Jose Castellanos, M.D., DAB CR5089 (2018)

DECISION

Petitioner’s Medicare billing privileges were deactivated on May 2, 2017, as a result of his failure to timely comply with a request that he revalidate his Medicare enrollment.  For the reasons discussed below, I conclude that the effective date of Petitioner’s reactivated Medicare billing privileges remains May 17, 2017.

I.  Background and Procedural History

On December 15, 2016, Noridian Healthcare Solutions (Noridian), a Medicare administrative contractor, sent a letter to Petitioner, Jose Gabriel Castellanos, M.D., a family practice physician, informing him that he needed to revalidate his Medicare enrollment no later than February 28, 2017.  Centers for Medicare & Medicaid Services (CMS) Exhibit (Ex.) 1 at 1; see CMS Ex. 9 at 4.  Noridian directed Petitioner to “update or confirm all the information in [his] record, including [his] practice locations and reassignments.”  CMS Ex. 1 at 1.  Noridian cautioned Petitioner that a “[f]ailure to respond to this notice will result in a hold on [his] payments, and possible deactivation of [his] Medicare enrollment,” and further warned that in the event of deactivation,

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“[Petitioner] will not be paid for services rendered during the period of deactivation” which “will cause a gap in [his] reimbursement.”  CMS Ex. 1 at 1.  Noridian provided two telephone numbers that Petitioner could call if he needed assistance, and also provided various public websites that he could reference.  CMS Ex. 1.  Noridian mailed the letter to Petitioner at 234 E. Badillo Street in Covina, California (CMS Ex. 1 at 1), which is the address listed for Petitioner in Medicare enrollment records.  CMS Exs. 2 at 2-3; 9 at 6.

Because Petitioner did not comply with the revalidation request by the February 28, 2017 deadline, Noridian again requested, in a letter dated March 24, 2017, that Petitioner revalidate his enrollment.  CMS Ex. 4.  Noridian once again warned Petitioner that a failure to revalidate could result in deactivation of his billing privileges and a gap in reimbursement.  CMS Ex. 4 at 1.  Noridian mailed the letter to the same address in Covina, California.  CMS Ex. 4 at 1.

In a letter dated May 19, 2017, Noridian informed Petitioner that it had deactivated Petitioner’s billing privileges because he had not revalidated his enrollment record.  CMS Ex. 5 at 1.1   Noridian once again sent the letter to the aforementioned address in Covina, California.  CMS Ex. 5 at 1.

Noridian received Petitioner’s individual Medicare enrollment application for purposes of revalidation and reactivation, via the internet-based Provider, Enrollment, Chain, and Ownership System (PECOS), on May 17, 2017 (CMS Ex. 9 at 3), and it received Petitioner’s enrollment application for purposes of reassignment of benefits on June 14, 2017.  CMS Ex. 9 at 1.  Petitioner indicated that his practice location and contact person were both located at the same address in Covina, California.  CMS Ex. 9 at 4-5.  In a letter dated June 19, 2017, Noridian informed Petitioner that it had reactivated his Medicare billing privileges, effective May 17, 2017, and that he had a “lapse in coverage” from May 2 through May 17, 2017.2   CMS Ex. 6 at 1.

Petitioner submitted a request for reconsideration, dated July 26, 2017, in which he disputed the effective date assigned for his reactivated billing privileges.  CMS Ex. 7.  Petitioner explained, without providing any evidence in support, that “[t]he revalidation application was filled out and mailed within the deadline, but upon checking [the] status online there was no application on file.”  CMS Ex. 7 at 4.

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Noridian issued a reconsidered determination on October 9, 2017, in which it maintained the May 17, 2017 effective date of Petitioner’s reactivated billing privileges.  CMS Ex. 8.  The letter, which Noridian again mailed to the address in Covina, California, explained that Noridian had deactivated Petitioner’s billing privileges because Petitioner did not respond to a revalidation request.  CMS Ex. 8 at 2.  Noridian further explained that it received an enrollment application for purposes of revalidation on May 17, 2017, and that “[t]he request to remove the gap in billing cannot be honored due to the enrollment not being revalidated by the due date of February 28, 2017.”  CMS Ex. 8 at 2.

Petitioner submitted a request for an administrative law judge (ALJ) hearing on October 17, 2017.  I issued an Acknowledgment and Pre-Hearing Order (Pre-Hearing Order) on October 26, 2017.  CMS filed a Pre-Hearing Brief and Motion for Summary Judgment (CMS Br.), along with ten proposed exhibits (CMS Exs. 1-10), and Petitioner submitted a brief (P. Br.) and six exhibits (P. Exs. 1-6).  In the absence of any objections, I admit CMS Exs. 1-10 and P. Exs. 1-6 into the evidentiary record.

