James A. Crane, Ph.D., DAB CR5684 (2020)

DECISION

Petitioner’s Medicare billing number for his enrollment as a sole proprietor was deactivated on December 31, 2017, after he submitted a revalidation enrollment application that lacked information about that billing number and he did not respond to a development request.  Petitioner did not revalidate and reactivate his sole proprietor billing number until November 21, 2018.  For the reasons discussed below, I conclude that the effective date of Petitioner’s reactivated Medicare billing privileges for his sole proprietor billing number remains November 21, 2018, with retrospective billing privileges authorized beginning October 22, 2018.

I.  Background and Procedural History

Petitioner submitted a Form CMS-855I application dated July 7, 2017, to revalidate his Medicare enrollment as a clinical psychologist.  Centers for Medicare & Medicaid Services (CMS) Ex. 1 at 6, 13, 20; see 42 C.F.R. § 424.515 (“To maintain Medicare billing privileges, a provider or supplier . . . must resubmit and recertify the accuracy of its enrollment information every 5 years.”).  Petitioner reported that he had only one practice location in Coalinga, California, with the Department of State Hospitals.  CMS

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Ex. 1 at 6, 13; see CMS Ex. 1 at 12 (“Complete this section for each of your practice locations where you render services to Medicare beneficiaries.”).  The application directed Petitioner to provide “information regarding the person you would like for [CMS] to contact regarding this application” and explained that, “[i]f no one is listed, [CMS] will contact you directly.”  In response, Petitioner submitted the names and contact information for three individuals associated with the Department of State Hospitals.  CMS Ex. 1 at 19, 36-37.  Petitioner listed the same contact email address for each of these individuals and listed that same email address as the contact email address for his sole practice location.  CMS Ex. 1 at 13, 19, 36-37.  Petitioner signed the certification statement for the application, at which time he acknowledged that he had “read the contents of this application, and the information contained herein is true, correct, and complete.”  CMS Ex. 1 at 20, 40.

On July 28, 2017, Noridian Healthcare Solutions (Noridian), a Medicare administrative contractor, sent Petitioner a letter via an email message to the email address listed in his revalidation application.  CMS Exs. 3-4; see CMS Ex. 2 at 3 (written direct testimony of Claire E. Anderson, Provider Education Representative for Noridian, discussing the communication log (CMS Ex. 4)).  Noridian explained that Petitioner had another active provider transaction access number (PTAN) (CP9374) for his “Sole Proprietor Enrollment,” but did not provide enrollment information with respect to that billing number when he revalidated his enrollment record.  CMS Ex. 3 at 1.  Noridian stated that it “need[ed] to verify with him whether or not he still practices at this location” in order to “ensure the application is accurate and up-to-date.”  CMS Ex. 3 at 1.  Noridian also explained that verification of the billing number for Petitioner’s enrollment as a sole proprietor “prevents deactivating a Medicare PTAN that should be active.”  CMS Ex. 3 at 1.  Noridian requested that Petitioner provide, within 30 days, information regarding his sole proprietor enrollment, to include his practice location, remittance and special payments addresses, and electronic funds transfer information.  CMS Ex. 3 at 1-2.

On August 30, 2017, after it did not receive a response to its development request, Noridian sent Petitioner a letter, via email to the same contact email address, notifying him that it had approved his revalidation enrollment application.  CMS Ex. 5 at 1-2.  Noridian explained that it made changes to Petitioner’s enrollment record, to include updating his correspondence address and contact information.  CMS Ex. 5 at 2-3.  However, with respect to Petitioner’s billing number associated with his practice as a sole proprietor, Noridian stated the following:  “We have deactivated the enrollment . . . for dates of service beginning De[cem]ber 31, 2017.”  CMS Ex. 5 at 3.  

On November 21, 2018, Petitioner submitted an enrollment application to reactivate his sole proprietor billing privileges.  CMS Ex. 6.  In a letter dated May 21, 2019, Noridian reactivated those billing privileges, but informed Petitioner of a gap in billing privileges from December 31, 2017, through November 20, 2018.  CMS Ex. 8 at 1.

