Guardian Hospice MN, LLC d/b/a Moments Hospice, DAB CR5326 (2019)

DECISION

Petitioner, Guardian Hospice MN, LLC d/b/a Moments Hospice, challenges the Centers for Medicare & Medicaid Services’ (CMS) determination that November 20, 2017, is the effective date for Petitioner’s Medicare provider agreement and billing privileges.  For the reasons that follow, I conclude that November 20, 2017, is the correct effective date for Petitioner’s Medicare provider agreement and billing privileges.

I.  Background

The Social Security Act (Act) authorizes the Secretary of the Department of Health and Human Services (Secretary) to establish regulations for enrolling providers and suppliers in the Medicare program.  42 U.S.C. § 1395cc(j)(1)(A).  A hospice program is a provider of services that “is primarily engaged in providing” a variety of “items and services to . . . terminally ill individual[s],” be it “in individuals’ homes, on an outpatient basis, [or] on a short-term inpatient basis . . . .”  42 U.S.C. § 1395x(u), (dd)(1), (2); see also 42 C.F.R. § 488.1 (definition of provider of services).

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In order to participate as a provider in Medicare, a hospice program must meet requirements specified in the Act and regulations as well as enter into a provider agreement with CMS on behalf of the Secretary of the Department of Health and Human Services (Secretary).  42 U.S.C. §§ 1395x(dd), 1395cc; 42 C.F.R Parts 418, 489.  In addition, a hospice program must enroll in the Medicare program to receive payment for covered Medicare items or services.  42 C.F.R. § 424.505.  The terms “Enroll/Enrollment mean[] the process that Medicare uses to establish eligibility to submit claims for Medicare-covered items and services.”  42 C.F.R. § 424.502.  Among other things, the enrollment process for a hospice program includes entering into a provider agreement and completion of a state survey, certification, or accreditation.  42 C.F.R. §§ 424.510(d)(5), 489.1(a)(2), (a)(3), (b); 489.2(b)(6); 489.10(d).  A provider seeking billing privileges under the Medicare program “must submit enrollment information on the applicable enrollment application.  Once the provider . . . successfully completes the enrollment process, including . . . a State survey and certification or accreditation process, CMS enrolls the provider . . . into the Medicare program.”  42 C.F.R. § 424.510(a).  CMS then establishes an effective date for the provider agreement and billing privileges under 42 C.F.R. § 489.13.  42 C.F.R. §§ 424.510(b), (c), 424.520(a).

The health and safety requirements for hospice programs, called conditions of participation, are codified in 42 C.F.R. Part 418.  The conditions of participation are a compilation of the hospice requirements established by the Act and the requirements that the Act authorizes the Secretary to establish for the health and safety of the individuals receiving hospice care.  See 42 U.S.C. § 1395x(dd).  Each condition of participation represents a general health or safety requirement described in a single regulation, which is divided into subparts called standards.  Compliance with a condition of participation is determined by the manner and degree to which the provider satisfies the standards within the condition.  42 C.F.R. § 488.26(b).  If deficiencies are of such character as to “substantially limit the provider’s . . . capacity to furnish adequate care or which adversely affect the health and safety of patients,” the provider is not in compliance with conditions of participation.  42 C.F.R. § 488.24(b).  CMS may “refuse to enter into an agreement” with a provider that fails to meet even one condition of participation.  42 U.S.C. § 1395cc(b)(2)(B); 42 C.F.R. § 488.3(a).

An approved accreditation body, such as Community Health Accreditation Partner (CHAP), is authorized, by statute and regulation, to survey and accredit prospective providers and recommend Medicare certification.  Institutions accredited by CHAP are generally deemed to meet Medicare conditions of participation.  42 U.S.C. § 1395bb; 42 C.F.R. § 488.5.  However, if the Secretary finds that the prospective provider has significant deficiencies, it will be deemed not to meet those conditions.  42 U.S.C. § 1395bb(c).

