Vision Services, P.C., DAB CR5923 (2021)

DECISION

Wisconsin Physicians Service (WPS), an administrative contractor for Respondent, the Centers for Medicare & Medicaid Services (CMS), granted Medicare billing privileges to Petitioner, Vision Services, P.C. (Vision Services or Petitioner),1 effective April 4, 2018.  Petitioner and its principal, Bruce Christensen, O.D., requested a hearing before an administrative law judge to dispute CMS’ effective date determination.  As explained herein, WPS correctly determined Petitioner’s effective date of reactivation to be April 4, 2018.  I therefore affirm CMS’ effective date determination.

Page 2

I.  Background

On February 7, 2017, WPS demanded revalidation of both Dr. Christensen’s individual Medicare enrollment information and Petitioner’s group Medicare enrollment information by April 30, 2017.  CMS Exs. 2-4.  WPS warned them that if it did not receive their revalidation applications by April 30, 2017, it would terminate Medicare billing privileges for both Dr. Christensen and Vision Services.  Id.

Dr. Christensen submitted a CMS-855I application to revalidate his individual enrollment on April 24, 2017.  CMS Ex. 5.  WPS subsequently approved Dr. Christensen’s individual revalidation application on May 30, 2017.  CMS Ex. 8.

On April 26, 2017, WPS wrote to Dr. Christensen and Vision Services to explain that Dr. Christensen’s April 24, 2017 application would serve only to revalidate his individual enrollment under his own PTAN number.  CMS Ex. 6 at 1 (“The below application is needed for the group revalidation, the application already submitted will just revalidate the individual PTAN for the above provider.”).  WPS warned that Petitioner needed to submit a CMS-855B group enrollment application by May 26, 2017 in order to revalidate its group enrollment.  Id.

On May 9, 2017, WPS notified Petitioner that its Medicare claims payments were on hold because Petitioner had failed to revalidate its enrollment record.  CMS Ex. 7 at 1.  WPS warned that the failure to respond could result in deactivation of Petitioner’s Medicare enrollment, resulting in nonpayment for services during the period of deactivation, or a gap in reimbursement.  Id.  On July 7, 2017, because Petitioner failed to revalidate its enrollment record or respond to WPS’ request for additional information, WPS notified Petitioner it had “stopped”2 Petitioner’s Medicare billing privileges, effective July 5, 2017.  CMS Ex. 9 at 1.

Petitioner submitted an online CMS-855B group revalidation application on July 26, 2017.  CMS Ex. 10.  Petitioner’s revalidation application identified Amanda Beck and ecospringlake@eyecareone.com as the contact person and e-mail address for its enrollment application.  Id. at 3.  On August 2, 2017, by e-mail to ecospringlake@eyecareone.com, WPS acknowledged receipt of Petitioner’s group revalidation application and requested additional information to complete the application.

Page 3

CMS Ex. 11 at 1.  In that e-mail, WPS warned Petitioner it would deactivate the group’s Medicare billing privileges within 30 days if it did not receive the information it had requested.  Id.

On September 1, 2017, WPS rejected Petitioner’s July 26, 2017 group revalidation application, asserting it had not received a written response to its August 2, 2017 development request within 30 days.  CMS Ex. 12 at 1.  WPS instructed Petitioner to submit a new enrollment application that provided the information requested in WPS’ August 2, 2017 development letter in order to revalidate its enrollment in the Medicare program.  Id.

On December 4, 2017, Petitioner submitted a second online CMS-855B group revalidation application.  CMS Ex. 13.  This revalidation application identified Amanda Beck and 105 W. Exchange St., Spring Lake, MI 49456-2024 as Petitioner’s contact person.  Id. at 5.  WPS issued a development request to Petitioner on December 5, 2017 to Amanda Beck’s attention at 105 W. Exchange St., Spring Lake, MI 49456-2024.  CMS Ex. 14 at 1.  WPS acknowledged receipt of Petitioner’s group revalidation application and requested additional information to complete the application.  Id.  WPS also warned Petitioner it would deactivate the group’s Medicare billing privileges within 30 days if it did not receive the information it had requested.  Id.

