William Garner, M.D., DAB No. 3026 (2020)

FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE DECISION

William Garner, M.D. (Petitioner) appeals the October 16, 2019 Administrative Law Judge decision, William Garner, M.D., DAB CR5447 (ALJ Decision), granting summary judgment in favor of the Centers for Medicare & Medicaid Services (CMS).  The ALJ upheld CMS’s decision to revoke Petitioner’s Medicare billing privileges under 42 C.F.R. § 424.535(a)(4) for certifying as “true” misleading or false information on his Medicare enrollment application.  The ALJ concluded CMS had a legal basis for the revocation because Petitioner failed to disclose on his application the revocation of his California medical license, while certifying that the information on his application was true, correct, and complete.  For the reasons explained below, we affirm the ALJ Decision.

Legal Background

A physician or other “supplier” of health care services must be enrolled in Medicare in order to bill the program for services furnished to program beneficiaries.  42 C.F.R. §§ 424.500, 400.202 (defining “Supplier”), 424.502 (defining “Enroll/Enrollment”).  Medicare enrollment is governed by regulations in 42 C.F.R. Part 424, subpart P (sections 424.500-.570).

In order to enroll in Medicare, a supplier must submit an “enrollment application” to CMS.  See 42 C.F.R. § 424.510(a), (d)(1).  The term “enrollment application” is defined in CMS’s regulations to mean the “CMS-approved paper enrollment application” – form CMS-855 – or the internet-based electronic application, which is submitted through the Medicare Provider Enrollment, Chain, and Ownership System (PECOS).  Id. § 424.502 (defining “enrollment application” and PECOS).  A submitted enrollment application must include “[c]omplete, accurate, and truthful responses to all information requested within each section as applicable to the provider or supplier type.”  Id. § 424.510(d)(2)(i).  By signing an enrollment application, a supplier certifies that they have “read the contents of [the] application” and the “information contained [t]herein is true, correct, and complete.”  CMS Ex. 1, at 57.

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To maintain Medicare billing privileges, an enrolled supplier must “revalidate” enrollment every five years by resubmitting and recertifying their Medicare enrollment information.  42 C.F.R. § 424.515.  In order to revalidate Medicare enrollment, the supplier “must submit to CMS the applicable enrollment application with complete and accurate information and applicable supporting documentation . . . .”  Id. § 424.515(a)(2).  

CMS may revoke an enrolled supplier’s Medicare billing privileges for any of the “reasons” specified in paragraphs (a)(1) through (a)(22) of section 424.535 of Medicare’s enrollment regulations.  Under paragraph (a)(4), CMS may revoke a supplier’s Medicare billing privileges if the supplier “certified as ‘true’ misleading or false information on the enrollment application to be enrolled or maintain enrollment in the Medicare program.”  42 C.F.R. § 424.535(a)(4).1

Revocation bars the affected supplier from participating in the Medicare program from “the effective date of the revocation until the end of the reenrollment bar.”  42 C.F.R. § 424.535(b), (c)(1).  The duration of the re-enrollment bar is determined by CMS on a case-by-case basis.  On the date CMS imposed the revocation at issue in this case, the regulations provided that the re-enrollment bar was a minimum of one year and a maximum of three years, depending on the severity of the basis for revocation.  Id. § 424.535(c)(1) (Oct. 1, 2017).2

A supplier may contest a revocation in accordance with the administrative appeal regulations in 42 C.F.R. Part 498.  Id. § 424.545(a).  The supplier must first request reconsideration of CMS’s initial revocation determination.  Id. §§ 498.5(l), 498.22.  CMS then “[m]akes a reconsidered determination, affirming or modifying the initial determination and the findings on which it is based.”  Id. § 498.24(c).  If dissatisfied with CMS’s “reconsidered determination,” the supplier may request a hearing before an ALJ.  Id. § 498.40.  A party dissatisfied with an ALJ’s decision may seek review by the Departmental Appeals Board (Board).  Id. § 498.80.

Case Background

Petitioner at one point held medical licenses in Texas, California, and Washington.  P. Ex. 1, at 31.  However, at all times relevant to this case, he practiced medicine only in Texas.

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1.       The initial revocation determination and CMS’s reconsidered determination

In late 2016, Petitioner submitted a paper enrollment application (on form CMS-855I) to revalidate his Medicare enrollment.  CMS Ex. 1, at 2, 31, 34, 61.  On December 6, 2017, Novitas Solutions Inc., a CMS contractor, notified Petitioner that his Medicare billing privileges were being revoked pursuant to 42 C.F.R. § 424.535(a)(4) because his revalidation application failed to indicate (in section three) that his Texas medical license had been suspended and his California license had been revoked.  Id. at 10.3  Petitioner requested reconsideration, alleging that he had disclosed information about the Texas suspension and California revocation in documentation that he provided to CMS in connection with both his initial Medicare enrollment application (filed in 2014) and his revalidation application.  Id. at 6-8. 

On May 2, 2018, a CMS hearing officer issued a reconsidered determination sustaining the revocation.  Id. at 1-5.  In support of that determination, the hearing officer stated that Petitioner’s disclosure of adverse legal actions in “supporting documentation,” rather than on the revalidation application itself, was “misleading” because the application instructed him to list each final adverse legal action “directly” on the application, and because Petitioner had not listed the California revocation and Texas suspension on any prior enrollment application.  Id. at 3.

2.       The ALJ proceeding

Petitioner appealed the reconsidered determination by timely requesting an ALJ hearing.  The parties later filed cross-motions for summary judgment and supporting briefs.  Those submissions disclose the following undisputed facts.