Petitioner submitted two additional documents after the expiration of his January 4, 2018 deadline to file his pre-hearing exchange, and neither document was accompanied by a motion for leave.  Neither submission is marked or identified as an exhibit.  Pre-Hearing Order, § 5.  Additionally, neither document is relevant to the issue before me.3   In an order dated February 6, 2018, I informed the parties that I would not accept these submissions for filing.

Because neither party has submitted the written direct testimony of any witnesses, a hearing for the purpose of cross‑examination is unnecessary.  See Pre-Hearing Order, §§ 8, 9, and 10.  I consider the record in this case to be closed, and the matter is ready for a decision on the merits.4

II.  Issue

Whether CMS had a legitimate basis to assign Petitioner a May 17, 2017 effective date for his reactivated billing privileges.

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III.  Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(15), 498.5(l)(2).

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

1. On December 15, 2016, Noridian requested that Petitioner revalidate his Medicare enrollment no later than February 28, 2017.

2. Petitioner did not submit a response to Noridian’s revalidation request, and Noridian deactivated Petitioner’s billing privileges effective May 2, 2017.

3. Noridian received Petitioner’s enrollment application for purposes of revalidation and reactivation on May 17, 2017, and Noridian processed that application to approval.

4. An effective date earlier than May 17, 2017, is not warranted for the reactivation of Petitioner’s Medicare enrollment and billing privileges.

Petitioner is a “supplier” for purposes of the Medicare program.  See 42 U.S.C. § 1395x(d); 42 C.F.R. §§ 400.202 (definition of supplier), 410.20(b)(1); see also 42 C.F.R. § 498.2.  A “supplier” furnishes services under Medicare and the term applies to physicians who provide services.  42 U.S.C. § 1395x(d).  A supplier must enroll in the Medicare program to receive payment for covered Medicare items or services.  42 C.F.R. § 424.505.  The regulations at 42 C.F.R. Part 424, subpart P, establish the requirements for a supplier to enroll in the Medicare program.  42 C.F.R. §§ 424.510 - 424.516; see also 42 U.S.C. § 1395cc(j)(1)(A) (authorizing the Secretary of the U.S. Department of Health and Human Services to establish regulations addressing the enrollment of providers and suppliers in the Medicare program).  A supplier that seeks billing privileges under Medicare “must submit enrollment information on the applicable enrollment application.”  42 C.F.R. § 424.510(a)(1).  “Once the provider or supplier successfully completes the enrollment process . . . CMS enrolls the provider or supplier into the Medicare program.”  42 C.F.R. § 424.510(a)(1); see also 42 C.F.R. § 424.510(d) (listing enrollment requirements).  Thereafter, “[t]o maintain Medicare billing privileges, a . . . supplier . . . must resubmit and recertify the accuracy of its enrollment information every 5 years.”  42 C.F.R. § 424.515.

CMS is authorized to deactivate an enrolled supplier’s Medicare billing privileges if the enrollee does not provide complete and accurate information within 90 days of a request for such information.  42 C.F.R. § 424.540(a)(3).  If CMS deactivates a supplier’s

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Medicare billing privileges, “[n]o payment may be made for otherwise Medicare covered items or services furnished to a Medicare beneficiary.”  42 C.F.R. § 424.555(b).  Further, and quite significantly, the Departmental Appeals Board (DAB) has unambiguously stated that “[i]t is certainly true that [the petitioner] may not receive payment for claims for services during any period when his billing privileges were deactivated.”  Willie Goffney, Jr., M.D., DAB No. 2763 at 6 (2017); see Urology Group of NJ, LLC, DAB No. 2860 at 11 (2018) (“Taking these unique effects of revocation into consideration, it is reasonable to conclude that CMS intended for revocations and deactivations to share the feature of precluding a provider or supplier from collecting reimbursement for services rendered during the period of inactive Medicare billing privileges, while simultaneously intending for revocations to have more severe consequences on a provider’s or supplier’s ability to participate.”).  The regulation authorizing deactivation explains that “[d]eactivation of Medicare billing privileges is considered an action to protect the provider or supplier from misuse of its billing number and to protect the Medicare Trust Funds from unnecessary overpayments.”  42 C.F.R. § 424.540(c).