On January 5, 2018, WPS rejected Petitioner’s December 4, 2017 group revalidation application, asserting it had not received a written response to its development letter within 30 days.  CMS Ex. 15 at 1.  WPS instructed Petitioner to submit a new enrollment application that provided the information requested in WPS’ development letter in order to revalidate its enrollment in the Medicare program.  Id.

Petitioner submitted a third online CMS-855B group revalidation application on January 24, 2018.  CMS Ex. 16.  Petitioner’s revalidation application identified Amanda Beck as Petitioner’s contact person and ecospringlake@eyecareone.com as her e-mail address.  Id. at 5.  On January 25, 2018, by e-mail to ecospringlake@eyecareone.com, WPS acknowledged receipt of Petitioner’s group revalidation application and requested additional information to complete the application.  CMS Ex. 17 at 1.  In that e-mail, WPS warned Petitioner it would deactivate the group’s Medicare billing privileges within 30 days if it did not receive the information it had requested.  Id.

WPS rejected Petitioner’s January 24, 2018 group revalidation application on February 23, 2018, asserting it had not received a written response to its development letter within 30 days.  CMS Ex. 18 at 1.  WPS instructed Petitioner to submit a new enrollment application that provided the information requested in WPS’ January 25, 2018 development letter in order to revalidate its enrollment in the Medicare program.  Id.

Page 4

On April 4, 2018, Petitioner submitted a fourth online CMS-855B group revalidation application.  CMS Ex. 19.  Petitioner’s group revalidation application identified Amanda Beck and 105 W. Exchange St., Spring Lake, MI 49456-2024 as the contact person and address for the enrollment application.  Id. at 5.  On April 10, 2018, WPS acknowledged receipt of Petitioner’s application by letter mailed to the attention of Amanda Beck at 105 W. Exchange St., Spring Lake, MI 49456-2024.  CMS Ex. 20 at 1.  WPS also requested additional information to complete Petitioner’s application and again warned it would deactivate the group’s Medicare billing privileges within 30 days if it did not receive the information it had requested.  Id.  Petitioner provided the information sought by WPS on April 23, 2018.  CMS Ex. 21.

On May 15, 2018, WPS notified Petitioners it had approved the April 4, 2018 revalidation application with an effective date of August 22, 2001.3   CMS Ex. 22 at 1.  While somewhat obliquely phrased, WPS indicated in the notice of successful revalidation that a gap in billing privileges resulted from July 5, 2017, the date it “stopped” Petitioner’s billing privileges through April 4, 2018, the date it received the revalidation application from Petitioner it was able to successfully process.  CMS Ex. 22 at 1.  I can infer that April 4, 2018 is the effective date for Petitioner’s revalidation enrollment.  WPS also advised Petitioner it had 60 days to request reconsideration of WPS’ effective date determination.  Id. at 2.

Petitioner timely sought reconsideration, CMS Exs. 23-24, and WPS affirmed its effective date determination in a reconsidered determination dated July 31, 2018.  CMS Ex. 1.  Petitioner timely sought a hearing before an administrative law judge in the Civil Remedies Division and I was designated to hear and decide this case.  On October 4, 2018, I issued an Acknowledgment and Prehearing Order (Pre-Hearing Order) that required each party to file a pre-hearing exchange and supporting documents.  Pre-Hearing Order ¶ 4.  CMS timely filed a Combined Pre-Hearing Brief and Motion for Summary Judgment (CMS Br.), along with 24 exhibits (CMS Exs. 1-24).  Petitioner timely filed its Pre-Hearing Brief and Response in Opposition to CMS’ Motion for Summary Judgment (P. Br.).