On March 21, 2011, in order to resolve allegations that Petitioner had forged a prescription for Ambien (a controlled substance) and then self-administered that drug, the Washington Medical Quality Assurance Commission issued a “Stipulation to Informal Disposition” that placed Petitioner’s Washington medical license on probation for three years, required him to undergo substance abuse treatment and monitoring, and meet other conditions.  CMS Ex. 1, at 67-72.   (As part of the Stipulation to Informal Disposition, Petitioner did not admit to the alleged misconduct.  Id. at 67.)

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Based on the outcome of the Washington disciplinary proceeding, the Medical Board of California issued a complaint concerning Petitioner’s California medical license.  P. Ex. 1, at 31.  Petitioner did not respond to the complaint.  Id.  Consequently, on January 6, 2012, the Medical Board of California issued a “Default Decision and Order” revoking his California license.  Id.; CMS Ex. 1, at 14; CMS Ex. 2, at 10 (showing information self-reported by Petitioner to the Texas Medical Board).

To fulfill the condition imposed by the state of Washington that he receive substance abuse treatment and monitoring, Petitioner entered the Texas Physician Health Program (PHP).  P. Ex. 1, at 31.  He later “relapsed” and was terminated from the PHP, prompting the Texas Medical Board (TMB) to issue an order temporarily suspending his Texas medical license on the ground that his “impaired status” was a “threat to the public welfare.”  Id. at 30, 32.  The suspension order, issued on May 24, 2013, required Petitioner to cease the practice of medicine immediately “until the [TMB] took further action.”  Id. at 30.4  During the ensuing three months, Petitioner received inpatient and outpatient substance abuse treatment and counseling, underwent periodic drug testing (with negative results), and was readmitted to the PHP.  Id. at 32. 

On August 30, 2013, following an “Informal Show Compliance Proceeding and Settlement Conference” attended by Petitioner and his attorney, the TMB issued an “Agreed Order” (TMB Order) that revoked Petitioner’s Texas medical license, but stayed the revocation and placed him on probation for seven years.  Id. at 30, 33-34.  The TMB Order described the prior actions taken against him by the Washington and California licensing authorities during 2011 and 2012.  Id. at 31.

In late July 2014, Petitioner filed an initial Medicare enrollment application on form CMS-855I.  See P. Ex. 1; Pet.’s Sept. 13, 2018 Motion for Summary Judgment and Response to CMS’s Summary Judgment Motion (Pet.’s MSJ) at 1.  Section three of that application requested information about Petitioner’s history of “final adverse legal actions,” which the application defined to include “[a]ny revocation or suspension of a license to provide health care by any State licensing authority.”  P. Ex. 1, at 13-14.  The application instructed Petitioner to answer yes or no (by checking the appropriate box) if a final adverse legal action had been taken against him, and then, if his answer was yes, to specify each such adverse action; the date the reportable action occurred; the federal or state court, agency, or administrative body that took the action; and the “resolution, if any.”  Id. at 13.  Petitioner answered “yes” to the threshold question in section three and

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then wrote that the TMB had revoked his medical license on August 30, 2013, but placed him on probation for seven years, and that he was compliant with the terms of the probation.  Id.  CMS approved Petitioner’s initial enrollment application and enrolled him effective July 7, 2014.  CMS Ex. 1, at 7; P. Ex. 1, at 4, 28; P. Ex. 2, at 2 (showing a July 7, 2014 “effective date” of Medicare participation). 

As indicated, in 2016, Petitioner filed a CMS-855I to revalidate his Medicare enrollment.  The revalidation application’s instructions about reporting final adverse legal actions are identical to those in the initial enrollment application.  Compare CMS Ex. 1, at 43 with P. Ex. 1, at 14.  Petitioner entered the same information about his adverse legal history in section three of the revalidation application as he did in section three of the initial application.  Compare CMS Ex. 1, at 44 with P. Ex. 1, at 13.  Petitioner signed the revalidation application on October 27, 2016, and in doing so certified that the “information contained [t]herein is true, correct, and complete.”  CMS Ex. 1, at 57-58. 

On November 21, 2016, Novitas sent Petitioner a letter asking for “documentation” of the final adverse legal action reported in section three of the revalidation application.  Id. at 61.5   Petitioner responded to this “development request” on December 2, 2016, by faxing Novitas a copy of the TMB Order and a brief statement about the “status of his [Texas] medical license.”  Id. at 2, 16-30, 60-65.6   Although the TMB Order mentioned the California revocation and Texas suspension, Petitioner’s accompanying statement did not.  Id. at 65.  Petitioner did not provide a copy of the order revoking his California medical license or the order suspending his Texas medical license.   

In its briefs to the ALJ, CMS emphasized that Petitioner had:  (1) failed to “directly disclose” the Texas suspension and California revocation on his revalidation application in violation of its instruction to list each final adverse legal action in section three, and despite having certified that the information on the application was true, correct, and complete; and (2) also “failed to disclose” those two adverse legal actions in the development response he faxed to Novitas on December 2, 2016.  CMS’s Sept. 28, 2018 Response to Pet.’s Summary Judgment Motion and Reply to Pet.’s Brief Opposing CMS’s Summary Judgment Motion (CMS Reply) at 1-2, 7, 8; see also CMS’s Aug. 15, 2018 Motion for Summary Judgment (CMS MSJ) at 5-6.  In light of these undisputed facts, CMS asserted, “[t]here [was] a basis for revoking Petitioner’s billing privileges [under section 424.535(a)(4)] because he wrongly certified as true that he disclosed all

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final adverse legal actions imposed against him and that all information on his Medicare enrollment application was complete, true, and accurate.”  CMS MSJ at 5. 

