Steven Williams, MD, DAB CR6468 (2024)

DECISION

First Coast Service Options, Inc. (First Coast), an administrative contractor acting on behalf of the Centers for Medicare & Medicaid Services (CMS), revoked the Medicare enrollment and billing privileges of Petitioner, Steven Williams, MD, pursuant to 42 C.F.R. § 424.535(a)(12) because Petitioner had been terminated, revoked, or otherwise barred by the State of California - Health and Human Services Agency, Department of Health Care Services (DHCS) from participation in Medi-Cal, the California Medicaid program.  First Coast also placed Petitioner on CMS’s Preclusion List.  CMS upheld these determinations, and Petitioner disputes these determinations in his request for hearing. 

As I explain below, my review of this matter is based on not whether I, in the first instance, would have revoked Petitioner’s Medicare enrollment and billing privileges and upheld his placement on the Preclusion List.  Rather, my review is based on whether CMS was authorized to revoke Petitioner’s Medicare enrollment and billing privileges and to uphold his placement on the Preclusion List.  Because I cannot require CMS to exercise its discretionary authority, and it was authorized to revoke Petitioner’s enrollment and billing privileges and uphold his placement on the Preclusion List, I affirm CMS’s determinations. 

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I.     Background and Procedural History

Petitioner was enrolled in the Medicare program as an anesthesiologist.  CMS Ex. 8 at 1. 

Petitioner concedes that he administered a wrong-site anesthetic block nearly 14 years ago in June 2010.  Petitioner’s Brief (P. Br.) at 3.  Following the wrong-site anesthetic block, the Board of Medicine of the State of Florida’s Department of Health (Florida Medical Board) issued an administrative complaint in October 2011 charging that Petitioner administered a popliteal nerve block on the incorrect leg of a patient.  CMS Ex. 4 at 22.  Pursuant to a December 2011 settlement agreement, Petitioner agreed that the facts alleged in the administrative complaint, if proven, would be a violation of chapter 458 of the Florida Statutes.  CMS Ex. 4 at 14.  Petitioner agreed to pay an administrative fine of $2,500, along with the costs of the investigation and prosecution of the case.  CMS Ex. 4 at 14-15.  Petitioner also agreed to complete five hours of continuing medical education in “Risk Management.”  CMS Ex. 4 at 16. 

At the time of the action by the Florida Medical Board, Petitioner had an expired California medical license that had not been renewed.¹  CMS Ex. 4 at 1.  In December 2012, the Medical Board of California issued an accusation charging that the wrong-site anesthetic block and the action by the Florida Medical Board “constitutes cause for disciplinary action and/or unprofessional conduct.”  CMS Ex. 4 at 8.  After Petitioner did not respond to the accusation, the Medical Board of California issued a default decision and order in May 2013 that revoked his medical license.  CMS Ex. 4 at 2, 4-5. 

More than nine years later, in September 2022, DHCS first informed Petitioner of his automatic suspension from the California Medi-Cal program effective June 13, 2013, the effective date of the revocation of his expired and non-renewed California medical license.  CMS Exs. 3 at 1; 4 at 5.  The September 2022 letter informed Petitioner that he had been placed on the Suspended and Ineligible Provider List pursuant to Cal. Welf. & Inst. Code § 14043.6, which states the following:  

The department shall automatically suspend, as a provider in the Medi-Cal program, any individual who . . . has a license, certificate, or other approval to provide health care, which is revoked or suspended by a federal, California, or another state’s licensing, certification, or approval authority . . . . 

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CMS Ex. 3 at 1-2.  Petitioner did not take any action in response to this letter.  See CMS Ex. 2 at 6 (“Since I had not billed Medi-Cal for any anesthesia services since I left California in 2009, I ignored the letter.”) 