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Here, Petitioner, located in Golden Valley, Minnesota, applied for Medicare certification as a hospice program.  CHAP conducted an initial survey from September 6 through 8, 2017.  CHAP found deficiencies during the survey.  CMS Exhibit (Ex.) 2 at 2.  In response, Petitioner submitted a plan of correction (POC).  CMS Ex. 3; P. Ex. 3 and 3-14.  CHAP found the POC acceptable, accredited Petitioner, and recommended certification effective September 20, 2017.  CMS Ex. 1 at 1.  However, CMS disagreed with CHAP, finding that the POC was not acceptable, and instructed CHAP and Petitioner that Petitioner would need to submit an amended POC.  P. Ex. 5 at 1; P. Ex. 7 at 2 ¶¶ 17-18.

Petitioner submitted an amended POC to show that it had corrected its deficiencies.  CMS Ex. 4.  CHAP again recommended certification, this time effective November 20, 2017.  CMS Ex. 5 at 1.  Based on that recommendation, CMS certified Petitioner for enrollment in the Medicare program, effective November 20, 2017.  CMS Ex. 6 at 1.

Petitioner requested reconsideration, arguing that September 20, 2017, rather than November 20, 2017, should be the effective date of its provider agreement and Medicare billing privileges.  CMS Ex. 7.  In its February 13, 2018 reconsidered determination, CMS upheld the November 20, 2017 effective date.  CMS Ex. 8 at 1.

Petitioner timely requested administrative law judge (ALJ) review.  The case was assigned to Judge Bill Thomas for hearing and decision.  Judge Thomas issued an Acknowledgment and Pre-hearing Order (Pre-hearing Order) establishing deadlines for the submission of pre-hearing exchanges.  In accordance with the Pre-hearing Order, CMS timely filed its pre-hearing exchange, which included a combined pre-hearing brief and motion for summary judgment (CMS Br.), and nine exhibits (CMS Exs. 1-9).  Petitioner also timely filed its pre-hearing exchange, which included a combined pre-hearing brief and opposition to CMS’s motion for summary judgment (P. Br.), and seven exhibits (P. Exs. 1-7), including the written direct testimony of one witness.

On November 20, 2018, I was assigned to hear and decide this case.

II.  Decision on the Written Record

I admit all of the parties’ proposed exhibits into the record because neither party objected to any of them.

Judge Thomas directed the parties to include with their pre-hearing exchanges the written direct testimony, in the form of a declaration or an affidavit, for all witnesses that the parties intended to present.  Pre-hearing Order ¶¶ 4.c.iv, 8; Civil Remedies Division Procedures (CRDP) §§ 16(b), 19(b).  Further, if a party wanted to cross-examine any of the opposing party’s witnesses, then the party needed to file a request to cross-examine those witnesses.  Pre-hearing Order ¶ 9; CRDP § 16(b).  CMS did not provide written direct testimony for any witness, and although Petitioner provided written direct

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testimony for a witness, CMS did not request to cross-examine that witness.  Therefore, I issue this decision based on the written record because an evidentiary hearing in this case is not necessary.  Pre-hearing Order ¶ 10; CRDP § 19(b), (d); see Vandalia Park, DAB No. 1940 (2004); Pacific Regency Arvin, DAB No. 1823 at 7-8 (2002) (holding that the use of written direct testimony for witnesses is permissible so long as the opposing party has the opportunity to cross-examine those witnesses).

III.  Issue

Whether CMS had a legitimate basis to assign November 20, 2017, as the effective date for Petitioner’s Medicare provider agreement and billing privileges.

IV.  Jurisdiction

I have jurisdiction to hear and decide this case.  42 C.F.R. §§ 498.3(b)(15), 498.5(l)(2); see also 42 U.S.C. § 1395cc(h)(1), (j)(8).

V.  Findings of Fact

Petitioner, a hospice program located in Minnesota, sought to enroll in Medicare in September of 2017.  To enroll, it sought accreditation from CHAP, a CMS-approved accreditation organization.  CMS Br. at 2; P. Br. at 1.  CHAP surveyed Petitioner’s facility from September 6 through 8, 2017, and determined that Petitioner did not meet several standards of participation for hospice programs, including the standards at 42 C.F.R. §§ 418.54(c)(7), 418.76(c)(1), 418.76(h)(1)(i), and 418.112(f).  CMS Ex. 2 at 2.  The key standard that Petitioner did not meet, which is the focus of the parties’ disagreement and, consequently, of my discussion below, is the standard detailed at 42 C.F.R. § 418.112(f).  According to the surveyor, Petitioner did not meet this standard because it “d[id] not have documented evidence that the hospice staff provided orientation to SNF [skilled nursing facility] staff furnishing care to its hospice patients.”  CMS Ex. 3 at 4; CMS Ex. 4 at 5; P. Ex. 3 at 7.  The surveyor observed that, although Petitioner’s “Administrator indicated that the hospice RN [registered nurse] provided education to the SNF staff while hospice patients were being cared for . . . , there was no documentation that the required education was provided.”  CMS Ex. 3 at 4; CMS Ex. 4 at 5; P. Ex. 3 at 7.

