Skip to main content


U.S. flag
      An official website of the United States government
              Here’s how you know
        Here’s how you knowDot gov**Official websites use .gov**
                 A **.gov** website belongs to an official government organization in the United States.
                  HTTPS**Secure .gov websites use HTTPS**
                 A **lock** (A locked padlock) or **https://** means you’ve safely connected to the .gov website. Share sensitive information only on official, secure websites. 
  Menu Close
          HHS Search block
    Search
        








  
  
    

  
      

                                      About HHS
    
                        
                              
      
      
      Programs & Services
    
                        
                              
      
      
      Grants & Contracts
    
                        
                              
      
      
      Laws & Regulations Breadcrumb
    Home
                              About
                              Agencies
                              DAB
                              Decisions
                              ALJ Decisions
                              2020
                              Respiratory Support Services, Inc., DAB CR5647 (2020)
 Navigate to:
  Departmental Appeals Board (DAB)
    
                                                  
                                                    
            
      
      
      
      About DAB
                                            
            
            Organizational Overview
    
                                                  
                              
            
      
      
      
      Who are the Judges?
    
                                                  
                              
            
      
      
      
      DAB Divisions
    
                                                  
                              
            
      
      
      
      Contact DAB
    
                                                  
                                                    
            
      
      
      
      Filing an Appeal Online
                                            
            
            DAB E-File
    
                                                  
                              
            
      
      
      
      Medicare Operations Division (MOD) E-File
    
                                                  
                                                    
            
      
      
      
      Different Appeals at DAB
                                            
            
            Appeals to DAB Administrative Law Judges (ALJs)
                          
            
            Forms
    
                                                  
                              
            
      
      
      
      Procedures
    
                                                                
                                                    
            
      
      
      
      Appeals to Board
                          
            
            Practice Manual
    
                                                  
                              
            
      
      
      
      Guidelines
    
                                                  
                              
            
      
      
      
      Regulations
    
                                                  
                              
            
      
      
      
      National Coverage Determination Complaints
    
                                                                
                                                    
            
      
      
      
      Appeals to the Medicare Appeals Council (Council)
                          
            
            Forms
    
                                                  
                              
            
      
      
      
      Fully Integrated Duals Advantage (FIDA) Demonstration Project
    
                                                  
                                                    
            
      
      
      
      Alternative Dispute Resolution Services
                                            
            
            Sharing Neutrals
    
                                                  
                              
            
      
      
      
      ADR Training
    
                                                  
                              
            
      
      
      
      Other ADR Services
    
                                                  
                                                    
            
      
      
      
      DAB Decisions
                                            
            
            Board Decisions
    
                                                  
                              
            
      
      
      
      DAB Administrative Law Judge (ALJ) Decisions
    
                                                  
                              
            
      
      
      
      Medicare Appeals Council (Council) Decisions
    
                                    
                              
            
      
      
      
      Stakeholder Feedback
    
                                                  
                                                    
            
      
      
      
      Careers
                                            
            
            Open Career Opportunities
    
                                                  
                              
            
      
      
      
      Internships & ExternshipsText resize icon

                    




Respiratory Support Services, Inc., DAB CR5647 (2020)








  
  
    

  
      
Department of Health and Human Services 
    DEPARTMENTAL APPEALS BOARD
          Civil Remedies Division





Respiratory Support Services, Inc.,
	(NPI: 1760470710)
	Petitioner,
v.
Centers for Medicare & Medicaid Services.
Docket No. C-20-473Decision No. CR5647July 10, 2020

        
              
    