In response to CMS’s summary judgment motion, Petitioner did not dispute that the California revocation and Texas suspension were final adverse legal actions, or that he failed to comply with the revalidation application’s instruction to list them in section three.  However, Petitioner emphasized that he had provided (in response to the November 21, 2016 development request) information about the California revocation and Texas suspension indirectly by giving Novitas a copy of the August 30, 2013 TMB Order, which, he said, “includes more information about [the California revocation and Texas suspension] than is required by Section 3 of the CMS-855I application.”  Pet.’s MSJ at 1-2, 4-5.  Petitioner also alleged that he had submitted a copy of the TMB Order to CMS in connection with his initial (2014) enrollment application.  Id. at 2.7   In support of that allegation, Petitioner proffered an October 6, 2014 letter from Novitas stating that it had approved Petitioner’s “change of information request”; that the changed information in part concerned his “adverse legal action history”; and that the effective date of the changed information was July 22, 2014.  P. Ex. 2, at 5.8   Petitioner asserted that because he twice (in 2014 and 2016) gave CMS information about the Texas suspension and California revocation “through the TMB Order,” there was “no genuine issue of material fact on the issue of whether [he] acted falsely or misleadingly in failing to disclose his adverse action history because [he] did not fail to disclose his history.”  Pet.’s MSJ at 8.  

The ALJ’s Decision

The ALJ found no genuine dispute of material fact, stating that he needed to resolve only “issues of law related to the interpretation and application of” the governing regulation.  ALJ Decision at 7.  The ALJ questioned whether the TMB’s temporary suspension of Petitioner’s medical license constituted a final adverse legal action.  Id. at 10 n.3.  However, the ALJ found no need to resolve that issue “given the undisputed fact [that] the Petitioner did not list the revocation of his medical license in California” on his revalidation application.  Id.  Because Petitioner’s application “did not list all adverse actions required to be listed,” the ALJ concluded that “the application whose accuracy [Petitioner] certified by his signature . . . was not true, correct, and complete, but rather was false and misleading[.]”  Id. at 10.  The ALJ, therefore, held that a basis existed to

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revoke Petitioner’s Medicare enrollment and billing privileges pursuant to 42 C.F.R. § 424.535(a)(4).  Id. at 10-11. The ALJ further held it was immaterial (“no defense,” in his words) that Petitioner had submitted to CMS supporting documentation (namely, the TMB Order) that mentions the California revocation, or that CMS may have been aware of that adverse legal action when Petitioner filed the revalidation application, because Petitioner had an “affirmative duty” under the regulations – a duty that the application made him aware of – to list reportable adverse legal history truthfully, accurately, and completely on the enrollment application.  Id. at 11. 

The Parties’ Contentions on Appeal

In his request for review, Petitioner argues that CMS’s interpretation of section 424.535(a)(4) is unreasonable as applied to him because he “disclosed” the California revocation indirectly in documentation (the TMB Order) that he submitted in connection with both his initial and revalidation enrollment applications.  Request for Review (RR) at 4-6, 8.  While conceding that he did not follow the revalidation application’s instructions to list all final adverse legal actions “in the body of the application,” a failure  he describes as a “simple mistake of law,” Petitioner emphasizes that he did “[i]n substance” provide a “complete and accurate picture of his adverse legal action history to CMS with his application.”  Id. at 8-9.

In response to the request for review, CMS defends the ALJ’s grant of summary judgment and underlying reasoning, asserting that because Petitioner violated an “affirmative duty” to list all final adverse legal actions on the revalidation application, the application was “not true, correct, and complete”  (contrary to his certification) but instead was “false and misleading.”  Response Br. at 1-2.

After CMS filed its response brief, the Board asked the parties to submit supplemental briefs addressing the relevance, if any, of Breton L. Morgan, Inc. and Breton L. Morgan, M.D., DAB No. 2933 (2019), rev’d, No. 3:19-0406, 2020 WL 257376 (S.D.W. Va. Jan. 16, 2020).  As detailed below, the Board in that case upheld a section 424.535(a)(4) revocation based on a physician’s failure to list a final adverse legal action on an enrollment application, but the decision was reversed on judicial review.

The parties submitted their supplemental briefs addressing Morgan on September 4, 2020.  CMS replied to Petitioner’s supplemental brief on September 11, 2020, and Petitioner replied to CMS’s supplemental brief on September 15, 2020.

Standard of Review

We review the ALJ’s grant of summary judgment de novo.  Southpark Meadows Nursing & Rehab. Ctr., DAB No. 2703, at 5 (2016).  “Summary judgment is appropriate when the record shows there is no genuine issue as to any material fact, and the moving party is

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entitled to judgment as a matter of law.”  Id.  In reviewing whether there is a genuine dispute of material fact for purposes of summary judgment, the Board views the proffered evidence in the light most favorable to the non-moving party.  See Patrick Brueggeman, D.P.M., DAB No. 2725, at 6 (2016). 

The Board’s standard of review on a disputed issue of law is whether the ALJ’s decision is erroneous.  Guidelines – Appellate Review of Decisions of Administrative Law Judges Affecting a Provider’s or Supplier’s Enrollment in the Medicare Program, accessible at https://www.hhs.gov/about/agencies/dab/different-appeals-at-dab/appeals-to-board/guidelines/enrollment/index.html. 