Petitioner submitted to CHAP a POC detailing how it would correct the identified deficiencies.  In the POC, with respect to its failure to meet the standard at 42 C.F.R. § 418.112(f), Petitioner stated the following:

Orientation and education will be provided to all staff furnishing care to hospice patients who reside in a SNF/NF [nursing facility] or [intermediate care facility for individuals

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with intellectual disabilities (ICF/IID)] at the time [Petitioner] executes the contract with the facility.  Orientation and education will include the following topics[.] 1.  Hospice philosophy, including hospice policies and procedures regarding methods of comfort, pain control and symptom management;[ ]2.  Principles about death and dying and individual responses to death;[ ]3.  Patient rights.;[ ]4.
Appropriate forms used to document Informed Consent, Election of the Medicare Hospice Benefit, Hospice Plan of Care and documentation of the provision of hospice care; and[ ]5.  Record keeping requirements.[ ]Understanding of the requirements for the Hospice to provide this orientation and training will be signed by the Administrator or his/her designee and will be filed as an Orientation and Education Addendum with the executed facility contract.  Sign-in sheets will be kept to document attendance when the Orientation and Education is provided at each facility and filed with each executed facility contracts [sic].

CMS Ex. 3 at 4; P. Ex. 3 at 7-8.  Petitioner indicated that it would complete these actions by September 22, 2017.  Id. at 4-5.  By letter dated October 4, 2017, CHAP informed Petitioner that it had accepted Petitioner’s POC effective September 20, 2017, which date also served as the effective date of Petitioner’s accreditation.  CMS Ex. 1 at 1.  CHAP explained that it had found Petitioner “to be in compliance with the CHAP Standards of excellence.”  Id.  CHAP also informed Petitioner that it had “recommended Medicare certification” but noted that CMS “will make a final determination regarding [Petitioner’s] Medicare certification and the effective date of participation in accordance with the regulations at 42 C.F.R. [§ ]489.13.”  Id.

CMS did not find the POC acceptable with respect to Petitioner’s failure to meet the standard found at 42 C.F.R. § 418.112(f) and directed CHAP to obtain a new POC from Petitioner.  P. Ex. 5 at 1.  CHAP requested a new POC from Petitioner on November 15, 2017.  Id.  CHAP noted in the request that CMS, in instructing CHAP to request a new POC from Petitioner, had indicated that it “d[id] not feel the current POC addresses the still present deficiency in that [Petitioner] failed to document that the current SNF staff has been trained . . . .  There is also no clear wording within the POC to document that the current contracts have been revised to require documentation of training.”  P. Ex. 5 at 1 (emphasis in original).  That same day, CMS also informed Petitioner’s administrator that Petitioner “would need to amend” the POC.  P. Ex. 7 at 2 ¶ 17.

In response to CHAP’s and CMS’s directions, Petitioner submitted an amended POC.  CMS Ex. 4.  Petitioner’s amended POC greatly expanded the corrective actions it would take to correct its failure to meet the standard at 42 C.F.R. § 418.112(f).  Of particular

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note, one of the new corrective actions Petitioner added was that “[h]ospice education will be provided to all active SNF/NF contracted facilities by 12/2/17 and no new patients will be accepted in these facilities until education has been provided.”  CMS Ex. 4 at 7.

Consistent with this corrective action is a document related to a pre-existing contract between Petitioner and a SNF, labeled “Certification of Training and Orientation of Skilled Nursing Facility [SNF] Staff to Hospice,” which the SNF’s director of nursing (DON) signed November 29, 2017.  P. Ex. 2 at 32.  That document states that the SNF “has elected to integrate the training and orientation requirements of Hospice into the routine training and orientation of their staff.”  Id.  It also describes the elements of hospice training, and the DON verified that these elements were included “in the training and orientation of the staff” at the SNF.  Id.

