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                              Michael B. Zafrani, M.D., DAB No. 3075 (2022)
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Michael B. Zafrani, M.D., DAB No. 3075 (2022)








  
  
    

  
      
Department of Health and Human Services 
    DEPARTMENTAL APPEALS BOARD
          Appellate Division





Michael B. Zafrani, M.D.
Docket No. A-21-27Decision No. 3075October 18, 2022

        
              
    

      FINAL DECISION ON REVIEW OF ADMINISTRATIVE LAW JUDGE DECISION

Michael B. Zafrani, M.D. (Petitioner), appeals the November 19, 2020, decision of an Administrative Law Judge (ALJ) captioned *Michael B. Zafrani, MD*, DAB CR5765 (2020) (ALJ Decision).   The ALJ Decision upheld the determination by the Centers for Medicare and Medicaid Services (CMS) that the effective date for Petitioner’s reactivated Medicare billing privileges is February 18, 2020, with retrospective billing authorized beginning January 19, 2020.  We affirm the ALJ Decision for the reasons stated below.

Legal Background

Under the Social Security Act (Act), the Department of Health and Human Services administers the Medicare program through CMS and administrative contractors.  Act §§ 1816, 1842, 1874A; *see also Heckler v. Community Health Servs. of Crawford County, Inc.*, 467 U.S. 51, 53-54 (1984).  Regulations at 42 C.F.R. Part 424, Subpart P “contain the requirements for enrollment, periodic resubmission and certification of enrollment information for revalidation, and timely reporting of updates and changes to enrollment information.”  42 C.F.R. § 424.500.

A provider or supplier must be enrolled in the Medicare program to receive payment from the program for covered items or services.  42 C.F.R. §§ 424.500, 424.505.  The term “supplier” includes a physician who furnishes health care services under Medicare.  Act § 1861(d); 42 C.F.R. §§ 400.202, 498.2.  “Enrollment” means the process used to establish providers’ and suppliers’ eligibility to submit claims and receive payment for Medicare-covered items and services.  42 C.F.R. § 424.502.  The supplier enrollment process includes identifying the supplier, validating the supplier’s eligibility to provide items or services to Medicare beneficiaries, identifying and confirming the supplier’s practice location(s) and owner(s), and granting the supplier “Medicare billing privileges.”  *Id.*  To enroll, a supplier must use “the applicable enrollment application” and “submit a complete enrollment application and supporting documentation to” the designated Medicare contractor.  *Id.* § 424.510(a)(1), (d)(1).

**Page 2**

Once a supplier’s completed enrollment application is submitted and validated, the supplier enters a five-year revalidation cycle.  42 C.F.R. § 424.515.  This means that, to maintain Medicare billing privileges, a supplier must resubmit and recertify the accuracy of his enrollment information every five years or at other times as CMS requires.  *See id.* (describing five-year revalidation schedule and “off-cycle” revalidations); *id.* § 424.516 (describing supplier requirements for maintaining active Medicare enrollment).  CMS contacts each supplier directly when it is time to revalidate his enrollment information.  *Id.* § 424.515(a)(1).  The supplier then “must submit to CMS the applicable enrollment application with complete and accurate information and applicable supporting documentation,” and certify the information’s accuracy, within 60 calendar days of the notice to resubmit.  *Id.* § 424.515(a)(2).

CMS is authorized both to reject an enrollment application and to deactivate a supplier’s billing privileges.  CMS may reject a supplier’s enrollment application (including a revalidation application) for numerous reasons, including a supplier’s submission of the incorrect or inapplicable form.  42 C.F.R. § 424.525(a), (a)(x).  CMS also may deactivate the billing privileges of a supplier who does not furnish complete and accurate information and all supporting documentation within 90 calendar days of receiving notice from CMS to resubmit and certify the accuracy of the supplier’s enrollment information.  *Id.* § 424.540(a)(3).  “Deactivate” means that the “supplier’s billing privileges were stopped, but can be restored upon the submission of updated information.”  *Id.*§ 424.502.  CMS may not reimburse a supplier for otherwise covered items or services if the supplier’s billing privileges are deactivated.  *Id.* § 424.555(b).

To reactivate Medicare billing privileges, a supplier must submit a new enrollment application (or at least recertify that his enrollment information currently on file with Medicare is correct).  *See*42 C.F.R. § 424.540(b).1  A Medicare contractor’s approval of a supplier’s enrollment application (including a revalidation application) determines the “effective date of billing privileges” in accordance with 42 C.F.R. § 424.520(d).  The effective date of billing privileges is “the later of . . . [t]he date of filing of a Medicare enrollment application that was subsequently approved by a Medicare contractor” or “[t]he date that the supplier first began furnishing services at a new practice location.”  *Id.*§ 424.520(d).  CMS has explained, in the preamble to the rulemaking that adopted

**Page 3**

section 424.520, that the term “date of filing” means “the date that the Medicare . . . contractor receives a signed Medicare enrollment application that the Medicare . . . contractor is able to process to approval.”  73 Fed. Reg. 69,726, 69,766-67 (Nov. 19, 2008).  “[A] plain reading of the regulations indicates that the provision applies to all instances in which an effective date for Medicare billing privileges must be set, including reactivations.”  *Urology Group of NJ, LLC*, DAB No. 2860, at 9 (2018).  Suppliers who have “met all program requirements” may “retrospectively bill” Medicare for services for up to “[t]hirty days prior to the[] effective date if circumstances precluded enrollment in advance of providing services to Medicare beneficiaries.”  42 C.F.R. § 424.521(a)(1).  This 30-day period is commonly called the retrospective billing period.