      DECISION
I sustain the determination of a Medicare contractor, acting on behalf of the Centers for Medicare & Medicaid Services (CMS), to revoke the Medicare billing privileges of Petitioner, Respiratory Support Services, Inc.
I.  Background
CMS moved for summary judgment asserting that there are no disputed issues of material fact in this case.  Petitioner opposed the motion.  With its motion, CMS filed four exhibits that it identified as CMS Ex. 1-CMS Ex. 4.  In opposition, Petitioner filed four exhibits, identified as P. Ex. 1-P. Ex. 4.  Petitioner filed additional documents with its hearing request, not specifically identified as exhibits, which Petitioner intends to serve as evidence on its behalf.  These include a copy of a surety bond dated March 16, 2020.  Neither CMS nor Petitioner filed proposed witness testimony.
Petitioner did not object to my receiving any of CMS’s proposed exhibits into the record. CMS objected on two grounds to my receiving the March 16, 2020 surety bond into evidence.  It notes, first, that Petitioner did not file this surety bond as part of its request
Page 2
for reconsideration of the Medicare contractor’s initial determination.  It contends that the surety bond is new evidence and that Petitioner cannot offer such evidence absent a showing of good cause.  42 C.F.R. § 498.56(c).  CMS contends that this document clearly was in Petitioner’s possession when it filed its reconsideration request and that Petitioner cannot establish good cause for filing it untimely.  Second, CMS argues that the March 16, 2020 surety bond is irrelevant.  CMS motion at 5-7.
I sustain CMS’s objection.  As I discuss below, the determinative issue in this case is whether Petitioner had a valid surety bond as of the date that the Medicare contractor determined to revoke Petitioner’s Medicare billing privileges.  Petitioner knew or should have known that this was the determinative issue when it requested a reconsidered determination.  Indeed, it filed a different version of the surety bond, also dated March 16, 2020, with its reconsideration request.  CMS Ex. 3 at 25-28.  Consequently, Petitioner has no excuse for failing to offer with its reconsideration request the version of the surety bond that it now offers.1
I also agree with CMS’s contention that this surety bond is irrelevant.  As I discuss below, the issue in this case is whether Petitioner had a valid surety bond as of the date —November 17, 2019—that the Medicare contractor determined that Petitioner failed to meet participation requirements for DMEPOS suppliers.  CMS Ex. 2 at 1.  A subsequently obtained bond, whether valid or not, is irrelevant to that determination, for reasons that I shall explain.
It is unnecessary that I decide whether the traditional criteria for summary judgment are satisfied.  Neither party offers the testimony of a witness.  I decide the case based on the parties’ written exchanges.  I receive into evidence CMS Ex. 1-CMS Ex. 4 and P. Ex. 1‐P. Ex. 4.
II.  Issue, Findings of Fact and Conclusions of Law
**A. Issue**
The issue is whether, as of November 17, 2019, Petitioner satisfied the Medicare participation requirements governing DMEPOS suppliers.
Page 3
**B. Findings of Fact and Conclusions of Law**
The Medicare Act (Act) establishes as a condition of participation for a DMEPOS supplier that the supplier continuously maintain a surety bond.
Disclosure of Information and Surety Bond.  The Secretary shall not provide for the issuance (or renewal) of a provider number for a supplier of durable medical equipment, for purposes of payment under this part for durable medical equipment furnished by the supplier, unless the supplier provides the Secretary *on a continuing basis*–
****
(B) with a *surety bond in a form specified by the Secretary*and in an amount that is not less than $50,000 that the Secretary determines is commensurate with the volume of the billing of the supplier.
42 U.S.C. § 1395m(a)(16) (emphasis added).
Regulations intended to implement the Act require explicitly that a DMEPOS supplier must maintain a continuous surety bond in order to participate in Medicare.  42 C.F.R. § 424.57(c)(26), (d)(4)(i).  CMS may revoke a DMEPOS supplier’s participation if the supplier fails to meet the requirement that it maintain a continuous surety bond.  42 C.F.R. § 424.57(d)(4)(ii)(B), (d)(11)(i).
The facts of this case establish that Petitioner was without a requisite surety bond from November 17, 2019 until after February 11, 2020, the date when the Medicare contractor notified Petitioner of revocation of its Medicare billing privileges.  CMS Ex. 1; CMS Ex. 2 at 1.  The contractor thus revoked Petitioner’s Medicare billing privileges consistent with the requirements of the Act and governing regulations.2
Petitioner does not deny that its surety bond had expired as of November 17, 2019, nor does it assert that it obtained a valid surety bond at any time prior to the date when the contractor determined to revoke Petitioner’s Medicare billing privileges.  Petitioner
Page 4
argues, however, that it cured this deficiency by obtaining a valid surety bond effective February 16, 2020.3
Petitioner made this identical argument to the contractor in its request for a reconsidered determination, and the contractor rejected that argument.  The bond that Petitioner presented to the contractor in its reconsideration request was incomplete in that it lacked a signature from Petitioner’s President.  However, that bond would not have required that Petitioner be reinstated, even if it had been properly executed by one of Petitioner’s officers and even if it was effective on February 16, 2020, as Petitioner asserts.
The possibility that Petitioner may have obtained a new surety bond after November 17, 2019 provides Petitioner no argument that the contractor incorrectly revoked Petitioner’s Medicare billing privileges.  As I have discussed, the Act and implementing regulations require that a DMEPOS supplier continuously maintain a valid surety bond.  *Any*lapse in coverage is a basis for revocation of that supplier’s Medicare billing privileges.  42 U.S.C. § 1395m(a)(16); 42 C.F.R. § 424.57(c)(26), (d)(4)(i), (d)(4)(ii)(B), (d)(11)(i).  “CMS revokes the DMEPOS supplier’s billing privileges if an enrolled DMEPOS supplier fails to obtain, file timely, or maintain a surety bond as specified in this subpart and CMS instructions.”  42 C.F.R. § 424.57(d)(11)(i).  Cancellation of a surety bond will be a basis for revocation unless the DMEPOS supplier provides a new bond that is effective *prior to* the date of cancellation.  42 C.F.R. § 424.57(d)(6)(ii); *Pepper Hill Nursing & Rehab. Ctr. L.L.C.*, DAB No. 2395 (2011).
Petitioner also seems to argue that it should have been given a grace period by the contractor to allow it to cure the deficiency in its surety bond coverage.  In this circumstance, there is no regulatory provision (and none cited by Petitioner) that requires the contractor to give a DMEPOS supplier without a surety bond the opportunity to
Page 5
obtain one prior to revocation of its billing privileges.  Here, the Act’s requirement, and that of implementing regulations, is for continuous coverage.  Any lapse in coverage justifies revocation.


