Compass Ambulance Services LLC, DAB CR5475 (2019)

DECISION

I sustain the determination of a Medicare contractor, as affirmed on reconsideration, to revoke the Medicare enrollment and billing privileges of Petitioner, Compass Ambulance Services LLC, for the reason that Petitioner was not operational at the address that it had stated was its practice location.

I. Background

I held a hearing in this case on September 5, 2019, at which Petitioner’s counsel cross-examined a witness, Ms. Jaime McSwain, who is an inspector employed by a contractor operating on behalf of the Centers for Medicare & Medicaid Services (CMS). At the hearing I received into evidence exhibits from CMS, identified as CMS Ex. 1-CMS Ex. 6, and exhibits from Petitioner, identified as P. Ex. 1-P. Ex. 16 and P. Ex. 18-P. Ex. 23. Transcript at 7.

II. Issue, Findings of Fact and Conclusions of Law

A. Issue

The issue is whether a Medicare contractor, acting on behalf of CMS, had the authority to revoke Petitioner’s Medicare enrollment and billing privileges.

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B. Findings of Fact and Conclusions of Law

A Medicare-enrolled supplier, such as Petitioner, must comply with Medicare enrollment requirements in order to retain its eligibility to participate in Medicare.  One of these requirements is that the supplier be “operational to furnish Medicare covered items or services.”  42 C.F.R. § 424.510(d)(6).  The term “operational” means that the supplier “has a qualified physical practice location, is open to the public for the purpose of providing health care related services, is prepared to submit valid Medicare claims, and is properly staffed, equipped, and stocked . . . to furnish these items or services.”  42 C.F.R. § 424.502.  The regulations require a supplier to advise CMS of any change in its practice location within 90 days of that change.  42 C.F.R. § 424.516(e)(2).

CMS may revoke a supplier’s Medicare enrollment and billing privileges for any of several enumerated reasons, including failure to remain operational to provide Medicare-covered items or services.  42 C.F.R. § 424.535(a)(5)(i).

The evidence establishes unequivocally that Petitioner was not operational at its qualified physical practice location.  That failure by Petitioner authorized CMS and its contractor to revoke Petitioner’s Medicare enrollment and billing privileges.

In its Medicare enrollment revalidation application, dated July 10, 2018, Petitioner stated its practice location to be 5555 Apollo Drive, Dallas, Texas 75237.  CMS Ex. 3 at 17.  On August 2, 2018, an investigator, acting on behalf of a Medicare contractor, went to that address in order to verify that Petitioner was operational.  CMS Ex. 4 at 1; CMS Ex. 6 at 1.  The investigator discovered on arrival that the site was a commercial airport.  She entered the airport through an unattended security gate.  CMS Ex. 6 at 2.  She proceeded to 5555 Apollo Drive.  There were no business signs on the building’s exterior.  The inspector observed no vehicles in the parking lot.  The building showed no signs of activity, and its exterior doors were locked.  She knocked on the front door and there was no answer.  Id.

The inspector returned to the airport on August 14, 2018.  On this occasion, the security gate at the airport’s exterior was closed and locked.  The inspector spoke with an airport employee via an intercom.  That employee told her that Petitioner had not been located at that site for several years and denied the inspector entrance to the airport.  Id.

The evidence offered by CMS is more than sufficient to establish that Petitioner was not operational at the Apollo Drive location that it had identified as its practice location in its July 10, 2018 Medicare revalidation application.  Indeed, the evidence shows that Petitioner conducted no business at that location.

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In its reconsideration request, Petitioner acknowledged that it did not maintain a practice location at 5555 Apollo Drive, but it contended that it was nevertheless operational there because it received mail and conducted training at that address.  CMS Ex. 2 at 1, 5, 213-217.  That assertion, if true, would not be sufficient to prove that Petitioner was operational at 5555 Apollo Drive.  Maintaining a mailing address at a site or even conducting occasional training activity there does not satisfy the regulatory requirement that a supplier be “staffed, equipped, and stocked” at its practice location.  42 C.F.R. § 424.502.

Petitioner now asserts that it was indeed fully operational at 5555 Apollo Drive and that it met all regulatory requirements at that location.  Petitioner did not offer any persuasive evidence to support this contention.

Petitioner offered no testimony of a manager or employee to aver that it maintained an operational practice location at 5555 Apollo Drive.  It could have offered photographs showing people working in an office at that location, if one existed there.  It did not.  It could have offered photographs of its ambulances parked at 5555 Apollo Drive if, in fact, they parked there.  It did not.

Nor did Petitioner offer other exhibits that might have established activity at the 5555 Apollo Drive address.  It offered no current lease for the premises.1 It offered no evidence that it was paying rent for the premises as of August 2018.  It offered no telephone bills for the Apollo Drive address, nor did it offer copies of utility bills for that address.

Petitioner offered a series of photographs, without accompanying testimony, that it contends establish that it was operational at 5555 Apollo Drive.  P. Ex. 1-P. Ex. 3, P. Ex. 5-P. Ex. 6, P. Ex. 8-P. Ex. 9, P. Ex. 11-13, P. Ex. 15.  They are images of empty corridors and parking lots, an airplane hangar, and various airport gates and building entrances.  None of them depict an operational business at the Apollo Drive address.  These photographs include images of a sign with Petitioner’s business logo on it, but there is nothing to connect this sign to Apollo Drive.  See P. Ex. 4.

