Bruce Gladstone, PhD, DAB CR5719 (2020)

DECISION

Petitioner, Bruce Gladstone, PhD, is a psychologist, practicing in California, who participates in the Medicare program as a supplier of services.  After his Medicare billing privileges were deactivated, he applied to reenroll in the program.  The Centers for Medicare & Medicaid Services (CMS) granted the application, effective December 21, 2017, resulting in a coverage lapse of more than three months.  Petitioner asks for an earlier effective date.

CMS moves to dismiss Petitioner's hearing request.  For the reasons discussed below, I deny CMS's motion.

On the merits, I find that Petitioner filed his subsequently-approved application on November 6, 2017, and November 6 is therefore the correct effective date for his reactivated enrollment.

Background

In a notice letter dated February 5, 2018, the Medicare contractor, Noridian Healthcare Solutions, advised Petitioner that it approved his revalidated Medicare enrollment with a gap in billing privileges from September 7 through December 20, 2017.  CMS Ex. 9.

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Petitioner requested reconsideration, asking that he be reimbursed for the services he provided from September 7 through December 20, 2017.  CMS Ex. 10.

In a reconsidered determination, dated April 12, 2018, the contractor affirmed the December 21 effective date, noting a coverage gap from September 7 through December 20, 2017.  CMS Ex. 12.  Petitioner appealed.

CMS moves for summary judgment, which Petitioner opposes.  However, an in-person hearing would serve no purpose.  In my initial order, I directed the parties to list all proposed witnesses and to provide each witness's written direct testimony in the form of an affidavit or written declaration.  Acknowledgment and Pre‑hearing Order at 3, 5 (¶¶ 4(c)(iv), 8) (June 18, 2018).  CMS listed no witnesses.  Petitioner listed himself as a witness but did not provide his written direct testimony, so he would not be allowed to testify at an in-person hearing.  A hearing would therefore serve no purpose, and I may decide this case based on the written record, without considering whether the standards for summary judgment are met.  See Pre-hearing Order at 6 (¶ 10) ("An in-person hearing to cross-examine witnesses will be necessary only if a party files admissible, written direct testimony, and the opposing party asks to cross-examine.").

CMS submits its motion and brief (CMS Br.) with 12 exhibits (CMS Exs. 1-12).  Petitioner submits his brief in opposition (P. Br.).  In the absence of any objections, I admit into evidence CMS Exs. 1-12.

Discussion

1. Petitioner's hearing request is adequate to preserve his right to review by an administrative law judge.1

CMS complains that Petitioner's hearing request should be dismissed because it does not specify the findings of fact and conclusions of law with which he disagrees, as required by 42 C.F.R. § 498.40(b).  CMS Br. at 6.  Section 498.40(b) provides that a hearing request must "[i]dentify the specific issues, and the findings of fact and conclusions of law with which the affected party disagrees" and must "[s]pecify the basis for contending that the findings and conclusions are incorrect."

The Departmental Appeals Board has "rejected efforts to use these requirements to frustrate the good faith efforts of petitioners to perfect appeals and exercise hearing rights created by the statute."  The Carlton at the Lake, DAB No. 1829 at 4 (2002), citing Fairview Nursing Plaza, Inc., DAB No. 1715 (2005); Alden-Princeton Rehab. and Health Care Ctr., Inc., DAB No. 1709 (1999).  The Board stated emphatically that an affected

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party's good-faith efforts to appeal an allegedly erroneous decision should not be "defeated by 'gamesmanship' or hyper-technical procedural strictures."  Carlton, DAB No. 1829 at 4.  The government's interest, according to the Board, "ultimately lies in the factual and legal accuracy of its determinations . . . ."  Id., citing Alden Nursing Ctr. – Morrow, DAB No. 1815 at 12 (2002).

For these reasons, the Board has directed administrative law judges to exercise discretion to accept "as adequate to preserve a right to hearing" requests that fail to "[i]dentify the specific issues, and findings of fact and conclusions of law with which the affected party disagrees" and fail to "[s]pecify the basis for contending the findings and conclusions are incorrect."  Carlton, DAB No. 1829 at 9.

CMS plainly had no difficulty figuring out the bases for this appeal.  If anything, Petitioner's hearing request is overly inclusive.  He attaches a copy of the reconsidered determination and his request for reconsideration.  In any event, unlike cases involving long-term-care facilities (Carlton, Fairview, Alden-Princeton and the like), cases involving the effective date of a supplier's Medicare enrollment present limited issues of law and fact.  They involve just one (obvious) question:  what is the correct Medicare enrollment date.  And, as discussed below, the effective date of enrollment is the date the supplier filed his subsequently-approved enrollment application.  So the only question is:  when did Petitioner file his subsequently-approved application.  Anyone should be able to figure that out, and CMS obviously did.