On December 15, 2016, Noridian mailed a letter to Petitioner directing him to revalidate his Medicare enrollment record no later than February 28, 2017, and Noridian warned that Petitioner’s failure to revalidate could result in deactivation of his Medicare enrollment and billing privileges, with a resulting gap in reimbursement.  CMS Ex. 1 at 1.  After Petitioner did not comply with the revalidation request and a subsequent request (CMS Ex. 4), Noridian deactivated Petitioner’s billing privileges, effective May 2, 2017.  CMS Ex. 5 at 1.  Petitioner submitted a revalidation application that was received on May 17, 2017 (CMS Ex. 9 at 3), and Noridian granted an effective date of reactivated billing privileges of May 17, 2017.  CMS Ex. 10 at 1.

The pertinent regulation with respect to the effective date of reactivation is 42 C.F.R. § 424.520(d).  Urology Group, DAB No. 2860 at 9 (“The governing authority to determine the effective date for reactivation of Petitioner’s Medicare billing privileges is 42 C.F.R. § 424.520(d).”).  Section 424.520(d) states that “[t]he effective date for billing privileges for . . . physicians . . . is the later of – (1) [t]he date of filing of a Medicare enrollment application that was subsequently approved by a Medicare contractor; or (2) [t]he date that the supplier first began furnishing services at a new practice location.”  The DAB has explained that the “date of filing” is the date “that an application, however sent to a contractor, is actually received.”  Alexander C. Gatzimos, MD, JD, LLC, DAB No. 2730 at 5 (2016) (emphasis omitted).  Noridian deactivated Petitioner’s billing privileges because it did not timely receive an enrollment application for purposes of revalidation.  CMS Ex. 5.  Based on the May 17, 2017 receipt date of the enrollment application that was processed to approval (CMS Ex. 9 at 3), Noridian did not err in assigning a May 17, 2017 effective date for reactivated billing privileges.  See Urology Group, DAB No. 2860 at 9 (“Moreover, the fact that a supplier must file a new enrollment application in order to reactivate its billing privileges is consistent with the language of section 424.520(d) and compelling evidence that the provision should apply

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to reactivations.”); Willie Goffney, DAB No. 2763 at 6 (“It is certainly true that [the petitioner] may not receive payment for claims for services during any period when his billing privileges were deactivated.”); 42 C.F.R. § 424.520(d).

Petitioner is challenging the assignment of a May 17, 2017 effective date of his reactivated billing privileges, which resulted in a 15-day gap in his billing privileges from the date of his deactivation on May 2, 2017, through his reactivation on May 17, 2017.  Petitioner was required to timely respond to the revalidation request to avoid the prospect of deactivation pursuant to 42 C.F.R. § 424.540(a)(3), and Noridian deactivated his billing privileges due to his failure to comply with the revalidation request.  CMS Ex. 5.  The DAB has explained that a deactivation action is not reviewable, and “[t]he only action in the reconsidered determination which is appealable is . . . the initial determination of the effective date of the enrollment application reinstating [the petitioner].”5   Willie Goffney, DAB No. 2763 at 3-5.  Petitioner did not comply with the revalidation request in accordance with the time period prescribed by 42 C.F.R.  § 424.540(a)(3), and Noridian had a legitimate basis to assign an effective date of May 17, 2017, for Petitioner’s reactivated billing privileges based on a correct application of 42 C.F.R. § 424.520(d).

As I previously discussed, CMS has not offered evidence that Noridian notified Petitioner within five days of the date it deactivated Petitioner’s enrollment on May 2, 2017, even though an internal policy binding on the contractor directs that it should have timely notified Petitioner of his deactivation.  MPIM, § 15.29.3.3.  While CMS and Noridian have the discretion and authority to provide relief, and may revise the effective date of deactivation or reactivation of billing privileges, I am not empowered to exercise the same discretion when a Medicare administrative contractor fails to adhere to sub-regulatory policy.  Further, and as previously explained, I do not have the authority to review the deactivation of billing privileges.  Willie Goffney, DAB No. 2763 at 5.

Although I lack the authority to reverse a deactivation of billing privileges, as previously addressed at length, I cannot ignore Petitioner’s meritless allegations of ethical impropriety on the part of counsel for CMS.  Petitioner baselessly alleges that counsel for CMS has “irresponsibly ma[de] false statements” and acted in an “entirely unethical” manner.  P. Br. at 1; see also P. Br. at 4 (arguing that CMS’s statement of facts is