First Coast issued a letter dated February 3, 2023, informing Petitioner that it had revoked his Medicare enrollment, effective March 5, 2023, pursuant to 42 C.F.R. § 424.535(a)(12) (other program termination) based on his termination from the California Medicaid program and the exhaustion of his appeal rights.²  CMS Ex. 1 at 1.  First Coast also imposed a five-year bar to re-enrollment and placed Petitioner on CMS’s Preclusion List.  CMS Ex. 1 at 1-3. 

Petitioner submitted a request for reconsideration on May 2, 2023, along with follow-up correspondence in June and July of 2023.³  CMS Ex. 2 at 1-9.  Petitioner’s submissions included a copy of a March 22, 2023 DHCS letter that granted his request for reinstatement in the Medi-Cal program.  CMS Ex. 2 at 10-13.  The letter stated the following, in pertinent part: 

After review of the file, and based on the totality of the facts, the Department is reasonably certain that the kinds of conduct that led to the original exclusion will not recur, and hereby grants your request for

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reinstatement effective with the date of this letter.  Your name will be removed from the Department’s Suspended and Ineligible Provider List in the next monthly updated publication of the list. 

CMS Ex. 2 at 12. 

On August 9, 2023, CMS issued a reconsidered determination that upheld Petitioner’s revocation pursuant to 42 C.F.R. § 424.535(a)(12).⁴ Reconsidered Determination at 4.  CMS also upheld the five-year bar to re-enrollment.  Reconsidered Determination at 5. 

Additionally, CMS upheld Petitioner’s placement on its Preclusion List.  Reconsidered Determination at 5-6. 

Petitioner filed a request for an administrative law judge (ALJ) hearing on October 8, 2023.  Thereafter, the Civil Remedies Division acknowledged receipt of Petitioner’s request for hearing and issued my standing pre-hearing order directing the parties to file pre-hearing exchanges in accordance with specific requirements and deadlines.  CMS filed a pre-hearing brief, along with eight proposed exhibits (CMS Exs. 1-8).  Petitioner filed a pre-hearing brief.⁵

Because neither party has submitted written direct testimony, a hearing for the purpose of cross-examination of witnesses is unnecessary.  Standing Pre‑Hearing Order §§ 12-14.  The record is closed, and the matter is ready for a decision.  

II.     Issues

Whether CMS had a legitimate basis to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(12).  

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Whether CMS had a legitimate basis to place Petitioner on its Preclusion List pursuant to 42 C.F.R. §§ 422.2 and 423.100. 

III.     Jurisdiction

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

IV.     Findings of Fact, Conclusions of Law, and Analysis⁶

1. Petitioner is an anesthesiologist who practices in the state of Florida. 
2. Petitioner performed a wrong-site anesthetic block nearly 14 years ago in June 2010.  The following year, in December 2011, Petitioner entered into a settlement agreement with the Florida Medical Board in which he agreed to pay a $2,500 fine, the costs of the investigation and prosecution of the case, and to complete five hours of continuing education. 
3. In May 2013, effective June 13, 2013, the Medical Board of California revoked Petitioner’s expired and non-renewed California medical license after he did not respond to an accusation addressing the wrong-site nerve block and the disciplinary action taken by the Florida Medical Board. 
4. In September 2022, DHCS notified Petitioner that he had been placed on the Medi-Cal Suspended and Ineligible Provider List, effective June 13, 2013, based on the revocation of his California medical license. 
5. Petitioner had no right to appeal his suspension as a Medi-Cal provider because it was an “automatic suspension” pursuant to California Welfare and Institutions Code § 14043.6.  
6. On February 3, 2023, First Coast revoked Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(12), imposed a five-year bar to re-enrollment, and placed Petitioner on CMS’s Preclusion List. 
7. On March 22, 2023, DHCS reinstated Petitioner in the Medi-Cal program. 

