasion or the quantum of evidence required to satisfy the burden.  However, the Board has provided some persuasive analysis regarding the allocation of the burden of persuasion in cases subject to 42 C.F.R. pt. 498.  Batavia Nursing & Conv. Ctr., DAB No. 1904 (2004), aff’d, 129 Fed. App’x 181 (6th Cir. 2005). 

Viewing the evidence before me in a light most favorable to Petitioner and drawing all inferences in Petitioner’s favor, I conclude as discussed in the following analysis that there are no genuine disputes as to any material facts pertinent to revocation under 42 C.F.R. § 424.535(a)(3) or the addition of Petitioner to the CMS preclusion list that require a hearing in this case.  CMS is entitled to judgment as a matter of law.  Accordingly, summary judgment is appropriate.

2.  On February 24, 2021, Petitioner was convicted of the felony offense of making a false statement to a federal agent in violation of 18 U.S.C. § 1001(a)(2). 

3.  The Secretary has determined and provided by regulation that CMS may revoke the Medicare enrollment of a supplier who, within the preceding 10 years, was convicted of a felony that CMS determines is detrimental to the best interests of Medicare and its beneficiaries.  42 C.F.R. § 424.535(a)(3)(i). 

4.  Petitioner’s February 24, 2021 felony conviction occurred within the ten years preceding April 6 and 8, 2021, the dates on which the MACs issued initial determinations to revoke Petitioner’s Medicare enrollment and billing privileges. 

5.  There is a basis for the revocation of Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3)(i).

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6.  The effective date of revocation of Petitioner’s Medicare enrollment and billing privileges is, as a matter of law, the date of Petitioner’s conviction, February 24, 2021.  42 C.F.R. § 424.535(g). 

7.  I have no authority to review CMS’s determination to impose a ten-year bar to Petitioner’s reenrollment in Medicare. 

8.  As a matter of law, the 10-year bar to reenrollment began 30 days after the date on which the MACs mailed the notices of the initial determinations to revoke in this case‎.  42 C.F.R. § 424.535(c)(1)(i). 

9.  There is a basis for adding Petitioner to the CMS preclusion list for the duration of his bar to reenrollment.

a.  Undisputed Facts

The parties were advised in the Standing Order ¶ G that, for purposes of ruling on a motion for summary judgment, a fact alleged and not specifically denied would be accepted as true and offered evidence would be considered admissible and true absent a specific objection.  The following findings of fact are based upon the undisputed or conceded facts.  I do not make credibility determinations, weigh the evidence, or decide which inferences to draw from the evidence in deciding a summary judgment motion.  The evidence is viewed in the light most favorable to Petitioner, the nonmovant, with all inferences drawn in Petitioner’s favor.

On February 24, 2021, Petitioner was charged in the district court by a one-count information alleging the felony⁶ offense of making a false statement to a federal official:

On or about August 31, 2017, in the Western District of Tennessee, [Petitioner], did willfully and knowingly make a materially false statement and representation in a matter within the jurisdiction of the Executive Branch of the United States, to a Special Agent of the Federal Bureau of Investigation, to wit, [Petitioner] stated Individual 1 had been

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paid by Individual 2 because Individual 1 had done work for Individual 2.  The statement and representation was false because, as [Petitioner] then and there knew, Individual 1 had done little if any bona fide work for Individual 2.

All in violation of Title 18, United States Code, Section 1001 (a)(2).

P. Ex. 2.

On February 24, 2021, Petitioner pleaded guilty to the felony charge pursuant to the terms of a plea agreement and his guilty plea was accepted by the district court.  CMS Exs. 2, 3; P. Ex. 6.  On August 18, 2021, the district court entered a judgment of guilt against Petitioner as to the felony charge of making a false statement.  CMS Ex. 4. 

Pursuant to 42 C.F.R. § 424.535(a)(3)(i), whether one has been convicted is determined pursuant to 42 C.F.R. § 1001.2.  The regulation provides that a conviction occurs when:  (1) a judgment of conviction is entered,  (2) a finding of guilt has been made, (3) a guilty plea or no contest plea has been accepted, or (4) an individual or entity enters into a first offender, deferred adjudication, or other program or arrangement where a judgment of conviction is withheld.  42 C.F.R. § 1001.2.  Petitioner’s guilty plea was accepted on February 24, 2021.  CMS Exs. 2, 3.  Judgment of conviction was not entered until August 18, 2021.  CMS Ex. 4.  I find and conclude that February 24, 2021, the date Petitioner’s plea was accepted, was the date on which he was first convicted within the meaning of 42 C.F.R. § 1001.2.