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Petitioner submitted a request for reconsideration dated July 13, 2019.  CMS Ex. 9 at 2-4.  Petitioner reported that he first learned of his deactivation when he “submitted billing” for services he provided as a sole proprietor.  CMS Ex. 9 at 3.  Petitioner alleged that he “[did not] remember receiving (and signing) anything from [the Department of State Hospitals] authorizing them to change [his] mailing address” and “did not receive any such notice warning [him] that changes were being made.”  CMS Ex. 9 at 4.  Petitioner claimed that the Department of State Hospitals “had ‘ham-handedly’ inserted itself into [his] Noridian Medicare enrollment records, made a number of changes (including the mailing address of record), and did not bother to inform [him] of what they were doing.”  CMS Ex. 9 at 4.  Petitioner argued that the gap in his enrollment resulted in $12,000 in unpaid reimbursements.  CMS Ex. 9 at 4.

Noridian issued a reconsidered determination on September 25, 2019, in which it explained that Petitioner’s July 2017 enrollment application lacked the information necessary to revalidate his sole proprietor billing number.  CMS Ex. 7 at 2, 10.  Noridian discussed that it had sent a development request via email in which it requested a number of revisions and explained that “there was no response” to this request.  CMS Ex. 7 at 2‑4.  Noridian reported that when it issued the August 30, 2017 notice informing Petitioner that it had approved his revalidation application, it informed him that “the PTAN associated with [his] sole proprietor enrollment would be deactivated on December 31, 2017, in accordance with 42 [C.F.R. §] 424.515, as that was the due date for [his] revalidation.”  CMS Ex. 7 at 4.  Noridian informed Petitioner that it did not receive an application from Petitioner to revalidate his sole proprietor enrollment and reactivate his billing number until November 21, 2018, and that, following additional development, it reactivated his sole proprietor billing privileges effective November 21, 2018.  CMS Ex. 7 at 4.  Although Noridian maintained the November 21, 2018 effective date of billing privileges based on the date of receipt of Petitioner’s application to revalidate and reactivate that enrollment, it authorized retrospective billing privileges effective 30 days earlier, beginning October 22, 2018, pursuant to 42 C.F.R. § 424.521.  CMS Ex. 7 at 10.

Petitioner submitted a request for an administrative law judge (ALJ) hearing that was received on November 20, 2019.  See CMS Ex. 10 at 1.  The Civil Remedies Division issued my standing pre-hearing order (Pre-Hearing Order) on December 9, 2019, which directed the parties to file their respective pre-hearing exchanges.  CMS filed a pre‑hearing brief and motion for summary judgment, along with 10 proposed exhibits (CMS Exs. 1-10).  Petitioner filed a response (P. Br.).1   In the absence of any objections, I admit all submitted exhibits into the evidentiary record.

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A hearing for the purpose of cross-examination is unnecessary, because Petitioner has not requested an opportunity to cross-examine CMS’s sole witness, Ms. Anderson.  See CMS Ex. 2; Pre-Hearing Order, §§ 12-14.  I consider the record in this case to be closed, and the matter is ready for a decision on the merits.2

II.  Issue

Whether CMS had a legitimate basis to assign Petitioner a November 21, 2018 effective date for his reactivated Medicare billing privileges as a sole proprietor, with retrospective billing privileges authorized beginning October 21, 2018.

III.  Jurisdiction

I have jurisdiction to hear and decide this case.  42 C.F.R. § 498.3(b)(15); Victor Alvarez, M.D., DAB No. 2325 at 8-12 (2010); see 42 U.S.C. § 1395cc(j)(8).