Determination of the effective date of a supplier’s billing privileges is an “initial determination” subject to administrative review under 42 C.F.R. Part 498.  *See* 42 C.F.R. §§ 498.3(a)(1), (b)(15), 498.5(*l*); *Victor Alvarez, M.D.*, DAB No. 2325, at 3 (2010).  A supplier dissatisfied with the designated effective date may request a “reconsidered determination” from CMS and may thereafter request a hearing before an ALJ on the reconsidered determination.  42 C.F.R. § 498.5(*l*)(1)-(2); *see* *Alvarez*at 3 (stating approval of enrollment with a specific effective date is essentially a denial of enrollment with an earlier effective date, and supplier has right to reconsideration review under section 498.5(*l*)).  A supplier dissatisfied with an ALJ’s hearing decision may request Board review.  42 C.F.R.§ 498.5(f).

However, neither the rejection of an enrollment application, nor deactivation of billing privileges, is an “initial determination” subject to ALJ and Board review under 42 C.F.R. Part 498.  *See*42 C.F.R. § 424.525(d) (“Enrollment applications that are rejected are not afforded appeal rights.”); *Ark. Health Group*, DAB No. 2929, at 9 (2019)(citing cases concerning deactivations).  A supplier whose billing privileges are deactivated may file a written “rebuttal” with the contractor in accordance with 42 C.F.R. §§ 424.545(b) and 424.546, “but has no right to appeal the contractor’s determination on deactivation to an ALJ or the Board.”  *Chaplin Liu, M.D.*, DAB No. 2976, at 3 (2019) (citing 42 C.F.R. § 424.545(b)) (citation omitted).

Case Background2

Petitioner is a psychiatrist who has been a “30 year provider” for Medicare.3  CMS Ex. 6,

**Page 4**

at 4, Request for Review (RR) at 2.  On February 28, 2019, Noridian, a Medicare contractor, sent Petitioner a notice that he must revalidate his enrollment record information by May 31, 2019.  CMS Ex. 1.  The notice explained that failure to respond could result in deactivation of Petitioner’s Medicare enrollment, which would “cause a gap” in his Medicare reimbursements.  *Id.*

On June 24, 2019, Noridian sent Petitioner a “Past-Due” notice concerning his revalidation and billing privileges.  CMS Ex. 2.  The notice stated that he had not revalidated his enrollment record information as requested, and that he needed to do so immediately or risk deactivation and a gap in reimbursement.  *Id.*

On August 20, 2019, Noridian sent Petitioner a deactivation notice stating that “[w]e have stopped your Medicare billing privileges on July 31, 2019, because you haven’t revalidated your enrollment record with us, or you didn’t respond to our requests for more information.”  CMS Ex. 3, at 1.  The letter included instructions for Petitioner on how to recover his billing privileges.  *Id.*at 1-2. On the same day, August 20, 2019, Noridian received a Medicare enrollment application from Petitioner.  CMS Ex. 6, at 12.

On November 14, 2019, Noridian closed and returned Petitioner’s August 20, 2019 application with a letter stating the closure was “[a]s requested” and providing instructions on resubmitting an application.  *Id.* at 12-13.  On November 21, 2019, Noridian received a telephone query from Petitioner’s assistant asking the reason for the closing of the application.  *Id.* at 16; CMS Ex. 9.  After investigation, Noridian determined the reason for the closure was that Petitioner’s office had submitted the incorrect application form.  CMS Ex. 9.  Specifically, Petitioner acknowledges that he submitted an application that “was in error as it was for a Diabetes Physician and not a Psychiatrist,” CMS Ex. 6, at 3-4, and that because the submission “applied for the wrong privileges,” the “request was denied.”  RR at 2.  Petitioner claims his office called Noridian again on December 2 and 17, 2019, and January 2, 2020.  CMS Ex. 6, at 16.

On February 18, 2020, Petitioner’s office faxed the correct application to Noridian.  CMS Ex. 4.  On February 21, 2020, Noridian notified Petitioner that his revalidated Medicare enrollment application was approved, but with a lapse in billing privileges from July 31, 2019 through January 18, 2020.  CMS Ex. 5.  Noridian’s revalidation letter explained that Petitioner would “not be reimbursed for services provided to Medicare beneficiaries during this time period” because he was “not in compliance with Medicare requirements.”  *Id.* at 1.  The letter further informed Petitioner of his right to request reconsideration from a contractor hearing officer if he disagreed with Noridian’s effective date determination.  *Id.* at 2.

