Brian O'Connor, DAB CR6380 (2023)

DECISION

I affirm the Centers for Medicare & Medicaid Services’ (CMS) determination to revoke the Medicare enrollment and billing privileges of Petitioner, Brian O’Connor.

I.  Legal Framework

The Social Security Act (Act) authorizes the Secretary of Health and Human Services (Secretary) to create regulations governing the enrollment of providers and suppliers to furnish health care items and services to Medicare program beneficiaries.  See 42 U.S.C. § 1395cc(j).  For purposes of the Medicare program, physician assistants are considered suppliers.  See 42 U.S.C. §§ 1395x(d), (s)(2)(K)(i), (aa)(5)(a); 42 C.F.R. §§ 410.74, 498.2 (definition of Supplier paragraph (5)).

Under the regulations, a supplier must enroll in the Medicare program to receive payment for covered Medicare items or services provided to beneficiaries.  42 C.F.R. § 424.505.  To enroll, a supplier must complete and file an enrollment application with CMS and meet all of the requirements to be a supplier.  42 C.F.R. §§ 424.510, 424.530.

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Once enrolled, CMS may revoke a supplier’s enrollment for any of the reasons stated in 42 C.F.R. § 424.535(a).  When CMS revokes enrollment, it will establish a re-enrollment bar from one to ten years in duration.  42 C.F.R. § 424.535(c).  If CMS revokes a supplier’s enrollment and establishes a re-enrollment bar, CMS may also add the supplier to CMS’s Preclusion List if CMS determines that the basis for revocation is detrimental to the best interests of the Medicare program.  42 C.F.R. §§ 422.2, 423.100.

A supplier may request a hearing before an administrative law judge to dispute a revocation or being added to CMS’s Preclusion List.  42 C.F.R. §§ 498.3(b)(17), (20), 498.5(l)(2), (n)(2).  However, “the right to review of CMS’s determination by an [administrative law judge] serves to determine whether CMS has the authority to revoke [the supplier’s] Medicare billing privileges, not to substitute the [administrative law judge’s] discretion about whether to revoke.”  Letantia Bussell, M.D., DAB No. 2196 at 13 (2008) (emphasis omitted).  A supplier may administratively appeal an administrative law judge’s decision.  42 C.F.R. §§ 498.5(l)(3), (n)(3), 498.80.

I.  Background and Procedural History

Petitioner was enrolled in the Medicare program as a physician assistant (PA).  CMS Ex. 1 at 1-2.

In a July 30, 2021 notice of initial determination, issued by a CMS contractor, Petitioner’s Medicare enrollment was revoked, effective August 29, 2021, based on the following reasons:

42 CFR § 424.535(a)(12) – Other Program Termination
By letter dated April 17, 2021, you were informed that you were terminated from the North Carolina Medicaid Program.  Your appeal rights have been exhausted with respected to this termination.

42 CFR § 424.535(a)(9) – Failure to Report
The North Carolina Medical Board suspended your physician assistant license, effective April 1, 2021.  You did not notify [CMS] of this adverse legal action within 30 calendar days as required under 42 CFR § 424.516(d)(1).

Request for Hearing (RFH) at 20.¹  The CMS contractor also established a five-year re-enrollment bar.  RFH at 21.  In addition, the CMS contractor added Petitioner’s name to

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the CMS Preclusion List, which has the effect of precluding Petitioner from receiving reimbursement for services provided to Medicare Advantage Plan (i.e., Medicare Part C) enrollees.  It also precluded enrollees in Medicare Part D from receiving reimbursement for prescriptions written by Petitioner.  RFH at 20.

