Clifford L. Thacker, M.D., DAB CR6089 (2022)

DECISION

Petitioner, Clifford L. Thacker, M.D., challenges the revised reconsidered determination by the Centers for Medicare & Medicaid Services (CMS) to revoke his Medicare enrollment and billing privileges.  CMS took this action pursuant to 42 C.F.R. § 424.535(a)(1) because Petitioner did not comply with the documentation and access requirements at 42 C.F.R. § 424.516(f)(2).  I find there was a legitimate basis to revoke Petitioner's Medicare enrollment and billing privileges for the reasons stated below.

I.  Background and Procedural History

Petitioner was enrolled in the Medicare program as a physician.  CMS Exhibit (Ex.) 2.  A physician is considered a "supplier" of services in the Medicare program.  42 U.S.C. § 1395x(d); 42 C.F.R. § 400.202.  On January 24, 2020, a request for the medical records of 20 specified Medicare beneficiaries was sent to him by Southeastern Unified Program Integrity Contractor, SafeGuard Services, LLC, a Medicare contractor.  CMS Ex. 1.  This request was sent to Petitioner at P.O. Box 2147, Fort Meyers, FL  33902, the address on his Medicare enrollment record.  CMS Exs. 1, 2.  A follow up request was sent on July 15, 2020 when no records were received from Petitioner.  CMS Ex. 2.  On August 17, 2020, Dr. Thacker was notified that his Medicare privileges were being revoked effective

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September 16, 2020 because of his failure to provide CMS with access to the requested documentation, in violation of 42 C.F.R. § 424.516(f)(2).  Petitioner (P.) Exs. B, E6.  Petitioner filed a request for reconsideration on August 26, 2020, asserting that he no longer had access to the requested records.  P. Exs. D, E, and E4.  In a reconsidered determination dated September 17, 2020, Petitioner was notified that he had failed to comply with the documentation and access requirements of 42 C.F.R. § 424.516(f)(2)(i) and, as a result, the revocation of his Medicare enrollment was upheld.  CMS Ex. 3.  Following submission of additional evidence and argument by Petitioner, a revised reconsidered determination was issued on October 6, 2020.  P. Ex. A.  However, CMS again affirmed the determination to revoke Petitioner's Medicare enrollment under the provisions of 42 C.F.R. § 424.535(a)(10).  Petitioner filed a timely request for an administrative law judge (ALJ) hearing that was received on October 30, 2020.

On November 2, 2020, Judge Leslie Weyn issued an Acknowledgment and a Standing Prehearing Order, which directed the parties to file their respective pre-hearing exchanges.1   CMS filed a Motion for Summary Judgment and Memorandum in Support of Motion (CMS Motion), along with three proposed exhibits (CMS Exs. 1-3).  Petitioner filed a response to the motion (P. Response) on December 31, 2020.  Judge Weyn issued an Order to Show Cause on January 13, 2021 because Petitioner's December 31, 2020 submission failed to comply with paragraphs 4, 5, and 8 of the Standing Prehearing Order and § 14 of the Civil Remedies Division Procedures.  On January 29, 2021, Petitioner submitted 17 proposed exhibits2 and a Response to Order to Show Cause.  In the absence of any objections, I admit CMS Exs. 1-3 and P. Exs. A-E, E1-E6, and F-K into the record.

Petitioner submitted the written direct testimony of one witness but CMS has not requested to cross-examine that witness.  As a result, a hearing for the purpose of cross-examination is not necessary.3   See Standing Prehearing Order § 10.  I consider the record in this case to be closed and the matter is ready for a decision on the merits.

II.  Issue

Whether CMS had a legitimate basis to revoke Petitioner's Medicare enrollment and billing privileges, pursuant to 42 C.F.R. § 424.535(a)(10).

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III.  Jurisdiction

I have jurisdiction to decide this issue.  42 C.F.R. §§ 498.3(b)(17), 498.5(l)(2); see also 42 U.S.C. § 1395cc(j)(8).

IV.  Findings of Fact, Conclusions of Law, and Analysis4

The Social Security Act (Act) authorizes the Secretary of Health and Human Services to establish regulations for enrolling providers and suppliers in the Medicare program.  42 U.S.C. § 1395cc(j)(1)(A).  Suppliers must enroll in the Medicare program and receive a billing number in order to obtain payment for services rendered to Medicare beneficiaries.  42 C.F.R. § 424.505.

The regulations delegate to CMS the authority to revoke the enrollment and billing privileges of suppliers.  42 C.F.R. § 424.535.  CMS or a Medicare contractor may revoke a supplier's Medicare enrollment and billing privileges for a number of specified reasons, including, as relevant here, when the supplier does not maintain appropriate documentation or fails to grant CMS the access specified in § 424.516(f).  42 C.F.R. § 424.535(a)(10).  After CMS revokes a supplier's enrollment and billing privileges, CMS bars the supplier from reenrolling in the Medicare program for a minimum of one year but not greater than 10 years.  42 C.F.R. § 424.535(c)(1)(i).