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“incredibly unethical” and that “[i]n a time when our news media is riddled with fake news, I believe it is important to not think that fake statements of fact or fake undisputed statements of fact are okay to make.”).  However, I observe that the consistency and accuracy of Petitioner’s statements, and not CMS counsel’s statements, is of significant concern; Petitioner has presented contradictory arguments that he both timely submitted a revalidation application and that he did not timely submit a revalidation application because he did not receive the revalidation request.  Specifically, Petitioner currently argues that he did not receive the revalidation request, and that his receipt of various pieces of misdirected mail evidences an inherent unreliability of postal delivery services to his office.  P. Br. at 1 (“The first false statement fact is that we failed to respond to a Medicare enrollment revalidation request.  Medicare has no evidence that these notices were received by our office, and we would have responded to them immediately or we would have stopped seeing Medicare patients.”); P. Br. at 2-3 (arguing that each of the six exhibits Petitioner submitted as P. Exs. 1-6 evidences that mail addressed to another entity was “accidentally” or “incorrectly” delivered to his medical practice).  However, Petitioner apparently forgot that only six months earlier, when he requested reconsideration in July 2017, he claimed that he had submitted a paper revalidation application “within the deadline” and that “upon checking status online there was no application on file.”  CMS Ex. 7 at 4.

Further, Petitioner has not submitted evidence, such as sworn written testimony, establishing that he did not receive either the December 15, 2016 or March 24, 2017 letters requesting that he revalidate his enrollment, and such evidence would naturally undermine his previous claim that he timely submitted a revalidation application.  CMS Ex. 7 at 4; see P. Br. at 4 (“Medicare has no evidence that letters were sent or received.”).  In fact, Petitioner timely submitted a request for reconsideration (CMS Ex. 7) and request for hearing after receiving correspondence sent by Noridian to the same address to which Noridian mailed the revalidation requests.  CMS Exs. 6, 8, 10.  Further, and contrary to Petitioner’s arguments, Noridian and CMS need not prove Petitioner’s actual mail receipt of the revalidation request; I presume that CMS’s Medicare administrative contractor personnel have performed their ministerial duties.  See, e.g., Miley v. Principi, 366 F. 3d 1343, 1347 (Fed. Cir. 2004) (holding, in a case involving the mailing of a decision to a claimant for benefits, that the presumption of regularity “provides that, in the absence of clear evidence to the contrary, the court will presume that public officers have properly discharged their official duties”); U.S. Postal Serv. v. Gregory, 534 U.S. 1, 10 (2001) (discussing that the presumption of regularity attaches to actions of government agencies); U.S. v. Chem. Found., Inc., 272 U.S. 1, 14-15 (1926) (creating presumption that government officials and agents have properly discharged duties in the absence of “clear evidence to the contrary”).

To the extent that Petitioner is requesting equitable relief in the form of an earlier effective date of reactivated billing privileges, I am unable to grant equitable relief.  See US Ultrasound, DAB No. 2302 at 8 (2010) (“Neither the ALJ nor the [DAB] is

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authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements.”).  Likewise, I do not have the authority to “[f]ind invalid or refuse to follow Federal statutes or regulations or secretarial delegations of authority.”  See, e.g., 1866ICPayday.com, L.L.C., DAB No. 2289 at 14 (2009) (“An ALJ is bound by applicable laws and regulations and may not invalidate either a law or regulation on any ground, even a constitutional one.”).

In the absence of any basis to grant an earlier date for the reactivation of billing privileges, the May 17, 2017 effective date for the reactivation of Petitioner’s billing privileges must stand.

V.  Conclusion

For the foregoing reasons, I uphold the May 17, 2017 effective date of Petitioner’s reactivated billing privileges.

1. CMS does not present any evidence that Noridian notified Petitioner of his deactivation within five business of the deactivation action, as required by Section 15.29.3.3 of the Medicare Program Integrity Manual (MPIM), CMS Pub. 100-108.
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2. Noridian subsequently clarified that the gap in reimbursement was from May 2 through May 16, 2017. CMS Ex. 10 at 1.
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3. The January 11, 2018 submission is a copy of a UPS shipping envelope, reflecting that Westland Printers had shipped Petitioner “free posters” from CMS. The January 31, 2018 submission is a copy of a postmarked envelope addressed to a different entity that the U.S. Postal Service apparently misdirected to Petitioner.
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4. CMS argues that summary disposition is appropriate. It is unnecessary in this instance to address the issue of summary disposition, as neither party has requested an in person hearing.
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5. The DAB explained:  “Moreover, neither [42 C.F.R. §] 424.545(b) nor any other regulation provides appeal rights from the contractor’s deactivation determination or any rebuttal determination.”  Willie Goffney, DAB No. 2763 at 5; see also Arkady B. Stern, M.D.,DAB No. 2417 at 3 n.4 (2011) (Petitioner argues on appeal that deactivation was improper, but the DAB “does not have the authority to review” deactivation under circumstances of this case, citing42 C.F.R. §§ 424.545(b) and 498.3(b)); Andrew J. Elliott, M.D.,DAB No. 2334 at 4 n.4 (2010) (DAB “does not have authority to review” a deactivation).
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