Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Embassy Health Care Center,
(CCN: 14-5316),

Petitioner,
Vv.
Centers for Medicare and Medicaid Services.
Docket No. C-10-378
Decision No. CR2226

Date: August 20, 2010

DECISION

This case is before me pursuant to a January 28, 2010 remand from an appellate panel of
the Departmental Appeals Board (Board). Consistent with the dictate of the Board, I find
that Petitioner was out of substantial compliance with the regulation at 42 C.F.R.

§ 483.25(h). I further find that the Centers for Medicare and Medicaid Services’ (CMS)
imposition of a $200 per day civil money penalty (CMP) from March 17 through June 8,
2008 (84 days), amounting to a total CMP of $16,800, is reasonable.

I. Background

Petitioner, Embassy Health Care Center, is a long-term care facility located in
Wilmington, Illinois, that participates in the Medicare and Medicaid programs. Four
surveys were conducted at Petitioner’s facility during the relevant period; on March 17,
2008, April 1, 2008, May 16, 2008, and May 28, 2008, respectively. The March 17
survey involved deficiency citations concerning 42 C.F.R. § 483.13(c)(1)(ii)-(iii) and
(c)(2)-(4) (Tag F225, scope and severity level (ss) D) and 42 C.F.R. § 483.25(c) (Tag
F314, ss G). The April 1, 2008 survey involved a deficiency under 42 C.F.R.

§ 483.25(h) (Tag F323, ss G). CMS Exhibits (CMS Exs. 1, 9).
By document titled “Joint Motion to Consolidate and Stipulation of the Parties,” dated
October 23, 2008, the parties stipulated that the scope of the hearing would be limited to
evidence relating to the F314 and F323 Tags from the March 17 and April 1 surveys and
that all other deficiency findings would be uncontested.’

I conducted an in-person hearing in the case in December 2008 and admitted CMS Exs. 1
through 11 and Petitioner’s Exhibits (P. Exs.) 8 through 29, 31, and 34 (also referenced
as P. Ex. 32 (Tr. 206-07)). Petitioner did not offer a document as P. Ex. 30 (Petitioner’s
exchange exhibit list dated November 7, 2008). Each party submitted a post-hearing
brief (CMS Br. and P. Br., respectively) and a reply brief (CMS Reply and P. Reply,
respectively). A 210-page transcript (Tr.) of the hearing was prepared.

In my decision dated July 24, 2009, I sustained CMS’s determination to impose per day
CMPs of $200 against Petitioner for the period March 17 through June 8, 2008. Embassy
Health Care Center, DAB CR1980 (2009). In the interest of judicial economy, I did not
address the alleged violation of Tag F323, finding that Petitioner’s violation of Tag F314
was a sufficient basis for the enforcement remedies proposed by CMS. Petitioner
appealed my decision to the Board.

In its January 28, 2010 decision, the Board found that substantial evidence supported my
conclusion that Petitioner failed to comply with Tag F314 and that a $200 per day CMP
is reasonable for the period March 17 to April 1, 2008. However, the Board found that I
erred in deciding that CMS’s finding of noncompliance with Tag F323 from the April 1
survey was not material. The Board found it was undisputed that Petitioner had corrected
the noncompliance with Tag F314 by April 1, “so that noncompliance does not provide a
basis for a CMP for the period after that date.” Embassy Health Care Center, DAB No.
2299, at 2 (2010).? The Board vacated my decision to uphold the $200 per day CMP for

' Given the Board’s instructions on remand, in the event that I did not find Petitioner
violated the regulation at Tag F323, the Board directed me to consider whether I could
uphold the CMP in this case for the period May 16 through June 8, 2008, based solely on
the undisputed findings from the May 16 and May 28 surveys. Since I am upholding the
deficiency citation at Tag F323, however, I do not consider the deficiency findings from
the latter surveys.

* The Board also stated that “absent the finding of noncompliance from the April 1
survey, imposition of a [denial of payment for new admissions (DPNA)] effective June
17, 2008, would not have been mandatory.” Jd. The Board apparently did not consider
that CMS found Petitioner in substantial compliance effective June 9, 2008, and that the
DPNA never went into effect. CMS’s Disposition of Remedies letter dated July 24, 2008
(attached to Petitioner’s September 2, 2008 hearing request, which was docketed as C-08-
749 and consolidated with C-08-505 by my Order dated October 30, 2008). CMS’s
Disposition of Remedies letter specifically references that the DPNA was rescinded.
(continued...)
the period April 1 through June 8, 2008, and remanded the case to me for further
proceedings.

II. Discussion

I make numbered findings of fact and conclusions of law (Findings) to support my
decision. I set them forth below as separate headings in bold and italic type and discuss
each in detail.

1. Petitioner failed to comply substantially with the requirements at
42 CF.R. § 483.25(h).

42 C.F.R. § 483.25 regards a facility’s quality of care. It requires that:

Each resident must receive and the facility must provide the necessary care and
services to attain or maintain the highest practicable physical, mental, and
psychosocial well-being, in accordance with the comprehensive assessment and
plan of care.

The subsection at 42 C.F.R. § 483.25(h) references accidents and requires that:
(h) Accidents. The facility must ensure that —

(1) The resident environment remains as free of accident hazards as is
possible; an

(2) Each resident receives adequate supervision and assistance devices to
prevent accidents.

In the case of Meridian Nursing Center, DAB No. 2265, at 3 (2009), the Board stated,

Section 483.25(h)(1) requires that a facility address foreseeable risks of harm from
accidents “by identifying and removing hazards, where possible, or where the
hazard is unavoidable because of other resident needs, managing the hazard by
reducing the risk of accident to the extent possible.” Maine Veterans’ Home —
Scarborough, DAB No. 1975, at 10 (2005). Section 483.25(h)(2) requires that a
facility take “all reasonable steps to ensure that a resident receives supervision and

?(...continued)

Although the Board directed me to consider the DPNA as a remedy along with my
consideration of the $200 per day CMP for the period from April 1 through June 8, 2008
(Embassy, DAB No. 2299, at 14), I cannot consider it since the DPNA was rescinded.
assistance devices that meet his or her assessed needs and mitigate foreseeable
risks of harm from accidents.” Briarwood Nursing Center, DAB No. 2115, at 11
(2007), citing Woodstock Care Ctr. v. Thompson, DAB No. 1726 (2000) (facility
must take “all reasonable precautions against residents’ accidents”), aff'd,
Woodstock Care Ctr. v. Thompson, 363 F.3" 583 (6" Cir. 2003).

The Board also relied on the State Operations Manual (SOM) in defining an accident as,

“an unexpected, unintended event that can cause a resident bodily injury,”
excluding “adverse outcomes associated as a direct consequence of treatment or
care (e.g., drug side effects or reactions.” SOM Appendix PP, Guidance to
Surveyors, Part 2, SOP 483.25 Quality of Care (Rev. 274, June 1995) (SOM
Guidance).

Woodstock Care Center, DAB No. 1726, at 4 (2000).