The clear inference to be drawn from the amended POC and SNF certification of training document is that hospice education and orientation had not yet been provided to all SNF staff prior to the submission of the amended POC on November 15, 2017, and would require time to complete (by December 2, 2017).  Otherwise, Petitioner would have no reason to refuse to accept new patients in those facilities pending SNF/NF staff education.  The declaration from Petitioner’s administrator is not inconsistent with this inference; he does not assert that any particular training occurred on any particular date, making only a vague statement that CMS told him Petitioner “would need to amend their [POC] to change the way [it] document[ed] training to staff that had already been completed since September 22, 2017.”  P. Ex. 7 at 2 ¶ 17.  This statement is vague because it does not specify which “staff” had received “training,” what “training” they had received, or when precisely that training occurred.  Further, saying that the training “had already been completed since September 22, 2017,” suggests the unspecified training to unspecified staff occurred after September 22, 2017, but before November 15, 2017, but even that is not entirely clear.

Petitioner offered no other evidence that it completed hospice training and orientation to the contracted SNF’s staff before December 2, 2017; consequently, I find it more likely than not that Petitioner did not in fact provide hospice training and orientation to all of the contracted SNF’s staff prior to that date.

By letter dated November 29, 2017, CHAP informed Petitioner that it had accepted Petitioner’s new POC effective November 20, 2017, which date served as the new effective date of Petitioner’s accreditation.  CMS Ex. 5 at 1.  CHAP again explained that it had found Petitioner “to be in compliance with the CHAP Standards of Excellence.”  Id.  CHAP also again informed Petitioner that it had “recommended Medicare certification” and that CMS “will make a final determination regarding your Medicare certification and the effective date of participation in accordance with the regulations at 42 C.F.R. [§ ]498.13.”  Id.

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CMS found Petitioner’s updated POC acceptable and accepted Petitioner’s request to participate in Medicare, assigning November 20, 2017, as the effective date of Petitioner’s provider agreement and billing privileges.  CMS Ex. 6 at 1.

VI.  Conclusions of Law and Analysis

My conclusions of law are in numbered headings and bold text, followed by my analysis.

1. November 20, 2017, is the correct effective date of Petitioner’s provider agreement and Medicare billing privileges.

For a hospice program that does not meet all Medicare health and safety standards on the date an accreditation survey is completed and that has not submitted a waiver request, the effective date of the hospice program’s provider agreement and billing privileges is governed by 42 C.F.R. § 489.13(c)(2).  That regulation provides as follows:

(2) For an agreement with, or an approval of, any other provider or supplier, (except those specified in paragraph (a)(2) of this section), the effective date is the earlier of the following:
(i) The date on which the provider or supplier meets all applicable conditions of participation, conditions for coverage, or conditions for certification; or, if applicable, the date of a CMS-approved accreditation organization program’s positive accreditation decision, issued after the accreditation organization has determined that the provider or supplier meets all applicable conditions.
(ii) The date on which a provider or supplier is found to meet all conditions of participation, conditions for coverage, or conditions for certification, but has lower-level deficiencies, and—
(A) CMS or the State survey agency receives an acceptable plan of correction for the lower-level deficiencies (the date of receipt is the effective date regardless of when the plan of correction is approved); or, if applicable, a CMS-approved accreditation organization program issues a positive accreditation decision after it receives an acceptable plan of correction for the lower-level deficiencies; or
(B) CMS receives an approvable waiver request (the date of receipt is the effective date regardless of when CMS approves the waiver request).