Additionally, Petitioner offered what appears to be a Fedex label addressed to Petitioner.  P. Ex. 7.  The label includes “5555 Apollo Drive” as part of Petitioner’s business name, but it is in fact addressed to a post office box, PO Box 764264.  The fact that the delivery site is a post office box suggests that Petitioner did not maintain an active business office at 5555 Apollo Drive.

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Petitioner also submitted a training roster showing a training session conducted on September 10, 2018, nearly a month after the August 14 site visit.  P. Ex. 10.  At the top of the roster is printed the 5555 Apollo Drive address.  However, I do not find that this document proves that training actually occurred at that location absent testimony explaining the document and describing the training.

Petitioner also filed what appears to be an undated receipt of some sort, and a fax journal report.  P. Ex. 14; P. Ex. 23.  Neither of these documents suggests that Petitioner operated a business at 5555 Apollo Drive.

Finally, Petitioner offered four documents recording ambulance services rendered on August 2, 2018, which, it asserts, proves that Petitioner actively operated its business from the Apollo Drive address on that date.  P. Ex. 18-P. Ex. 21.  I do not find these records to be persuasive.  They do show that Petitioner rendered ambulance services on August 2, 2018.  As with several other exhibits, these documents show a post office box as Petitioner’s actual mailing address.  However, they do not prove that Petitioner rendered those services from 5555 Apollo Drive as opposed to originating them from some other location.  Putting the Apollo Drive address on the top of the documents does not prove that this address was the actual originating point for the services that Petitioner rendered.2

I find Petitioner’s additional arguments to be without merit.  Petitioner argues that CMS and its contractor lack legal authority to revoke Petitioner’s Medicare enrollment and billing privileges, allegedly because the inspections of August 2 and 14, 2018 failed to comply with survey criteria.  Petitioner Compass Ambulance’s Post Hearing Brief (Petitioner’s brief) at 5-8.  The adequacy of the inspection is not at issue here.  Petitioner points to nothing that impeaches what the inspector discovered on August 2 and 14, 2018.  As I have discussed, Petitioner had the opportunity to rebut the inspector’s findings by offering affirmative proof that it was operational at 5555 Apollo Drive.  It failed to do so.

Petitioner argues also that the investigator’s declaration is inadmissible because it is undated and therefore allegedly does not comply with a statutory requirement.  Petitioner’s brief at 8; see CMS Ex. 6.  I find no defect in the declaration that would bar its admission.  Moreover, the inspector appeared at the hearing and was cross-examined at length by Petitioner’s counsel.  During her testimony she repeated on the record of the hearing all of the contents of her declaration.

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Petitioner asserts that the inspector’s findings are invalid because on August 2 and August 14 she went only to one gate at the airport at which 5555 Apollo Drive is located and failed to attempt to get on site through other gates.  Petitioner’s brief at 10.  I find that argument to be meaningless in the absence of evidence that other gates provided access to 5555 Apollo Drive and had signage indicating that Petitioner’s business was located there.  Moreover, the inspector’s testimony is that she did obtain access to 5555 Apollo Drive on August 2 and that there was no sign of any business activity at that location.  That evidence renders irrelevant whether there were multiple airport gates that allowed access to the site.

Next, Petitioner contends that the inspector’s findings are invalid because the documents that she was supplied with in preparation for her inspection contained no telephone number for Petitioner’s business.  Petitioner’s brief at 10.  The absence of a telephone number accessible to the inspector does not invalidate her findings of August 2 and 14, 2018.  As I have stated, her findings are sufficient to establish that Petitioner was not operational at the Apollo Drive location.  It is Petitioner’s burden to rebut those findings, and it has not done so.

Petitioner also argues that the absence of ambulances at 5555 Apollo Drive on August 2 does not mean that that Petitioner operated no ambulances from that location.  Petitioner’s brief at 11.  The absence of ambulances on August 2, 2018, is a fact from which I may infer that Petitioner was not operational at the Apollo Drive site.  Petitioner had the opportunity to rebut that inference by proving that it did operate ambulances from that location.  Petitioner failed to do so.  As I have discussed, it offered no testimony averring that it used the Apollo Drive site as an originating point for its ambulances.  It did not even offer a photograph depicting ambulances at 5555 Apollo Drive.  See P. Ex. 2, P. Ex. 5-P. Ex. 6, P. Ex. 8-P. Ex. 9, P. Ex. 11-P. Ex. 13.  The records offered by Petitioner do show that it operated ambulances on August 2, 2018, but they do not establish the originating point for that activity.  See P. Ex. 18-P. Ex. 21.

Finally, Petitioner requests that I conduct a second in-person hearing so that it may present testimony as to the “ins and outs of . . . [Petitioner’s] airport location . . . .”  Petitioner’s brief at 15.  I deny that request.  I gave Petitioner ample opportunity to produce evidence, and I held a hearing based on the evidence that the parties offered.  Due process does not require an additional hearing.

• 1. P. Ex. 16 is a copy of a lease that covers the period running from July 2013 to July 2014. Petitioner did not offer proof that this lease was still in effect five years later.
• 2. Indeed, and as CMS notes, there is a discrepancy in each of these reports between the mileage recorded as traveled and the distance between 5555 Apollo Drive and the destination points of the ambulances. In each instance the mileage recorded as traveled is substantially less than the actual distance from 5555 Apollo Drive to the destination point. CMS Post-Hearing Brief at 5-6.