The deficiency at issue here concerns Petitioner’s care of one resident, Resident 3. The
statement of deficiencies dated April 1, 2008, asserts that Petitioner “failed to supervise
and assist | resident (R3), resulting in R3 falling backwards out of his manual wheel
chair and injuring himself.” CMS Ex. 9, at 1.

At the relevant time Resident 3 was a 70-year old bilateral lower-limb amputee. CMS
Ex. 5, at 1. The facility describes Resident 3 after the fall as “alert” and “oriented” (CMS
Ex. 5, at 11) and hospital records after the fall describe that his “[r]ecent memory is
intact” and that he “experienced no loss of consciousness.” CMS Ex. 5, at 22, 23.
Petitioner acknowledges that Resident 3 did not suffer from any cognitive or
psychological disorder which would make it impossible for him to follow instructions or
wait for assistance. P. Br. at 8-9. There is no evidence of record to suggest that Resident
3 was not an accurate chronicler of events.

The facility prepared an incident/accident report on March 24, 2010. The licensed
practical nurse (LPN) preparing the report, LPN Roberts, describes the incident, which
occurred about 5:00 p.m., as:

Res. was in w/c. Stated he fell backwards in w/c trying to roll himself over
threshold of doorway.

CMS Ex. 5, at 9. She notes that the resident sustained a small skin tear to his right hand
and right forearm. Jd. She also notes that Resident 3 was in a new wheelchair, which he
began using on the day of the fall, and that the wheelchair contributed to the fall because
“[njo stoppee guards on back of w/c.” CMS Ex. 5, at 10. She also notes the resident’s
behaviors did not affect the use of the device. Jd. In an undated handwritten note, she
states that she wrote her nurse’s note “referring to indirect statement of falling backwards
in w/c.” P. Ex. 22, at 13. In another undated handwritten note she states that Resident 3
was found “lying on back facing outside in doorway and w/c was on back behind him.”
CMS Ex. 5, at 58.

On March 25, 2010, the director of nursing (DON), DON Foster, reported to the state
agency that:

On 3/24/08 @ 5:30pm, resident [3], a 70 year old white male with diagnosis of
IDDM, CAD, COPD, BLE amputation, Hyperlipidemia, Depression,
Hypertension, FX left 4"/5" pheblaz (sic), URI and Allergic rhinitis, was observed
on the floor over the threshold of the doorway in the dining room. The resident
was attempting to wheel self outside to smoke when he fell backwards in the
wheelchair trying to wheel over the threshold of the doorway. A small skin tear
was noted to resident right hand and right forearm. Triple antibiotic ointment was
applied. Neurological checks were initiated. The resident complained of a
headache i.e. refused Tylenol. Family and Dr. Shah were notified. No new
orders.

8:40pm, the resident complained of back pain i.e. Tylenol given. The family was
visiting at the time. Dr. Shah made aware of resident concerns. Order received to
send resident to Silver Cross Hospital for an evaluation.

9:05p.m., the resident was transferred to Silver Cross Hospital for an evaluation x
2 assist... .

1:30am, the resident returned to the facility with diagnosis of a rib fracture i.e.
administer Tylenol #3 for pain.

Id. at 15. The DON’s report repeats what was noted by LPN Roberts in the nurse’s notes
for March 24 and 25. CMS Ex. 5, at 33-34.

The parties do not dispute that Resident 3 was given a manual wheelchair after his
motorized wheelchair was taken away because of his misuse of it: Resident 3 allegedly
ran over a CNA’s foot with the motorized device. P. Reply at 7; P. Ex. 22, at 7, 15; CMS
Ex. 5, at 44.

Petitioner’s maintenance supervisor, Mr. Brazier, testified that over the last three years
when Resident 3’s motorized wheelchair was broken or out of service, Resident 3 used a
manual wheelchair and “seemed to operate it pretty good.” However, Mr. Brazier also
testified that Resident 3 was without his motorized wheelchair only three times over three
years for only one or two days at a time. Tr. 96-98; see P. Ex. 22, at 9. Mr. Brazier
further testified that Resident 3 did not always use his motorized wheelchair safely, once
running his wheelchair into a door and breaking it trying to go outside to smoke, and
once running over a CNA. Tr. 97-99.

On March 24 and 25, 2008, after the accident, Resident 3 was “re-educated” on the
proper use of a manual wheelchair. CMS Ex. 5, at 35. The only assessment regarding
wheelchair use prior to Resident 3’s accident, that of Resident 3’s “wheelchair
mobility/management training,” took place in February of 2005 as part of a physical
therapy initial evaluation and plan of care. CMS Ex. 5, at 24-25. It noted that Resident 3
had “poor” sitting balance and “a tendency to fall forward . . . poor trunk control.” CMS
Ex. 5, at 24. It is also to be noted that the wheelchair assessed was Petitioner’s motorized
wheelchair (“w/c mob (electric w/c)”). Id. Petitioner provided no documentary evidence
that Resident 3 had, at any time, been trained or assessed in how to use a manual
wheelchair.

Petitioner argues that CMS has not made a prima facie case under either 42 C.F.R.

§ 483.25(h)(1) or (2), asserting that no accident occurred and that the facility did not fail
to do what it could to supervise residents or provide assistance devices to minimize
accident risks. P. Br. at 7-8.

Petitioner asserts that the injury Resident 3 sustained was not really the result of an
accident but a “foreseeable” event given Resident 3’s character. Petitioner points to the
testimony of Ms. Bates, the social service director of the facility where Resident 3 moved
after his discharge from Petitioner’s facility, and asserts Ms. Bates’ testimony shows that
Resident 3 had a habit of acting out his anger and frustration; that Resident 3 had a habit
of taking inappropriate self-help measures when he felt that CNAs were not responding
to him with “sufficient alacrity”; that Resident 3 was capable of controlling his anger and
impatience when threatened with involuntary discharge; and that Resident 3 was capable
of entering into a contract to govern his future conduct. Tr. 108-10; P. Br. at 8.
Petitioner asserts that on August 24, 2008, instead of simply falling from his wheelchair,
Resident 3 “threw himself forward out of the wheelchair in an attempt to demonstrate his
dissatisfaction with Embassy’s decision to replace his motorized wheelchair in light of
several recent aggressive incidents.” P. Br. at 8. Petitioner asserts that there was
assistance at hand, but not on the “immediate terms” Resident 3 “demanded.” Jd.

Petitioner also argues that at the time of the incident, Resident 3 was appropriately
supervised. Petitioner asserts that CNA Schott was prepared to provide assistance. P. Br.
at 8-9; P. Reply at 7-8. CNA Schott testified:
I was working with another resident, and [Resident 3] wanted to go outside of the
building to go outside to smoke. I told him to wait and I would help him after I
was done with the other resident. He proceeded to bust through the door, and
when he went out the door, he fell out of his wheelchair . . . [he] fell forward out
of his chair, and after that, I went and got the nurses.