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42 C.F.R. § 489.13(c)(2).  The Departmental Appeals Board (DAB) has explained that “section 489.13(c)(2)(i) must be read to apply where a provider is found to meet all conditions of participation and to have no lower-level deficiencies.”  Ridgeview Hosp., DAB No. 2593 at 8 (2014) (emphasis in original) (citing Oak Lawn Endoscopy, DAB No. 1952 (2004)).  Moreover, for a prospective accredited provider, the second clause of 42 C.F.R. § 489.13(c)(2)(i) (i.e., “the date of a CMS-approved accreditation organization program’s positive accreditation decision, issued after the accreditation organization has determined that the provider or supplier meets all applicable conditions”) applies, not the first clause (i.e., “[t]he date on which the provider or supplier meets all applicable conditions of participation, conditions for coverage, or conditions for certification”).  Id. at 7.1  By contrast, where a provider meets the conditions of participation but has lower-level deficiencies, 42 C.F.R. § 489.13(c)(2)(ii) requires the provider to submit an acceptable POC for those deficiencies before its provider agreement goes into effect.  Id. at 10.  As the DAB put it, the effective date of the provider agreement for a prospective accredited provider that meets the conditions of participation but has lower-level deficiencies “is the date when . . . the provider is in compliance with all applicable conditions of participation but has lower-level deficiencies; the AO [accrediting organization] has received an acceptable plan of correction; and the AO has issued a positive accreditation decision.”  Id. (emphasis in original).  The DAB’s reading of the regulation is consistent with 42 C.F.R. § 488.28(a), which states that “[i]f a provider . . . is found to be deficient in one or more of the standards in the conditions of participation . . . , it may participate in, or be covered under, the Medicare program only if the provider . . . has submitted an acceptable plan of correction for achieving compliance within a reasonable period of time acceptable to CMS.”  Furthermore, the DAB’s reasoning is consistent with regulations that reserve to CMS, not the accrediting organization, the ultimate authority to accept or reject a prospective accredited provider’s POC, determine whether the provider meets applicable Medicare conditions, and set the effective date of the provider agreement where a prospective provider seeks to enroll in Medicare via an accreditation survey.  42 C.F.R. §§ 488.7(a), 489.11; see also Apollo Behavioral Health Hosp., LLC, DAB No. 2561 at 7 (2014).

To summarize, pursuant to 42 C.F.R. § 489.13(c)(2), the effective date of a provider agreement and Medicare billing privileges for a prospective accredited provider that does not meet all health and safety standards on the date of the accreditation survey and does not submit an approvable waiver request is the earlier of either:

(1) the date that the AO issues a positive accreditation decision after determining that the provider meets all conditions of participation and has no lower-level deficiencies (or, if CMS rejects the AO’s determination and finds the provider

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does not meet a condition(s) of participation or has lower-level deficiencies, the date CMS determines the provider meets all conditions of participation and has no lower-level deficiencies) (42 C.F.R. § 489.13(c)(2)(i)) or

(2) the date the provider is in compliance with all conditions of participation but has lower level deficiencies, the AO has received an acceptable POC, and the AO has issued a positive accreditation decision (42 C.F.R. § 489.13(c)(2)(ii)(A)).

To determine which date is earlier, it is necessary to analyze whether both 42 C.F.R. § 489.13(c)(2)(i) and (c)(2)(ii)(A) even produce dates that could be used as the effective date and, if so, whether the dates conflict.  If two conflicting dates exist, the earlier date is the effective date under the regulation, while if only one date exists, that is the correct effective date.

Petitioner argues that it should have been granted an effective date of September 20, 2017, because CHAP found that Petitioner “met all applicable conditions for participation for a hospice” and issued a positive accreditation decision effective on that date.  P. Br. at 6-8 (emphasis omitted).  Although Petitioner does not dispute that the accreditation survey revealed standard-level deficiencies, it contends that it corrected those deficiencies and “met all applicable regulations for participation [as] a hospice in the Medicare program” by September 20, 2017, as evidenced by both of its POCs.  P. Br. at 3, 8-9.  In Petitioner’s words, “the relevant question reflected in the [POC] was whether or not [Petitioner] had conducted the necessary training sufficient to comply with the requirement [found at 42 C.F.R. § 418.112(f)],” and “the September 20, 2017 . . . submission and the updated submission of November 20, 2017, both reflect that [Petitioner] had provided all of the requisite training when certification was recommended on September 20, 2017.”  P. Br. at 8 (emphasis in original) (citations omitted).  According to Petitioner, the disagreement between CHAP and CMS related only to the issue of how Petitioner was supposed to document the corrective actions it took to return to full compliance, not the issue of when Petitioner in fact returned to full compliance.  P. Br. at 8-9.