Analysis

In reviewing the revocation of a supplier’s Medicare billing privileges, ALJs and the Board decide only whether CMS has “established a lawful basis for the revocation.”  Cornelius M. Donohue, DPM, DAB No. 2888, at 4 (2018).  Here, that means we consider only whether the regulatory elements in section 424.535(a)(4) are met.  Id.  If CMS has proffered evidence to that effect, and there is no genuine dispute of material fact, then we must uphold the grant of summary judgment and sustain the revocation.  Stanley Beekman, D.P.M., DAB No. 2650, at 10 (2015).

Although the regulation affords CMS discretion to revoke or not revoke in a particular case, the role of the ALJ and the Board “is limited to determining whether CMS’s action is legally authorized and does not extend to second-guessing whether CMS properly exercised its discretion . . . .”  Acute Care Homenursing Servs., Inc., DAB No. 2837, at 9 (2017).  Thus, if the regulatory elements for revocation are satisfied, “then the revocation must be sustained.”  Douglas Bradley, M.D., DAB No. 2663, at 13 (2015) (internal quotations and citation omitted).  

1.       There are no genuine disputes of material fact precluding summary judgment.

In their appeal briefs, neither party asserts that a genuine dispute of material fact precludes summary judgment.  Rather, the parties argue that a proper application of the relevant law to the undisputed facts warrants either reversing or sustaining the revocation.  See Pet.’s Supp. Br. at 4-5 (urging reversal of the revocation and reinstatement of billing privileges); CMS Response Br. (urging the Board to affirm the grant of summary judgment).  We agree that there are no material facts in dispute and that the parties primarily disagree about the application of law to fact.  The case is therefore appropriate for summary judgment.  See Senior Rehab. & Skilled Nursing Ctr., DAB No. 2300, at 6 (2010) (holding that the case was suitable for summary judgment because the parties’ dispute was “whether, applying the regulatory requirements to the undisputed facts, the facility was or was not in substantial compliance” with the applicable regulatory requirements), aff’d, 405 F. App’x 820 (5th Cir. 2010); Vandalia Park, DAB No. 1939, at

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8 (2004) (“[A] dispute . . . as to the correct conclusion to draw from undisputed facts,” as distinct from a dispute about whether or not some fact can plausibly be found or inferred based on the record, “is not an impediment to the entry of summary judgment.”).

2.       CMS lawfully revoked Petitioner’s Medicare billing privileges under 42 C.F.R. § 424.535(a)(4) based on undisputed material facts.

Section 424.535(a)(4) authorizes CMS to revoke the Medicare billing privileges of a physician (or other supplier) who has “certified as ‘true’ misleading or false information on the enrollment application to be enrolled or maintain enrollment in the Medicare program.”  A “key purpose of enrollment is to ensure that suppliers comply with eligibility and other requirements for program participation and payment.”  Sunsites Pearce Fire Dist., DAB No. 2926, at 2 (2019), remanded on other grounds, No. 4:19-CV00203, 2020 WL 3971401 (D. Ariz. July 14, 2020).  To ensure that Medicare enrolls only qualified and trustworthy suppliers, the program’s regulations require a supplier:  to provide “[c]omplete, accurate, and truthful responses” to an enrollment application’s requests for information (42 C.F.R. § 424.510(d)(2)(i)); to provide those responses “on the applicable enrollment application” (id. § 424.510(a)(1)); and to certify, by a signature on the application, that the information provided therein is “accurate” (id. § 424.510(d)(3)).  Moreover, the information submitted on the enrollment application “must be such that CMS can validate it for accuracy at the time of submission.”  Id. § 424.510(d)(4) (emphasis added).

Given the affirmative duty to provide “complete, accurate, and truthful” information on the enrollment application, if a supplier submits a signed application and fails to list a final adverse legal action on the application, then the supplier will have certified as true information concerning his adverse legal history that is manifestly not “complete, accurate, and truthful,” but rather false or misleading.  In those circumstances, CMS may revoke the supplier’s Medicare billing privileges under section 424.535(a)(4).  See, e.g., Dennis McGinty, PT, DAB No. 2838, at 6, 8 (2017) (holding that the supplier was subject to revocation under section 424.535(a)(4) because he certified his enrollment application as true and complete, yet failed to report on the application a final adverse legal action), aff’d, No. 3:18-CV-359, 2019 WL 3034596 (N.D. Tex. July 19, 2019).

Here, Petitioner certified as “true” incomplete information about his adverse legal history on his revalidation application.  In response to the application’s instructions to report, in section three, all final adverse legal actions, including “[a]ny revocation . . . of a license to provide health care by any State licensing authority,” Petitioner listed only the stayed revocation of his Texas medical license.  CMS Ex. 1at 43-44.  The information he provided in section three was incomplete because it omitted the fact that his California medical license had been revoked.  Petitioner’s certification that the information on his application was true, correct, and complete (see id. at 57-58) was false.  His application falsely indicated that his adverse legal history was confined to a single action taken

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against his Texas medical license.  By signing an application that failed to report all final adverse legal actions, Petitioner certified as true incomplete – and thus false and misleading – information about his adverse legal history on his application.9