          /s/
        Steven T. Kessel

                      Administrative Law Judge
      1. The difference between the surety bond that Petitioner submitted with its reconsideration request and the one that it currently offers is that the version that Petitioner submitted originally is not signed by an officer of Petitioner, whereas the currently offered version is signed by Petitioner’s president.  Compare CMS Ex. 3 at 26 with Departmental Appeals Board Electronic Filing System Docket 1c at 2; see also CMS Ex. 3 at 17, 22. back to note 1
                      2. The contractor imposed a two-year bar on reenrollment.  CMS Ex. 2 at 1.  That is consistent with CMS’s authority to impose a bar on reenrollment of up to three years in circumstances where it revokes a supplier’s participation. 42 C.F.R. § 424.535(c)(1); see 84 Fed. Reg. 47,794, 47,794, 47,854-56 (Sept. 10, 2019) (extending reenrollment bar to 10 years).  I have no authority to decide whether the length of the reenrollment bar is reasonable, inasmuch as the length of a bar on reenrollment is not an initial determination that creates a right to a hearing.  See 42 C.F.R. § 498.3, .5. back to note 2
                      3. In its brief, Petitioner asserts that it obtained a new surety bond effective February 16, 2020.  Petitioner’s Brief at 4; P. Ex. 1.  That date is not the date of the bond (March 16, 2020).  However, even if Petitioner’s new bond became effective on February 16, that is insufficient to find the contractor’s determination incorrect.  By Petitioner’s own admission, there is a gap in Petitioner’s surety bond coverage from November 17, 2019 until February 16, 2020, contravening the statutory and regulatory requirement of continuous coverage. back to note 3 Back to top
    Contact HHS
    
                        
                                            
      
      
      Careers
    
                        
                                            
      
      
      HHS FAQs
    
                        
                                            
      
      
      Nondiscrimination NoticeHHS Archive
    
                        
                                            
      
      
      Accessibility Statement
    
                        
                                            
      
      
      Privacy Policy
    
                        
                                            
      
      
      Viewers & PlayersBudget/Performance
    
                        
                                            
      
      
      Inspector General
    
                        
                                            
      
      
      Web Site Disclaimers
    
                        
                                            
      
      
      EEO/No Fear ActFOIA
    
                        
                                            
      
      
      The White House
    
                        
                                            
      
      
      USA.gov
    
                        
                                            
      
      
      Vulnerability Disclosure Policy
        Sign Up for Email Updates

Receive the latest updates from the Secretary, Blogs, and News Releases.

Sign Up
  HHS Headquarters
          200 Independence Avenue, S.W.
                  Washington, D.C. 20201
                  Toll Free Call Center: 1-877-696-6775​ Disclaimer Policy: Links with this icon () mean that you are leaving the HHS website. The Department of Health and Human Services (HHS) cannot guarantee the accuracy of a non-federal website.
                  Linking to a non-federal website does not mean that HHS or its employees endorse the sponsors, information, or products presented on the website. HHS links outside of itself to provide you with further information.
                  You will be bound by the destination website's privacy policy and/or terms of service when you follow the link.
                  HHS is not responsible for Section 508 compliance (accessibility) on private websites. For more information on HHS's web notification policies, see Website Disclaimers.
 Continue
                  Go back