**Page 5**

Petitioner timely requested reconsideration of the effective date determination.  CMS Exs. 6 and 7.  Petitioner claimed that he did not receive Noridian’s notices dated February 28, June 24, and August 20 of 2019 because Noridian used an unhyphenated and thus “faulty” nine-digit zip code, then sent “[n]either a follow up email nor a certified letter” to ensure he received the notices.  CMS Ex. 6, at 4.  Petitioner next complained of a three-month period between November 2019 and February 2020, during which Noridian allegedly was “working on” a “glitch” that was the subject of a pre-call announcement, without checking Petitioner’s “true status.”  *Id.* at 3-4.  Finally, Petitioner complained that Noridian’s November 14, 2019 letter did not explain that Noridian had closed and returned his application “because it was for the wrong specialty,” though Petitioner acknowledged that on receiving the letter his practice “realized that we weren’t being paid for seeing Medicare patients.”  *Id.*

On May 29, 2020, Noridian issued its reconsidered determination.  CMS Ex. 8.  In response to Petitioner’s objections to the zip code format in Noridian’s notice letters, the determination stated that “the revalidation notifications contained a return address,” so “the items would have been returned if undeliverable,” but “Noridian confirmed that the letters had not been returned.”  *Id.* at 5.  The reconsidered determination also rejected Petitioner’s remaining arguments because Petitioner had provided no email address in his applications submitted before February 18, 2020, and Noridian could not confirm any “glitch in the revalidation process” or any “pre-recorded message” about it.  *Id.*  Accordingly, Noridian’s reconsidered determination was unfavorable to Petitioner and informed him of his further appeal rights.  *Id.* at 5-6.

Petitioner timely requested an ALJ hearing.  Petitioner sought to “have Medicare pay for [his] patient care from August 01, 2019,” which allegedly amounted to $56,000 in billable services.  Req. for ALJ Hearing at 2.

CMS filed a pre-hearing brief or, in the alternative, motion for summary judgment.  CMS argued that “[u]nfortunately, the deactivation of [Petitioner’s] enrollment, or resulting gap in billing privileges until reactivation, is not an initial determination” subject to ALJ review, and “Noridian properly determined the effective date of Petitioner’s Medicare enrollment and billing privileges.”  CMS Pre-Hearing Br. & Mot. for Summ. J. at 1, 13.

Petitioner’s written response to CMS’s filing contended that CMS “did not fulfill the ‘Usual and Customary Treatment’” in handling his Medicare privileges, “did not carry out their fiduciary responsibility to answer our questions,” and “did not perform due diligence to help us when we asked for help repeatedly.”  P. Resp. Br. to ALJ at 2.

The ALJ sustained Noridian’s reconsidered determination that February 18, 2020, was the correct effective date for Petitioner’s enrollment, with retrospective billing authorized beginning January 19, 2020.  ALJ Decision at 1.  The ALJ admitted into the record all of CMS’s exhibits but noted that “Petitioner disregarded the clear instructions in the Pre-

**Page 6**

Hearing Order with respect to the submission of proposed exhibits, in that he attached a number of exhibits to his brief.”  *Id.* at 3 n.3.  The ALJ noted that Petitioner’s exhibits duplicated CMS’s exhibits and brief except for one exhibit consisting of “email correspondence with non-Medicare health plans regarding matters unrelated to [Petitioner’s] Medicare enrollment,” which therefore was “irrelevant” and “not admitted into the evidentiary record.”  *Id.*Neither party submitted written direct witness testimony, so the ALJ determined that an in-person hearing was unnecessary and decided the case on the written record rather than by summary judgment.  *Id.* at 4, n.4.  The ALJ held that CMS (through its contractor, Noridian) had a legitimate basis to assign Petitioner a February 18, 2020 effective date for his reactivated Medicare billing privileges, with retrospective billing privileges authorized beginning January 19, 2020.  *Id.* at 6-8.  Applying 42 C.F.R. § 424.520(d) and Board precedent, the ALJ reasoned that February 18, 2020, was the filing date of the first revalidation application that CMS could and did approve, and that CMS permissibly exercised its discretion to grant Petitioner a 30-day retrospective billing period from that date.  *Id.* at 6-7.  The ALJ also ruled that Petitioner’s deactivation and his equitable arguments were not reviewable, and the only reviewable issue was the correctness of the reactivation effective date.  *Id.*

On December 10, 2020, Petitioner addressed a letter to both the Board and the ALJ, which the Board received and docketed under Docket Number A-21-19.  Petitioner’s letter contained further argument about his retrospective billing date and sought to submit new exhibits, yet seemed to request action only by the ALJ and not the Board.  *See*Jan. 8, 2021 Order Denying Request for Reopening at 1.  Accordingly, the Board informed Petitioner that it would treat his letter as a petition to the ALJ to reopen and revise her decision pursuant to 42 C.F.R. 498.100(a) and would refer the request to the ALJ unless Petitioner advised the Board otherwise within 10 days*.  Id.*  After receiving no timely response from Petitioner, the Board referred the letter to the ALJ and closed the matter docketed as A-21-19.

The ALJ treated Petitioner’s December 10, 2020 letter as a request to reopen and revise the ALJ Decision and issued an order denying that request.  *Id.* at 1, 3.  The ALJ’s order reiterated the reasoning and holding of the ALJ Decision.  Regarding Petitioner’s request to submit new evidence, the ALJ explained that Petitioner already had received an opportunity to timely present evidence in support of his arguments as part of his request for reconsideration but had failed to do so, and that the ALJ would not now consider the new evidence.  *Id.* at 2-3.  The ALJ further noted that the exhibits Petitioner referenced in his request were not appended to it, and their descriptions indicated they also would be irrelevant to the only disputed and reviewable issue.  *Id.* at 1-2 nn. 1, 2.