Tr. 191. CNA Schott testified that he saw Resident 3 fall. Jd. CNA Schott also testified
that he was the only CNA supervising 15 residents and, at the time Resident 3 fell, he
was helping reposition another resident. He was at least 20 feet away from the door
where Resident 3 fell. Tr. 192, 196, 198. Thus, it is not clear whether CNA Schott was
in a position to actually see Resident 3 fall. In his contemporaneous note describing the
accident, dated March 28, 2008, CNA Schott stated,

I... was in the dining room caring for other residents when [Resident 3]
approached the door. I asked resident to please wait and I would assist him.
Instead he barged through the door resulting in a fall. I called for the nurse.

P. Ex. 28. There is no mention that Resident 3 fell forward.

Petitioner also asserts that Resident 3’s forward fall was not precipitated by his use of the
manual wheelchair or Petitioner’s failure to assess him for the manual wheelchair. P.
Reply at 7. In support of its assertion, Petitioner refers to the February 2005 assessment
by its physical therapy department for wheelchair mobility and management training. Tr.
128. And Petitioner argues that it is inappropriate for CMS to infer that rear anti-tippers
were installed on Resident 3’s wheelchair after the accident because the lack of the anti-
tipping devices had caused Resident 3 to fall backward. P. Reply at 9. Petitioner’s
Administrator, Ms. Bessette, notes in her statement of the incident for informal dispute
resolution (IDR) that Petitioner had the necessary assistance devices (front “tipsters”) on
the wheelchair to prevent accidents. She asserts that Resident 3 had never tipped the
chair backwards, and back “tipsters” were not a necessary safety feature for him.
Petitioner asserts that Resident 3’s chair did not flip backward, and maintains instead that
he pulled himself out of his chair going forward. Back “tipsters” or more supervision
would not, argues Petitioner, have prevented the incident.’ P. Ex. 22, at 2. Petitioner
argues also that the medical evidence demonstrates that Resident 3 fell forward. Id.; Tr.

> Petitioner has submitted two handwritten notes from one of its employees regarding
discussions the employee allegedly had with residents who purportedly saw Resident 3
fall forward. The discussions allegedly took place on April 15, 2008, several weeks after
the incident. I do not find these hearsay statements probative of anything. P. Ex. 22, at 3,
4.
53-55. Petitioner argues that there is no evidence that Resident 3 was more likely to fall
from his manual wheelchair than from his motorized wheelchair if he were inclined to act
hastily and imprudently. The only supervision that could have guaranteed that he would
not fall was one-on-one supervision. P. Reply at 8.

I find Petitioner violated both 42 C.F.R. § 483.25(h)(1) and (2).

There is no question that Resident 3 was a difficult person for whom to care. He had
angry outbursts and used his motorized wheelchair in an unsafe manner on several
occasions — on the occasions iterated above, and also including an occasion in June
2007 when staff had to chase him in his wheelchair as he tried to reach a park outside the
acility and another time when he almost ran over a child at an Easter egg hunt. CMS Ex.
5, at 45; P. Ex. 22, at 15; CMS Br. at 11; P. Br. at 4; CMS Reply at 9. It is Petitioner’s
responsibility, however, to make sure that its residents are safe from accidental injury.
That responsibility includes making all reasonable efforts to prevent such accidents when
they are foreseeable. Petitioner recognizes that Resident 3’s fall was foreseeable given

is character. However, Petitioner attempts to absolve itself of responsibility for
Resident 3’s accident by blaming Resident 3 for foreseeable behavior that was
Petitioner’s responsibility to manage. Petitioner simply did not provide an environment
as free of accident hazards as possible and did not provide adequate assistance devices to
prevent accidental injury pursuant to 42 C.F.R. § 483.25(h)(1) and (2). Moreover, the
evidence does not support Petitioner’s suggestions that Resident 3 fell forward from his
wheelchair or threw himself from his wheelchair.

Petitioner provided Resident 1 with a manual wheelchair, but there is no evidence that
Petitioner assessed his ability to use a manual wheelchair nor is there evidence that
Petitioner trained him on how to use the manual wheelchair. That Resident 3 may have
used a manual wheelchair for a few days over the previous three years without an
accident ensuing, as testified to by Mr. Brazier, is no substitute for determining whether
he could use a manual wheelchair safely given his poor assessed balance and his previous
reliance on a motorized wheelchair.

That Petitioner put some form of guard on the back wheels of Petitioner’s manual
wheelchair to stop it from tipping backwards after the accident (variously described as
anti-tipping, stopper or stopee guards) is consistent with CMS’s view that at the time of
the accident Petitioner believed that not having the guards on the wheelchair could have
led to Resident 3’s fall. Petitioner’s action is also consistent with its contemporaneous
description of how the accident occurred.

Petitioner’s argument that Resident 3 purposely threw himself forward from the
wheelchair, essentially in a fit of pique, is also without record support. Petitioner’s
reliance on CNA Schott’s latter description of the accident — that Resident 3 fell
forward — is not credible, as his contemporaneous statement of the event does not refer
to Resident 3 falling forward. And what is more, CNA Schott was distant from the door
and fully occupied with another resident at the time Resident 3 fell.

Petitioner’s reference to medical evidence supporting a view that Resident 3 fell forward
is without adequate support. While Petitioner discusses Resident 3’s medical records as
support for its assertion that Resident 3 fell forward, the only testimony Petitioner cites
about those records comes from Petitioner’s cross-examination of Surveyor Henson-
Walker. Surveyor Henson-Walker’s only response to Petitioner’s counsel’s query
regarding whether Resident 3’s fractured ribs were consistent with a forward fall was “I
don’t know. You have to speak with the radiologist.” P. Br. at 9, citing Tr. 55.

Most important, Resident 3 asserts that he fell backward. Petitioner has nowhere shown
that Resident 3 is not a credible chronicler of events. The contemporaneous
documentation, prepared by Petitioner’s staff, supports Resident 3’s statement, and
supports a conclusion that Petitioner fell backward while trying to go through the dining
room doors to smoke.

It is, however, not even necessary for me to decide whether stoppers were put on the back
wheels or whether Resident 3 fell backwards or forwards to decide that Petitioner was
deficient. Petitioner provided no evidence that it ever specifically assessed or trained this
bilateral lower-limb amputee with poor balance in the use of a manual wheelchair. That
failure alone supports my conclusion that Petitioner did not provide an environment as
free of accident hazards as possible or provide an adequate assistance device.

Petitioner also failed to provide adequate supervision to prevent an accident. Petitioner’s
accident was foreseeable. Petitioner knew Resident 3 had a volatile temper, knew
Resident 3 was capable of using a wheelchair in a dangerous manner, knew Resident 3
was impatient when he wanted to go outside for a smoke, knew Resident 3 had a history
of flouting instructions, and knew Resident 3 had a propensity to ignore CNAs when he
wanted to go out to smoke. Petitioner knew that Resident 3 previously had forced his
way through the dining room doors when agitated. Yet, knowing this, and having just
removed the motorized wheelchair upon which Resident 3 depended for his mobility,
Petitioner failed utterly to address Resident 3’s behaviors and left Resident 3 in a room
(where he had previously forced his way through doors) with only one CNA supervising
15 residents.

2. The amount of the CMP imposed by CMS is reasonable.
Having determined that Petitioner failed to comply substantially with participation

requirements from April 1 to May 16, 2008, I must determine whether the $200 per-day
CMP for that period is reasonable.
10

In determining the amount of the CMP, the following factors specified at 42 C.F.R.