Petitioner emphasizes that he twice (in 2014 and 2016) indirectly “disclosed” the revocation of his California medical license by giving CMS a copy of the TMB Order, which mentions the California revocation.  RR at 8; see also Pet.’s Supp. Br. at 5.  That fact is irrelevant under section 424.535(a)(4), which by its terms authorizes revocation when the enrollment application itself contains false or misleading information, irrespective of information conveyed to CMS at a different time through other means.  See 42 C.F.R. § 424.535(a)(4) (authorizing revocation if the supplier “certified as ‘true’ misleading or false information on the enrollment application”) (emphasis added).  To hold that section 424.535(a)(4) is inapplicable when a supplier discloses a final adverse legal action indirectly in a separate document at a different time, in lieu of listing it on the application, would undermine the supplier’s obligation to provide complete and accurate information “on the applicable enrollment application” (42 C.F.R. § 424.510(a)) and frustrate CMS’s ability to validate the information “for accuracy at the time of submission” (id. § 424.510(d)(4)).  We decline to interpret or apply the enrollment regulations in a manner that is not only inconsistent with their plain language, but would relieve providers and suppliers of the legal obligation to provide “complete, accurate, and truthful responses” in each section of the enrollment application at the time of submission.  42 C.F.R. § 424.510(d)(2)(i); see also Breton L. Morgan, M.D., et al., DAB No. 2933, at 12 (holding that a supplier’s enrollment application must provide direct disclosures of all final adverse actions, “not disclosure of some actions or indirect references that, if followed, might result in CMS’s becoming aware of final adverse actions not mentioned”).10

We reject Petitioner’s suggestion that the revalidation application’s instruction to list all final adverse legal actions in section three was a mere administrative technicality (“form over substance,” as he says (RR at 8)).  The standard enrollment application is an important tool for verifying the professional integrity and qualifications of physicians and other suppliers seeking to participate in Medicare.  Cf. 42 C.F.R. § 424.502 (defining “enrollment” as the “process” for establishing a supplier’s “eligibility to submit claims for Medicare-covered items and services”); McGinty, DAB No. 2838, at 10 (noting that

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the “central purpose of the enrollment provisions is to protect Medicare beneficiaries and Trust Funds from fraudulent, untrustworthy and abusive providers and suppliers” (internal quotation marks omitted)).  Consequently, a supplier’s legal obligation to provide “[c]omplete, accurate, and truthful responses” (42 C.F.R. § 424.510(d)(2)(i)) – and to do so “on the applicable enrollment application” (id. § 424.510(a)(1)) – is no mere formality but a substantive legal obligation intended to strengthen CMS’s ability to protect Medicare and its beneficiaries.  See Final Rule, Medicare Program; Requirements for Providers and Suppliers to Establish and Maintain Medicare Enrollment, 71 Fed. Reg. 20,754, 20,758 (April 21, 2006) (explaining that the enrollment revalidation process ensures not only that CMS has “complete and current information” on Medicare suppliers and providers, but “further ensures that Medicare beneficiaries are receiving services furnished only by legitimate providers and suppliers, and strengthens [its] ability to protect the Medicare Trust Funds”).

3.       The district court’s holding in Morgan is not binding on the Board, and the court’s reasoning is unpersuasive.

In his supplemental brief, Petitioner contends that his circumstancesare “completely analogous” to those of the physician in Breton L. Morgan, M.D., Inc. v. Azar, No. 3:19-0406, 2020 WL 257376 (S.D.W. Va. Jan. 16, 2020).  Pet.’s Supp. Br. at 8.  In line with the district court’s decision, Petitioner requests that we reverse the revocation, reinstate his Medicare billing privileges, and grant other relief.  Id.

The Board is not required to treat as “controlling precedent” a district court holding from a federal judicial district different than the one from which the pending Board appeal arises.  Wash. State Dep’t of Social & Health Servs., DAB No. 940, at 7 (1988) (“The Board is not bound to apply the cited district court decision as controlling precedent because the instant appeal is from a different district than the court in Delaware.”); see also Camreta v. Greene, 563 U.S. 692, 709 n.7 (2011) (noting that, even within the federal judicial system, the “decision of a federal district court judge is not binding precedent in either a different judicial district, the same judicial district, or even upon the same judge in a different case” (internal quotation marks omitted)).11   Petitioner’s case and the Morgan case arise from different federal judicial districts.  Therefore, we are not bound by the district court’s decision.

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Moreover, we find the districtcourt’s reasoning unpersuasive.  Morgan involved the incomplete reporting of adverse legal history by the supplier, Dr. Morgan, on a Medicare enrollment application.  Dr. Morgan was convicted in 2007 of fraudulently obtaining a controlled substance.  In 2008, based on this felony conviction, the Department of Health and Human Services Inspector General (I.G.) excluded Dr. Morgan from all federal health care programs, and CMS revoked his Medicare billing privileges.  In 2013, the I.G. reinstated Dr. Morgan’s eligibility to participate in federal health care programs, and Dr. Morgan applied to enroll in Medicare.  On his enrollment application, which instructed him to report all final adverse legal actions, Dr. Morgan checked the box indicating that a final adverse legal action had been taken against him and then reported (in the space provided for listing each such action) the 2008 exclusion.  Dr. Morgan did not separately disclose the felony conviction that led to his exclusion.  Dr. Morgan enclosed with his application a copy of the I.G.’s 2013 reinstatement letter, which referenced the file number relating to the I.G.’s exclusion. 

CMS approved Dr. Morgan’s enrollment application in October 2013 but revoked his Medicare billing privileges in 2016.  In its reconsidered determination, CMS explained that the revocation was based on section 424.535(a)(4) because Dr. Morgan failed to report his felony conviction on the application.12   The ALJ and the Board sustained the revocation, finding that Dr. Morgan had certified as true false or misleading information on his enrollment application by omitting his felony conviction.  DAB CR5014, at 5, 7; DAB No. 2933, at 13-15.