The MACs notified Petitioner of their initial determinations to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(3), by letters dated April 6 and 8, 2021.⁷  Both MACs cited Petitioner’s district court felony conviction as the basis for the revocation effective the date of his conviction – February 24, 2021 – the date his guilty plea was accepted by the district court.  Both MACs imposed a 10-year reenrollment bar, which pursuant to 42 C.F.R. § 424.535(c) was effective 30 days after the notices of initial determinations.  Both MACs also informed

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Petitioner that his name was being added to the CMS preclusion list.⁸  DAB E-File, C-22-129 # 1_a; DAB E-File C-22-130 # 1_a; CMS Exs. 1, 7.

There is no dispute that the HHS IG informed Petitioner by letter dated November 29, 2021, that the IG would not exclude him from participation in federal health care programs pursuant to section 1128(a) or (b) of the Act.  P. Ex. 3.

There is also no dispute that Petitioner was reinstated in TennCare with no break in coverage, after TennCare was informed that the IG was not excluding Petitioner from federal health care programs.  P. Ex. 4.

b.  Analysis

Congress granted the Secretary authority to revoke the enrollment of a provider or supplier convicted under federal or state law of a felony offense that the Secretary determines is detrimental to the program or its beneficiaries.  Act § 1866(b)(2)(D) (42 U.S.C. § 1395cc(b)(2)(D)).  The Secretary delegated to CMS the authority to revoke a supplier’s billing privileges if CMS determines that the “supplier was, within the preceding 10 years, convicted (as that term is defined in 42 CFR 1001.2) of a Federal or State felony offense that CMS determines is detrimental to the best interests of the Medicare program and its beneficiaries.”  42 C.F.R. § 424.535(a)(3)(i).  The Secretary has specified those crimes that are per se detrimental to the best interests of the program and its beneficiaries in 42 C.F.R. § 424.535(a)(3)(ii).  The listing of per se detrimental felonies in 42 C.F.R. § 424.535(a)(3)(ii) is not exhaustive, but specifically permits revocation for detrimental felonies like the crimes listed.  Abdul Razzaque Ahmed, M.D., DAB No. 2261 at 10. 

The elements necessary for revocation pursuant to 42 C.F.R. § 424.535(a)(3) are:  (1) the supplier was convicted of a federal or state felony offense; (2) the conviction occurred within the 10 years preceding the revocation action; and (3) the Secretary has specified that the conviction is per se detrimental in 42 C.F.R. § 424.535(a)(3)(ii) or CMS has determined on a case-by-case basis under 42 C.F.R. § 424.535(a)(3)(i) that the supplier’s felony offense is detrimental to the best interests of the Medicare program and its beneficiaries.  Fady Fayad, MD, DAB No. 2266 at 7; Michael Scott Edwards, OD and

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M. Scott Edwards, OD, PA, DAB No. 2975 at 9-11 (2019); Neil Niren, MD and Neil Niren, MD, PC, DAB No. 2856 (2018).

I conclude that the undisputed facts satisfy the elements necessary to establish a basis for revocation of Petitioner’s Medicare enrollment under 42 C.F.R. § 424.535(a)(3).

(1)  Petitioner was convicted of a felony offense by the district court on February 24, 2021. 

(2)  The MACs’ initial determinations to revoke were issued on April 6 and 8, 2021, well within the 10‑year period of limitations that began the date of Petitioner’s conviction – February 24, 2021. 

(3)  The CMS hearing officer determined that Petitioner’s felony conviction was detrimental to the best interests of the Medicare program based on the specific facts of his case specifically because his offense involved making a false statement to a federal official indicating a lack of sound judgment and reflecting badly upon his ability and willingness to be truthful in interactions with the federal government.  CMS Ex. 7 at 4; DAB E-File C-22-129 # 1_a at 4.

I further conclude Petitioner has failed to aver facts that show there is a genuine dispute as to any fact material to revocation or sufficient to rebut the CMS prima facie case and CMS prevails as a matter of law.