§ 488.438(f) must be considered: (1) the facility’s history of non-compliance, including
repeated deficiencies; (2) the facility’s financial condition; (3) the seriousness of the
deficiencies as set forth at 42 C.F.R. § 488.404; and (4) the facility’s degree of
culpability.

The lower range of CMP, from $50 to $3,000 per day, is reserved for deficiencies that do
not constitute immediate jeopardy, but either cause actual harm to residents, or cause no
actual harm, but have the potential for causing more than minimal harm. 42 C.F.R.

§ 488.438(a)(1)(ii).

As noted in my original decision, neither party has contended that the penalty amount
should be affected by Petitioner’s compliance history or financial condition. Thus, my
inquiry is only to whether the deficiency is serious and whether Petitioner is culpable.

The deficiency determination at 42 C.F.R. § 483.25(h) supports a $200 per day CMP.
The deficiency is serious and Petitioner is culpable. Petitioner failed to provide an
environment as free of accident hazards as possible and failed to provide adequate
supervision and assistance devices to Resident 3, such that he fell from his wheelchair
and sustained an injury, constituting actual harm. Petitioner’s culpability is enhanced by
its insistence that it was Resident 3’s throwing himself from his wheelchair that caused
the injury, not an accidental fall or a failure on Petitioner’s part to supervise the resident.
Petitioner’s argument shows that even now Petitioner fails to understand that it was
required to assure that Resident 3 could safely use the manual wheelchair. Given
Resident 3’s history and mood, one on one monitoring during the transition period might
have been required for adequate supervision. At a minimum, however, Petitioner should
have assessed and trained the resident on the manual wheelchair, and assured that there
was sufficient supervision of the resident while he adjusted to the manual wheelchair to
prevent injury to Resident 3 or any of Petitioner’s other residents.

Il. Conclusion

For the foregoing reasons, I conclude that there is a basis for imposition of a CMP and
that a $200 per day CMP for the period April 1 to June 8, 2008, is a reasonable remedy
for Petitioner’s noncompliance. Thus, the $200 per day CMP imposed by CMS from
March 17 through June 8, 2008, amounting to a total CMP of $16,800, is reasonable.

/s/
Richard J. Smith
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

A.M. Home Health Services, Inc.
(CCN: 05-8369),

Petitioner
Vv.
Centers for Medicare and Medicaid Services.
Docket No. C-10-476
Decision No. CR2225

Date: August 20, 2010

DECISION

I grant summary judgment in favor of the Centers for Medicare and Medicaid Services
(CMS) terminating the participation in the Medicare program of Petitioner, A.M. Home
Health Services, Inc.

I. Background

Petitioner participated in the Medicare program as a home health agency. Sections
1861(0) and 1866 of the Social Security Act (Act), and implementing regulations at 42
C.F.R. Parts 484 and 489, govern Petitioner’s participation in Medicare. Regulations at
42 C.F.R. Part 498 govern Petitioner’s right to hearing in this case.

CMS determined to terminate Petitioner’s participation in the Medicare program, and
Petitioner requested a hearing to challenge that determination. The case was assigned to
me for a hearing and a decision. I ordered the parties to exchange proposed exhibits and
briefs. CMS timely filed a brief plus seven proposed exhibits, which it identified as CMS
Ex. 1— CMS Ex. 7. Petitioner then filed a brief plus several assorted documents, which,
evidently, it intended that I receive as exhibits. These documents were neither properly
marked as exhibits nor paginated pursuant to the instructions that I had given to the
parties. Furthermore, Petitioner failed to supply CMS counsel with a copy of its
exchange. I returned the documents to Petitioner and ordered that it re-file them
consistent with what I had ordered. Petitioner re-filed the exhibits, which it identified as
P. Ex. 1 —P. Ex. 9 on its exhibit list, but, again, it failed to mark and paginate them
consistent with my pre-hearing order. Once again, Petitioner failed to send a copy of its
filing to CMS counsel. Therefore, I mailed a copy of Petitioner’s exhibits to CMS
counsel.

II. Issues, Findings of Fact, and Conclusions of Law
A. Issues
The issues in this case are whether:
1. Petitioner failed to comply with Medicare participation requirements.
2. CMS is authorized to terminate Petitioner’s participation in Medicare.
B. Findings of Fact and Conclusions of Law
This case is before me on CMS’s motion for summary judgment. In deciding whether
summary judgment is appropriate, I apply the principles of Rule 56 of the Federal Rules
of Civil Procedure. I grant summary judgment only where a party is entitled to it as a
matter of law based on the undisputed material facts of the case. A “material fact” is a
fact that potentially affects the outcome of a case. I may not issue summary judgment

where a material fact is in dispute.

I make the following findings of fact and conclusions of law (Findings) based on the
undisputed material facts of this case.

1. Petitioner failed to comply with Medicare participation
requirements.

Section 1861(0)(1) of the Act defines a home health agency as follows:

The term “home health agency” means a public agency or private
organization, or a subdivision of such an agency or organization, which —

(1) is primarily engaged in providing skilled nursing services and other
therapeutic services; ....

A home health agency must comply with statutory requirements to be eligible to
participate in Medicare. 42 C.F.R. § 484.1(a)(1). To be a home health agency, an entity
must be “engaged in” providing services. The plain meaning of the statute is that an
entity must be functional — that is, it must actively provide skilled nursing and other
therapeutic services — to meet the statutory definition of a home health agency. An entity
that is dormant, or that fails to provide services for an extended period, does not meet the
statutory definition and is, therefore, not a home health agency within the meaning of the
Act.

CMS offered facts to show that Petitioner was not engaged in providing services and had
not done so for many months. These facts, if not disputed by Petitioner, establish that
Petitioner failed to meet the statutory definition of a home health agency.

CMS asserts the following. On November 4, 2009 a surveyor went to Petitioner’s office
at 12626 Riverside Drive, Valley Village, California, to conduct a compliance survey of
Petitioner’s operations (November 4 Survey). CMS Ex. | at 1; CMS Ex. 3 at 1. No one
was present at this location, and the door to the facility was locked with the type of lock
that real estate agencies put on vacant facilities that are for sale or for lease. [d.; CMS
Ex. 4 at 1. The manager of the premises told the surveyor that Petitioner had moved from
the premises about six months previously. CMS Ex. | at 1; CMS Ex. 4 at 1.

On that same morning, another surveyor went to 1420 N. Claremont Blvd., Suite 110A,
Claremont, California. This location is the address that Petitioner had on the check that it
used to pay for its license renewal. CMS Ex. | at 1; CMS Ex. 5 at 1. The surveyor spoke
with Janet Marcelin, Petitioner’s administrator. CMS Ex. | at 1; CMS Ex. 5 at 2. Ms.
Marcelin told the surveyor that Petitioner had not provided services to patients since
December 2008, or for about 10 months. CMS Ex. | at 1; CMS Ex. 5 at 2. According to
Ms. Marcelin, Petitioner was in the process of recruiting professional staff. Ms. Marcelin
stated that, as of the survey date, Petitioner had no registered nurses, or other professional
personnel on its staff, who could provide patient care. CMS Ex. | at 2; CMS Ex. 5 at 2.