II. Decision on the Written Record and Admission of Exhibits

Petitioner did not object to the exhibits offered by CMS.  I admit CMS Exs. 1-24 into evidence.  Neither party offered written direct testimony of a witness as part of its pre‑hearing exchange, meaning an in-person hearing is not necessary in this matter.  Pre‑Hearing Order ¶¶ 8-10; Civ. Remedies Div. P. §§ 16(b), 19(b).  I therefore decide this case on the record based on the parties’ written submissions and arguments.  Civ. Remedies Div. P. § 19(d).  CMS’ motion for summary judgment is denied as moot.

Page 5

III. Issues

The issue in this case is whether WPS, acting on behalf of CMS, properly established April 4, 2018, as the effective date of reactivation of Petitioner’s Medicare billing privileges.

IV. Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(15), 498.5(l)(2); see also Soc. Sec. Act (Act) § 1866(j)(8) (codified at 42 U.S.C. § 1395cc(j)(8)).

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

A.  Applicable Law

1. Enrollment

Petitioner participates in the Medicare program as a “supplier” of services.  Social Security Act (Act) § 1861(d); 42 C.F.R. § 498.2.  To receive Medicare payments for the services it furnishes to program beneficiaries, a prospective supplier must enroll in the Medicare program.  42 C.F.R. § 424.505.  “Enrollment” is the process by which CMS and its contractors:  (1) identify the prospective supplier; (2) validate the supplier’s eligibility to provide items or services to Medicare beneficiaries; (3) identify and confirm a supplier’s owners and practice location; and (4) grant the supplier Medicare billing privileges.  42 C.F.R. § 424.502.

To enroll, a prospective supplier must complete and submit an enrollment application.  42 C.F.R. §§ 424.510(d)(1), 424.515(a).  An enrollment application is either a CMS‑approved paper application or an electronic process approved by the Office of Management and Budget.  42 C.F.R. § 424.502.  When CMS determines that a prospective supplier meets the applicable enrollment requirements, it grants Medicare billing privileges, which means that the supplier can submit claims and receive payments from Medicare for covered services provided to program beneficiaries.

The effective date for its billing privileges “is the later of the date of filing” of a subsequently approved enrollment application or “the date that the supplier first began furnishing services at a new practice location.”  42 C.F.R. § 424.520(d) (emphasis added).  The “date of filing” is the date that the Medicare contractor “receives” a signed enrollment application that the Medicare contractor is able to process to approval.  73 Fed. Reg. 69,726, 69,769 (Nov. 19, 2008); Donald Dolce, M.D., DAB No. 2685 at 8 (2016).  CMS may allow a supplier to bill retrospectively for up to 30 days prior to the effective date.  42 C.F.R. § 424.521(a)(1).

Page 6

2. Revalidation

To maintain its billing privileges, a supplier must, at least every five years, resubmit and recertify the accuracy of its enrollment information, a process referred to as “revalidation.”  42 C.F.R. § 424.515.  In addition to periodic revalidations, CMS may, at other times and for its own reasons, ask a supplier to recertify the accuracy of its enrollment information.  42 C.F.R. § 424.515(d).  A supplier must submit an appropriate enrollment application with complete and accurate information and supporting documentation within 60 days of receiving CMS’ notice to recertify.  42 C.F.R. § 424.515(a)(2).

3. Deactivation

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).  CMS is authorized to deactivate an enrolled supplier’s Medicare billing privileges if the enrollee “does not furnish complete and accurate information and all supporting documentation within 90 calendar days of receipt of notification from CMS to submit an enrollment application and supporting documentation, or resubmit and certify to the accuracy of its enrollment information.”  42 C.F.R. § 424.540(a)(3).

If CMS deactivates a supplier’s 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).  If a supplier’s failure to respond to a development request results in the provider’s Medicare billing privileges being deactivated, the supplier is required to submit a new enrollment application in order to revalidate its billing privileges.  See Medicare Program Integrity Manual (MPIM) (CMS Pub. 100-08) § 15.29.4.3.