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

1. Petitioner submitted an enrollment application dated July 7, 2017, for the purpose of revalidating his Medicare enrollment record, but the application only included enrollment information pertaining to his work with the Department of State Hospitals.
2. On July 28, 2017, Noridian sent Petitioner a development request, via an email to the contact email address listed on his enrollment application, in which it asked him to provide information to revalidate his sole proprietor billing number.
3. Petitioner did not respond to Noridian’s July 28, 2017 development request.
4. In a letter dated August 30, 2017, Noridian informed Petitioner that it had revalidated his enrollment, but that his sole proprietor billing number would be deactivated effective December 31, 2017.
5. Petitioner did not submit an application to reactivate his sole proprietor billing number until November 21, 2018.

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6. Pursuant to 42 C.F.R. § 424.520(d)(1), Noridian had a legitimate basis to reactivate Petitioner’s enrollment as a sole proprietor effective November 21, 2018, the date it received his enrollment application.
7. Noridian had the authority to allow retrospective billing privileges 30 days prior to the receipt date of the application, beginning October 22, 2018, pursuant to 42 C.F.R. § 424.521(a)(1).

As a clinical psychologist, Petitioner is a “supplier” for purposes of the Medicare program.  See CMS Ex. 1 at 6; see also 42 U.S.C. § 1395x(d); 42 C.F.R. §§ 400.202, 498.2 (definitions of supplier).  A “supplier” furnishes items or services under Medicare, and the term applies to physicians or other practitioners who are not included within the definition of the phrase “provider of 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.”  Id.; 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.  Further, a supplier “may be required to revalidate [its] enrollment outside the routine 5-year revalidation cycle.”  42 C.F.R. § 424.515(e).

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 receipt of notification.”  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); Urology Grp. of NJ, LLC,DAB No. 2860 at 10 (2018) (“The regulations, taken together, clearly establish that a deactivated provider or supplier was not intended to be entitled to Medicare reimbursement for services rendered during the period of deactivation.”).  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), aff’d sub nom. Goffney v. Azar, 2:17-CV-8032 (C.D. Cal. Sept. 25, 2019); see Urology Grp.,DAB No. 2860 at 11 (“Taking these unique effects of revocation into consideration, it is reasonable to conclude that CMS intended

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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.”); Frederick Brodeur, M.D.,DAB No. 2857 at 16 (2018) (“Allowing a deactivated supplier to bill for services furnished during a period of deactivation would conflict with section 424.555(b) of the regulations . . . .”).  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).

In July 2017, Petitioner submitted an application to revalidate his Medicare enrollment record.  CMS Ex. 1.  Shortly thereafter, Noridian sent an email message to the contact email address he listed in July 2017 directing him to submit enrollment information regarding his sole proprietorship.  CMS Ex. 3 at 1.  After Petitioner did not respond to that request, Noridian informed Petitioner that it had approved his revalidation application, but that it would deactivate his billing number associated with his sole proprietorship on December 31, 2017.  CMS Ex. 5 at 3.  Petitioner did not submit an application to revalidate and reactivate his enrollment as a sole proprietor until November 21, 2018.  CMS Ex. 6. 

The pertinent regulation with respect to the effective date of reactivation is 42 C.F.R. § 424.520(d).  Urology Grp.,DAB No. 2860 at 7 (“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, non-physician practitioners, physician and non‑physician practitioner organizations . . . 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 as a sole proprietor because he did not comply with a development request following his submission of an enrollment application to revalidate his enrollment, nor did he submit the requested information even after he was notified that his enrollment as a sole proprietor would be deactivated at the conclusion of the year.  CMS Exs. 3, 5.  Based on the November 21, 2018 receipt date of the enrollment application that was processed to approval, the November 21, 2018 effective date for reactivated billing privileges, with retrospective billing allowed beginning October 22, 2018, is not erroneous.  42 C.F.R. §§ 424.520(d)(1), 424.521(a)(1); see Urology Grp.,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 to reactivations.”); Frederick Brodeur,DAB No. 2857 at

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16 (“Petitioner remained enrolled in Medicare, but his deactivated status made [him] ineligible for payment for any covered services he furnished to otherwise eligible Medicare beneficiaries, pursuant to section 424.555(b), until he provided the information necessary to reactivate his billing privileges.”); 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.”).