On judicial review, the district court held that Dr. Morgan’s enrollment application was not false or misleading and did not warrant revocation under section 424.535(a)(4).  Morgan, 2020 WL 257376, at *5, *7.  The district court found the terms of the application unclear because it did not specify how a supplier should report multiple adverse legal actions arising from the “same set of operative facts.”  Id. at *6.  The district court further found that Dr. Morgan’s disclosure of his exclusion and submission of the I.G.’s reinstatement letter with his application “would immediately have informed any reviewer charged with parsing his application” of the existence of the felony conviction.  Id.  The district court emphasized that CMS “was aware of” Dr. Morgan’s felony conviction when he submitted his enrollment application because it had previously revoked his billing privileges based on that same conviction.  Id.  “It would be irrational to conclude,” said the district court, “that failure to report the details of a criminal conviction to an agency that is already aware of that criminal conviction—and has acted

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upon it—is somehow false or misleading.”  Id.13

In the district court’s (apparent) view, a supplier’s failure to list a final adverse legal action on the enrollment application does not render the application false or misleading if CMS was otherwise aware of the omitted information or could have, with reasonable diligence, discovered that information in its files.  The court’s focus on CMS’s knowledge of facts relating to Dr. Morgan’s adverse legal history implies that section 424.535(a)(4) requires proof that CMS was actually deceived or misled by incomplete responses on an enrollment application.  The court, however, did not cite or discuss any regulatory text, legal principle, or rule of interpretation supporting its view.  Indeed, section 424.535(a)(4) plainly authorizes CMS to revoke a supplier’s billing privileges if the supplier “certified as ‘true’ misleading or false information on the enrollment application.”14

In the Board’s view, a revocation under section 424.535(a)(4) is lawful if CMS establishes that information certified as true on an enrollment application is either “false” or “misleading.”  An incomplete response certified to be “true, correct, and complete” is, by definition, “false” because it is incomplete.  See Merriam-Webster.com Dictionary, https://www.merriam-webster.com/dictionary/false (providing a legal definition of the term “false” to mean “not true or correct”).  Still further, an incomplete response may be “misleading” because it has a tendency to “create a false impression.”  See id., https://www.merriam-webster.com/dictionary/mislead (providing a legal definition of the term “mislead”).15  Section three of Petitioner’s certified revalidation application purported to report “each final adverse legal action,” yet Petitioner omitted the revocation

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of his California medical license.  CMS Ex. 1 at 44, 57-58.  The information Petitioner certified to be true in section three was false and misleading because it was not “true, correct, and complete,” as Petitioner had certified, and created a false impression about the extent of his adverse legal history.  The district court’s reasoning in Morgan does not persuade us that we have incorrectly discerned the meaning of the terms “false” or “misleading” or that the regulation was somehow misapplied in Petitioner’s case.

While acknowledging that “CMS has a vital interest in ensuring that suppliers adhere to its rules and regulations in applying for Medicare billing privileges,” the district court found this vital interest “does not warrant the wholesale embrace of form over substance.”  Morgan, 2020 WL 257376, at *7.  Adopting the court’s language, Petitioner contends that his revocation elevates “form over substance” because it was imposed “despite his good-faith substantive compliance” with Medicare rules regarding enrollment.  Pet.’s Supp. Br. at 13; see also RR at 5 (contending that applying the regulation to his circumstances “permits disciplinary sanctions against enrollees for unintentional missteps of form”).  The Board has never recognized, and does not do so here, “good-faith substantive compliance” as the standard for evaluating whether a supplier has complied with Medicare enrollment regulations.  A supplier’s subjective intentions in failing to report adverse legal history, or a supplier’s good-faith but erroneous belief that it was compliant with its reporting obligations, is immaterial in evaluating whether CMS had a legal basis to revoke billing privileges under section 424.535(a)(4). See Mark Koch, D.O., DAB No. 2610, at 4 (2016).

Moreover, we reject Petitioner’s characterization of the revocation as elevating form over substance because we disagree that there was “substantive compliance” with Medicare enrollment regulations.  Those regulations plainly required Petitioner to report and certify all final adverse legal actions on section three of his application.  See 42 C.F.R. § 424.510(a)(1), (d)(2)(i), (d)(3), (d)(4).  As discussed, that requirement is not a mere formality, but a critical mechanism for evaluating and verifying an applicant’s fitness to participate in Medicare.  Petitioner’s failure to report a final adverse legal action on his enrollment application cannot be considered “substantive compliance” with Medicare enrollment requirements.

4.       Petitioner’s other contentions do not warrant overturning the revocation.

Petitioner makes various other contentions (which we address here briefly) that do not warrant overturning the revocation.  First, we reject Petitioner’s contention that he had no obligation to report “each of the adverse outcomes resulting from a common set of operative facts” having disclosed the “precipitating event and information regarding the resulting adverse actions . . . in supplemental documentation.”  Pet.’s Supp. Br. at 8, 10-11.  The application’s instructions and applicable regulations neither state nor imply such a rule.  Moreover, Petitioner notably failed to specify what he believed to be the

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“precipitating event” or “common set of operative facts” in his adverse legal history.16   No explanation would suffice because the enrollment application’s instructions clearly required him to list “all” final adverse legal actions, including “[a]ny revocation” issued by “any State licensing authority.”  CMS Ex. 1, at 43. 

Next, Petitioner notes that CMS did not establish that he “deliberate[ly]” omitted the California revocation on the revalidation application (RR at 8 n.7) and that he did not “intend to mislead” CMS (Pet.’s Supp. Br. at 11).  However, the Board has held that section 424.535(a)(4) does not require CMS to prove that a supplier subjectively intended to convey false or misleading information on an application; CMS need only show that there is false or misleading information on the application that the supplier certified (by his signature) as true.  Koch, DAB No. 2610, at 4; Acute Care Homenursing, DAB No. 2837, at 7-8. 