4. Reactivation

The reactivation of an enrolled supplier’s billing privileges is governed by 42 C.F.R. § 424.540(b).  The process for reactivation is contingent on the reason for deactivation.  If CMS deactivates a supplier’s billing privileges for a reason other than nonsubmission of a claim, the supplier must apply for CMS to reactivate its Medicare billing privileges by completing and submitting the appropriate enrollment application(s) or recertifying its enrollment information, if deemed appropriate.  42 C.F.R. § 424.540(a)(3), (b)(1).

Page 7

B.  Analysis

1. The effective date of Vision Services, PC’s Medicare reactivation application is April 4, 2018, as that is the date WPS received the application it subsequently processed to approval.

On April 4, 2018, WPS received an enrollment application from Petitioner that it ultimately processed to approval.  CMS Exs. 19, 22.  The record before me reflects no earlier application submitted by Petitioner that WPS processed to approval.  Therefore, April 4, 2018, the date WPS received a revalidation application from Petitioner that it was able to subsequently approve, is the correct effective date of revalidation for Petitioner.  42 C.F.R. § 424.520(d); Urology Grp. of NJ, LLC, DAB No. 2860 at 7-9 (2018); Willie Goffney, Jr., M.D., DAB No. 2763 at 7 (2017), aff’d sub nom. Goffney v. Azar, No. CV 17-8032 MRW (C.D. Cal. Sept. 25, 2019), aff’d sub nom. Goffney v. Becerra, 995 F.3d 737 (9th Cir. 2021).

2. I have no authority to review WPS’ rejections of Petitioner’s earlier applications or consider Petitioner’s equitable claims for relief.

Petitioner has provided no basis in law or fact that would permit me to modify the effective date determined by WPS.  While Petitioner did file revalidation applications on July 26, 2017, December 4, 2017, and January 24, 2018, WPS explicitly rejected each of these prior applications, citing Petitioner’s failure to timely respond to its requests for development.  CMS Exs. 10-12; 13-15; 16-18.

Petitioner now contends it did not consistently receive notices from WPS, that WPS did not reliably provide information as needed for Petitioner to successfully complete its earlier applications, and that the notices it did receive from WPS were generally “confusing.”  P. Req. for Hearing at 1-2.  Petitioner otherwise contends WPS’ approval of Dr. Christensen’s individual application on May 30, 2017 led it to believe it could bill Medicare for services because that notice to Dr. Christensen of his successful validation included Petitioner’s NPI and PTAN numbers.  P. Br. at 3-5.  As such, Petitioner claims there is a legal basis to conclude WPS had revalidated its enrollment on May 30, 2017.  Id. at 5.

Regardless of the merits of Petitioner’s complaints concerning WPS, the applicable regulations do not permit me to review rejection of earlier applications, which are not initial determinations under 42 C.F.R. § 498.3(b).  See 42 C.F.R. § 424.525(d); see also James Shepard, M.D., DAB No. 2793 at 8 (2017) (providing 42 C.F.R. § 424.525(d) “plainly prohibits” ALJ review of a rejected application because there are no appeal rights for such a determination).  Here, there are three prior applications submitted by Petitioner that WPS clearly rejected.  I cannot consider the merits of those denials.

Page 8

But in any case, Petitioner could not have reasonably concluded that Dr. Christensen’s successful revalidation in April 2017 also applied to itself merely because WPS listed Vision Services’ NPI and PTAN numbers on the April 26, 2017 notice to Dr. Christensen of his successful individual revalidation.  That notice made clear that Petitioner would still need to revalidate its own enrollment as a group biller.  CMS Ex. 6 at 1 (“The below application is needed for the group revalidation, the application already submitted will just revalidate the individual PTAN for the above provider.”).  WPS explicitly stated in that notice that Petitioner would need to submit a CMS-855B group enrollment application by May 26, 2017 in order to revalidate its own enrollment.  Id.  Petitioner cannot have reasonably relied on WPS’ April 26, 2017 notice of revalidation to Dr. Christensen to assume it had also been revalidated.