Petitioner’s argument fails for two reasons.  First, CHAP’s initial accreditation decision does not say anywhere that CHAP found Petitioner was in compliance with all conditions of participation and had no lower-level deficiencies.  CMS Ex. 1 at 1.  CHAP’s survey revealed standard-level deficiencies.  CMS Ex. 2 at 2.  When issuing its initial accreditation decision, CHAP indicated that it had accepted Petitioner’s plan for correcting those deficiencies, that Petitioner was “in compliance with the CHAP Standards of Excellence,” and that CHAP had “recommended Medicare certification.” CMS Ex. 1 at 1.  CHAP correctly clarified that CMS retained authority to “make a final determination regarding [Petitioner’s] Medicare certification and the effective date of participation . . . .”  CMS Ex. 1 at 1.  Second, and consistent with the regulations and

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CHAP’s clarification, CMS found Petitioner’s initial POC inadequate and rejected CHAP’s acceptance of that POC.  Thus, even assuming that CHAP, in accepting Petitioner’s POC, implicitly found that Petitioner met all conditions of participation and had no lower-level deficiencies, CMS supplanted that finding with its own contrary determination, which it was lawfully allowed to do.  See 42 C.F.R. § 488.7(a).

CMS’s determination is consistent with the facts I have found based on the evidence of record.  Petitioner relies on its POCs to show that, by September 20, 2017, it corrected all deficiencies identified during CHAP’s survey, but those POCs do not support that finding.  The regulations at 42 C.F.R. § 418.112(f) required Petitioner to “assure orientation of SNF/NF or ICF/IID staff furnishing care to hospice patients in the hospice philosophy, including hospice policies and procedures regarding methods of comfort, pain control, symptom management, as well as principles about death and dying, individual responses to death, patient rights, appropriate forms, and record keeping requirements.”  Petitioner undisputedly did not meet this standard at the time of the accreditation survey.  P. Br. at 3.

Petitioner claimed in its initial POC that it would, among other things, provide orientation and education on the required topics “to all staff furnishing care to hospice patients who reside in a SNF/NF or ICF/[IID] at the time [Petitioner] executes the contract with the facility.”  CMS Ex. 3 at 4; P. Ex. 3 at 7.  This language does not indicate what Petitioner would do to educate staff at any SNF/NF or ICF/IID with which it already had a contract.  Nor does this language explain why Petitioner would not educate all SNF/NF or ICF/IID staff who might someday furnish care to hospice patients residing in the SNF/NF or ICF/IID, rather than only those who were in fact furnishing such care.  Similarly, no provision is made in the initial POC for assuring that new SNF/NF or ICF/IID employees who began to provide care to hospice patients would obtain required training and orientation.  Further, even assuming that Petitioner was claiming in its initial POC that it would provide the same listed orientation and education to all staff at any SNF/NF or ICF/IID with which it had a pre-existing contract (an inference I do not draw because it is not supported by the POC’s language), I have found it more likely than not that Petitioner did not complete such orientation and education until December 2, 2017.  Therefore, Petitioner did not correct its noncompliance with 42 C.F.R. § 418.112(f) until, at the earliest, December 2, 2017.  Consequently, September 20, 2017, is not the date that CHAP issued a positive accreditation after it (or CMS) determined that Petitioner met all conditions of participation and had no lower-level deficiencies.

In fact, there is no date on which CHAP issued a positive accreditation decision after determining Petitioner met all conditions of participation and had no lower-level deficiencies.  As already noted, in its initial accreditation decision, CHAP did not determine that Petitioner was in compliance with all conditions of participation and had no lower-level deficiencies.  CMS Ex. 1 at 1.  The revised accreditation decision contains identical language regarding Petitioner’s compliance with “CHAP Standards of

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Excellence” and CMS’s authority to “make a final determination regarding [Petitioner’s] Medicare certification and . . . effective date of participation,” without any indication CHAP had found Petitioner compliant with all Medicare conditions and standards applicable to hospice programs.  CMS Ex. 5 at 1.  In addition, both the initial (September 20, 2017) and revised (November 20, 2017) positive accreditation dates occurred before Petitioner corrected its noncompliance with 42 C.F.R. § 418.112(f).  Thus, analyzing the facts of this case under 42 C.F.R. § 489.13(c)(2)(i) produces no date that could be used as an effective date for Petitioner’s provider agreement and Medicare billing privileges.