Petitioner requested reconsideration and sought the reversal of the revocation, removal of the re-enrollment bar, and removal of Petitioner’s name from the Preclusion List.  RFH at 13-14.  In support of the reversal of the revocation, Petitioner asserted that:  Petitioner was no longer on the North Carolina Medicaid exclusion list and is eligible to apply for re-enrollment; Petitioner’s North Carolina PA license was reinstated on February 10, 2022; and Petitioner was licensed to practice as a PA in Virginia, Iowa, and South Carolina.  RFH at 15-16.  Petitioner argued that a five-year re-enrollment bar was “overly punitive” and that, despite Petitioner’s licenses and certifications to practice, the Medicare revocation is causing Petitioner to struggle to earn a living because “the ability to practice in his trained profession has been taken away from him.”  RFH at 17.  Finally, Petitioner asserted that he has been a PA since 1996 and had no other disciplinary history.  RFH at 17.

On April 14, 2023, a CMS hearing officer issued an unfavorable reconsidered determination upholding the initial determination.  RFH at 61-70.  The hearing officer found the following:

• [Petitioner] does not dispute that at the time the initial determination was implemented, his participation in the [North Carolina] Medicaid program was terminated.  Therefore, considering the applicable factors, CMS upholds the revocation of [Petitioner’s] Medicare enrollment pursuant to § 424.535(a)(12).  (RFH at 65.);
• [Petitioner] claims that the [North Carolina Medical Board] has reinstated his [PA’s] license.  However, this reinstatement does not change the fact that [Petitioner] failed to report the suspension of his PA’s license as required under § 424.516(d).  Therefore, after considering the enumerated factors, CMS upholds the revocation of [Petitioner’s] Medicare enrollment pursuant to § 424.535(a)(9).  (RFH at 66.);

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• However, based on [Petitioner’s] non-compliance with Medicare requirements coupled with his actions that led to the suspension of his [PA’s] license and suspension from the [North Carolina] Medicaid program, CMS finds that the duration of the re-enrollment bar is appropriate.  Therefore, CMS upholds the five-year re-enrollment bar established in the initial determination.  (RFH at 66); and
• After carefully reviewing the regulatory factors, CMS finds that the conduct that led to the revocation of [Petitioner’s] Medicare enrollment pursuant to §§ 424.535(a)(9) and (a)(12) is detrimental to the best interests of the Medicare program.  Therefore, each revocation basis and its underlying conduct provide an independent basis to add [Petitioner] to the CMS Preclusion List. (RFH at 67).

On May 3, 2023, Petitioner timely requested a hearing to dispute the revocation.  On May 8, 2023, the Civil Remedies Division acknowledged receipt of the RFH and issued my Standing Prehearing Order (SPO) establishing deadlines for the submission of prehearing exchanges.  In accordance with the SPO, CMS filed its prehearing exchange, which included a brief (CMS Br.) and five exhibits (CMS Exs. 1-5).  Petitioner’s prehearing exchange consisted of only a brief (P. Br.).  CMS filed a reply brief (CMS Reply) and an additional proposed exhibit (CMS Ex. 6).

II.  Evidentiary Rulings and Decision on the Record

I admit all of CMS’s proposed exhibits into the record because Petitioner did not object to any of them.  See SPO ¶ 10.  I also admit into the record Petitioner’s 13 exhibits submitted with the reconsideration request that have not otherwise been submitted in this proceeding as marked exhibits (i.e., RFH at 19-57).  These documents were part of the record on reconsideration and, therefore, are appropriately part of the record in this case.  RFH at 62.

I ordered the parties to submit written direct testimony for all of their proposed witnesses and advised that I would only hold a hearing if a party requested to cross-examine a witness from whom written direct testimony was submitted.  SPO ¶¶ 11-12; Civil Remedies Division Procedures §§ 16(b), 19(b).  Because the parties did not submit written direct testimony from any witnesses, I issue this decision based on the written record.  SPO ¶¶ 13-14; Civil Remedies Division Procedures § 19(d).

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III.  Issues

Whether CMS had a legitimate basis to revoke Petitioner’s Medicare enrollment and add Petitioner’s name to CMS’s Preclusion List.

IV.  Jurisdiction

I have jurisdiction to hear and decide the issues in this case.  42 C.F.R. §§ 498.3(b)(17), (20), 498.5(l)(2), (n)(2); see also 42 U.S.C. § 1395cc(j)(8); 42 C.F.R. § 498.1(g).