The Board has narrowly construed the scope of review of the ALJ and the Board in cases involving provider and supplier enrollment, denial of enrollment, and revocation of enrollment cases.  The regulation, 42 C.F.R. § 424.535(a), specifies the reasons for which CMS is authorized by the Secretary to revoke a provider or supplier’s Medicare enrollment and billing privileges.  The Board has concluded that so long as an ALJ finds that CMS had a regulatory basis for revocation under 42 C.F.R. § 424.535(a), the ALJ (and the Board on appeal) may not refuse to apply the regulation and must sustain the revocation.  Stanley Beekman, D.P.M., DAB No. 2650 at 10 (2015) (an ALJ and the Board must sustain a revocation “[i]f the record establishes that the regulatory elements are satisfied”); Douglas Bradley, MD, DAB No. 2663 at 13 (CMS’s revocation authority is discretionary but an ALJ and the Board are limited to deciding whether CMS had a legal basis for revocation and may not substitute their discretion for that of CMS in determining whether revocation is appropriate under all the circumstances); Letantia Bussell, MD, DAB No. 2196 at 13 (the only issue before an ALJ and the Board in enrollment cases is whether CMS has “established a legal basis for its actions”).  Thus, the Board’s view is that it is not my prerogative to review the CMS exercise of discretion to revoke once I have concluded that there is a basis for revocation. 

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Petitioner argues that the initial determinations were arbitrary and capricious and denied Petitioner due process because they failed to articulate the bases and reasons for the revocation of Petitioner’s Medicare enrollment and billing privileges.  Petitioner argues that the initial determinations failed to “state a valid basis for revocation or placement on the Preclusion list.”  P. Br. at 1.  Petitioner also argues that the evidence does not establish that Petitioner was convicted of a felony detrimental to either Medicare or its beneficiaries.  P. Br. at 1.  Petitioner argues more specifically that the MACs’ initial determinations did not reflect the determination that Petitioner’s felony conviction was detrimental to Medicare or its beneficiaries or allege facts to support such a determination.  Petitioner argues that the initial determinations did not state factual findings to support the determination to place Petitioner on the preclusion list.  Petitioner argues the MACs stated no rational for the length of the 10-year reenrollment bar.  P. Br. at 4, 7-9.  Petitioner points out that these issues were raised in his requests for reconsideration, which is consistent with the record of the consolidated cases and evidence.  P. Br. at 4; CMS Exs. 6-7; DAB E-File C-22-129 # 1_a.  Petitioner also raised the issues in his requests for hearing.  Petitioner complains that the reconsidered determinations “attempted to retroactively resolve the clear deficiencies” of the initial determination.  Petitioner acknowledges, however, that the reconsidered determinations did address that Petitioner’s conviction for making a false statement was detrimental to Medicare and its beneficiaries and the factors to be considered in determining to place Petitioner’s name on the CMS preclusion list.  P. Br. at 5.

Petitioner’s focus on omissions from the initial determination is misplaced.  The Board has been clear that the only determination of CMS or the MAC that is subject to my review in a provider and supplier enrollment case is the reconsidered determination.  42 C.F.R. § 498.5(l)(1)-(2); Neb Grp., DAB No. 2573 at 7.  Therefore, I do not review the initial determinations.  Based on my review of the reconsidered determinations, I conclude that the CMS hearing officer did a thorough and detailed analysis and determined that there was a basis for revocation of Petitioner’s Medicare enrollment and billing privileges, the 10-year bar to reenrollment was appropriate, and there was a basis for placing Petitioner’s name on the CMS preclusion list.

Petitioner’s argument that deficiencies in the initial determinations deprived him of due process are without merit.  Petitioner was notified of the initial determinations by the MACs; he was accorded the right to request reconsideration, which he did; and he was granted the right to request ALJ review of the reconsidered determinations, which he also did.  Petitioner set forth his arguments in his requests for hearing and his prehearing brief and response to the CMS motion for summary judgment.  Petitioner has presented evidence for my consideration.  Petitioner argues that the initial determinations deprived him of the opportunity to challenge the revocation and preclusion list determinations.  P. Br. at 7.  However, neither the Act nor the regulations require that the MAC or CMS grant Petitioner an opportunity to address revocation and preclusion list determinations

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prior to issuance of an initial determination to revoke.  Petitioner’s request for hearing and his prehearing brief and the response to the CMS motion for summary judgment demonstrate that Petitioner is aware of the issues in this case, and he has extensively addressed the issues.  This decision reflects that I have conducted de novo review of whether CMS had a basis to revoke Petitioner’s Medicare enrollment and billing privileges and to place Petitioner’s name on the CMS preclusion list.  Petitioner is advised by documents issued with this decision of his right to request Board review.  Petitioner has been accorded all the procedural due process provided for by the Secretary under 42 C.F.R. pts. 424 and 498.  The fact that the initial determinations may have been deficient as Petitioner argues did not deprive Petitioner of any process due him under the Act or regulations, that was not fully satisfied by the reconsidered determinations and this decision.