On January 21, 2021, Petitioner requested Board review of the ALJ Decision and that his Medicare billing privileges “be reinstated from August 2019” because “CMS failed to do their due diligence in working with” him to “save” his privileges.  RR at 2*.*  Petitioner complains that Noridian did not send its pre-deactivation letters via certified mail, and

**Page 7**

that Noridian had his phone and fax numbers, but “never did they call or fax me from February 18, 2019 when this all began,” until “after we started the appeal.”  *Id.*  Petitioner also asserts that Noridian’s November 14, 2019 letter concerning his initial revalidation application of August 20, 2019, was “vague” and “very ambiguous” because it “did not state the word ‘rejected’ due to erroneous specialty privileges,” and that Noridian did not effectively communicate with him by telephone or fax.  *Id*.

CMS’s brief asserts that Petitioner has alleged no consequential factual errors or erroneous legal conclusions in the ALJ Decision, and that he instead raises issues that the Board cannot address concerning his deactivation and equitable relief.  CMS Br. at 2-3.  CMS contends that “Petitioner does not allege that he submitted a Form CMS-855I Medicare revalidation application to be processed between his July 31, 2019 deactivation and February 18, 2020,” which “is the material issue in determining the effective date of reactivation of his Medicare enrollment and billing privileges.”  *Id.* at 11.  CMS also asserts that many of Petitioner’s arguments focus on his deactivation, which “is not a determination that may be appealed.”  *Id.* at 15.  CMS also contends that “essentially Petitioner’s claim is one for equitable relief – that the circumstances surrounding his deactivation and reactivation were such that CMS should use an earlier effective date of reactivation,” and that the Board has no authority to provide such equitable relief.  *Id.* at 18, 19.

Standard of Review

In supplier enrollment appeals, the Board may not admit evidence into the record that was not introduced**before the ALJ.  42 C.F.R. § 498.86(a).  The Board will not consider issues that Petitioner has not raised in the request for review, or which the parties could have presented to the ALJ but did not.  *Guidelines – Appellate Review of Decisions of Administrative Law Judges Affecting a Provider’s or Supplier’s Enrollment in the Medicare Program*(*Guidelines*), “Completion of the Review Process,” ¶ (a) (available at https://www.hhs.gov/about/agencies/dab/different-appeals-at-dab/appeals-to-board/guidelines/enrollment/index.html).

The Board’s standard of review on a disputed factual issue is “whether the ALJ decision is supported by substantial evidence in the record as a whole.”  *Id.*, “Completion of the Review Process,” ¶ (c).  The Board also reviews whether any “prejudicial error of procedure (including an abuse of discretion under the law or applicable regulations) was committed.”  *Id.*  The Board’s standard of review on a disputed issue of law is “whether the ALJ decision is erroneous,” meaning “contrary to law or applicable regulations.”  *Id.*

**Page 8**

Analysis

The ALJ correctly concluded that the only appealable issue Petitioner has raised is the effective date of his reactivated Medicare enrollment and billing privileges.  *See*ALJ Decision at 6-7; *see also Ark. Health Group* at 9(“The only appealable issue where, as here, billing privileges were deactivated and then reactivated, is the effective date of reactivated billing privileges in accordance with section 424.520(d).”) (footnote omitted).  Applying 42 C.F.R. § 424.520(d) and Board precedents, the ALJ also correctly concluded that CMS had correctly determined that the effective date of reactivation of Petitioner’s Medicare enrollment was February 18, 2020 (with a retrospective billing period of 30 days before that date).  Petitioner’s attempt to challenge that determination by presenting to the Board new evidence not previously proffered to the ALJ is impermissible.  Finally, the ALJ also properly determined that, to the extent that Petitioner requested relief based on equitable principles, the ALJ could not grant such relief.  We therefore affirm the ALJ’s conclusion concerning the effective date of Petitioner’s reactivated Medicare billing privileges.

***The ALJ correctly concluded that the only reviewable issue before her was whether Noridian assigned the correct effective date for Petitioner’s reactivated billing privileges.***Petitioner appeals from the ALJ Decision, and requests elimination of the gap in his Medicare billing privileges between July 31, 2019 and January 19, 2020 on the grounds that CMS did not act with “due diligence” concerning his deactivation and reactivation in two respects.  RR at 1-2.  First, Petitioner objects that CMS did not transmit advance notice of his Medicare reactivation requirement and potential loss of billing privileges by telephone, text message, or certified mail as well as regular mail.  *See id.* at 1.  Second, Petitioner asserts that CMS’s letter dated November 14, 2019, which returned his erroneous August 20, 2019 reactivation application, was “ambiguous” and “vague,” and that in several subsequent communications CMS did not adequately convey “that there was a problem with [his] privileges application.”  *Id.* at 1-2.

Petitioner’s arguments concerning inadequate notice of CMS’s deactivation of his billing privileges are not subject to ALJ or Board review, because “whether or not Petitioner was notified of the deactivation of . . . Medicare billing privileges is outside the Board’s authority to review.”  *Urology Group* at 7; *see also Ark. Health Group* at 10 (stating that “deactivation is not itself an appealable determination”);*Frederick Brodeur, M.D.*, DAB No. 2857, at 12 (2018) (“A contractor’s deactivation decision is not an initial determination subject to ALJ or Board review.”) (citing 42 C.F.R. § 498.3(b));*Willie Goffney, Jr., M.D.* ̧ DAB No. 2763, at 4 (2017) (“[T]he regulations do not provide a right to ALJ review of deactivation of billing privileges.”), *aff’d sub nom. Goffney v. Azar*, 2019 WL 13067036 (C.D. Cal. Sep. 25, 2019),*aff’d sub nom. Goffney v. Becerra*, 995 F.3d 737 (9th Cir. 2021),*cert. denied*, 142 S. Ct. 589 (2021). “The governing regulations

**Page 9**

grant providers and suppliers the right to appeal certain specified ‘initial determinations’ by CMS for ALJ and Board review, which the Board has held include initial determinations regarding the effective date of Medicare billing privileges,” but “[t]he regulations do not grant suppliers the right to appeal deactivations.”  *Urology Group* at 6 (citations omitted).

