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                              DiNapoli and DiNapoli, Inc., DAB CR5968 (2021)
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DiNapoli and DiNapoli, Inc., DAB CR5968 (2021)








  
  
    

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





DiNapoli and DiNapoli, Inc.,
(PTAN:  J100000336)
(NPI:  1508084096)
Petitioner,

v.

Centers for Medicare & Medicaid Services.
Docket No. C-19-1061Decision No. CR5968October 22, 2021

        
              
    

      DECISION

Petitioner, DiNapoli and DiNapoli, Inc., is a group optometry practice, operating in Clifton Park, New York.  After its Medicare billing privileges were deactivated, the practice applied to reenroll in the program.  After several rejections, the Centers for Medicare & Medicaid Services (CMS) granted its application, effective May 24, 2019 (with a retrospective billing date of April 24, 2019).

Petitioner now challenges that effective date.

Because Petitioner filed its subsequently-approved enrollment application on May 24, 2019, I find that May 24 is the correct effective date of its enrollment.  *Urology Grp. of NJ, LLC*, DAB No. 2860 (2018); *Willie Goffney, Jr., M.D.*, DAB No. 2763 at 3-5 (2017), *aff’d*,*Goffney v. Azar*, No. CV 17-8032, 2019 WL 13067036 (C.D. Cal. Sept. 25, 2019).

Background

In a letter dated June 20, 2019, the Medicare contractor, National Government Services, advised Petitioner that it approved the practice’s reactivation application, with a gap in billing privileges from June 21, 2018, through April 23, 2019.  CMS Ex. 22.  Petitioner sought reconsideration, asking that Medicare pay the claims it filed during the billing gap

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period.  CMS Exs. 23, 24.  In a reconsidered determination, dated August 8, 2019, the contractor denied Petitioner’s request.  CMS Ex. 1.

Petitioner appealed.

Although CMS has moved for summary judgment, I find that this matter may be decided on the written record, without considering whether the standards for summary judgment are satisfied.  In my initial order, I instructed the parties to list all proposed witnesses (if any) and to submit their written direct testimony.  Acknowledgment and Pre-hearing Order at 3-5 (¶¶ 4, 8) (Sept. 11, 2019).  I also directed each party to state, affirmatively, whether it intended to cross-examine any proposed witness.  Order at 5 (¶ 9).  An in-person hearing is necessary “only if a party files admissible, written direct testimony, and the opposing party asks to cross-examine.”  Order at 6 (¶ 10).  CMS listed no witnesses.  Although Petitioner submits the written declaration of its President (P. Ex. 5), CMS has not asked to cross-examine him.  An in-person hearing would therefore serve no purpose, and I may decide the case based on the written record.

With its motion and brief (CMS Br.), CMS submits 27 exhibits (CMS Exs. 1-27).  Petitioner submits its own brief (P. Br.) with six exhibits (P. Exs. 1-6).

CMS objects to my admitting P. Exs. 3 and 4 for two reasons:  1) Petitioner did not submit these documents at the reconsideration level or before and has not provided good cause for failing to do so, as required by 42 C.F.R. § 498.56(e); and 2) the documents are irrelevant.

P. Ex. 3 is a letter from TD Bank, dated August 23, 2019, stating that “Dinapoli and Dinapoli has had an active checking account with TD Bank” since 2002. P. Ex. 4 includes the first page of Petitioner’s state and federal tax returns for 2017 and 2018.

Under 42 C.F.R. § 498.56(e), I may admit new documentary evidence only if I find good cause for Petitioner’s submitting it, for the first time, at the hearing level.  In its June 20, 2019 notice letter, the contractor warned Petitioner:

If you have additional information that you would like a hearing officer to consider during the reconsideration, or, if necessary, an administrative law judge to consider during a hearing, *you must submit that information with your request for reconsideration*.  This is your *only opportunity* to submit information during the administrative appeals process; *you will not have another opportunity to do so* unless an administrative law judge specifically allows you to do so under 42 CFR § 498.56(e).

CMS Ex. 22 at 2-3 (emphasis added).

Here, Petitioner claims good cause because the Medicare contractor purportedly did not give the practice “the opportunity to produce exhibits 3 and 4 prior to

Page 3

rejecting/deactivating [the practice’s] billing privileges on June 22, 2018.”  P. Reply to CMS’s objections (Jan. 23, 2020).  This does not explain why Petitioner couldn’t have produced these documents with its request for reconsideration, a full year later.  Although the TD Bank letter is dated August 23, 2019, the information it contains has been available throughout the period of Petitioner’s deactivation and reapplication.  *See* CMS Ex. 17 at 19 (May 1, 2019 letter from TD Bank, which is attached to Petitioner’s third revalidation enrollment application).  Petitioner’s tax returns were likewise available and could have been produced at an earlier stage.  Petitioner has thus not established good cause for failing to submit the documents.

Moreover, the documents are irrelevant.  Petitioner submits them to show that the contractor erred in deactivating its Medicare billing privileges and rejecting its enrollment application.  As discussed below, I have no authority to review these actions.