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8. On August 9, 2023, CMS upheld the revocation of Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(12), the five-year bar to re-enrollment, and Petitioner’s inclusion on the Preclusion List. 
9. Because, at the time of the revocation determination on February 3, 2023, Petitioner was the subject of a final and unappealable suspension from the Medi-Cal program, CMS, after considering the factors at 42 C.F.R. § 424.535(a)(12)(i)(A)-(C), was authorized to uphold the revocation of Petitioner’s Medicare enrollment and billing privileges.  
10. The length of a bar to re-enrollment is not reviewable. 
11. Because Petitioner’s Medicare enrollment has been revoked, he has been barred from re-enrollment, and CMS determined that the conduct underlying his revocation is detrimental to the best interests of the Medicare program, CMS was authorized to place Petitioner on its Preclusion List pursuant to 42 C.F.R. §§ 422.2 and 423.100. 

CMS was authorized to revoke Petitioner’s Medicare enrollment. 

As an anesthesiologist, Petitioner is a supplier for purposes of the Medicare program.  See 42 U.S.C. § 1395x(d); 42 C.F.R. § 400.202 (definition of Supplier).  CMS may revoke a supplier’s Medicare billing privileges for any of the reasons stated in 42 C.F.R. § 424.535(a).  When CMS revokes a supplier’s Medicare billing privileges, CMS establishes a re-enrollment bar that lasts from one to ten years.  42 C.F.R. § 424.535(c)(1).  Generally, a revocation becomes effective 30 days after CMS mails the initial determination revoking Medicare billing privileges.  42 C.F.R. § 424.535(g). 

The Departmental Appeals Board (DAB) has explained that CMS “may have discretion to consider unique or mitigating circumstances in deciding whether, or how, to exercise its revocation authority,” but that “its role (and the role of [ALJs]) is limited to deciding whether CMS has a permissible ‘legal basis’ for revocation.”  Care Pro Home Health, Inc., DAB No. 2723 at 9 fn.8 (2016).  Thus, the scope of my review is whether CMS had a legitimate basis to revoke Petitioner’s Medicare enrollment and billing privileges, and not whether I would make the same determination in the first instance. 

Pursuant to 42 C.F.R. § 424.535(a)(12), when a supplier has been terminated by a state Medicaid program, CMS, in determining whether revocation is appropriate, is required to consider the following factors: 

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(A) The reason for the termination or revocation.  

(B) Whether the provider or supplier is currently terminated, revoked or otherwise barred from more than one program (for example, more than one State’s Medicaid program) or has been subject to any sanctions during its participation in other programs. 

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

42 C.F.R. § 424.535(a)(12)(i)(A)-(C). 

CMS was authorized to revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(12), which states that CMS may revoke a supplier’s billing privileges if the supplier “is terminated, revoked, or otherwise barred from participation in a State Medicaid program or any other federal healthcare program” and if the supplier “has exhausted all applicable appeal rights . . . .” 42 C.F.R. § 424.535(a)(12)(i)-(ii). 

Petitioner administered a wrong-site anesthetic block in June 2010.  P. Br. at 3.  In December 2011, Petitioner entered into a settlement agreement with the Florida Medical Board in which he agreed to pay a $2,500 fine, the costs of the investigation and prosecution of the case, and to complete five hours of continuing education in “Risk Management.”  CMS Ex. 4 at 15.  After Petitioner did not respond to an accusation issued by the Medical Board of California in May 2013, the Medical Board of California, effective June 13, 2013, revoked Petitioner’s medical license based on the wrong-site anesthetic block and Florida Medical Board disciplinary action.  CMS Ex. 4 at 2, 4. 

In September 2022, effective June 13, 2013, DHCS added Petitioner to the Medi-Cal Suspended and Ineligible Provider List.  CMS Ex. 3 at 1.  The letter explained that pursuant to section 14043.6 of the California Welfare and Institutions Code, the Medi-Cal suspension was automatic.  CMS Ex. 3 at 1; see Cal. Welf. & Inst. Code § 14043.6 (“The department shall automatically suspend, as a provider in the Medi-Cal program, any individual who . . . has a license, certificate, or other approval to provide health care, which is revoked or suspended by a federal, California, or another state’s licensing, certification, or approval authority . . . .”).  The letter did not provide appeal rights.  CMS Ex. 3 at 1-2. 