V.  Findings of Fact

1. Petitioner was issued a license to practice as a PA in North Carolina on August 11, 2003, and a license to practice as a PA in Virginia on March 29, 2017.  CMS Ex. 3 at 1; RFH at 34, 42.
2. On August 28, 2020, the North Carolina Medical Board issued a letter stating that, during an investigation into Petitioner’s prescribing practices, Petitioner admitted to prescribing Plaquenil® for Petitioner and Petitioner’s family in order to stockpile it in the event that Petitioner or a member of Petitioner’s family contracted COVID-19.  CMS Ex. 2 at 1.
3. On March 16, 2021, Petitioner entered into a Consent Order with the North Carolina Medical Board.  CMS Ex. 3.  Petitioner’s PA license was indefinitely suspended, effective April 1, 2021.  CMS Ex. 3 at 4; CMS Ex. 4 at 1.  Petitioner’s misconduct was based on the following facts (CMS Ex. 3 at 2):

The [Medical Board of North Carolina] determined that [Petitioner] was stockpiling Plaquenil® in the event he or one of his family members was diagnosed with COVID-19.

Additional investigation into [Petitioner’s] prescribing practices revealed that, in addition to the above-referenced prescribing of Plaquenil®, [Petitioner] prescribed multiple controlled substances to Person A, a person with whom [Petitioner] has a significant personal and emotional relationship.  [Petitioner] did not have an established provider/patient relationship with Person A and did not prepare any documentation or medical charting for the prescriptions.

The [Medical Board of North Carolina] has evidence to conclude that [Petitioner] fraudulently utilized the credentials

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of several colleagues to obtain multiple controlled substances for himself and Person A.

4. In an April 17, 2021 notice, Petitioner’s participation in the North Carolina Medicaid program was terminated as of April 1, 2021.  CMS Ex. 5 at 2.
5. The Virginia Department of Health Professions entered an order on June 23, 2021, mandatorily suspending Petitioner from practice based on Petitioner’s indefinite suspension in North Carolina.  RFH at 34-35.
6. On February 10, 2022, Petitioner entered into a Consent Order with the North Carolina Medical Board.  RFH at 25-30.  The North Carolina Medical Board reinstated Petitioner’s PA license without restrictions or limitations.  RFH at 28; see also RFH at 40.
7. On June 24, 2022, Petitioner entered into a Consent Order with the Virginia Board of Medicine to reinstate Petitioner’s PA license.  RFH at 34-38.  The Consent Order noted that Petitioner demonstrated completion of a Physician Prescribing Course, a Professional Boundaries and Ethics Course, and a Professional/Problem-Based Ethics Course, and the Drug Enforcement Administration issued Petitioner a Controlled Substances Registration Certificate.  RFH at 35-36; see also RFH at 48, 50-51, 53, 57.
8. Petitioner is also authorized to practice as a PA in South Carolina and Iowa.  RFH at 44, 46.
9. Petitioner “failed to report his licensure suspension to CMS.”  RFH at 3.

VI.  Conclusions of Law

1. As a non-physician practitioner, Petitioner was obligated under 42 C.F.R. § 424.516(d)(1)(ii) to report “[a]ny adverse legal action” to the relevant servicing CMS contractor within 30 days.  An “adverse legal action” includes a “[s]uspension . . . of a license to provide health care by any [s]tate licensing authority.”  42 C.F.R. § 424.502 (definition of Final adverse action paragraph (2)); see also Akram A. Ismail, M.D., DAB No. 2429 at 10-11 (2011).  Petitioner did not timely report the indefinite suspension of Petitioner’s PA license in North Carolina to a CMS contractor.  Therefore, CMS legitimately revoked Petitioner’s Medicare enrollment under 42 C.F.R. § 424.535(a)(9).
2. The North Carolina Medicaid program terminated Petitioner’s participation in that program effective April 1, 2021.  There is no evidence that an appeal of the

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termination is pending.  Therefore, CMS legitimately revoked Petitioner’s Medicare enrollment under 42 C.F.R. § 424.535(a)(12).