CMS offered corroboration for the surveyors’ findings, consisting of information from
the California Outcome & Assessment Information Set system, which shows that
Petitioner had not submitted any data concerning patient care since December 10, 2008.
CM Ex. 7 at 9 3, 5.

Petitioner offers a variety of arguments and contentions to challenge CMS’s
determination that Petitioner was not engaged in providing services. None of these
arguments and contentions calls into dispute the core facts on which CMS relies. At
bottom, Petitioner has produced nothing to show that it was actually engaged in providing
services to patients during the months preceding the November 4 Survey.

Petitioner asserts that:

e The surveyors’ findings, including the statements that the building manager at the
12626 Riverside Drive address reportedly made, are hearsay and, therefore, are of
no probative value.

e As of October 1, 2009, Petitioner had moved its business address to 1420 N.
Claremont Drive in Claremont, California.

e Petitioner’s provider agreement was “under a 6-month suspension, than [sic]
extended to another 6-month suspension, from January 09, 2009 through January
9, 2010.” Petitioner’s Brief at 7.

e The fact that Petitioner moved its offices a total distance of more than 43 miles
made it “expedient” for Petitioner to discharge its patients. In fact, Petitioner
could no longer provide services to its patients because of the distance between
Petitioner’s old and new office locations. Petitioner’s Brief at 7-8.

e Petitioner was “primarily engaged in operating the agency” as is attested to by
documents including: an office lease; telecommunication documents; utility bills;
a business license; a home health license; a CLIA waiver/registration document;
personnel documents; and other business records. Petitioner’s Brief at 8-9.

Petitioner’s objection to CMS’s facts on the ground that some of them may be based on
earsay is without merit, because Petitioner has not actually challenged those facts. It has
offered nothing to show that the surveyors’ findings are, or may be, incorrect.

More significantly, Petitioner has offered no facts to dispute CMS’s assertions that
Petitioner was not engaged in providing patient care as of November 4, 2009, and had not
done so for many months. That Petitioner had a business license, was renting offices, or
ad satisfied CLIA and other requirements, does not constitute any challenge to CMS’s
acts showing that Petitioner was not engaging in patient care. Those facts could only be
challenged by facts showing that Petitioner was providing actual care to patients through
licensed professional staff. Petitioner has provided nothing that would show that to have
been the case. Indeed, Petitioner admits that it was not actively providing such care in
that it avers that its operations were under some sort of official suspension beginning in
January 2009.

Thus, the core of CMS’s contentions — that Petitioner was not actively engaged in
providing services to patients and that it had not done so for about 10 months as of
November 2009 — is simply not challenged by Petitioner. Those facts are undisputed and,
therefore, provide ample support for CMS’s assertion that Petitioner did not meet the
statutory definition of a home health agency. I enter summary judgment as to this issue.
CMS also contends that, as of the November 4 Survey, Petitioner failed to comply with
regulatory requirements mandating that a home health agency allow the inspection and
copying of its records in response to a surveyor’s request. 42 C.F.R. § 489.53(a)(5), (13).
CMS contends that, on November 4, 2009, Ms. Marcelin responded to a surveyor’s
request to see the treatment record of the last patient that Petitioner had cared for by
stating that she did not have access to the record and could not provide it. Nor, according
to CMS, was Ms. Marcelin able to provide employee records as of that date. CMS Ex. 1
at 1-2; CMS Ex. 5 at 2.

In response, Petitioner asserts that Ms. Marcelin told the surveyor only that the relevant
records were in storage and that they could be produced by noon on November 4, 2009. I
conclude that this assertion by Petitioner does raise a fact dispute as to whether Petitioner
complied with the requirements of 42 C.F.R. § 489.53, because the ability to produce
requested records after a short delay would, on its face, appear to satisfy regulatory
requirements. Therefore, I do not enter summary judgment as to this issue.

2. CMS is authorized to terminate Petitioner’s participation in Medicare,
because Petitioner did not meet the statutory definition of a home
health agency.

CMS may terminate a Medicare provider agreement where the provider fails substantially
to meet the applicable provisions of section 1861 of the Act. Act Section 1866(b)(2)(B);
42 CFR. § 489.53(a)(1).

The undisputed facts of this case plainly establish that Petitioner failed to comply with
the requirements of section 1861(0)(1) of the Act in that it was not engaged in providing
skilled nursing services and other therapeutic services to patients as of November 4,
2009, or during the 10 months preceding that date. Consequently, CMS is authorized to
terminate Petitioner’s participation in Medicare.

/s/
Steven T. Kessel
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD
Civil Remedies Division
Kris Durschmidt
(OI File No.: L-08-40143-9),
Petitioner
Vv.

The Inspector General.

Docket No. C-10-675
Decision No. CR2224

Date: August 20, 2010

DECISION

Petitioner, Kris Durschmidt, asks review of the Inspector General’s (I.G.’s) determination
to exclude her from participation in the Medicare, Medicaid, and all federal health care
programs under section 1128(b)(4) of the Social Security Act. The I.G. has moved to
dismiss, arguing that the appeal is untimely. I agree and dismiss Petitioner’s appeal.

Petitioner’s hearing request must be dismissed pursuant to
42 C.F.R. § 1005.2(e)(1), because it was not timely filed.!

In a letter dated December 31, 2009, the I.G. advised Petitioner that, because the State of
Arizona revoked her license to practice as a nursing assistant for reasons bearing on her
professional competence, professional performance, or financial integrity, she was
excluded from participation in Medicare, Medicaid, and all federal health care programs.
With the notice letter, the I.G. sent Petitioner an explanation of her appeal rights: she
was entitled to a hearing before an administrative law judge (ALJ) if she filed a written
request for review within sixty days after receiving the notice. CMS Ex. | at 3.

' [make this one finding of fact/conclusion of law.
Petitioner filed her hearing request on April 27, 2010 (received in the Civil Remedies
Division on May 3, 2010). Although the request is dated April 17, it is postmarked April
27. Documents are considered filed on the date they are mailed. 42 C.F.R.

§ 1005.11(a)(4).

The I.G. filed a motion to dismiss and informal brief, accompanied by six exhibits (I.G.
Exs. 1-6). Petitioner filed a response with five attachments and ten exhibits (P. Exs. 1-
10). The LG. submitted a reply brief.

The regulations governing these proceedings grant me virtually no discretion. An
aggrieved party must request a hearing within sixty days after receiving notice of the
exclusion. 42 C.F.R. § 1001.2007(b). The date of receipt is presumed to be five days
after the date of the notice unless there is a reasonable showing to the contrary. 42 C.F.R.
§ 1005.2(c). The regulations do not include a good-cause exception for untimely filing;
they provide that the ALJ will dismiss a hearing request that is not filed in a timely
manner. 42 C.F.R. § 1005.2(e)(1); John Maiorano, R. Ph., v. Thompson, Civil Action
No. 04-2279, 2008 WL 304899, at *6 (D.N.J. Feb. 1, 2008)

In this case, we presume that Petitioner received the notice on January 5, 2010. Since the
sixtieth day thereafter fell on a Saturday, her hearing request was due no later than March
8, 2010. 42 C.F.R. § 1005.12(a). She filed her hearing request more than seven weeks
too late.