Petitioner’s complaint that it did not receive all of WPS’ requests for development after submitting each of the three earlier rejected applications is also unavailing.  The fact that Petitioner continued to submit applications in July 2017, December 2017, and January 2018 suggests that Petitioner in fact received correspondence from WPS that indicated the need to provide more information or file a new application.  And the fact that WPS had held payments to Petitioner as of May 2017 and then stopped them altogether in July 2017 should have made clear to Petitioner that it needed to rectify an issue with WPS, regardless of the quality of communications between that contractor and Petitioner.  In any event, there is no legal basis to award an earlier effective date for Petitioner’s revalidation.

I recognize that from Dr. Christensen’s perspective, he made considerable effort to comply with the requirement to revalidate Petitioner’s enrollment.  He sought the assistance of his congressional representative’s office and claims to have received fuller explanations as to nature of the defects in his earlier applications through that route than he received directly from WPS.  P. Req. for Hearing at 1.  I am sympathetic to his claim that WPS did not reliably or effectively communicate with him as to what if any missing information his staff needed to provide in four attempts at revalidation.  Though nothing in Petitioner’s submissions suggests any clear error on the part of WPS, inadequate or inconsistent efforts at communication by CMS’ administrative contractors would not be without precedent.

Nevertheless, Petitioner’s request to modify its effective date of enrollment has no basis in law, and is therefore a plea for equitable relief, which I do not have the authority to grant, whatever its merits.  See, e.g., US Ultrasound, DAB No. 2302 at 8 (2010) (“Neither the ALJ nor the Board is authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements.”); Pepper Hill Nursing & Rehab. Ctr., LLC, DAB No. 2395 at 11 (2011) (holding the ALJ and Board were not authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements).

Page 9

My jurisdiction is instead limited to review of CMS’ determinations of the effective dates of Petitioner’s enrollment application under 42 C.F.R. § 424.520(d).  WPS properly determined April 4, 2018 to be Petitioner’s effective date of enrollment because that is the earliest date WPS received an application that it was able to successfully approve.

3. CMS should consider paying Petitioner for billing held or stopped during the billing gap because of WPS’ failure to adequately notify Petitioner of its deactivation.

Though I have ruled in CMS’ favor, it is worth noting here that WPS’ July 7, 2017 purported notice of deactivation is inadequate because it failed to actually apprise Petitioner of the deactivation of its billing status in any meaningful sense.  CMS Ex. 9 at 1.  WPS’ notice merely states “We have stopped your Medicare billing privileges on July 5, 2017, because you haven’t revalidated your enrollment record with us, or you didn’t respond to our requests for more information.  We will not pay any claims after this date.”  Id.

Telling a supplier its Medicare billing privileges have been “stopped” utterly fails to apprise that supplier of the import of deactivation – namely, that the supplier would never receive payment for any services rendered during the period of deactivation.  By contrast, a supplier subject to a temporary hold on payments (referred to in CMS parlance as a “Pend status,” and which occurred here on May 9, 2017) would eventually receive those payments after successfully revalidating.  See MPIM (Rev. 578) § 15.29.3.2 (requiring imposition of a pend status 71 to 75 days after notice of revalidation if a revalidation application has not been received, which results in all payments being held); MPIM (Rev. 578) § 15.29.4.2 (requiring CMS contractors to release all held payments to a supplier upon receipt of a revalidation application).  While the notice here indicates WPS would not pay claims after this date, Petitioner could not have known that having its privileges “stopped” meant it would never receive payments for services rendered after that date until it successfully revalidated its enrollment status.

Moreover, by failing to adequately apprise Petitioner of its deactivation, WPS made it virtually impossible for Petitioner to recognize the fact of deactivation4 and appeal that action through the rebuttal process provided in the regulations.  See 42 C.F.R. § 424.545(b) (providing a separate review process for a provider or supplier dissatisfied with their deactivation who file a rebuttal with CMS’ administrative contractor).