Also, to the extent Petitioner contends Noridian’s November 14, 2019 letter was an inadequately informative rejection of Petitioner’s reactivation application of August 20, 2019, that, too, is an issue the Board may not review.4  Petitioner appears to argue that the letter was in effect a rejection but improperly failed to identify itself as such and failed to state the basis for rejection.  *See*RR at 2 (“If it stated the word ‘rejected’ due to erroneous specialty privileges were requested, it would have made sense.”)  However, even assuming arguendo that the November 14, 2019 letter constituted a rejection of Petitioner’s erroneous application of August 20, 2019, and that the letter could have stated more clearly that it was a rejection and the grounds for rejection, the issue is unreviewable.  “Enrollment applications that are rejected are not afforded appeal rights.”  42 C.F.R. § 424.525(d); *see also Gregory J. Frazer, Au. D., Ph. D*., DAB No. 3038, at 14 (2021)(“[T]he rejection of an enrollment application and deactivation of billing privileges are not reviewable by the Board.”); *Liu* at 7 (“[T]he regulations do not provide for ALJ (or Board) review of the deactivation of billing privileges or the rejection of enrollment applications.”).

Thus, the ALJ did not err in concluding that “[t]he deactivation of Petitioner’s billing privileges on July 31, 2019, based on his failure to revalidate his enrollment record, is not reviewable,” and that the only reviewable issue was “the effective date assigned for Petitioner’s reactivated billing privileges.”  ALJ Decision at 6, 7 (internal citations omitted).  “Petitioner may not now challenge the effectuation of the deactivation through an appeal that solely concerns the effective date of reactivation.”  *Urology Group*at 7.  As the ALJ correctly summarized, Petitioner’s request for an earlier effective date of revalidated billing privileges impermissibly “focuses on matters outside of the scope of” review, given that he indisputably submitted no revalidation application that CMS could process to approval before February 18, 2020.  ALJ Decision at 7.

**Page 10**

***The ALJ’s conclusion that the effective date of Petitioner’s Medicare enrollment and billing privileges is February 18, 2020, with retrospective billing authorized beginning January 19, 2020, is supported by substantial evidence and free of legal error.***Substantial evidence supports the ALJ’s material findings of fact on the sole reviewable issue of Petitioner’s effective date for reactivated billing privileges.  The ALJ found, as the record shows, that on February 28, 2019, Noridian informed Petitioner that he was
required to revalidate his Medicare enrollment prior to May 31, 2019.  ALJ Decision at 4; CMS Ex. 1.  Petitioner’s claim that he did not timely receive the letter does not disprove the record evidence that Noridian issued it to Petitioner and it was not returned.  *See*CMS Ex. 8, at 4-5.  The ALJ found, and Petitioner does not dispute, that on July 31, 2019, Noridian deactivated Petitioner’s billing privileges because he had not responded to the revalidation request.  ALJ Decision at 4; CMS Ex. 3.  The ALJ found, and Petitioner does not dispute, that on February 18, 2020, he submitted an enrollment application to revalidate his enrollment record.  ALJ Decision at 4; CMS Ex. 4.  Petitioner alleges Noridian mishandled a previous enrollment application filed on August 20, 2019, yet acknowledges it was for the “wrong privileges” and that he received CMS’s November 14, 2019 notice that CMS was “returning” and “closing” that application along with instructions on resubmitting a new one.  RR at 1-2.  The record also contains substantial and uncontested evidence that when Petitioner submitted a second, approvable reactivation application on February 18, 2020, CMS promptly reactivated his Medicare enrollment as of that date, with retrospective billing privileges effective January 19, 2020.  CMS Exs. 4, 5.  Thus, the ALJ’s findings are supported by substantial evidence.*See Shelia Ann Reed*, DAB No. 3059, at 6 (2022) (stating that substantial evidence constitutes more than a mere scintilla of evidence, and is evidence which a reasonable mind might accept as adequate to support a conclusion) (citations omitted).

Based on the ALJ’s supported factual findings, the ALJ committed no legal error in concluding that, pursuant to 42 C.F.R. §§ 424.520(d)(1) and 424.521(a)(1), Noridian had a legitimate basis to reactivate Petitioner’s billing privileges effective February 18, 2020, with retrospective billing privileges authorized beginning January 19, 2020.5  Petitioner has not argued or offered proof that he filed any enrollment application before February 18, 2020, which Noridian could or did process to approval before that date.  Petitioner also has cited no factual or legal basis supporting a retrospective billing period longer than the 30 days that section 424.521(a)(1) authorized and CMS granted.  Deactivation means that a supplier’s billing privileges “can be restored *upon*,” not before, “the submission of updated information.”  42 C.F.R. § 424.502 (emphasis added).  “[T]he

**Page 11**

effective date of enrollment is, and must be, based on the date of receipt of an application that was actually approved, not one that was rejected.”  *Wishon Radiological Med. Group, Inc.*, DAB No. 2941, at 6 (2019).  Therefore, Petitioner has established no factual or legal basis for an earlier effective reactivation enrollment date than February 18, 2020, with a retrospective billing date of January 19, 2020.