On March 22, 2023, DHCS reinstated Petitioner in the Medi-Cal program, explaining that it “is reasonably certain that the kinds of conduct that led to the original exclusion will not recur.”  CMS Ex. 2 at 12.  Contrary to Petitioner’s claim that he was reinstated pursuant to a timely and successful appeal (P. Br. at 8), DHCS explained that Petitioner

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had “petitioned the Department for removal of [his] name from the Department’s Suspended and Ineligible List.”  CMS Ex. 2 at 11.  Based on this request for removal, DHCS “conducted an investigation to determine [Petitioner’s] suitability to participate as a provider in the Medi-Cal program” and granted reinstatement pursuant to 42 C.F.R. § 1002.215(a).  CMS Ex. 2 at 11.  

During the pendency of Petitioner’s automatic Medi-Cal suspension pursuant to Cal. Welf. & Inst. Code § 14043.6, First Coast revoked Petitioner’s Medicare enrollment and billing privileges, imposed a five-year re-enrollment bar, and added Petitioner to CMS’s Preclusion List.  CMS Ex. 1 at 1-3.  CMS upheld these determinations in its August 9, 2023 reconsidered determination.  

Based on the evidence of record, I conclude that First Coast was authorized to revoke Petitioner’s Medicare billing privileges and CMS was authorized to uphold that determination because his Medi-Cal billing privileges had been suspended by the DHCS and Petitioner had no right to appeal DHCS’s determination.  CMS Exs. 2 at 10-13; 3 at 1-2. 

After determining that Petitioner had been terminated, revoked, or otherwise barred by a state Medicaid program, CMS considered the additional factors at 42 C.F.R. § 424.535(a)(12)(i)(A)-(C) in determining that it would revoke Petitioner’s Medicare enrollment.  Reconsidered Determination at 4-5.  CMS considered the reason for Petitioner’s Medicaid termination.  Reconsidered Determination at 4 (discussing that the Medicaid termination resulted from a wrong-site anesthetic block and the revocation of Petitioner’s California medical license); see 42 C.F.R. § 424.535(a)(12)(i)(A).  CMS also acknowledged that it was unaware of other actions by “any other programs.”  Reconsidered Determination at 4; see 42 C.F.R. § 424.535(a)(12)(i)(B).  CMS further considered that Petitioner’s Medi-Cal suspension was effective June 13, 2013, and that his California medical license remained revoked.  Reconsidered Determination at 4; see 42 C.F.R. § 424.535(a)(12)(i)(C). 

Petitioner’s arguments distill to a challenge of how CMS chose to exercise its discretion.  I cannot second-guess CMS’s unwillingness to exercise its discretion so long as CMS had a legitimate basis for its revocation action.  See Linda Silva, P.A., DAB No. 2966 at 12 (2019) (“Neither CMS’s enrollment regulations (in 42 C.F.R. Part 424) nor the administrative appeal regulations (in 42 C.F.R. Part 498) authorize an [ALJ] or the [DAB] to mitigate the consequences of a valid and binding revocation determination.”).  To be clear:  I would not have reached the same determination, inasmuch as the wrong-site anesthetic block was performed nearly 14 years ago, Petitioner’s California medical license was already expired and non-renewed at the time of the revocation (with Petitioner no longer residing or practicing in California at that time), and DHCS, in reinstating Petitioner, determined that it “is reasonably certain that the kinds of conduct that led to the original exclusion will not recur.”  CMS Ex. 2 at 12.  However, my review

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is not based on how I would have decided this case in the first instance, but rather, whether CMS was authorized to uphold First Coast’s revocation determination.⁷

Petitioner has not shown that CMS and its contractor were not authorized to revoke his Medicare enrollment based on 42 C.F.R. § 424.535(a)(12).  Because DHCS had terminated, revoked, or otherwise barred Petitioner from participating in Medi-Cal, and Petitioner had no right to appeal the automatic suspension, CMS, after considering the factors at 42 C.F.R. § 424.535(a)(12)(i)(A)-(C), was authorized to uphold the revocation of Petitioner’s Medicare enrollment and billing privileges.  