The deactivation of Petitioner’s billing privileges on December 31, 2017, based on his failure to provide enrollment information regarding his sole proprietorship in conjunction with his revalidation of his enrollment, is not reviewable.  42 C.F.R. § 498.3(b) (listing the types of initial determinations that are subject to review); Ark. Health Grp.,DAB No. 2929 at 12 (2019) (“Where, as here, the contractor deactivated Petitioner’s billing privileges, the issue for us (and the ALJ) is the effective date of reactivation.”); Frederick Brodeur,DAB No. 2857 at 12 (“A contractor’s deactivation decision is not an initial determination subject to ALJ or [DAB] review.”); Willie Goffney,DAB No. 2763 at 5 (stating no regulation provides appeal rights with respect to the contractor’s deactivation).  I can only review the effective date assigned for Petitioner’s reactivated billing privileges, and Petitioner does not present evidence that he submitted a completed application for the purpose of reactivating his sole proprietorship billing number prior to November 21, 2018.  

Petitioner argues that he was unaware that his revalidation application did not include information regarding his enrollment as a sole proprietor.  P. Br.  Petitioner also claims that he did not know that the July 2017 enrollment application reported changes to his contact information, and he did not receive notice that his sole proprietor billing number would be deactivated for failure to revalidate that portion of his enrollment record.  P. Br.  However, Petitioner signed the July 2017 enrollment application; that application updated his contact information and reported enrollment information only with respect to his practice with the Department of State Hospitals.  CMS Ex. 1.  By signing the application, Petitioner certified that he had “read the contents of [the] application, and the information contained [t]herein is true, correct, and complete.”  CMS Ex. 1 at 20, 40.  Therefore, it should have been no surprise that the enrollment application he submitted to revalidate his enrollment record in July 2017 lacked certain contact information, such as his personal email address.  See CMS Ex. 1; P. Br.  Further, although Petitioner blames the Department of State Hospitals for omitting his sole proprietorship information when it filled out the application for his signature, the simple fact is that Petitioner should have reviewed the application before certifying the accuracy and completeness of the application.  CMS Ex. 1 at 20, 40.  While the circumstances are undoubtedly unfortunate, in that Petitioner has experienced a gap in billing privileges and a resulting loss of reimbursements, he has not identified any error committed by CMS or Noridian in the assignment of effective date of reactivated billing privileges for his sole proprietor billing number.

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Pursuant to 42 C.F.R. § 424.520(d)(1), Noridian had a legitimate basis to assign an effective date of November 21, 2018, for Petitioner’s reactivated billing privileges, which is based on the date of receipt of his application for purposes of revalidation.  Retrospective billing privileges are authorized up to 30 days at the discretion of CMS or its contractor pursuant to 42 C.F.R. § 424.521(a)(1), and Noridian allowed retrospective billing beginning October 22, 2018.  CMS Ex. 7 at 10.

To the extent that Petitioner’s request for relief is based on principles of equitable relief, I cannot grant such relief.  US Ultrasound, DAB No. 2302 at 8 (2010) (“Neither the ALJ nor the [DAB] is authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements.”).  Petitioner points to no authority by which I may grant him relief from the applicable regulatory requirements, and I have no authority to declare statutes or regulations invalid or ultra vires.  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 . . . .”).

V.  Conclusion

For the foregoing reasons, I uphold the November 21, 2018 effective date of Petitioner’s reactivated sole proprietor Medicare billing privileges, with retrospective billing authorized beginning October 22, 2018.

• 1. Petitioner’s brief is not paginated, and therefore, I do not provide pinpoint citations to his brief.
• 2. Because Petitioner has not requested an opportunity to cross-examine CMS’s sole witness and a hearing is unnecessary, I need not address whether summary judgment is appropriate.
• 3. Findings of fact and conclusions of law are in italics and bold font.