I therefore deny CMS's motion to dismiss.

2. Because Petitioner filed his subsequently-approved enrollment application on November 6, 2017, that is the correct effective date for his reactivated Medicare enrollment.  42 C.F.R. § 424.520(d).

Enrollment.  Petitioner Gladstone 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 furnished 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

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Management and Budget.  42 C.F.R. § 424.502.2   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.  For a non-physician practitioner, the effective date for billing privileges "is the later of – [t]he date of filing" a subsequently-approved enrollment application or "[t]he date that the supplier first began furnishing services at a new practice location."  42 C.F.R. § 424.520(d) (emphasis added).

Revalidation and deactivation.  To maintain his billing privileges, a supplier must, at least every five years, resubmit and recertify the accuracy of his 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 his enrollment information.  42 C.F.R. § 424.515(d) and (e).  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).

If, within 90 days from receipt of CMS's notice, the supplier does not furnish complete and accurate information and all supporting documentation or does not resubmit and certify the accuracy of his enrollment information, CMS may deactivate his billing privileges, and no Medicare payments will be made.  42 C.F.R. §§ 424.540(a)(3); 424.555(b).  To reactivate his billing privileges, the supplier must complete and submit a new enrollment application.  42 C.F.R. § 424.540(b)(1).  It is settled that, following deactivation, section 424.520(d) governs the effective date of reenrollment.  Howard M. Sokoloff, DPM, MS, Inc., DAB No. 2972 (2019); Urology Grp. of NJ, LLC, DAB No. 2860 (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).

I have no authority to review a deactivation.  Sokoloff, DAB No. 2972 at 6; Ark. Health Grp., DAB No. 2929 at 7-9 (2019).

Petitioner's deactivation and reenrollment.  In a notice letter, dated April 5, 2017, the contractor directed Petitioner to revalidate his Medicare enrollment by updating or confirming the information in his record.  The letter directed Petitioner to submit, no later than June 30, 2017, an updated paper CMS-855 Medicare enrollment application or to review, update, and confirm his information through the PECOS system.  The letter warned that Petitioner's failure to respond could result in deactivation of his Medicare enrollment, in which case he would not be paid for services rendered during the period of deactivation.  CMS Ex. 1.  Petitioner did not respond.

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The contractor sent a second letter, dated August 2, 2017, stating that Petitioner had not revalidated his enrollment by June 30; the letter again warned that he would not be paid for services rendered during a period of deactivation.  CMS Ex. 2.  Again, Petitioner did not respond.

In a letter, dated September 14, 2017, the contractor advised Petitioner that his billing privileges were stopped, effective September 7, 2017, because he had not revalidated his enrollment record and had not responded to the contractor's requests for information.  To revalidate, the letter instructed him to submit an updated paper enrollment application, or to revalidate his enrollment record via PECOS.  CMS Ex. 3.

On November 6, 2017, Petitioner filed, via PECOS, a Medicare enrollment application, which the contractor subsequently approved.  CMS Exs. 4, 9.  CMS concedes that the application "was created on November 6, 2018 [sic]," but gratuitously asserts (in a footnote) that "Petitioner's paper signatures, which [are] a required component of the application, were received by [the contractor] on December 21, 2017, which is considered the receipt date of the application."  CMS Br. at 3 n.1.  CMS is simply wrong.

Petitioner's November 6 enrollment application was incomplete.  CMS may reject an incomplete enrollment application if the prospective supplier "fails to furnish complete enrollment information on the . . . supplier enrollment application within 30 calendar days from the date of the contractor request for the missing information."  42 C.F.R. § 424.525(a).  However, so long as the contractor continues to process that application to a decision, the effective date will relate back to the date of its filing.  Karthik Ramaswamy, M.D., DAB No. 2563 at 5 (2014) (en banc), aff'd, Ramaswamy v. Burwell, 83 F. Supp. 3d 846 (E.D. Mo. 2015).