3. Petitioner’s Medicare enrollment is currently revoked, Petitioner is under an enrollment bar, and CMS determined that the underlying conduct that led to the revocation is detrimental to the best interests of the Medicare program.  Therefore, CMS legitimately added Petitioner’s name to the CMS preclusion list under 42 C.F.R. §§ 422.2, 423.100.

VII.  Discussion

Although Petitioner initially disputed the revocation of Medicare billing privileges for a variety of reasons related to the substantive bases for revocation (RFH at 2-6), Petitioner’s prehearing brief now concedes “that he cannot challenge the initial reasons for revoking his termination from the Medicare program.  He was in fact, terminated from the North Carolina Medicaid program and he did not report the suspension of his physician assistant’s license to Medicare within 30 days.”  P. Br. at 1.  Petitioner’s prehearing brief also did not dispute the factual or legal bases to place Petitioner’s name on the CMS Preclusion List.  Therefore, as reflected in my conclusions of law above, I uphold the revocation of Medicare enrollment and the placement of Petitioner’s name on the CMS Preclusion List without further discussion.

Petitioner instead argues that it was improper for a CMS contractor, rather than CMS itself, to revoke Petitioner’s Medicare enrollment and that the five-year re-enrollment bar is subject to review.  P. Br. at 1-2.  For the reasons discussed below, I reject these arguments.

A. Authority to Revoke

Petitioner cites 42 C.F.R. § 424.535(a) for the proposition that only CMS may revoke a supplier’s Medicare enrollment because that regulation provides that “CMS may revoke. . . .”  P. Br. at 3.  Petitioner states that a contractor is a private entity and not CMS.  P. Br. at 3-4.  Petitioner also points out that many of the specific bases for revocation indicate that CMS will make various determinations related to each of those specific bases (i.e., 42 C.F.R. § 424.535(a)(1), (3), (5), (6), (8), (9), (10), (12), (14), (17), (18), (19), (20), (21)).  P. Br. at 4.  In contrast, only one basis for revocation (42 C.F.R. § 424.535(a)(11)) specifies that a CMS contractor may revoke the enrollment of home health agencies under certain circumstances.  P. Br. at 4.  Petitioner argues that Sebelius v. Cloer, 569 U.S. 369, 378 (2013) stands for the proposition that “when Congress includes particular language in one section of the statute, but omits it in another section of the same statute, then Congress acts intentionally in the disparate inclusion and exclusion.”  P. Br. at 4.  Using this method of interpreting text, Petitioner argues that the

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references to CMS in § 424.535(a) mean that only CMS, and not a contractor, can exercise the authority directly granted to CMS.  P. Br. at 4.

CMS disagrees with Petitioner’s argument.  CMS asserts that it, and not the contractor, decided to revoke Petitioner’s Medicare enrollment.  CMS Reply at 2.  CMS cites Glenn Alden Harrison, M.D., DAB No. 3023 at 9 (2020) to show that CMS revokes Medicare enrollment through its contractors.  CMS Reply at 2.  In support of the notion that CMS actually makes the revocation decision, and the contractor merely effectuates that decision, CMS cites 42 C.F.R. § 424.535(c)(1)(i) and (g), which indicate CMS or a CMS contractor mails the revocation notice, and Medicare Program Integrity Manual instructions that state contractors only revoke suppliers if CMS’s Provider Enrollment and Oversight Group authorizes the revocation.  CMS Reply at 2-3.

As an initial matter, I note that CMS contractors can revoke a supplier’s enrollment, even when the regulation designates CMS as the revoking authority.  See Lilia Gorovits, M.D., P.C., DAB No. 2985 at 8-9 (2020); Fady FAYAD, M.D., DAB No 2266 at 17-20 (2009) (concluding that contractors were delegated authority to revoke) aff’d, Fayad v. Sebelius, 803 F. Supp. 2d 699, 704-706 (E.D. Mich. 2011).  However, CMS argues that its internal procedures show that CMS contractors must obtain CMS’s consent to revoke the Medicare enrollment of a supplier.  CMS Ex. 6 at 3-4.  Such a procedure would be sufficient to ensure CMS oversight of revocations issued by contactors.