Page 10

The inadequacy of WPS’ notice is made plain by comparison with the model language for deactivation notices set forth by CMS in 2015, which WPS pointedly failed to use.  See MPIM (Rev. 578) § 15.24.5.4 (providing a model notice of deactivation headlined “NOTICE OF DEACTIVATION OF MEDICARE BILLING PRIVILEGES” and stating “This is to inform you that your Medicare [PTAN] . . . has been deactivated . . . . ”).5   CMS required its contractors to actually use the words “deactivation” and “deactivate” in notices to suppliers in order to adequately provide notice under the regulations.  WPS did not comply with this guidance from CMS in this case.

Unfortunately, while I find this error both significant and prejudicial to Petitioner, I do not have jurisdiction to review this action because deactivation is not an “initial determination” subject to review by an administrative law judge.  See 42 C.F.R. § 498.3(b)(6); Urology Grp., DAB No. 2860 at 6 (“The regulations do not grant suppliers the right to appeal deactivations.”).

While Petitioner certainly failed to act with sufficient urgency in the revalidation process, I urge CMS to consider that Petitioner was not afforded adequate notice of deactivation or informed of its ability to seek relief through the rebuttal process provided in the regulations.  Because of the deficient notice of deactivation, CMS could find that Petitioner’s enrollment was in fact never deactivated, putting all payments after May 9, 2017 in a “pend status” until April 4, 2018, the effective date of revalidation, thus allowing Petitioner to receive payment for services rendered during that period.  MPIM (Rev. 578) §§ 15.29.3.2,15.29.4.2

VI.  Conclusion

For the foregoing reasons, I affirm CMS’ determination of the effective date of Petitioner’s Medicare enrollment to be April 4, 2018.

1. Petitioner erroneously contends CMS deactivated both Dr. Christensen’s individual enrollment and Vision Services’ group enrollment from July 5, 2017 through April 4, 2018.  P. Br. at 1-2.  In fact, CMS revalidated Dr. Christensen’s individual enrollment as a biller to the Medicare program on May 30, 2017, CMS Ex. 8 at 1, and deactivated only the group billing privileges of Vision Services.  CMS Ex. 1 at 1-2; CMS Ex. 9 at 1.  Thus, while this matter is docketed as an appeal by both Dr. Christensen and Vision Services, the only issue before me is whether CMS had a basis to determine the effective date of reactivation for Vision Services.  In his individual capacity, Dr. Christensen is not a party with a right to a hearing before me.  42 C.F.R. §§ 498.5(e), 498.40(a)(1), 498.42.  I therefore refer only to Vision Services as the Petitioner in this decision.
• back to note 1
2.  CMS identified Exhibit 9 as a “Deactivation Notification Letter” when it uploaded this document to the docket for this case in the DAB E-file system, but this notice nowhere states that Petitioner’s billing privileges were deactivated.  It only states “We have stopped your Medicare billing privileges on July 5, 2017.”  CMS Ex. 9 at 1.  However, the regulations specify “Deactivate means that the provider or supplier’s billing privileges were stopped, but can be restored upon the submission of updated information.”  42 C.F.R. § 424.502 (emphasis added).  WPS’ notice to Petitioner that it had “stopped” Petitioner’s Medicare billing privileges thus amounts, however obliquely, to a notice of deactivation.  I address this further infra at p. 9.
• back to note 2
3.  August 22, 2001 is the date of Petitioner’s initial enrollment as a biller to the Medicare program, not the effective date of revalidation at issue here.
• back to note 3
4.  Adding to the confusion, WPS continued to threaten Petitioner with deactivation in each request for development that followed Petitioner’s subsequent attempts to file applications.  CMS Ex. 11 at 1; CMS Ex. 14 at 1; CMS Ex. 17 at 1; CMS Ex. 20 at 1.  No supplier would assume deactivation had already taken place if subsequent efforts at revalidation caused the contractor to continue warning of possible deactivation.
• back to note 4
5.  CMS’ “model” language is itself deficient because it fails to apprise a deactivated supplier of the rebuttal process provided for in the regulations that is the only means to contest a deactivation action.  42 C.F.R. § 424.545(b).  CMS should modify this language to better inform suppliers of their rights under the regulations.
• back to note 5