Petitioner argues that he was not convicted of a felony offense that is detrimental to the best interests of the Medicare program and its beneficiaries.  P. Br. at 9-12.  The Secretary has determined that certain types of offenses are per se detrimental to the best interests of the Medicare program and its beneficiaries, which are listed in 42 C.F.R. § 424.535(a)(3)(ii)(A)-(D).  Those per se detrimental felony offenses include crimes against persons, financial crimes, any crime that places the Medicare program or its beneficiaries at immediate risk; and crimes that would result in exclusion under section 1128(a) of the Act.  42 C.F.R. § 424.535(a)(3)(ii).  The regulation is clear, as has been the Board, that similar crimes may be found to fall within these categories of detrimental offenses and be a basis for revocation of Medicare enrollment and billing privileges.  Abdul Razzaque Ahmed, M.D., DAB No. 2261 at 10.  I agree with Petitioner’s argument that his felony conviction does not fit within any of the categories of per se detrimental offenses identified by the Secretary.  The CMS hearing officer found Petitioner’s felony offense is substantially like per se detrimental financial felonies because Petitioner’s false statement had to do with receipt of payment for work.  CMS Ex. 7 at 3-4; DAB E-File C-22-129 # 1_a at 4.  The hearing officer’s conclusions are unsupportable.  The evidence simply does not show that Petitioner’s conviction was for an offense that was financial or fraudulent or akin to embezzlement or extortion so that it can be determined to be per se detrimental under 42 C.F.R. § 424.535(a)(3)(ii)(B). The evidence also does not show that Petitioner’s offense was a crime against a person or a crime that placed the Medicare program or its beneficiaries at risk.  The IG also did not exclude Petitioner under a mandatory exclusion provision of section 1128(a) of the Act.  P. Ex. 3.

However, the Secretary has also authorized CMS to determine on a case-by-case basis under 42 C.F.R. § 424.535(a)(3)(i) that the supplier’s felony offense is detrimental to the best interests of the Medicare program and its beneficiaries, even if the offense does not fit within a category of per se detrimental offenses.  Fady Fayad, MD, DAB No. 2266 at 7; Michael Scott Edwards, OD and M. Scott Edwards, OD, PA, DAB No. 2975 at 9-11; Neil Niren, MD and Neil Niren, MD, PC, DAB No. 2856.  The CMS hearing officer

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specifically found based on the specific facts and circumstances of Petitioner’s conviction that his conviction for making a false statement to a federal agent was detrimental to Medicare and its beneficiaries.  The hearing officer found that Petitioner’s false statement to a Special Agent of the Federal Bureau of Investigation “demonstrates that [Petitioner] lacks sound judgment and implicates his ability and willingness to be truthful concerning his actions with the federal government.”  CMS Ex. 7 at 4; DAB E-File C-22-129 # 1_a at 4.  CMS was granted the discretion to make this determination by 42 C.F.R. § 424.535(a)(3)(i).  Therefore, CMS had a basis to revoke Petitioner’s Medicare enrollment and billing privileges under 42 C.F.R. § 424.535(a)(3).  My review of the CMS revocation determination is limited to whether CMS had a legal basis for revocation.  Letantia Bussell, MD, DAB No. 2196 at 10.  If I conclude CMS had a basis for revocation, I must uphold the revocation and may not substitute my discretion for that of CMS.  Abdul Razzaque Ahmed, MD, DAB No. 2261 at 19.