1. Petitioner did not maintain documentation, as described in 42 C.F.R. § 424.516(f)(2)(ii), for seven years from the date of ordering, certifying, referring, or prescribing Part A or B services, items, or drugs, as required by 42 C.F.R § 424.516(f)(2)(i)(A). 
2. Petitioner did not, upon request of CMS or a Medicare contractor, provide access to the documentation described in 42 C.F.R. § 424.516(f)(2)(ii), as required by 42 C.F.R. § 424.516(f)(2)(i)(B).
3. The evidence establishes that there is a legitimate basis to revoke Petitioner's Medicare enrollment and billing privileges, pursuant to 42 C.F.R. § 424.535(a)(10).

The facts in this matter are not in dispute.  Petitioner signed a contract with Telemed Health Group LLC (THG) to work as an independent contractor providing telemedicine medical services and he worked in that capacity from June 29, 2017 through October 2017.  P. Exs. E2, E1 at 1.  According to the written statement of Dr. Thacker, he would use THG's online portal to review electronic medical records (EMR) provided by THG

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and then enter his medical notes into the EMR.  P. Ex. E1 at 1.  He stated that while employed at THG, he created and maintained medical records for all patients but the electronic records were the property of THG and he no longer had access to the EMR after he stopped working there.  P. Exs. E1, F at 1.  He also alleged he never participated in any fraudulent scheme and only ordered durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) that he deemed medically necessary.  P. Ex. F at 1.

Under the provisions of 42 C.F.R. § 424.535(a)(10)(i), CMS is authorized to revoke a currently enrolled supplier's enrollment if "[t]the provider or supplier did not comply with the documentation or CMS access requirements specified in § 424.516(f) of this subpart."  42 C.F.R. § 424.516(f)(2)(i), governing physicians, provides that

(i) A physician or, when permitted, an eligible professional who orders, certifies, refers, or prescribes Part A or B services, items or drugs is required to -

(A) Maintain documentation (as described in paragraph (f)(2)(ii) of this section) for 7 years from the date of the service; and

(B) Upon request of CMS or a Medicare contractor, to provide access to that documentation (as described in paragraph (f)(2)(ii) of this section).

Petitioner does not argue that he maintained the specified documentation of the beneficiaries identified in CMS Ex. 1 at 6 or that he provided access to that documentation when it was requested.  Rather, he argues that under his contract with Telemed:

he was never the record custodian, that he could only access the medical records while employed at Telemed, at the direction of Telemed, and on Telemed's platform.  The moment in which Petitioner stopped working for Telemed, he was prohibited by contract to have any access to any of the Telemed's proprietary information which included the medical records.  Petitioner is not a custodian of these records.

P. Response at 2 (emphasis in original).

He also alleged that under Florida law, he is not obligated to maintain a copy of the medical records when his employer designates the employer as the records owner and his contract with THG clearly indicates that he is not the owner of the records.  P. Ex. E1 at 2.  As a result, he asserts that he did "not have a duty to maintain the records."  Id.

Petitioner's arguments are initially premised on the notion that the above regulation only applies to "those physicians that are actual custodians of the medical records."

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P. Response at 3.  He cites as support for this argument, not the regulation, but language in the preamble to the Final Rule indicating that

We require that a good faith effort is made to comply with this rule.  However, we understand that from time to time situations arise that are outside of the control of these custodians.  In such a case, we may conduct an analysis based on the specific facts and circumstances involved in a particular case.  77 Fed. Reg. 25,284, 25,310 (April 27, 2012).  (emphasis added).

Id.

The regulations requiring document retention and disclosure by physicians were published in a final rule on April 27, 2012.  77 Fed. Reg. 25,284.  In the summary of the final rules, it is clearly stated that the rule "mandates document retention and provision requirements on providers and supplier [sic] that order and certify items and services for Medicare beneficiaries."  77 Fed. Reg. 25,284.  The final rules implemented The Patient Protection and Affordable Care Act (Pub. L. No. 111-148), as amended by the Health Care and Education Reconciliation Act of 2010 (Pub. L. No. 111-152) (collectively known as the Affordable Care Act), with the purpose of promoting "the furnishing of quality care, while protecting the integrity of the program."  Id.  To establish accountability measures to ensure compliance with the ordering and referring provisions, Section 6406 of the Affordable Care Act amended § 1842(h) of the Act by adding a new paragraph which states:

The Secretary may revoke enrollment, for a period of not more than one year for each act, for a physician or supplier under section 1866(j) if such physician or supplier fails to maintain and, upon request of the Secretary, provide access to documentation relating to written orders or requests for payment for durable medical equipment, certifications for home health services, or referrals for other items or services written or ordered by such physician or supplier under this title, as specified by the Secretary.

77 Fed. Reg. 25,284, 25,309.

The statutory language gives no support to the argument that the regulation implemented to effectuate the statute only applied to a custodian of a record.  It is clear that the purpose of the revision was to ensure that physicians ordering durable medical equipment or making referrals for services covered by Medicare could provide supportive documentation for those actions after the fact.  The preamble to the final regulation refers to the revised regulations as the " Requirement for Physicians, Other Suppliers, and Providers to Maintain and Provide Access to Documentation on Referrals to Programs at High Risk of Waste and Abuse."  77 Fed. Reg. 25,284, 25,309.  To limit those provisions to only those who "possess" the records would circumvent the purpose of the statute,

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which was to maintain the integrity of the Medicare program by requiring physicians to document and support their actions when Medicare funds are expended.  To allow a physician to avoid having to document orders and referrals covered by Medicare by simply not retaining records would not be in keeping with the statutory mandate to "establish accountability measures to ensure compliance with the ordering and referring provisions."  77 Fed. Reg. 25,284, 25,309.

