Edward H. Tiley, III, M.D., Inc., DAB CR5542 (2020)

DECISION

Petitioner, Edward H. Tiley, III, M.D., Inc., challenges the effective date of its Medicare enrollment application dated June 12, 2017, following a period of deactivation resulting from a failure to revalidate.  As explained herein, I find Respondent, the Centers for Medicare & Medicaid Services (CMS), properly established June 12, 2017 as the effective date of Petitioner’s enrollment, as it is the filing date of its successful application.

I. Background

On August 17, 2016, CMS contractor Palmetto GBA (Palmetto) advised Petitioner that it was obligated to revalidate its Medicare enrollment record by October 31, 2016.  CMS Exhibit (Ex.) 1.  Palmetto notified Petitioner by mail in a letter addressed to Petitioner’s office location.  CMS Ex. 1 at 5. 

On November 2, 2016, Palmetto notified Petitioner’s sole owner, Edward H. Tiley, III, M.D. (Dr. Tiley) by letter addressed to Petitioner’s office location to revalidate his

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individual enrollment record by January 31, 2017.  CMS Ex. 2.  Both of Palmetto’s August 17, 2016 and November 2, 2016 revalidation notices warned Petitioner and Dr. Tiley that “[f]ailure to respond to this notice will result in a hold on your payments, and possible deactivation of your Medicare enrollment.”  CMS Exs. 1, 2.

On January 26, 2017, Palmetto notified Petitioner it would hold all payments on Petitioner’s Medicare claims due to Petitioner’s failure to revalidate its Medicare enrollment.  CMS Ex. 3 at 1.  Similarly, Palmetto advised Dr. Tiley on February 7, 2017 that it would hold all payments to him for Medicare claims because he had failed to revalidate his individual Medicare enrollment.  CMS Ex. 4 at 1.  Palmetto warned both Petitioner and Dr. Tiley that if they failed to revalidate their enrollment, they would “not be paid for services rendered during the period of deactivation,” resulting in a gap in reimbursement.  CMS Exs. 3, 4.Neither Petitioner nor Dr. Tiley responded to these notices. 

As a result, Palmetto advised Petitioner on April 5, 2017 that its billing privileges were stopped as of that day because Petitioner failed to revalidate its Medicare enrollment.1   CMS Ex. 5 at 1.  Consequently, on June 12, 2017, Petitioner submitted an electronic revalidation application via the Provider Enrollment, Chain and Ownership System (PECOS).  CMS Ex. 14.  Palmetto approved Petitioner’s application on July 14, 2017 and reactivated the billing privileges of both the Petitioner and Dr. Tiley effective June 12, 2017.  CMS Ex. 8. 

Petitioner asked Palmetto to reconsider the effective date determination because it had not received any correspondence from Palmetto.  CMS Ex. 9.  On November 22, 2017, Palmetto issued an unfavorable decision upholding its effective date determination of June 12, 2017.  CMS Ex. 9.  Petitioner timely requested a hearing before an administrative law judge (ALJ), and I was designated to hear and decide this case. 

II. Admission of Exhibits and Decision on the Record

On January 25, 2018, I issued an Acknowledgment and Pre‑hearing Order (Pre‑hearing Order) setting forth a schedule for the parties to submit arguments and evidence.  CMS filed a motion for summary judgment and brief (CMS Br.) and 16 proposed exhibits (CMS Exs. 1-16).  Petitioner filed a brief (P. Br.) opposing summary judgment and

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proposed one exhibit entitled “medicare denied claims” (P. Ex. 1).  Petitioner also submitted a witness list of eight proposed witnesses (P. Witness List). 

Petitioner made no objections to CMS’s proposed exhibits.  I therefore admit CMS Exs. 1‑16 into the record.  CMS filed objections to Petitioner’s exhibit and proposed witnesses (CMS Objections).  CMS first objected to P. Ex. 1, which documents Petitioner’s denied Medicare claims.  CMS Objections at 2.  CMS argues the exhibit is irrelevant, exposes confidential information, and fails to comply with the Pre-Hearing Order’s requirements for exhibit preparation (Pre-Hearing Order ¶ 5).  Id.  Petitioner did not respond to CMS’s objections. 

There is no dispute that Petitioner was deactivated from April 5, 2017 until June 11, 2017.  As such, there is no need to corroborate the billing gap with Petitioner’s denied claims.  P. Ex. 1 is irrelevant.  Therefore, I sustain CMS’s objection and do not admit P. Ex. 1 into the record.

CMS also objected to Petitioner’s proposed witnesses because Petitioner failed to submit sworn, written direct testimony for each proposed witness as required by my Pre-Hearing Order ¶ 8.  CMS Objections.  In response, Petitioner provided written direct testimony for six witnesses in separate submissions entitled “medicare_signed forms” 1 through 6 (P. Exs. 2-7). 