Referring to the IG letter admitted as P. Ex. 3, Petitioner argues that the IG already reviewed the facts of his conviction and “reached the conclusion that [the IG] does not deem his offense sufficiently severe to warrant exclusion.”  P. Br. at 11.  Petitioner misrepresents the IG letter as the IG made no statement in her letter regarding the severity of Petitioner’s offense, stating only that the IG would “not be imposing an exclusion at this time.”  P. Ex. 3.  The Board has previously addressed that “revocation under [42 C.F.R. § 424.535] and exclusion under section 1128 are distinct remedial tools, each with its own set of prerequisites and consequences for the provider or supplier.”  Abdul Razzaque Ahmed, M.D., DAB No. 2261 at 13, aff’d, 710 F. Supp. 2d 167 (D. Mass. 2010).  Revocation and exclusion are two different administrative enforcement actions delegated to two different components of HHS.  The IG is responsible for imposing exclusions pursuant to section 1128 of the Act and 42 C.F.R. pts. 1001.  CMS is responsible for revoking the enrollment of providers and suppliers in Medicare pursuant to 42 C.F.R. § 424.535.  There is no authority that indicates that CMS is bound when making a revocation determination by the IG’s determination not to exclude an individual from federal health care programs.  Contrary to the suggestion of Petitioner (P. Br. at 11), the Act and regulations do not limit the discretion of CMS to revoke based upon the same conviction for which the IG has declined to impose an exclusion.

Petitioner also argues that TennCare has reinstated his participation in its program.  P. Br. at 11; P. Ex. 4.  Petitioner cites no authority for the proposition that the TennCare action has any binding effect on the Secretary or CMS.  The TennCare letter also makes clear that Petitioner’s reinstatement turned on the fact that the IG decided not to exclude Petitioner from federal health care programs, a decision that is also not binding on CMS. 

To the extent that Petitioner’s arguments may be construed that CMS should be estopped from revoking Petitioner’s Medicare enrollment and billing privileges based on the

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actions of the HHS IG and TennCare, 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, 421-22 (1990).  Petitioner points to no evidence of affirmative misconduct such as fraud by the MAC or CMS.

Petitioner argues that he is highly respected among his peers and patients.  He states that he is among only 150 physicians in the nation, seven of who are in Tennessee, only three of whom are in Memphis, Tennessee, and only one of two physicians in the area that accept TennCare, that diagnoses and treats benign and malignant tumors of the musculoskeletal system.  Petitioner states that two surgeons are required to perform the complex surgeries he performs.  Petitioner further states that he has trained dozens of medical students, residents, and fellows as a member of the faculty of the University of Tennessee Health Science Center.  He states that he pioneered same-day, out-patient total joint replacement surgery resulting in efficiency for patients and reduced costs to payers.  He has been enrolled in Medicare for over a decade with no disciplinary actions, patient grievances, or malpractice suits, and his medical license is in good standing.  P. Br. at 2-3.  Petitioner argues that his revocation, reenrollment bar, and listing on the CMS preclusion list are contrary to public policy and the intent of the relevant regulations, because “preventing [Petitioner] from serving Medicare beneficiaries for the next 10 years will have a substantially detrimental impact on the Medicare program and the community [Petitioner] serves.”  P. Br. at 12-13.

However, even accepting Petitioner’s assertions of fact as true for purposes of summary judgment, Petitioner’s arguments are requests for equitable relief that I have no authority to grant.  When I determine, as I have here, that CMS has a basis for revocation, I have no authority to substitute my judgment for that of CMS and void the revocation based on equitable considerations.  US Ultrasound, DAB No. 2302 at 8 (2010).  Furthermore, I am required to follow the Act and regulations and have no authority to declare statutes or regulations invalid.  1866ICPayday.com, L.L.C., DAB No. 2289 at 14 (2009).

When a supplier’s Medicare enrollment and billing privileges are revoked, the supplier is barred from reenrolling in the Medicare program for one to 10 years.  42 C.F.R. § 424.535(c).  In this case, CMS determined that a 10-year reenrollment bar was appropriate.  Petitioner argues that CMS failed to provide any rationale to explain the length of his reenrollment bar.  P. Br. at 4.  There is no statutory or regulatory language establishing a right to review of the duration of the reenrollment bar CMS imposes, or when it commences or ends.  Act § 1866(j)(8); 42 C.F.R. §§ 424.535(c), 424.545, 498.3(b), 498.5.  The Board has held that the duration of a revoked supplier’s reenrollment bar is not an appealable initial determination listed in 42 C.F.R. § 498.3(b) and is not subject to ALJ review.  Vijendra Dave, M.D., DAB No. 2672 at 11 (2016). 