Petitioner suggests that CMS improperly revoked his enrollment based on the content of the revalidation application given that it had enrolled him in 2014 based on a substantively identical application.  RR at 9 n.9.  According to Petitioner, “CMS ratified the format and sufficiency of Petitioner’s initial disclosure [on the 2014 enrollment application] such that he reasonably relied on it when submitting identical disclosures with his Revalidation Application.”  Id.17 Petitioner’s alleged “reliance” does not render the revocation unlawful because it does not negate the fact that Petitioner certified as true false or misleading information on his revalidation application, making CMS’s revocation decision lawful under section 424.535(a)(4).  Furthermore, Petitioner’s belief about the sufficiency of the information entered in section three of the revalidation application was unreasonable given the application’s clear instruction to list each and every final adverse legal action on the application, and the lack of any notice from CMS explicitly addressing the sufficiency of the information he reported in section three of his initial enrollment application.

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To the extent Petitioner contends that CMS is equitably estopped from revoking his billing privileges having accepted his enrollment application in 2014, this argument must be rejected.  “There can be no estoppel absent the traditional requirements of a misrepresentation of fact, reasonable reliance, and detriment to the opposing party.”  Chautauqua Opportunities, Inc., DAB No. 3011, at 10 (2020) (internal quotation marks omitted).  “Moreover, estoppel against the federal government, if available at all, is presumably not available absent affirmative misconduct by the federal government.”  Id. (internal quotation marks omitted); see also Kensington Diagnostics LLC, DAB No. 2992, at 16 (2020) (noting that affirmative misconduct is akin to deliberate or reckless misrepresentation).  Here, there is no evidence of the traditional elements of estoppel, much less evidence of affirmative misconduct by the federal government.

Next, Petitioner contends that the three-year re-enrollment bar imposed by CMS as a consequence of the revocation is “inappropriate,” “inequitable,” and also “fundamentally unreasonable . . . where there is no harm alleged to the Medicare program.”  RR at 8-9 (italics in original).  We need not address these contentions because the Board has repeatedly held that the duration of a re‑enrollment bar is not an initial determination subject to review by the ALJ or the Board.  See Lilia Gorovits, M.D., P.C., DAB No. 2985, at 15-16 (2020); Blossomwood Medical, P.C., et al., DAB No. 2914, at 11 (2018), aff’d, No. 5:19-CV-00232, 2020 WL 5632970 (N.D. Ala. Sept. 21, 2020); Vijendra Dave, M.D., DAB No. 2672, at 10-12 (2016).   

Finally, Petitioner implies that the revocation should be overturned because it harms the “underserved community of pediatric patients in Central Texas,” where he works.  RR at 4.  He asks that the Board “weigh the needs of the community against CMS’[s] priorities in this case.”  RR at 10.  We have no authority to overturn a lawful revocation based on such a weighing of interests.  “[W]hen reviewing a Medicare enrollment revocation, the Board and its ALJs are limited to deciding whether the regulatory prerequisites for revocation have been satisfied.”  Donohue, DAB No. 2888, at 10.  Because we conclude that the regulatory elements in section 424.535(a)(4) are met in this case, “we must sustain the revocation . . .  regardless of other factors” (such as the needs of the community served by Dr. Garner) “that CMS might reasonably have weighed in exercising its discretion about whether or not to revoke.”  Id. (internal quotation marks omitted); see also Daniel Wiltz, M.D., et al., DAB No. 2864, at 12 (2018) (“If, as here, CMS has a basis for revocation, the Board must uphold the determination to revoke without regard to, e.g., . . . the potential impact of revocation on the supplier’s patients . . . .”); Dinesh Patel, M.D., DAB No. 2551, at 10 (2013) (holding that the Board had no authority to overturn a revocation based on Medicare beneficiaries’ need for the revoked physician’s services).

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5.       The exhibits attached to CMS’s supplemental brief are inadmissible.

CMS attached to its supplemental reply brief (filed September 11, 2020) two exhibits that it did not submit to the ALJ.  The regulations governing this appeal prohibit the Board from admitting to the record evidence that was not submitted to the ALJ.  42 C.F.R. § 498.86(a); Michael Scott Edwards, OD, et al., DAB No. 2975, at 8 n.10 (2019) (“By regulation, the Board decides appeals involving enrollment (and revocation) on the evidentiary record on which the ALJ decided the case.”); Chaplin Liu, M.D., DAB No. 2976, at 9 n.4 (2019).  Consequently, we exclude these exhibits from the record and have not considered or relied upon them in reaching our decision. 

Conclusion

For the reasons stated above, we affirm the ALJ’s conclusion that CMS lawfully revoked Petitioner’s Medicare billing privileges pursuant to 42 C.F.R. § 424.535(a)(4).