I cannot review the length of the bar to re-enrollment. 

Petitioner disputes the five-year bar to re-enrollment.  P. Br. at 1.  Pursuant to 42 C.F.R. § 424.535(c), CMS is authorized to impose a bar to re-enrollment of up to ten years when it has revoked a supplier’s Medicare enrollment.  In its reconsidered determination, CMS upheld the five-year bar to re-enrollment.  Reconsidered Determination at 5.  The DAB has unambiguously explained that such a matter is beyond the scope of an ALJ’s review, stating:  

A decision by CMS or its contractor about how long to bar a revoked supplier from re-enrolling in Medicare, unlike the determination to revoke the supplier’s billing privileges, is not an appealable “initial determination” under 42 C.F.R. Part 498.  Blossomwood Medical, P.C., et al., DAB No. 2914, at 11 (2018); Vijendra Dave, M.D. [DAB No. 2672] at 8-11 [(2016)] (stating that the authority of an ALJ or the Board in a revocation appeal “does not extend to reviewing the length of the reenrollment bar imposed by CMS”).  We therefore cannot consider or act upon Petitioner’s contention that the . . . re-enrollment bar was excessive in her circumstances.  

Linda Silva, P.A., DAB No. 2966 at 11.  Petitioner has not identified any legal error in CMS’s imposition of the re-enrollment bar, and I may not otherwise review the duration of the re-enrollment bar.  See Vijendra Dave, M.D., DAB No. 2672at 11 (2016) (“CMS’s determination regarding the duration of the re-enrollment bar is not reviewable.”). 

CMS was authorized to place Petitioner on its Preclusion List.  

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CMS has established a single list of individuals and entities for whom Medicare Advantage plans cannot provide reimbursement for items and services they provide, and for prescribers to whom Medicare Part D plans cannot provide reimbursement for any prescriptions the individuals write.  42 C.F.R. §§ 422.222, 423.120(c)(6).  As relevant here, in order for CMS to include an individual, entity, or prescriber on its Preclusion List, all of the following three requirements must be met: 

(i) The [individual, entity, or prescriber] is currently revoked from Medicare for a reason other than that stated in [42 C.F.R.] § 424.535(a)(3) . . .

(ii) The [individual, entity, or prescriber] is currently under a reenrollment bar under [42 C.F.R] § 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 . . . , CMS considers the following factors: 

(A) The seriousness of the conduct underlying the . . . revocation. 

(B) The degree to which the . . . conduct could affect the integrity of the [Medicare/Part D] program. 

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

42 C.F.R. §§ 422.2, 423.100. 

Petitioner disputes his placement on the Preclusion List.  P. Br. at 1.  Because I have upheld Petitioner’s revocation pursuant to 42 C.F.R. § 424.535(a)(12), and Petitioner is subject to a five-year bar to re-enrollment, the first two requirements for inclusion on the Preclusion List are met.  42 C.F.R. §§ 422.2, 423.100. 

As for the third requirement listed in 42 C.F.R. §§ 422.2 and 423.100, CMS first determined that Petitioner’s conduct underlying his revocation and the disciplinary actions against his medical licenses was detrimental to the best interests of the Medicare program.  Reconsidered Determination at 6 (“This conduct is extremely serious, as it directly implicates patient safety.  Any procedure performed inappropriately or unnecessarily is plainly very serious.”). 

In considering the second factor, CMS next determined that Petitioner’s “conduct could significantly affect the integrity of the Medicare program” because “[p]atient safety is of utmost importance to the Medicare program” and “[a]ny threat to patient safety is a threat to the integrity of the Medicare program.”  Reconsidered Determination at 6. 

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Finally, with respect to the third factor, CMS discussed that Petitioner’s actions “reflect poorly on the medical profession as a whole and jeopardizes public confidence in Medicare providers and suppliers,” and that “[a]llowing [Petitioner] to continue to participate in the Medicare program jeopardizes public confidence in the Medicare program.”  Reconsidered Determination at 6. 