To conduct the review and reach the result that Petitioner seeks would be contrary to the letter and intent of the regulatory scheme.  “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.”  *Urology Group*at 11.  *See also Wishon* at 6 (“If Petitioner could challenge Noridian’s rejection of its initial application through an appeal of the effective date of a subsequently approved new application, section 424.525(d) would be rendered null.”) (citing *Lindsay Zamis, M.D., a Pro. Corp.*, DAB No. 2802, at 9 (2017));*Brodeur* at 16 (holding that to let a supplier enjoy continued billing privileges while deactivated for regulatory non-compliance “is to render sections 424.540(a) and (b) meaningless” and “would conflict with section 424.555(b) of the regulations”).  Thus, Petitioner has established no legal error in the ALJ’s conclusion that the effective date of Petitioner’s Medicare enrollment and billing privileges is February 18, 2020, with retrospective billing authorized beginning January 19, 2020.

***Petitioner’s proposed new exhibits are not admissible.***Petitioner now seeks to augment the factual record by asking that the Board “kindly accept” and consider three supplemental exhibits.  RR at 1.  Petitioner describes proposed “Exhibit 1” as “copies of emails from the sources that were used by Senator Brian Schatz’s office to get me copies of the letters that I did not receive.”  *Id*.  Petitioner describes proposed “Exhibit 2” as “a copy of the public statement by CMS that they try to contact providers to let them know about their expiring privileges,” *id.*; however, it actually is a printout of United States Postal Service zip code information, which Petitioner previously submitted to the ALJ.  *See*CMS Ex. 6, at 14-15; Ex. C to Sept. 1, 2021 P. Br. to ALJ; ALJ Decision at 3, 3 n.3.  Petitioner’s proposed “Exhibit 3” is a three-page website printout headed “CMS.gov,” concerning “Revalidations,” which bears a footer date of “8/21/20,” and which Petitioner cites for the proposition that CMS “failed to carry out their promise.”  RR at 2.

Petitioner referenced these additional exhibits in his December 10, 2020 letter to the Board and the ALJ after the ALJ Decision issued.  *See*Dec. 10, 2020 letter at 1, 2.  The ALJ noted, in reviewing that letter, that “no exhibits are appended to” it, and that “Petitioner had an opportunity to timely present evidence in support of his arguments, and he did not do so.”  *See*Jan. 8, 2021 Order Denying Request for Reopening at 1-2 n.1, 2.  Petitioner now indicates that he intended to submit these supplemental exhibits only to the Board, not the ALJ, and seeks review only of the ALJ Decision and not the ALJ’s

**Page 12**

subsequent order denying reopening of the ALJ Decision.  *See*RR at 1 (stating that Petitioner “requested that the Appellate/DAB Board take up” his appeal of the ALJ’s “November 19, 2020 decision” and objecting that “[f]or some reason” his December 10, 2020, correspondence referencing the new exhibits “went back” for consideration by the ALJ rather than the Board).  Accordingly, the Board does not review the ALJ’s January 8, 2021 Order Denying Request For Reopening, and addresses Petitioner’s request as one to submit new evidence to the Board.

Petitioner’s proposed exhibits are inadmissible, because the Board has no discretion to admit them.  The regulation at 42 C.F.R § 498.86(a) states that, “[e]xcept for provider or supplier enrollment appeals, the Board may admit evidence into the record in addition to the evidence introduced” before the ALJ.  In other words, as the Board’s decisions repeatedly have made clear in supplier enrollment appeals like this one, the Board cannot admit into the record new evidence that was not proffered to the ALJ.  *See Liu* at 9 n.4 (“The appeal regulations, however, forbid the Board from admitting into the record in Medicare enrollment appeals evidence not proffered to the ALJ.”); *accord Frazer* at 8 (“The appeal regulations prohibit the Board from admitting into the record in Medicare enrollment appeals evidence not proffered to the ALJ.”) (citation omitted).  Petitioner did not proffer Exhibits 1 and 3 to the ALJ, and therefore the Board cannot admit them or consider their substantive contents.  Petitioner did proffer Exhibit 2 (consisting of zip code information) to the ALJ, who noted that it was already part of the administrative record (*see* ALJ Decision at 3 n.3), and therefore it is inadmissible before the Board as duplicative evidence.6

Even if the Board had discretion to admit these exhibits, they would be admissible only if the Board considered them “relevant and material to an issue before it,” *see*42 C.F.R. § 498.86(a), but they are not.  In such circumstances, the Board properly excludes proposed new evidence.  *See Frazer* at 8 n.12 (“Even if we could consider admitting [petitioner’s proposed new] evidence, we would exclude it as irrelevant and immaterial because the evidence only goes to challenging determinations that are not reviewable by the ALJ or the Board . . . .”).  As the ALJ correctly determined, the only disputed and appealable issue is whether CMS had a legal basis to assign a February 18, 2020 effective date for Petitioner’s reactivated billing privileges.  *See*ALJ Decision at 6-7; *see also*Jan. 8, 2021 Order Denying Request for Reopening at 3.  Petitioner’s proposed Exhibit 1, consisting of emails from and to a senator’s office concerning allegedly unreceived letters from Noridian, is not relevant or material to the appealable issue, and at most relates