• 1.We apply the regulations in 42 C.F.R. Part 424 in effect on the date of the challenged revocation determination.  John P. McDonough III, Ph.D., DAB No. 2728, at 2 n.1 (2016).  CMS issued the reconsidered determination challenged here on May 2, 2018.  CMS Ex. 1, at 1.
• 2.The maximum re-enrollment bar has since been raised to ten years (and higher in limited circumstances).  See 42 C.F.R. § 424.535(c)(1)(i) (Oct. 1, 2019).
• 3.The December 6, 2017 revocation notice also stated that Petitioner had represented on the revalidation application that he had no adverse legal history.  CMS Ex. 1, at 10.  However, as CMS acknowledged in its reconsidered determination, Petitioner had checked the “yes” box in section three of his revalidation application, indicating that a “final adverse legal action” had been taken against him, and he reported on the application that his Texas medical license had been revoked but that revocation had been stayed.  Id. at 2 n.2; see also id. at 44.
• 4.Texas law authorizes the TMB to “temporarily suspend or restrict the license” of a physician that it finds “constitute[s] a continuing threat to the public welfare,” provided that the TMB immediately notifies the physician of the temporary suspension and schedules a hearing concerning the suspension’s validity.  Tex. Occ. Code § 164.059(b)-(c).  If the temporary suspension is affirmed, the TMB schedules an “informal compliance meeting” to give the license holder an opportunity to show that he or she meets conditions for retaining the license.  Id. §§ 164.059(e), 2001.054(c).
• 5.The November 21, 2016 letter stated CMS’s request as follows:  “Please furnish documentation concerning the type and date of the final adverse action [in section 3] to provide information on what authorities or organizations were involved and how the adverse action was resolved.”  CMS Ex. 1, at 61.
• 6.The TMB Order and statement concerning the status of Petitioner’s Texas license were provided to CMS on his behalf by his employer, the Texas Department of Aging and Disability Services.  CMS Ex. 1, at 65.
• 7.CMS asserts that Petitioner “did not disclose or submit [the TMB] order with his 2014 . . . application.” CMS Supp. Br. at 10 n.3.  Although this assertion creates an apparent dispute about whether Petitioner submitted the TMB Order to CMS in 2014 (either with the application or separately), that factual dispute is immaterial for the reasons explained below.
• 8.CMS objected to the ALJ’s consideration of Petitioner’s exhibits, but the ALJ found “good cause” to admit them to the record of the case.  ALJ Decision at 2-4.
• 9.The parties do not address whether the TMB’s temporary suspension of Petitioner’s Texas medical license constitutes a final adverse legal action that Petitioner should have listed in the revalidation application.  We agree with the ALJ that it is unnecessary to resolve that issue in order to decide this case.
• 10.The Board’s decision in Morgan was vacated and reversed by Breton L. Morgan, M.D., Inc. v. Azar, No. 3:19-0406, 2020 WL 257376 (S.D.W. Va. Jan. 16, 2020).  As discussed below, the Board respectfully disagrees with the district court’s analysis, and is not bound by the district court’s decision in this case.  See infra at 11-14 (section 3).
• 11.The Board has also held that it is not bound by a federal court of appeals decision from a judicial circuit other than the circuit to which its decision in the pending matter may be appealed.  Rockcastle Health & Rehab. Ctr., DAB No. 2891, at 24 (2018); Golden Living Ctr. – Trussville, DAB No. 2937, at 27 (2019).
• 12.CMS also cited Dr. Morgan’s failure to list on the application his 2008 revocation, but that omission was not a factor in the ensuing decisions by the ALJ, Board, or district court.  See DAB No. 2933, at 4-5 & n.6.
• 13.We note that Morgan is factually distinguishable from Petitioner’s case in that Dr. Morgan’s billing privileges were initially revoked by CMS (with a three-year re-enrollment bar) due to his felony conviction, and then revoked a second time approximately nine years later for not reporting the same felony conviction that led to the initial revocation.  Petitioner’s billing privileges were not previously revoked due to the revocation of his California medical license or any failure to report the loss of his California medical license.
• 14.Similarly, “section 424.535(a)(4) does not require proof that [a supplier] subjectively intended to provide false information, only proof that he in fact provided misleading or false information that he certified as true.”  Mark Koch, D.O., DAB No. 2610, at 4 (2016).
• 15.In other areas of the law, it has long been established that an incomplete or partial disclosure may be misleading to the same extent as a wholly false statement.  See, e.g., Universal Health Servs., Inc. v. United States, 136 S. Ct. 1989, 2000 & n.3 (2016) (explaining in the context of the False Claims Act “that half-truths—representations that state the truth only so far as it goes, while omitting critical qualifying information—can be actionable misrepresentations”); W. Keeton, D. Dobbs, R. Keeton, & D. Owen, Prosser and Keeton on Law of Torts § 106, p. 738 (5th ed. 1984) (“[I]f the defendant does speak, he must disclose enough to prevent his words from being misleading.”); Restatement (Second) of Contracts § 161 cmt. a (1981) (“[N]on-disclosure of a fact may be equivalent to a misrepresentation.”); Restatement (Second) of Torts § 529 (“Representation Misleading Because Incomplete”), cmt. a (1977) (“[A] half-truth may be as misleading as a statement wholly false.”); id. § 551 (“Liability for Nondisclosure”) cmt. g (“A statement that is partial or incomplete may be a misrepresentation because it is misleading, when it purports to tell the whole truth and does not.”).
• 16.We further note that the California revocation and subsequent Texas suspension do not arise from a common set of operative facts.  The California revocation resulted from a default following a disciplinary action in Washington State due to Petitioner forging a prescription for a controlled substance in 2010.  CMS Ex. 1 at 67.  The Texas suspension appears to have been the result of Petitioner’s termination from the Texas Physician Health Program due to a “relapse” in 2013.  P. Ex. 1, at 32.
• 17.We do not understand Petitioner to be arguing that CMS’s approval of his initial (2014) enrollment application bars CMS from disapproving a revalidation application containing the same disclosures.  In any event, we note here that CMS’s authority to revoke a supplier’s billing privileges in a given set of circumstances is not constrained by its failure to exercise that authority under previous similar circumstances.  See Pa. Physicians, P.C., DAB No. 2980, at 13-14 (2019) (citing Board decisions “which hold that CMS’s revocation authority is not constrained by prior decisions not to take an adverse action affecting the supplier’s enrollment”).