In summary, Petitioner has not demonstrated legal error in CMS’s determination upholding his placement on its Preclusion List, and as I previously explained, I am not authorized to second-guess CMS’s refusal to exercise its discretion.  While I disagree with CMS’s August 2023 determination that Petitioner’s conduct involving a wrong-site anesthetic block in June 2010, and the disciplinary actions that resulted, is presently detrimental to the best interests of the Medicare program, I am not empowered to force CMS to exercise its discretion in Petitioner’s favor.  Because I have upheld Petitioner’s revocation pursuant to 42 C.F.R. § 424.535(a)(12) and Petitioner remains under a bar to re-enrollment, and CMS addressed the regulatory factors outlined at 42 C.F.R. §§ 422.2 and 423.100, CMS was authorized to uphold Petitioner’s placement on its Preclusion List.  See 42 C.F.R. §§ 422.2, 423.100. 

V.     Conclusion

I affirm the determinations revoking Petitioner’s Medicare enrollment and billing privileges and placing him on CMS’s Preclusion List. 

Endnotes

¹  Petitioner concedes that his address on file for his expired California medical license was not current, and he therefore did not receive notices regarding actions by the Medical Board of California.  Request for Hearing at 1.

²  It appears that Petitioner received First Coast’s letter on May 1, 2023.  P. Br. at 6; CMS Ex. 2 at 48 (listing May 1, 2023 facsimile header).  First Coast mailed its February 3, 2023 letter to an address in Plantation, Florida.  CMS Ex. 1 at 1.  Petitioner claims that  First Coast erred by not mailing the letter to an address in Indialantic, Florida.  P. Br. at 6.  In support, Petitioner cites an application for a national provider identifier submitted to the National Plan & Provider Enumeration System that lists an Indialantic address.  P. Br. at 6 (citing CMS Ex. 2 at 52).  Absent evidence that Petitioner’s Medicare enrollment record included the Indialantic address, there is no indication that First Coast was on notice of the Indialantic address.  See 42 C.F.R. § 424.516(d) (addressing reporting requirements for changes to enrollment).

³  Owing to the delay in receipt of the revocation determination, Petitioner filed the request for reconsideration late.  CMS granted a good cause waiver and accepted the request for reconsideration.  DAB E-File Docket No. 1a (Reconsidered Determination) at 1; see Reconsidered Determination at 3 (“CMS has confirmed that the revocation notice was sent to the Correspondence Mailing address on file in his Florida Medicare enrollment record. . . . Nevertheless, CMS accepted [the] reconsideration request.”).  CMS also noted that it limited its discussion to the revocation of Petitioner’s Florida enrollment and billing privileges because Petitioner had not challenged the revocation of his enrollment and billing privileges in other jurisdictions.  Reconsidered Determination at 1.

⁴  CMS disregarded my standing pre-hearing order and did not file a copy of the reconsidered determination.  See Standing Pre-Hearing Order § 8 (“CMS must file as a proposed exhibit a copy of the determination that is being appealed.”).  I note that the copy of the reconsidered determination filed with the request for hearing is heavily annotated and marked with highlights, to include containing handwritten notations such as “not accurate” and “misleading.”

⁵  Petitioner also filed a copy of 42 C.F.R. § 424.535 that was not marked as an evidentiary exhibit.  I do not admit Petitioner’s submission into the evidentiary record.  However, I cite to that regulation throughout this decision.  A copy of 42 C.F.R. § 424.535 can be found at https://www.govinfo.gov/app/details/CFR-2023-title42-vol3/CFR-2023-title42-vol3-sec424-535 (last visited April 24, 2024).

⁶  My findings of fact and conclusions of law are in bold and italics.

⁷  While an ALJ reviews whether CMS had a legitimate basis to reach a determination, as opposed to whether CMS abused its discretion, judicial review of an ALJ decision can potentially reach the issue of abuse of discretion.