Petitioner does not deny that she timely received the I.G.’s notice letter. Instead, she
points out that, by electronic mail sent on April 10, 2010, she asked the LG. to take her
name off the exclusion list. P. Br. at 6; P. Ex. 4 at 1-3. Even if I accepted this
correspondence as a hearing request (which it plainly is not), Petitioner submitted it well
after the March 8 deadline.

I therefore have no discretion here, and I dismiss Petitioner’s request for a hearing
pursuant to 42 C.F.R. § 1005.2(e)(1).

/s/
Carolyn Cozad Hughes
Administrative Law Judge


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division

Winchester Medical Center (NPI: 1679711261),
Thomas Bouder (PTAN: 00Y116W02), and
Moses Bachan (NPI: 1972764413),

Petitioners
Vv.
Centers for Medicare & Medicaid Services.
Docket Nos. C-10-612, 618, and 619
Decision No. CR2222

Date: August 18, 2010

DECISION

I dismiss Petitioners’ appeals with prejudice because they were filed untimely without a
showing of good cause.

I. Background

By letter dated April 1, 2010, Petitioners sought to appeal the denial by TrailBlazer
Health Enterprises, LLC (TrailBlazer), the Medicare contractor, of Petitioners’ request
for reconsideration of the effective date assigned to each of them of August 11, 2009.
Hearing Request (HR). Each Petitioner was assigned a docket number (C-10-612 for
Winchester Medical Center; C-10-618 for Dr. Bouder; and C-10-619 for Dr. Bachan),
but the three cases have been consolidated for decision. The hearing request was
accompanied by the following supporting documentation: TrailBlazer letter dated
January 19, 2010 denying the reconsideration request as untimely; November 15, 2009
letter to TrailBlazer requesting reconsideration; December 11, 2009 TrailBlazer letter
indicating that the reconsideration request was not signed by the individual provider and
the requestor was not either the individual provider or the authorized official (and
attached copy of the November 15, 2009 letter showing a receipt stamp of December 9,
2009); October 7, 2009 TrailBlazer letter granting enrollment with effective date of
August 11, 2009 for Winchester Medical Services (along with duplicates of preceding
documents and a copy of the letter with handwritten notations); October 13, 2009
TrailBlazer letter granting enrollment with effective date of August 11, 2009 for Dr.
Bachan; and TrailBlazer letters dated September 14, 2009 acknowledging receipt of each
Petitioner’s enrollment applications.

It is not disputed that Petitioners, a physician group and two physicians from that group,
first attempted to enroll in Medicare in April 2009 (for the group and Dr. Bachan) or July
2009 (for Dr. Bouder). CMS Brs. in C-10-612, 618, and 619, all at 2 n.1. In each case,
Petitioner describes efforts to communicate with TrailBlazer about the status of the
application and to provide missing information, but acknowledges that the applications
were ultimately returned due to failure to provide missing information timely. HRs in C-
10-612, 618, and 619.'

It is also undisputed that Petitioners re-submitted the enrollment applications which
TrailBlazer received by on September 9, 2009. CMS Brs. in C-10-612, 618, and 619, all
at 2; HRs in C-10-612, 618, and 619. These applications were ultimately processed to
approval and each Petitioner was assigned the effective date for Medicare enrollment of
August 11, 2009. CMS Ex. 2 in C-10-612, at 1; CMS Ex.1 in C-10-618, at 1; and CMS
Ex. 1 in 619, at 1.

By letter dated November 15, 2009, Petitioners sought reconsideration of their assigned
effective dates. CMS Ex. 3 in C-10-612.7 By letter dated December 11, 2009,
TrailBlazer rejected the request (which it received on December 9, 2009) on the grounds
that the request was not signed by the individual provider and the requestor was not either

' Tn its briefs, CMS asserts that these applications were “denied” and that Petitioners
could have sought reconsideration of the denials but “failed to do so.” CMS Brs. in C-
10-612, 618, and 619, all at 2 n.1. These assertions appear to be in error. The regulations
provide that a contractor rejects an application when the applicant fails to provide
missing information timely and that, after rejection, a prospective supplier may resubmit
a new application but is not afforded appeal rights. 42 C.F.R. § 424.525. By contrast, an
application is denied when one of the reasons listed in section 424.530 is found to be
present (such as non-compliance, a felony conviction or exclusion, or outstanding
overpayments or payment suspensions). When an application is denied, a prospective
supplier may appeal the basis for the denial but is not permitted to resubmit an
application until the appeal is resolved or the time for appeal expires. 42 C.F.R.

§ 424.530(b). The fact that the reason given for returning the applications was failure to
submit missing information timely indicates that they were rejected, not denied.
Petitioners therefore had no opportunity to seek reconsideration or appeal of those
rejections.

> Since the documents relating to the reconsideration request were the same for all
Petitioners, I provide only citations to the exhibits in the lead case file for these
references.
the individual provider or the authorized official. CMS Ex. 4 in C-10-612. The request
was resubmitted and received by TrailBlazer on January 4, 2010. CMS Ex. 5 in C-10-
612. On January 19, 2010, TrailBlazer rejected the reconsideration request as past the
time limit of 60 days from the postmark date on the original determination and advised
Petitioners that failure to request reconsideration timely constituted ‘a waiver of all rights
to further administrative review.” CMS Ex. 6 in C-10-612.

The instant appeals were filed by letter dated April 1, 2010. I was assigned to hear the
case as a member of the Departmental Appeals Board (Board) pursuant to 42 C.F.R.

§ 498.44. In each case, CMS filed a motion to dismiss or, in the alternative, for summary
judgment. Petitioners’ representative indicated that no response or additional
documentation would be submitted.

II. Applicable Law and Regulations
Regulations specify the effective dates for physicians and physician groups as follows:

The effective date for billing privileges for physicians . . . and

physician ... organizations is the later of the date of filing of a Medicare
enrollment application that was subsequently approved by a Medicare
contractor or the date an enrolled physician ... first began furnishing
services at a new practice location.

42 C.F.R. § 424.520(d).

Physicians .. . and physician . . . .organizations may retrospectively bill for
services when a physician or... a physician . . . organization have met all
program requirements, including State licensure requirements, and services
were provided at the enrolled practice location for up to—

(1) 30 days prior to their effective date if circumstances precluded
enrollment in advance of providing services to Medicare beneficiaries, or
(2) 90 days [in certain emergencies.]

42 CFR. § 424.521 (a).

A prospective supplier “that is denied enrollment in the Medicare program ... may
appeal CMS’ decision” in accordance with 42 C.F.R. Part 498. 42 C.F.R. § 424.545(a).
An appeal must be requested “in writing within 60 days from receipt of the notice of the
initial, reconsidered or revised determination unless that period is extended” by the judge
for “good cause shown” and receipt is presumed to be 5 days after the date on the notice
absent a contrary showing. 42 C.F.R. § 498.40(a)(2).
Pursuant to 42 C.F.R. § 498.70(b), I may dismiss a hearing request when a party
requesting a hearing “does not otherwise have a right to a hearing.”