As applying 42 C.F.R. § 489.13(c)(2)(i) to the facts of this case produces no possible effective date, Petitioner’s effective date must be governed instead by 42 C.F.R. § 489.13(c)(2)(ii)(A).  This comports with the fact that the CHAP survey revealed that Petitioner had multiple deficiencies that CHAP cited as standard-level, not condition-level, deficiencies,2 none of which Petitioner disputes.  P. Br. at 3; CMS Ex. 2 at 2; CMS Ex. 3 at 1; CMS Ex. 4 at 1; P. Ex. 3 at 3.  Therefore, the effective date of Petitioner’s provider agreement is the date on which CHAP issued a positive accreditation decision after receiving an acceptable POC from Petitioner regarding its standard-level deficiencies.  Although CHAP found Petitioner’s initial POC acceptable, CMS disagreed, and CMS’s decision to reject the POC controls.  42 C.F.R. §§ 488.7(a), 489.11; see also Apollo Behavioral Health Hosp., LLC, DAB No. 2561 at 7.  Thus, CHAP’s initial positive accreditation decision, effective September 20, 2017, cannot form the basis for the effective date of Petitioner’s provider agreement and Medicare billing privileges because CHAP had not received an acceptable POC at that point.  42 C.F.R. § 489.13(c)(2)(i)(A); Ridgeview Hosp., DAB No. 2593 at 10.  However, both CHAP and, more importantly, CMS accepted Petitioner’s revised POC, and CHAP issued a new positive accreditation decision effective November 20, 2017.  Consequently, November

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20, 2017, is the correct effective date of Petitioner’s provider agreement and Medicare billing privileges.  42 C.F.R. § 489.13(c)(2)(ii)(A).

2. Petitioner’s equitable arguments afford no basis to grant it an effective date earlier than November 20, 2017.

Petitioner argues that it would be inequitable to uphold the November 20, 2017 effective date because it would unjustly enrich CMS at Petitioner’s expense.  P. Br. at 9-11.  Petitioner represents that it “provided over $200,000 worth of quality care without reimbursement” to Medicare beneficiaries during the period of September 20 through November 19, 2017.  P. Br. at 10.  Petitioner also argues that it reasonably relied, to its detriment, on guidance from CHAP that it would receive a September 20, 2017 effective date when providing care on and after that date, and, due to its reliance, it should be entitled to the benefit of that effective date (and to reimbursement of the care so provided).  In support of this argument, Petitioner points to the declaration of its administrator, who asserts that he asked a CHAP employee “whether [Petitioner] could provide services to Medicare patients and seek reimbursement,” and the CHAP employee “told [him] that [Petitioner] could proceed with business as usual.”  P. Ex. 7 at 2 ¶ 11.  Petitioner also relies on guidance in the Medicare Claims Processing Manual (MCPM), which, according to Petitioner, “outlines in another context the idea that, when acts or omissions that might otherwise yield a penalty are a result of erroneous guidance from Medicare or one of its contractors – that the imposition of penalties would be inappropriate, assuming certain conditions are met.”  P. Br. at 10.  Petitioner lists the conditions that must be met in such circumstances, which include that the guidance on which the provider relied “must have been erroneous,” “issued by the secretary or a contractor,” and “in writing.”  In other words, Petitioner argues that I should exercise equitable discretion to grant it a September 20, 2017 effective date and equitably estop CMS from enforcing the November 20, 2017 effective date.