CMS nevertheless asserts that Petitioner is not entitled to the November 6 effective date because his application did not then include necessary signatures.3   The Board has specifically rejected this position.  Citing 42 C.F.R. § 424.525, it noted that applicants are

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"given an opportunity to cure any deficiencies or supply any missing documentation before an application will be rejected."  Tri-Valley Family Medicine, Inc., DAB No. 2358 at 5 (2010).4   CMS may deny an enrollment application, rather than reject it, if the supplier does not comply with Medicare enrollment requirements, "which include the requirement for a signature on the certification statement," and does not submit a corrective action plan.  Tri-Valley, DAB No. 2358 at 5-6.  Thus, where, as here, an application lacks necessary signatures, the regulations give the Medicare contractor two options:  1) treat the missing signature like any other missing information and request it within the regulatory deadline; or 2) treat the failure as noncompliance and deny the application.  Tri-Valley, DAB No. 2358 at 6.

Regulatory changes, effective January 1, 2009, added section 424.520(d), but did not change the regulations governing the contractor's options for responding to a deficient enrollment application.  The preamble to section 424.520 says that the "date of filing" is the date that a Medicare contractor receives a signed application that it is able to process to approval.  73 Fed. Reg. 69,725, 69,769 (Nov. 19, 2008).  "This was the first indication that lack of a signature on an application might affect the timing of when a physician could get paid for covered services."  Tri-Valley, DAB No. 2358 at 6.  The Board concluded that nothing in the regulations or the language of the preamble indicates that the effective date should be determined by the submission of a complete application:

Instead, the regulation refers to an application that is "subsequently approved" by the contractor.  It does not require that the application be "approvable" as initially submitted.  The regulatory process, which was unchanged, included provision for the contractor to request information or supporting documentation if an application was not complete.  Thus, if the information or documentation was timely submitted and all other requirements were met, that application could be approved, and a provider or supplier was not required to submit an additional application.  The preamble language . . . recognizes this by referring to an application that the contractor is able to process to approval.  Indeed, the preamble indicated agreement with the comment that that the filing date should not be the date when the application is "deemed complete and ready for approval."

Tri-Valley, DAB No. 2358 at 7 (citing 73 Fed. Reg. at 69,769).

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For reasons unrelated to this conclusion, Tri-Valley represented a bit of a departure.  The case involved an earlier application that, in the Board's view, "could have been processed to approval" had the contractor "properly requested" missing information.  Tri-Valley, DAB No. 2358 at 1.  Even though that earlier application was rejected (a determination that is not reviewable), and the Board was reviewing the effective date of a subsequent application, the review panel in Tri-Valley accepted, as the effective date, the filing date of the original application.  Since then, the Board has soundly rejected supplier requests for review of prior applications under the guise of challenging the effective dates of their subsequently-approved applications.  Ramaswamy, DAB No. 2563 at 5.

We will not determine de novo that an application could have been processed to approval in the face of the contractor's actual determination to deny the application because it was not approvable.  To do so would improperly use the scope of review to revisit a legally binding and administratively final determination.

Ramaswamy, DAB No. 2563 at 9.

The Board nevertheless agreed with the Tri-Valley conclusion that "while the contractor may require and request additional information to complete the application, the effective date will relate back to the date of filing so long as that application continues to be processed to a decision on whether to approve it."  Ramaswamy, DAB No. 2563 at 5.

Conclusion

Because Petitioner filed his subsequently-approved reenrollment application on November 6, 2017, his Medicare reenrollment is effective as of that date.  I have no authority to grant Petitioner an earlier effective date based on equitable and policy arguments.  Sokoloff, DAB No. 2972 at 9.

• 1. My findings of fact/conclusions of law are set forth, in italics and bold, in the discussion captions of this decision.
• 2. CMS's electronic process is referred to as PECOS (Provider Enrollment, Chain, and Ownership System).
• 3. Although the regulation has not changed, CMS has changed its instructions to contractors, going back and forth on how they should treat PECOS applications that are missing signatures.  Compare Medicare Program Integrity Manual (MPIM) ¶ 15.17A (Rev. 582, Issued:  03-04-15; Effective 05-28-15) ("The date of filing for . . . PECOS applications is the date that the contractor received an electronic version of the enrollment application and a signed certification statement submitted via paper or electronically") with MPIM ¶ 15.17A (Rev. 824, Issued:  09-05-18; Effective 10-01-18) ("The date of filing for paper Form CMS-855 applications is the date on which the contractor received the application, regardless of whether the application was submitted via paper or Internet-based PECOS.").
• 4. See the discussion below regarding the Board's subsequent misgivings about the breadth of its decision in Tri-Valley, which, nevertheless did not question Tri-Valley's rulings regarding how contractors should treat applications that lack the required signatures.