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Finally, because I have found that there is a basis for revocation, and Petitioner is subject to a reenrollment bar, CMS has a basis for adding Petitioner to the CMS preclusion list for the duration of his reenrollment bar.  The CMS hearing officer on reconsideration addressed in detail the basis for placing Petitioner’s name on the CMS preclusion list and Petitioner’s challenges to that action.  CMS Ex. 7 at 4-6; DAB E-File C-22-129 # 1_a at 4-6.  I have no authority to conduct review of the CMS exercise of discretion in determining that Petitioner’s underlying conduct was detrimental to Medicare and in adding Petitioner to the preclusion list where, as here, I determine that there is a basis for such action.  42 C.F.R. §§ 422.2, 423.100 (definition of preclusion list); 83 Fed. Reg. 16,440, 16,641-67.

III.  Conclusion

For the foregoing reasons, the Medicare enrollment and billing privileges of Petitioner are revoked pursuant to 42 C.F.R. § 424.535(a)(3), effective February 24, 2021.  There is a basis for listing Petitioner on the CMS preclusion list for the duration of his 10‑year bar to reenrollment. 

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Endnotes

¹  Citations are to the 2020 revision of the Code of Federal Regulations (C.F.R.), which was in effect at the time of the initial determination, unless otherwise indicated.  An appellate panel of the Departmental Appeals Board (Board) concluded in Mark A. Kabat, D.O., DAB No. 2875 at 9-11 (2018) that the applicable regulations are those in effect at the time of the initial determination.  The Board previously concluded that the only determination subject to my review in a provider and supplier enrollment case such as this is the reconsidered determination.  Neb Group of Ariz. LLC, DAB No. 2573 at 7 (2014).  In this case, the applicable regulations did not change between the issuance of the initial and reconsidered determinations. 

²  CMS failed to place in evidence the Novitas notice of initial determination and the related CMS reconsidered determination.  The CMS error does not affect the outcome in this case as only the reconsidered determinations are subject to my review.  Neb Group, DAB No. 2573 at 7.  The reconsideration determinations in issue are both in the record as they were filed by Petitioner with the respective requests for hearing.  CMS placed the reconsidered determination related to the April 8, 2021 initial determination of Palmetto GBA (Palmetto), a MAC, in the record as CMS Ex. 7.  I note that CMS violated Standing Order para. D.1 when filing the CMS exhibits.  However, I conclude no sanction is appropriate as the violation did not delay proceedings or pose prejudice to Petitioner. 

³  CMS agrees that the documents marked P. Exs. 1, 2, 5, and 6 were considered by the CMS hearing officer on reconsideration.  CMS Reply at 1 n.1. 

⁴  The correspondence in P. Ex. 1 is also not relevant for the same reasons the correspondence in P. Ex. 7 is not relevant.  However, P. Ex. 1 is admitted to have in evidence the complete record considered by the CMS hearing officer on reconsideration.

⁵  A “supplier” furnishes services under Medicare and includes physicians or other practitioners and facilities that are not included within the definition of the phrase “provider of services.” Act § 1861(d) (42 U.S.C. § 1395x(d)).  A “provider of services,” commonly shortened to “provider,” includes hospitals, critical access hospitals, skilled nursing facilities, comprehensive outpatient rehabilitation facilities, home health agencies, hospice programs, and a fund as described in sections 1814(g) (42 U.S.C. § 1395f(g)) and 1835(e) (42 U.S.C. § 1395n(e)) of the Act.  Act § 1861(u) (42 U.S.C. § 1395x(u)).  The distinction between providers and suppliers is important because they are treated differently under the Act for some purposes. 

⁶  The maximum sentence for violation of 18 U.S.C. § 1001(a) is five to eight years in prison.  18 U.S.C. § 1001.  A federal criminal offense with a possible term of imprisonment of five or more years but less than 10 years is a Class D felony.  18 U.S.C. § 3559. 

⁷  I accept as true Petitioner’s assertion that he reported his conviction to the MACs.  P. Br. at 4.  However, that fact is not material, i.e., it has no effect on the outcome in this case, because there is no authority that suggests a self-report of an adverse action limits CMS’s authority to revoke Medicare enrollment or billing privileges.

⁸  An individual’s, entity’s, or prescriber’s name is added to the preclusion list after the 60-day period for requesting reconsideration of the initial determination has expired or the date of a reconsidered determination if reconsideration is requested.  42 C.F.R. §§ 422.222(a)(3)(ii), 423.120(c)(6)(v)(C).