Petitioner’s equitable arguments lack merit and, furthermore, do not justify setting an earlier effective date than that provided by the regulations.  This case does not involve imposition of a penalty against Petitioner, and the MCPM’s guidance on imposing penalties is directed at Medicare contractors, who have discretionary authority to waive penalties that has no parallel in ALJ proceedings.  In any case, the MCPM’s guidance is inapplicable to the facts of this case.  The guidance on which Petitioner claims to have relied was from CHAP, which is not a governmental entity or even a contractor for the government.  Further, even assuming CHAP has the same status as a governmental contractor, the allegedly erroneous guidance provided by CHAP was oral guidance; CHAP’s written guidance was entirely accurate, regardless of any oral guidance provided over the phone by a CHAP employee.  In both of its accreditation decisions, CHAP cautioned Petitioner, correctly, that CMS “will make a final determination of [Petitioner’s] Medicare certification and . . . effective date of participation . . . .”  CMS Ex. 1 at 1; CMS Ex. 5 at 1.  Moreover, even were I to credit Petitioner’s administrator’s

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statement about the guidance he claims to have received from a CHAP employee, that guidance clearly contradicts federal regulations that reserve to CMS, not CHAP or any other AO, the final authority to determine, based on an accreditation survey, whether a provider is compliant with Medicare requirements.  42 C.F.R. §§ 488.7(a), 489.11; see also Apollo Behavioral Health Hosp., LLC, DAB No. 2561 at 7.  Petitioner could not reasonably rely on oral guidance from CHAP that contradicts these regulations.  For these same reasons, Petitioner cannot credibly claim that CMS unjustly benefited from the unreimbursed care it provided to Medicare beneficiaries prior to November 20, 2018.  The regulations and CHAP’s written guidance put Petitioner on notice that CMS had the final say on whether Petitioner was in compliance with all Medicare requirements and what effective date to assign to Petitioner’s provider agreement and Medicare billing privileges.  Petitioner may be aggrieved that it provided so much care that will not be reimbursed, but that alone does not render CMS’s actions unjust or inequitable.  So, as a factual matter, the balance of equities in this case would not justify setting an earlier effective date than November 20, 2017.

In any event, the DAB has held that neither ALJs nor the DAB are “authorized to provide equitable relief by reimbursing or enrolling a [provider] who does not meet statutory or regulatory requirements.”  US Ultrasound, DAB No. 2302 at 8 (2010).  The DAB also has explained that a provider cannot seek to equitably estop CMS from denying reimbursement for services the provider furnished without showing “‘affirmative misconduct,’ such as fraud, by the federal government.”  Id.  Even if conduct by a CHAP employee could somehow be imputed to the government, Petitioner has fallen far short of showing that the oral guidance that a CHAP employee allegedly provided to its administrator was motivated by malign intent.  I find it more likely that the CHAP employee mistakenly—though perhaps reasonably, given her reported statement to Petitioner’s administrator that CMS’s request for an amended POC “almost never happens and . . . was the result of bad timing”—believed that a positive accreditation decision entailed automatic enrollment in Medicare effective on the same date as the positive accreditation date.  These are insufficient grounds on which to grant equitable relief in this case.

VII.  Conclusion

For the foregoing reasons, I conclude that November 20, 2017, remains the effective date of Petitioner’s Medicare provider agreement and billing privileges.

• 1. Thus, to the extent Petitioner is arguing that its effective date should be “[t]he date on which [it] me[]t[] all applicable conditions of participation,” as provided in the first clause of 42 C.F.R. § 489.13(c)(2)(i), its argument is misplaced.
• 2. I have already explained why 42 C.F.R. § 489.13(c)(2)(i) does not control the effective date of Petitioner’s provider agreement and Medicare billing privileges in this case. In upholding the November 20, 2017 effective date in its February 13, 2018 reconsidered determination, CMS relied on 42 C.F.R. § 489.13(c)(2)(i), CMS Ex. 8 at 1, and in this proceeding, CMS continues to rely on 42 C.F.R. § 489.13(c)(2)(i) to argue that November 20, 2017, is the correct effective date for Petitioner’s provider agreement and Medicare billing privileges. CMS Br. at 1, 2, 5. In addition, CMS now claims, for the first time, that Petitioner’s deficiencies were in fact condition-level deficiencies. CMS Br. at 3, 5, 7. CMS’s position is at odds with the way the requirements that Petitioner violated are labeled in the regulations; 42 C.F.R. §§ 418.54(c)(7), 418.76(c)(1), 418.76(h)(1)(i), and 418.112(f) are all labeled “standards” that fall within conditions in the regulations—they are not themselves conditions. In any event, I need not analyze whether Petitioner’s deficiencies were standard- or condition-level because that analysis would not affect the outcome of this case.