**Page 13**

tangentially to the circumstances of Petitioner’s deactivation, which is not appealable.  *See**Ark. Health Group* at 12 (2019) (describing deactivation as “a determination that is for CMS (or its contractor) to make and which is not appealable to the ALJ and the Board”).  For the same reasons, Petitioner’s proposed Exhibit 2, which concerns postal service zip codes and relates to the circumstances of Petitioner’s deactivation, also is neither relevant nor material to the issue before us.  Proposed Exhibits 1 and 2 also appear irrelevant and immaterial on the additional ground that, while Petitioner still maintains he did not timely receive Noridian’s pre-deactivation letters, he now concedes he is “not arguing why I didn’t receive the letters.”  RR at 1.  Petitioner’s proposed Exhibit 3, a purported CMS website printout bearing a footer date of “8/21/20,” is irrelevant and immaterial because no testimony or other evidence confirms its authenticity or consistency with information CMS provided at the time that Noridian issued the challenged revalidation effective date determination on February 21, 2020.  Furthermore, proposed Exhibit 3 is irrelevant in that it speaks only to the revalidation requirement and says nothing determinative of the effective date of revalidation, which is the sole reviewable issue.

Accordingly, we do not admit or consider Petitioner’s proposed new exhibits in rendering this decision.  They are retained in the administrative record but are not admitted to the record for decision.

***The ALJ correctly rejected Petitioner’s arguments that are equitable in nature.***As the ALJ correctly concluded, Petitioner’s equitable arguments are unavailing.  *See*ALJ Decision at 7 (“To the extent that Petitioner’s request for relief is based on principles of equitable relief, I cannot grant such relief.”) (citation omitted).  Petitioner asserts that, as he is a “30 year provider,” he and CMS “should be working as a team to make sure that we continue to provide the best treatment,” and that CMS “failed to do their due diligence in working with me to save my privileges.”  RR at 2.  “The applicable regulations, however, do not provide for consideration of such equitable arguments in ALJ or Board appeals of CMS enrollment determinations.”  *Amber Mullins, N.P.*, DAB No. 2729, at 5 (2016).  “Neither the ALJ nor the Board is authorized to provide equitable relief by reimbursing or enrolling a supplier who,” like Petitioner in this case during the period from July 31, 2019 through January 18, 2020, “does not meet statutory or regulatory requirements.”  *US Ultrasound*, DAB No. 2302, at 8 (2010).  “[T]he Board has repeatedly held that it, and ALJs, are bound by the applicable regulations and cannot alter an effective date based on principles of equity.”  *Tosan Fregene, M.D. and Oncology Clinics, Inc.*, DAB No. 3018, at 6 (2020) (citation omitted).  *See also 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, even a constitutional one.”).

**Page 14**

Even if the Board were to construe Petitioner’s arguments as asserting an equitable estoppel claim, and even if such a claim could constitute an exception to the general rule barring the Board’s consideration of equitable arguments, the record does not support such a claim.  It is possible to construe Petitioner’s argument that CMS “failed to carry out their promise” to “reach out to the providers in every way possible,” RR at 2, as an attempted equitable estoppel claim against CMS.  However, under Board and judicial precedent, a claim of equitable estoppel against the government could be cognizable (if at all) only in the situation of affirmative governmental misconduct, such as fraud, which Petitioner does not assert, and of which there is no evidence here.  *See Goffney* at 8-9; *US Ultrasound* at 8.  Petitioner’s assertion of inadequate “due diligence” by CMS in “working with” him (*see* RR at 2) does not amount to actionable affirmative misconduct by CMS.  *See Frazer*at 12 (surveying decisions holding that negligently providing inaccurate information or erroneous oral advice does not constitute affirmative misconduct).

Petitioner’s arguments are remarkably similar to equitable contentions that the Board held it could not address in *Chaplin Liu, M.D.*, DAB No. 2976.  The petitioning supplier in that case, like Petitioner in this case, complained of difficulties in navigating the process for updating and maintaining Medicare enrollment with CMS through Noridian.  *Id.*at 8-9.  Specifically, in *Liu*, as here, the petitioner complained of unreceived correspondence and unsuccessful telephone inquiries, and that Noridian staff generally should have assisted him and his staff better with submitting a complete and timely revalidation application.  *Id.* at 5, 8-10.  Such contentions, “however sympathetic a picture they evoke, are not legal grounds for the Board or an ALJ to set an earlier effective date for Petitioner’s Medicare billing privileges, where CMS’s determination of that date is, as explained above, consistent with the governing regulation.”  *Id.*at 10.

Even if the Board could address Petitioner’s equitable arguments, it is noteworthy that Petitioner bears the ultimate legal responsibility for his non-compliance with Medicare program requirements, which led to his deactivation and any delay in restoring his billing privileges.  As CMS observes, “Petitioner points to no regulatory support for his contention that CMS may not deactivate a provider unless it has used a specific communication method.”  CMS Br. at 16.  The pertinent regulation requires only that “CMS contacts each provider or supplier directly when it is time to revalidate their enrollment information,” without requiring any particular transmittal method for the notice.  *See* 42 C.F.R. § 424.515(a)(1).  Petitioner also ultimately bears responsibility for submitting an incorrect revalidation application to CMS on August 20, 2019, and thus for any resulting delay in restoring his billing privileges.  *See*42 C.F.R. § 424.515 (stating that, to revalidate enrollment, physician suppliers are “*required* to complete the *applicable* enrollment application”) (emphasis added); 42 C.F.R. § 424.515(a)(2) (stating supplier “*must* submit to CMS the *applicable* enrollment application with complete and *accurate* information”) (emphasis added).