III. Issue

The issues before me are whether Petitioners have a right to appeal their effective date
determinations and, if so, whether CMS is entitled to summary judgment upholding those
determinations.

IV. Findings of Fact and Conclusions of Law

My findings and conclusions are in the italicized heading supported by the subsequent
discussion below.

A. I reject CMS’s argument that Petitioner has no right to appeal the effective
date determination.

CMS sought dismissal on two bases: (1) that the regulations do not permit appeals of
effective date determinations by suppliers whose enrollment is approved and (2) that
Petitioners failed to file a timely hearing request. CMS Brs. in C-10-612, 618, and 619,
all at 2, 4-6. I reject the first basis for the reasons explained here.

The Board recently addressed CMS’s argument about effective date appeals in Victor
Alvarez, M.D., DAB No. 2325 (2010). In Alvarez, the Board concluded that “a
determination of a supplier’s effective date of enrollment in Medicare is an initial
determination subject to appeal rights under 42 C.F.R. Part 498.” Alvarez, DAB No.
2325, at 1. The Board explained that this determination is consistent with the historical
interpretation of hearing rights under section 1866(h)(1)(A) and as discussed in the
rulemaking process. Further, “while section 498.3(b)(15) originally applied primarily to
suppliers subject to survey and certification, the term ‘supplier’ as used in 42 C.F.R. Part
498 was amended to cover all Medicare suppliers, including physicians.” Jd. at 3.

In several prior decisions, I also came to the same conclusion. See, e.g., Michael Majette,
D.C., DAB CR2142 (2010); Eugene Rubach, M.D., DAB CR2125 (2010); Mobile Vision,
Inc., DAB CR2124 (2010). I likewise concluded that the wording of section 498.3(b)(15)
appears straightforward in providing that the “effective date of a Medicare provider
agreement or supplier approval” is an appealable initial determination and includes no
qualifying or limiting language. A legislative rule generally binds the agency that issues
it, and the agency is legally bound to follow its own regulations as long as they are in
force. Cal. Dep’t of Soc. Servs., DAB No. 1959 (2005); Hermina Traeye Mem’l Nursing
Home, DAB No. 1810 (2002), citing Kenneth Culp Davis and Richard J. Pierce, Jr.,
Administrative Law Treatise § 6.5 (3rd ed. 1994), aff’d Sea Island Comprehensive
Healthcare Corp. v. U.S. Dep’t of Health & Human Servs., 79 F. App’x 563 (4th Cir.
2003); 2 AM. JUR. 2d Administrative Law § 236 (2010), available at WL AM. JUR.
ADMINLAW § 236. Absent further rulemaking, I am bound to follow the plain meaning of
the regulation and, as the Board mandated, permit an appeal by any provider or supplier
dissatisfied with a determination as to the effective date of its provider agreement or
supplier approval.

I therefore deny CMS’s motion to dismiss on this basis.

B. I conclude that Petitioners failed to perfect their appeals timely or to
show good cause for late filing.

Petitioners’ attempts to challenge the effective dates for their Medicare enrollment have
been tardy on two levels. Petitioners had 60 days from the October 2009 determination
letters (dated October 7, 8, and 13) that assigned their effective dates of Medicare
enrollment in which to file a request for reconsideration. By a single letter dated
November 15, 2009 and signed by a Constance C. Carey, Director of Billing, Petitioners
requested reconsideration of the effective dates assigned to all three of their supplier
numbers.’ CMS Ex. 3 in C-10-612. As noted, the request was rejected because it was
not filed by either the individual providers or an authorized official on file with the
contractor and not signed by the individual providers. CMS Ex. 4 in C-10-612. The
December 11, 2009 rejection notice indicates that TrailBlazer did not receive the
reconsideration request until December 9, 2009. The same request (still dated November
15, 2009) was apparently resent over the signature of a Terry L. Sinclair, M.D., and
received by TrailBlazer on January 4, 2010. CMS Ex. 5 in C-10-612. At that point, more
than 60 days had elapsed since the determination notice and the reconsideration request
was rejected as untimely. CMS Ex. 6 in C-10-612.

Petitioners do not deny that their initial reconsideration lacked proper signatures or allege
that they filed a timely reconsideration request. Petitioners assert, however, that they
would have submitted a properly signed reconsideration request if they had been told of
the requirement. HR. Petitioners do not indicate that they made any attempt to find out
what the requirements were for a valid reconsideration request (such as contacting the
contractor, reviewing the manuals or regulations, or visiting the contractor or CMS
website). Nor do Petitioners explain why they could not have submitted a valid request
within the 60-day time limit had they acted diligently or show that they sought an
extension of the time to file for good cause. See 42 C.F.R. § 498.22(d). As CMS notes,
the failure to request reconsideration timely may be deemed a waiver of further appeal
rights. CMS Ex. 6 in C-10-612.

I note, however, that Petitioner would have been explicitly advised of the signature
requirement if the determination letter had explained the applicable rights to file a

> TrailBlazer assigned each an “effective date” of August 11, 2009. This date is actually
30 days prior to the date on which Petitioners’ enrollment applications were received and
thus reflects not the actual effective date of their Medicare enrollment but a grant of a 30-
day retroactive period of billing privileges as permitted by 42 C.F.R. § 424.521.
corrective action plan or request reconsideration of an adverse effective date
determination. See CMS Medicare Program Integrity Manual, Ch. 15 passim. The
information was likely omitted based on CMS’s position that effective date
determinations in supplier enrollment cases were not subject to appeal, which I have
found to be erroneous in the previous section. Under those circumstances, I would be
reluctant to preclude an appeal based solely on the Petitioner’s lateness in perfecting their
request for reconsideration.

Petitioners continued to be dilatory in seeking further appeal rights, however. Requests
for hearings must also be signed by the affected party or authorized official and must be
filed within 60 days of the receipt of the initial or reconsidered determination with receipt
presumed to be five days after the date on the determination. 42 C.F.R. § 498.40(a)(2).
Their hearing request was dated April 1, 2010 and received in this office on April 12,
2010. Even if I were to treat the final letter rejecting the reconsideration request as the
determination at issue, it was dated January 19, 2010 so Petitioners are presumed to have
received it by January 24, 2010. The last date for filing a hearing request was, therefore,
March 25, 2010.

Petitioners offer no explanation for their late hearing request and proffer no basis on
which I could find good cause to extend the appeal period. I conclude that their appeals
are untimely and subject to dismissal. I grant CMS’s motion to dismiss on this basis.

V. Conclusion

For the reasons explained above, I dismiss these appeals.

/s/
Leslie A. Sussan
Board Member


Department of Health and Human Services
DEPARTMENTAL APPEALS BOARD

Civil Remedies Division
William Luper, M.D.
(NPI: 1104988906),
Petitioner,
Vv.
Centers for Medicare & Medicaid Services.
Docket No. C-10-582
Decision No. CR2221

Date: August 18, 2010

DECISION DISMISSING REQUEST FOR HEARING

I dismiss the hearing request of Petitioner, William Luper, M.D. Petitioner did not
request reconsideration of the Centers for Medicare & Medicaid Services (CMS) decision
to revoke Petitioner’s billing privileges, and thus there is no reconsideration
determination for me to review.