If there were any question that the CMS contractor in this case exceeded its authority when it issued the initial determination to revoke Petitioner enrollment, it is significant that a CMS hearing officer rendered the reconsidered determination.  RFH at 70.  It is the reconsidered determination that establishes CMS’s final determination and provides the basis for administrative law judge review.  See 42 C.F.R. §§ 498.5(l), (n), 498.24-498.25, 498.40(a); see also Rollington Ferguson, M.D., DAB No. 2949 at 3 (2019) (the regulations require the issuance of a reconsidered determination before a party is entitled to ALJ review); Denise A. Hardy, D.P.M., DAB No. 2464 at 5 (2012) (“By filing a request for a hearing without having first obtained a reconsidered determination, Petitioner did not comply with the procedures set forth in the applicable regulations, which were stated in [the] revocation notice, and is therefore not entitled to a hearing before an ALJ.”).  On reconsideration, the CMS hearing officer “receives written evidence and statements that are relevant and material to the matters at issue,” “[c]onsiders the initial determination, the findings on which the initial determination was based, the evidence considered in making the initial determination, and any other written evidence submitted,” and “makes a reconsidered determination, affirming or modifying the initial determination and the findings on which it was based.”  42 C.F.R. § 498.24.  A notice of a reconsidered determination “gives the reasons for the determination” and “specifies the . . . requirements of law or regulations that the affected party fails to meet, and informs the party of its right to a hearing.”  42 C.F.R. § 498.25.  The reconsidered determination supersedes the initial determination.  42 C.F.R. § 498.20(b)(1).  Therefore,

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if the CMS contractor did not have the authority to revoke the enrollment of a supplier, the detailed reconsidered determination upholding the revocation is sufficient to cure any potential flaw in authority.  See Gorovits, DAB No. 2985 at 9 (“Moreover, under Part 498, CMS retains the authority to review on reconsideration a contractor’s revised initial determination to revoke a supplier’s billing privileges, as it did in this case.”).

B. Length of Re-Enrollment Bar

When CMS revokes the Medicare enrollment of a supplier, it must impose a re-enrollment bar from one to ten years in length depending on the severity of the basis for revocation.  42 C.F.R. § 424.535(c)(1)(i).

Petitioner argues that I have jurisdiction to review and reduce the length of the re-enrollment bar imposed on Petitioner.  Petitioner asserts that due process demands that Petitioner have the right to review of the length of re-enrollment bar because an agency cannot act as both the accuser and the final decisionmaker.  P. Br. at 2-3.  Petitioner’s view is that administrative law judges are to provide the impartiality necessary to ensure fairness for Petitioner.  P. Br. at 3.  Petitioner also posits that CMS abused its discretion as to the length of the re-enrollment bar because CMS did not explain why it decided on that amount of time.  P. Br. at 7-8.

CMS disagrees with Petitioner and asserts that I do not have jurisdiction to review the length of the re-enrollment bar.  CMS Br. at 8-9; CMS Reply at 3.

As CMS argues, prior administrative appellate decisions have interpreted the regulations as indicating the re-enrollment bar is not subject to administrative law judge review.  E.g., Gorovits, DAB No. 2985 at 15-16; Vijendra Dave, M.D., DAB No. 2672 at 9 (2016); see also Shah v. Azar, 920 F.3d 987, 998-99 (5th Cir. 2019) (indicating that CMS’s decision as to the length of the re-enrollment bar is accorded significant deference).  Therefore, I cannot review whether a five-year re-enrollment bar is appropriate in this case.

VII.  Conclusion

I affirm CMS’s determination to revoke Petitioner’s Medicare enrollment and billing privileges and to place Petitioner’s name on the CMS Preclusion List.

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Endnotes

¹ Petitioner’s RFH is a PDF document that includes a number of exhibits, many of which were submitted with Petitioner’s reconsideration request.  The RFH is Document No. 1 in the Electronic Filing System (E-File).  I cite to the exhibits attached to the RFH by the PDF counter number.