To be sure, as Petitioner points out, there is a reference to "custodians" in the regulatory preamble.  However, the citation provided by Petitioner is incomplete and taken out of context.  The reference to custodians was made in response to a comment inquiring whether a home health agency would be considered to have forged documentation if the documentation could not be produced by the physician but could be found in the home health agency's documentation.  What Petitioner fails to acknowledge is that the agency first responded that "[t]his final rule places the responsibility for the maintenance of records on both the ordering and certifying physician and the provider and supplier."  77 Fed. Reg. 25,284, 25,310.  The language in the preamble presumes that a physician is already in possession of records, making him or her a custodian of those records.  However, the preamble does not suggest that it is not necessary for a physician to possess the requisite records.

To the contrary, the preamble also makes clear in a discussion of situations in which records would not typically be retained by the physician, such as referrals for DMEPOS at a hospital or nursing home discharge, that "[t]he physician or other eligible professional who signed the order or certification is responsible for maintaining and disclosing the documentation."  Id.  Thus, the language in the preamble does not support Petitioner's argument that he was not required to maintain and disclose the specified beneficiaries' records.

Petitioner then argues that, under Florida law, his obligation to maintain a copy of the medical records does not apply when the contract with the health care employer designates the employer as the records owner, which was the case with his employment contract.  P. Ex. E1 at 2.  While this may, in fact, be Florida law, it does not negate the federal obligation of a physician participating in the Medicare program to comply with the provisions of 42 C.F.R. § 424.516(f).  Petitioner cites no authority to counter the presumption that the preemption clause would apply here.

Finally5 , Petitioner argues that CMS failed to exercise its discretion and conduct an analysis of the facts and circumstances prior to making a determination and instead

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revoked Petitioner's enrollment and billing privileges simply because he failed to provide the records requested.  P. Response at 4.  This argument apparently presumes that CMS did not analyze the facts and circumstances prior to revocation.  A review of the reconsidered determination and the revised reconsidered determination indicates extensive discussion of the facts and arguments presented by Petitioner.  CMS Ex. 3; P. Ex. A.  CMS did exercise its discretion but not in a manner favoring Petitioner.  As the Departmental Appeals Board (Board) stated in George M. Young, M.D., DAB No. 2750 at 11 (2016), "[i]t is within CMS's discretion to determine whether a particular physician's circumstances warrant a decision not to pursue revocation."  The Board further stated that

To the extent CMS exercised its discretion in ultimately deciding to go forward with revocation in Petitioner's case, it is not for the ALJ and the Board to look behind that exercise of discretion to ask whether he or she, or the Board, standing in CMS's shoes, would reach the same decision to revoke.  Sandra E. Johnson, CRNA, DAB No. 2708, at 16 (2016); see also Brian K. Ellefsen, D.O., DAB No. 2626 (2015) (where CMS has legal authority to deny an enrollment application, neither the ALJ nor the Board may substitute discretion as to whether denial was appropriate, but may review whether CMS exercised that discretion).  As stated earlier, the inquiry for the ALJ and the Board is to determine whether the stated basis for revocation, as found in the decision on reconsideration, is grounded in law and fact.  If it is, then upholding the determination to revoke is proper.

Young, DAB No. 2750 at 11.

In this case, the stated basis for revocation, that of failure to maintain records and grant access to those records by  Petitioner, is grounded in law and fact.  Accordingly, I find that CMS had a legitimate basis for revoking Petitioner's Medicare enrollment and billing privileges, pursuant to the provisions of 42 C.F.R. § 424.535(a)(10).

V.  Conclusion

For the reasons explained above, I affirm the revocation of Petitioner's Medicare enrollment and billing privileges, pursuant to 42 C.F.R. § 424.535(a)(10).

1. This case was transferred to me on April 22, 2022.
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2. Petitioner's submissions still did not comply with Judge Weyn's Standing Prehearing Order, which required that proposed exhibits be "[d]esignated with a separate, unique, and whole identifying number (i.e., "1")."  Prehearing Order § 5(c). However, because there is no apparent prejudice to CMS and CMS has not expressed any objection, I will admit these exhibits.
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3. Because an in-person hearing for the purpose of cross-examination is not necessary, I need not rule on CMS's motion for summary judgment.
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4. My findings of fact and conclusion of law are set forth in italics and bold font.
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5. While Petitioner raised a number of other arguments in Petitioner's Pre-Hearing Brief and supporting documents submitted with the Request for Hearing, such as the negative consequences of the regulatory requirements to maintain and disclose records on the use of electronic records, arguments are beyond the scope of the issues before me.  As a result, those arguments are not addressed in this decision.
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