I. Background

Petitioner is a pathologist. At the time of the revocation of his Medicare provider
number, Petitioner was a member of J.S. Wilkenfeld, M.D. & Associates, a pathology
practice group in Houston, Texas.

By letter dated June 15, 2009, pursuant to 42 C.F.R. § 424.535, CMS notified all eligible
Medicare providers, including Petitioner, that they must verify the accuracy of their
enrollment information by submitting a completed CMS 855 application within 60 days
from the date of that notice to avoid revocation of Medicare billing privileges. CMS
Exhibit (Ex.) 1, at 1. Petitioner alleges that the third-party billing service that his practice
group used did not receive this notice. Petitioner’s Brief (P. Br.) at 2.
By letter dated October 8, 2009, CMS notified Petitioner that his Medicare provider
number was currently in the revocation process. CMS Ex. 2. In that letter, CMS
requested Petitioner to submit a revalidation request within 30 days of the date of the
letter to avoid revocation. Jd. According to Petitioner, his billing service submitted the
revalidation materials (CMS 855] and 855R applications) to TrailBlazer Health
Enterprises, LLC (TrailBlazer), a Medicare contractor. P. Br. at 2. CMS states that it did
not receive these materials until November 17, 2009. CMS Br. at 6; CMS Ex. 4 (letter
dated Nov. 20, 2009, from CMS to Petitioner, acknowledging that CMS received
Petitioner’s materials on Nov. 17, 2009). Petitioner maintains that on November 12,
2009, his billing service received a telephone call from CMS regarding the revalidation
materials and requesting additional information. P. Br. at 2. According to Petitioner,
November 17, 2009 appears to be the date TrailBlazer received the supplemental
information requested in that telephone call. Jd. at 3.

By letter dated November 25, 2009, TrailBlazer notified Petitioner that his Medicare
provider number has been revoked effective November 7, 2009. CMS Ex. 5. It stated:

According to the Federal Register (42 CFR § 424.515) information,
requested from a provider as part of the revalidation process, must be
received within 60 calendar days after the date TrailBlazer Health
Enterprises” notified the provider of the need to revalidate. If the provider
fails to do so, TrailBlazer™ should revoke the provider’s billing privileges
using existing revocation procedures. An application CMS 855] and R was
requested on June 15, 2009. The requested information was not received
within the allotted time frame.

Id. The letter lists the following options for the Petitioner: (1) correct the noncompliance
by submitting a Correction Action Plan (CAP) within 30 days after the postmark date of
the letter, with evidence that Petitioner is in compliance with the Medicare requirements;
and/or (2) request reconsideration of the determination to revoke Petitioner’s billing
privileges within 60 days after the postmark date of the letter. Jd.

Petitioner, by his billing service, submitted a CAP with new CMS 855] and 855R
application forms in December 2009. Hearing Request Letter, dated Mar. 19, 2010 (HR).
In response, TrailBlazer notified Petitioner that he submitted expired versions of the
CMS application forms and required Petitioner to re-submit the information on current
orms. HR. Petitioner missed the deadline to submit these forms, as well as the deadline
to submit a request for reconsideration of the determination to revoke his Medicare
billing privileges. HR.

By letter dated March 19, 2010, Petitioner requested a hearing before an administrative
law judge (ALJ). HR. I was assigned to hear the case as a member of the Departmental
Appeals Board (Board) pursuant to 42 C.F.R. § 498.44. I issued an initial order on April
7, 2010, setting the briefing schedule of the parties. CMS filed a motion for summary
disposition dated May 7, 2010, accompanied by exhibits | through 9. During this time
period, Petitioner left J.S. Wilkenfeld, M.D. & Associates, and his new attorney was
granted an extension to file a response to CMS’s motion. Order Granting Extension,
issued May 21, 2010. Petitioner filed his response to CMS’s motion dated June 30, 2010
with one exhibit. Having received no objections, I admit all exhibits.

II. Issue, findings of fact and conclusions of law
A. Issue

The issue in this case is whether I may dismiss Petitioner’s hearing request.
B. Findings of fact and conclusions of law

I make findings of fact and conclusions of law to support my decision which are set forth
below as numbered headings.

1. I dismiss Petitioner’s hearing request for cause because he did not
request reconsideration.

My determination of whether to dismiss Petitioner’s request for hearing rests on the chain
of events that occurred after November 25, 2009, the date of the letter notifying Petitioner
of the revocation of his billing privileges (revocation notice).

Pursuant to 42 C.F.R. § 498.5(1)(1), “an existing provider . . . dissatisfied with an initial
determination . . . related to the denial or revocation of Medicare billing privileges may
request reconsideration.” Then, pursuant to subsection (2) of that same regulation, the
provider “dissatisfied with a reconsidered determination under paragraph (1)(1) of this
section . . . is entitled to a hearing before an ALJ.”

As stated above, in the revocation notice, Petitioner was advised that he had the
opportunity to request reconsideration “within 60 calendar days of the postmark date of
this letter.” CMS Ex. 5. At that time, Petitioner, through his billing services, submitted
only a CAP consisting of CMS 855] and 855R application forms. The Board stated the
following in DMS Imaging, Inc., DAB No. 2313, at 5 (2010): “Neither the Social
Security Act nor the implementing regulations provide for administrative review of a
contractor’s refusal to reinstate a supplier’s billing privileges on the basis of a CAP.”
Thus, I have no authority to review the refusal of the contractor to reinstate Petitioner’s
billing privileges. See id. at 8 (“The hearing officer conducting the reconsideration (and
the ALJ on appeal of the hearing officer decision) are limited to reviewing the basis for
revocation set out in the initial notice, not the merits of any contractor decision that
corrective action under a CAP was unacceptable.”) .
Petitioner could have also sought reconsideration at that time or at the time the CAP was
denied, so long as the request for reconsideration was within 60 days from receipt of the
notice of revocation. 42 C.F.R. 498.22. Petitioner did not request reconsideration from
the contractor at any time.

The regulations provide, in pertinent part, as follows:

On his or her own motion, or on the motion of a party to the hearing,
the ALJ may dismiss a hearing request either entirely or as to any stated
issue, under any of the following circumstances:

(a) Res judicata. There has been a previous determination or
decision with respect to the right of the same affected party on the same
facts and law pertinent to the same issue or issues which has become final .
. . without judicial consideration, because the affected party did not timely
request reconsideration . . . with respect to that determination or decision.

42 C.F.R. § 498.70. Because Petitioner did not request reconsideration and thus there is
no reconsideration determination for me to review, pursuant to 42 C.F.R. § 498.70(a), I
have the authority to dismiss Petitioner’s request for hearing for cause.

II. Conclusion

For the foregoing reasons, I dismiss Petitioner’s request for hearing.

/s/
Leslie A. Sussan
Board Member