I admit into evidence CMS Exs. 1-27 and P. Exs. 1-2 and 5-6.

Discussion

***Petitioner filed its subsequently-approved application on May 24, 2019, and its Medicare enrollment can be no earlier than that date.  42 C.F.R. §*** ***424.520(d).***1

**Enrollment**.  Petitioner, DiNapoli and DiNapoli, Inc., participates in the Medicare program as a “supplier” of services.  Social Security Act § 1861(d); 42 C.F.R. § 498.2.  To receive Medicare payments for the services it furnishes to program beneficiaries, a prospective supplier must enroll in the program.  42 C.F.R. § 424.505.  “Enrollment” is the process by which CMS and its contractors: 1) identify the prospective supplier; 2) validate the supplier’s eligibility to provide items or services to Medicare beneficiaries; 3) identify and confirm a supplier’s owners and practice location; and 4) grant the supplier Medicare billing privileges. 42 C.F.R. § 424.502.

To enroll, a prospective supplier must complete and submit an enrollment application.  42 C.F.R. §§ 424.510(d)(1), 424.515(a).  An enrollment application is either a CMS-approved paper application or an electronic process approved by the Office of Management and Budget.  42 C.F.R. § 424.502.2
   CMS may reject a provider’s or supplier’s enrollment application if:  1) the applicant fails to furnish complete information on the enrollment application within 30 calendar days from the date the contractor requests missing information; 2) the applicant fails to furnish all required supporting documentation within 30 calendar days of submitting the enrollment

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application; or 3) the applicant does not submit the application fee or a hardship waiver request with the enrollment application.  42 C.F.R. § 424.525(a).  At its discretion, CMS may extend the 30-day period if it determines that the applicant “is actively working with CMS to resolve any outstanding issues.”  42 C.F.R. § 424.525(b).

If an enrollment application is rejected, the applicant must complete and submit a new enrollment application and submit all supporting documentation for CMS review and approval.  42 C.F.R. § 424.525(c).

Rejected enrollment applications *have no appeal rights*.  42 C.F.R. § 424.525(d).

When CMS determines that a prospective supplier meets the applicable enrollment requirements, it grants Medicare billing privileges, which means that the supplier can submit claims and receive payments from Medicare for covered services provided to program beneficiaries.  The effective date for its billing privileges “is the *later*of the date of filing” a subsequently-approved enrollment application or “the date an enrolled physician . . . first began furnishing services at a new practice location.”  42 C.F.R. § 424.520(d) (emphasis added).

**Retrospective billing**.  If a physician, non-physician practitioner, or practice group (such as Petitioner) meets all program requirements, CMS may allow it to bill retrospectively for up to 30 days prior to the effective date of enrollment “if circumstances precluded enrollment in advance of providing services to Medicare beneficiaries.”  42 C.F.R. § 424.521(a)(1).

**Deactivation**.  To maintain its billing privileges, a supplier must, at least every five years, resubmit and recertify the accuracy of its enrollment information, a process referred to as “revalidation.”  42 C.F.R. § 424.515.  In addition to periodic revalidations, CMS may, at other times and for its own reasons, ask a supplier to recertify the accuracy of its 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 its enrollment information, CMS may deactivate its billing privileges, and no Medicare payments will be made.  42 C.F.R. §§ 424.540(a)(3); 424.555(b).  To reactivate its 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.  *Urology Grp.*, DAB No. 2860 at 7; *Goffney*, DAB No. 2763 at 7.

**Petitioner’s deactivation**.  The following is the tortured history of Petitioner’s efforts to revalidate its Medicare enrollment:

Page 5

On March 30, 2018, Petitioner submitted a revalidation application, CMS Form 855B.  CMS Ex. 2.  In a letter dated April 25, 2018, the contractor acknowledged receiving the application but asked Petitioner to submit, no later than May 25, 2018, additional information, including ownership interest and/or managing control information, a certification statement signed and dated by the authorized official, and an authorization agreement for electronic funds transfer and a copy of a voided check.  CMS Ex. 3.  Citing 42 C.F.R. § 424.525, the letter warned that “we may reject your application(s) if you do not furnish complete information within 30 calendar days from the postmarked date of this letter.”  CMS Ex. 3 at 1.

On May 24, 2018, Petitioner submitted another CMS Form 855B, accompanied by some of the missing documents.  CMS Ex. 4 at 5-11.  However, the name on the voided check was not the practice’s legal business name.  *Compare* CMS Ex. 4 at 11 (“DINAPOLI OPTICIANS INC.”) *with* CMS Ex. 2 at 11 (“DiNapoli & DiNapoli, Inc.”).  Thereafter, on June 6, 2021, a contractor representative called Petitioner’s contact person and directed him to email an “updated” voided check or bank document as soon as possible.  CMS Ex. 5 at 1.  Petitioner did not submit the requested document.