**Page 15**

Furthermore, even if the Board could weigh equitable considerations, assessing responsibility to Petitioner for complying with Medicare revalidation requirements would be reasonable, given his asserted familiarity with the Medicare program and its requirements as “an almost 30 year provider for Medicare.”  CMS Ex. 6, at 4; *see also*RR at 2.  “As courts and the Board have recognized, Medicare providers and suppliers, as participants in the program, have a duty to familiarize themselves with Medicare requirements.”  *Brodeur* at 11 (citing cases); *see also* *Heckler*, 467 U.S. at 63 (“Protection of the public fisc requires that those who seek public funds act with scrupulous regard for the requirements of law. . . .”); *Waterfront Terrace, Inc.*, DAB No. 2320, at 7 (2010) (confirming that Medicare-certified provider should possess at least a rudimentary understanding of program rules and terminology) (citation omitted).  Petitioner’s attempt to shift “due diligence” obligations from himself to CMS and its contractors is inconsistent with “the general rule that those who deal with the Government are expected to know the law and may not rely on the conduct of Government agents.”  *Heckler*, 467 U.S. at 63.  As the Board has stated previously under similar circumstances, in the end “the ability for Petitioner to bill for Medicare reimbursement rested entirely in Petitioner’s own hands.”  *Urology Group*at 14.

For these reasons, we reject Petitioner’s equitable arguments and uphold the ALJ’s decision declining to grant Petitioner an earlier effective date based on equitable grounds.  ALJ Decision at 7-8 (citing *US Ultrasound* at 8 and *1866ICPayday.com, L.L.C*. at 14).

**Conclusion**

We affirm the ALJ’s November 19, 2020 decision upholding February 18, 2020 as the effective date for Petitioner’s reactivated billing privileges, with retrospective billing authorized beginning January 19, 2020.

Endnotes

1  We apply the versions of the regulations in effect during the relevant events.  Subsection 424.540(b), as originally adopted effective June 20, 2006, and as amended effective November 4, 2019, and January 1, 2022, consistently has permitted CMS and its contractors to require a deactivated supplier to submit a Form CMS-855 application to reactivate his billing privileges.  *See*71 Fed. Reg. 20,754, 20,780 (Apr. 21, 2006); 84 Fed. Reg. 47,794, 47,856 (Sept. 10, 2019); 86 Fed. Reg. 62,240, 62,420 (Nov. 9, 2021).  The regulations at 42 C.F.R. Part 424, Subpart P have undergone other revisions that postdate the relevant events and thus do not affect this appeal.  For example, effective January 1, 2022, CMS adopted 42 C.F.R. § 424.540(d)(2) and 42 C.F.R. § 424.540(e), which, respectively, address when billing reactivation takes effect and prohibit retrospective billing privileges during a period of deactivation.  *See* 86 Fed. Reg. at 62,420-21.

2  This background summary is drawn from the ALJ Decision and the record of the ALJ proceedings.  Our summary should not be regarded as supplementing or modifying the ALJ’s findings of fact.  *Breton Lee Morgan, M.D.*, DAB No. 2264, at 3 n.3 (2009), *aff’d*, *Morgan v. Sebelius*, 2010 WL 3702608 (D. W.Va. Sept. 15, 2010), *aff’d*, 694 F.3d 535 (4th Cir. 2012).  We make no additional findings of fact.

3  Although Petitioner repeatedly identifies himself as a “provider,” he is instead a “supplier” under the applicable regulatory definitions.  *See*42 C.F.R. § 400.202 (defining “provider” to include “a hospital, . . . a skilled nursing facility, a comprehensive outpatient rehabilitation facility,” and other institutions, and a “supplier” as “a physician or other practitioner, or an entity other than a provider, that furnishes health care services under Medicare”).

4  The ALJ did not determine, nor need the Board determine, whether Noridian’s November 14, 2019 letter was notice of the rejection of Petitioner’s application under 42 C.F.R. § 424.525(a) or a mere application return of the type previously recognized in sub-regulatory guidance and now expressly authorized, effective January 1, 2022, under 42 C.F.R. § 424.526.  *See* 86 Fed. Reg. 62,240, 62,357-59 (discussing existing sub-regulatory guidance and implementing new rules and procedures for application “returns” at new section 424.526).  Neither rejections nor returns of applications by CMS contractors are subject to Board review.  *See* 42 C.F.R. §§ 424.525(d), 424.526(b).

5  We cite to, and apply, the enrollment regulations in effect on the date CMS’s contractor issued the initial determination.  *See George Yaplee Med. Ctr.*, DAB No. 3003, at 3 n.3 (2020).  *See supra*note 1*.*

6  The document that the ALJ referenced as “Exhibit 2” in her post-hearing Order declining to reopen the case is in fact Exhibit 3 of the proposed Exhibits that Petitioner has submitted to the Board.  The ALJ could not recognize the discrepancy between Petitioner’s description of Exhibit 2, and his actual Exhibit 2, because, as the ALJ noted, “no exhibits [we]re appended to Petitioner’s December 10, 2020 correspondence.”  *See*Jan. 8, 2021 Order Denying Request for Reopening at 1-2 n.1.
  
          /s/
        Christopher S. Randolph

                      Board Member
          /s/
        Constance B. Tobias

                      Board Member
          /s/
        Kathleen E. Wherthey

                      Presiding Board Member Back to top
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