I find good cause to allow the late filing of written direct testimony for these six witnesses (P. Exs. 2-7).  While P. Exs. 2-7 are not sworn statements, they are signed by their respective declarants.  I find this testimony minimally relevant as each witness corroborates Petitioner’s assertion that no one in the office received Palmetto’s notifications.  Consequently, I admit P. Exs. 2-7.  Petitioner did not provide written statements for its two remaining proposed witnesses.  I therefore reject them as witnesses in this proceeding.

CMS has neither identified witnesses nor requested cross‑examination of Petitioner’s witnesses.  As a result, I will not hold an in-person hearing in this matter, and I issue this decision based on the written record.2  Civ. Remedies Div. P. § 19(d).

III. Issue

Whether CMS had a legitimate basis for establishing June 12, 2017, as the effective date of Petitioner’s reactivated billing privileges.

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IV. Jurisdiction

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

V. Findings of Fact, Conclusions of Law, and Analysis3

A. Applicable Law

1. Enrollment

Petitioner participates in the Medicare program as a “supplier” of services.  Social Security 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 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” 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).  In this case, the date of filing of Petitioner’s subsequently-approved enrollment application is relevant.  If a supplier satisfies certain requirements, 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).

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

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enrollment information.  42 C.F.R. § 424.515(d).  Within 60 days of receiving CMS’s notice to recertify, the supplier must submit an appropriate enrollment application with complete and accurate information and supporting documentation.  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). 

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 due to 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).

B. Analysis

1. Petitioner filed a subsequently approved revalidation application on June 12, 2017, and the effective date of its Medicare enrollment can be no earlier than that date.

Petitioner submitted a revalidation application on June 12, 2017.  CMS Ex. 2.  There is no dispute that Petitioner’s application submitted on June 12, 2017 was the only application Palmetto received and could subsequently approve.  Therefore, pursuant to 42 C.F.R. § 424.520(d), the date Petitioner filed its subsequently approved enrollment application – June 12, 2017 – is the correct effective date of enrollment.  Urology Grp. of NJ, LLC, DAB No. 2860 at 7-9 (2018); Willie Goffney, Jr., M.D., DAB No. 2763 (2017) at 7.

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2. I have no authority to review the deactivation of Petitioner’s billing privileges and cannot afford it equitable relief.

Petitioner argues it did not receive Palmetto’s notices regarding revalidation, though they were addressed to Petitioner’s office.  P. Br. at 1.  Petitioner also argues three other physicians within the office failed to receive their own revalidation notices from Palmetto.  Id.  Petitioner further suggests Palmetto’s payment hold notifications, dated January 26, 2017 and February 7, 2017 respectively, were created after Petitioner was deactivated on April 5, 2017.  Id.

As to the latter claim, Petitioner has provided no evidence that even suggests Palmetto generated false revalidation notices after the fact.  And even if I were to fully credit Petitioner’s assertion that it never received any notices from Palmetto, I have no authority to review CMS’s decision to deactivate a supplier.  Urology Grp.,DAB No. 2860 at 6 (“The regulations do not grant suppliers the right to appeal deactivations.”); Goffney,DAB No. 2763 at 6 (“Only facts relevant to the effective date resulting from the . . . application were material to the ALJ decision”).

This is because deactivation is not an “initial determination” subject to administrative law judge review (deactivation decisions have a separate review process).  See 42 C.F.R. §§ 424.545(b), 498.3(b); see also Goffney, DAB No. 2763 at 4-5.  My jurisdiction in this case is limited to reviewing the effective date of the approval of Petitioner’s reactivation enrollment application.  42 C.F.R. § 498.3(b)(15).  Unfortunately, while I am sympathetic to Petitioner’s claim that it was deactivated through no fault of its own, I have no authority to revise the effective date of enrollment established by CMS in this case. 

VI. Conclusion

For the reasons explained above, I affirm CMS’s determination that June 12, 2017 is the effective date of Petitioner’s Medicare enrollment and billing privileges.

1. It appears from the record before me that Palmetto only notified Petitioner of its deactivation.  CMS Ex. 5.  However, Palmetto had already suspended Dr. Tiley’s billing privileges by April 5, 2017.  CMS Ex. 8 (“PTAN 0526784 [Dr. Tiley’s individual PTAN] ALREADY TERMINATED”); CMS Ex. 5.  Nevertheless, Dr. Tiley’s failure to revalidate his individual Medicare enrollment record by January 31, 2017 made him vulnerable to deactivation by Palmetto.  And, while it is not within my purview to address deactivation determinations, I note Dr. Tiley was not prejudiced since he was assigned an effective date based on his group’s application.  CMS Ex. 8.
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2. CMS’s motion for summary judgment is denied as moot.
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3. My findings of fact and conclusions of law are set forth in italics and bold font.
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