In a letter date June 21, 2018, the contractor advised Petitioner that, because it did not respond to the contractor’s request for more information, its billing privileges were stopped, effective June 21, 2018.  The letter also explained how Petitioner could revalidate its enrollment.  CMS Ex. 6

**Petitioner’s second revalidation application and its rejection**.  On June 29, 2018, Petitioner submitted a second revalidation application, CMS Form 855B.  CMS Ex. 7.  Again, the contractor determined that information was missing from the application.  In a letter dated July 31, 2018, the contractor listed the missing information, which included “written confirmation from the IRS confirming the practice’s Tax Identification Number with the Legal Business Name (e.g., IRS CP 575) provided in Section 2.”  CMS Ex. 8 at 3.  The letter again warned that, pursuant to 42 C.F.R. § 424.525, the contractor might reject the application if Petitioner did not furnish complete information within 30 calendar days from the letter’s postmarked date, by August 30, 2018.  CMS Ex. 8 at 1.

On August 7, 2018, Petitioner submitted additional information.  Contrary to the contractor’s explicit instructions, the IRS letter did not list the practice’s legal business name (“DiNapoli & DiNapoli, Inc.”); it listed “DINAPOLI OPTICIANS INC.”  CMS Ex. 9 at 13.  In a letter dated August 9, 2018, the contractor reiterated and emphasized that the practice’s electronic funds transfer application and its CMS 855B application had to identify Petitioner’s *legal business name*.  CMS Ex. 10 at 3.  The letter warned that the contractor might reject the application if Petitioner did not furnish the complete information within 15 calendar days (by August 24, 2018).  CMS Ex. 10 at 1.

On August 13, 2018, Petitioner filed another CMS Form 855B and submitted another electronic funds transfer application.  Again, on both documents, Petitioner incorrectly listed its legal business name as DiNapoli Opticians, Inc.  CMS Ex. 12 at 7, 11.  In a

Page 6

letter dated August 21, 2018, the contractor directed Petitioner to correct the errors and advised Petitioner to show that it had updated its name on the NPPES (National Plan and Provider Enumeration System) NPI registry and the New York State Corporations website to match its legal business name.  CMS Ex. 13 at 3.

On August 29, 2018, Petitioner submitted some of the requested corrections, but did not respond to the contractor’s request that it update its name on the NPI registry and the New York State Corporations website.  CMS Ex. 14.  The contractor sent another letter, dated September 12, 2018, asking for evidence that it had done so, warning Petitioner that it might reject the application if Petitioner failed to furnish the information within seven days (by September 19, 2018).  CMS Ex. 15.  Because Petitioner did not timely submit the requested information, the contractor rejected its application on October 1, 2018.  CMS Ex. 16.

**Petitioner’s third revalidation application and its approval**.  On *May 24, 2019*, Petitioner submitted, via PECOS, its third revalidation application, Form CMS 855B.  This application correctly identified the practice’s legal business name (“DiNapoli & DiNapoli, Inc.”).  Petitioner also submitted a letter from the IRS with the correct legal business name and an electronic funds transfer application and bank letter identifying the legal business name as the account holder.  CMS Ex. 17 at 1, 15.   After some additional development, the contractor approved the May 24, 2019 application.  CMS Ex. 22.

Thus, pursuant to section 424.520(d), the date Petitioner filed its subsequently-approved enrollment application – *May 24, 2019* – is the correct effective date of enrollment.  *Urology Grp.*, DAB No. 2860 at 7-9; *Goffney*, DAB No. 2763 at 7.

**Petitioner’s arguments**.  Petitioner submits a notice letter, dated September 28, 2018, directing Petitioner to revalidate its Medicare enrollment record no later than December 31, 2018.  P. Ex. 1.  Neither party has explained this letter.  Inasmuch as Petitioner’s billing privileges had been deactivated three months earlier, on June 21, 2018, it seems that the letter was a mistake.  Nevertheless, because of it, Petitioner suggests, without offering any additional underlying support or argument, that its billing privileges should have continued through December 31, 2018.  However, at the time it received the letter, Petitioner was well aware that its billing privileges had been deactivated and that one of its reactivation applications had been rejected.  Indeed, at the same time Petitioner would have received this letter, its second application was rejected.  Because CMS had not determined that Petitioner met the applicable enrollment requirements through December 2018, Petitioner was not entitled to bill the program during that time.

Petitioner also complains that the revalidation process took longer than it should have and that it was not able to submit timely the necessary documents due to circumstances beyond its control.  For example, the practice’s bookkeeper submitted the wrong names and then quit unexpectedly.  P. Ex. 5.  This explains why Petitioner did not provide the information that the contractor requested – indeed, repeatedly requested – leading to the contractor’s deactivating its enrollment and rejecting its earlier applications.  But those

Page 7

actions are not reviewable.  *Ark. Health Grp.*, DAB No. 2929 at 7-9 (2019) and cases cited therein; 42 C.F.R. § 424.525(d).

Conclusion

Because Petitioner filed its subsequently-approved reenrollment application on May 24, 2019, CMS properly granted its Medicare reenrollment effective that date.


          /s/
        Carolyn Cozad Hughes

                      Administrative Law Judge
      1. I make this one finding of fact/conclusion of law. back to note 1
                      2. CMS’s electronic process is referred to as PECOS (Provider Enrollment, Chain, and Ownership System). back to note 2 Back to top
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