Over the last few years, there has been an uptick in Medicare billing privileges deactivations for failure to timely and fully update or revalidate Medicare enrollment information and respond to development requests for information from Medicare Administrative Contractors (MACs). During a period of deactivation, providers and suppliers are not paid for services that they render to Medicare beneficiaries and are subject to a billing gap, resulting in permanent lost revenue. [1]
MACs may deactivate Medicare billing privileges for a number of reasons, including (i) failing to timely report a change to the information supplied on the enrollment application, (ii) failing to timely furnish complete and accurate information and all supporting documentation in response to a MAC request; and (iii) failing to comply with all enrollment requirements. MACs may even impose a retroactive billing privileges deactivation as of the date of non-compliance. This article addresses certain Medicare enrollment requirements, best practices for minimizing the risk of deactivation, and the process for challenging deactivations and billing gaps.
Most providers and suppliers must revalidate their enrollment records (i.e., update and confirm their Medicare enrollment information) every 5 years, with the notable exception of durable medical equipment, prosthetics, orthotics, and supplies (“DMEPOS”) suppliers, who must revalidate every 3 years. [2] The Centers for Medicare & Medicaid Services (CMS) or the applicable MAC may also require providers and suppliers to undergo revalidation at other times to validate that current enrollment information is accurate. Providers and suppliers are also generally required to report changes to their enrollment information within 30 or 90 days, as described below.
MACs have become increasingly aggressive in scrutinizing every line of a CMS Form 855 enrollment (or re-enrollment) application and supporting documentation (855 Applications). For example, we have seen MACs implement numerous deactivations due to slight mismatches between the legal business name set forth on the IRS CP-575 Form, the 855 Application and supporting documentation. Accordingly, it is important to read every line of the 855 Application carefully and to promptly contact the MAC or health care counsel if you are unsure about how to complete particular questions on an 855 Application. There is also no administrative process to challenge the rejection of an 855 Application. [3]
Billing privileges are typically reactivated by submitting a complete 855 Application or by recertifying enrollment information and furnishing missing information. However, the effective date of reactivated billing privileges is generally the date on which a MAC receives a reactivation submission that is processed to approval. [4] Accordingly, failing to include all requested information in the reactivation submission, furnishing inaccurate information or delaying the submission of the reactivation request may result in a gap in billing privileges and lost revenue.
Billing privileges deactivations do not result in the termination of a provider’s or supplier’s Medicare participation agreement. Medicare terminations are typically reserved for more egregious conduct and entitle providers and suppliers to full administrative appeal rights. However, the right to administratively appeal a deactivation is limited to submitting a rebuttal to the MAC, and the timeframe for appeal is exceedingly short (15 days). [5] Accordingly, providers and suppliers should consider engaging legal counsel when enrollment issues first arise.
As described below, once billing privileges have been reactivated, it is possible to challenge a billing gap through challenging the reactivation effective date in the administrative process and, if necessary, to challenge the deactivation itself in District Court. [6] In order to preserve a provider’s or supplier’s future potential appeal rights (described below), providers and suppliers should exhaust their administrative remedies, including by pursuing a rebuttal. [7]
Best Practices for Avoiding Enrollment Deactivations
- Promptly and completely respond to revalidation requests, including providing supporting documentation.
- Report changes to enrollment information, including, but not limited to changes in name, location, ownership and adverse legal actions within the required timeframe (typically 30 or 90 days).
- Promptly and completely respond to development request letters and telephone requests issued by a MAC within 30 days.
- If you have submitted an 855 Application or responded to a development request, call your MAC to confirm that it has received everything it needs, including all supporting documentation.
- Ensure that you remain in compliance with all applicable enrollment requirements, including unique requirements applicable to certain provider and supplier types (e.g., bond and licensure requirements).
- If you become subject to a deactivation, immediately submit an 855 Application and contact legal counsel for assistance with submitting the rebuttal.
What to Do if Your Billing Privileges are Deactivated
If your billing privileges are deactivated, you may challenge the deactivation by submitting a rebuttal to the MAC. [8] To minimize the gap in billing privileges, it is important to immediately prepare and submit a new enrollment application (or the information and certification requested by the MAC) to promptly reactivate your billing privileges and to engage legal counsel to assist with the rebuttal.
In lieu of (or in advance of) a deactivation, you may become subject to a stay of enrollment, which is effectively an enrollment “pause” prior to the issuance of a deactivation. While MACs will reject claims submitted during a stay of enrollment, if the enrollment issue is cured and the stay ends on or before its scheduled expiration (which may be up to 60 days), claims submitted by the provider or supplier with dates of service within the stay period are eligible for payment. [9] Similar to deactivations, stays can also be challenged via rebuttal within 15 calendar days from the date of the stay notification letter.
After you submit an 855 Application to reactivate your billing privileges, you may receive a development request letter or phone call from the MAC. It is important to provide the MAC with all of the requested information and supporting documents within 30 days of the request letter or call, because the MAC can reject the 855 Application if you do not provide all of the requested information within 30 days. [10] If the MAC rejects your application seeking to reactivate your billing privileges, you will likely experience a significant gap in billing privileges and should immediately submit a new enrollment application to minimize the gap to the greatest extent possible. MACs are not obligated to make more than one request for missing information, and, accordingly, providers and suppliers should promptly follow up with the MAC to confirm that it has received all of the information that it requires to process the reactivation. [11]
While there is not an administrative process to challenge rejected 855 Applications or deactivations (other than through a rebuttal), it is possible to challenge the billing gap by challenging the reactivation effective date of billing privileges through the administrative process [12] This process begins by seeking a reconsideration from the MAC of the reactivation effective date within 60 days of the reactivation decision. Legal counsel should be engaged early in this process to ensure that all applicable legal arguments are made and all evidence is submitted in order to preserve appeal rights.
Assuming the MAC responds with an unfavorable decision, the next step is submitting a request for an administrative law judge (ALJ) hearing to challenge the reactivation effective date. Once a hearing request is on file, a CMS attorney is appointed to handle the appeal. Depending on the circumstances, it may be possible to reach a settlement with CMS regarding the matter at that time, particularly if the MAC has engaged in unreasonable behavior. If a settlement cannot be reached and the ALJ hearing decision is unfavorable, a provider or supplier may challenge that decision before the HHS Departmental Appeals Board (Board). An adverse decision by the Board may be appealed to District Court.
If the MAC’s implementation of a deactivation or the rejection of an 855 Application was arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law (or there are other issues with the MAC’s actions), it may be possible to challenge the MAC’s actions in District Court. [13] In order to challenge the MAC’s actions in District Court, the provider or supplier must exhaust its administrative remedies. [14] Thus, if a provider wishes to challenge a deactivation or the rejection of an 855 Application, it is important to submit a rebuttal to the deactivation and raise its objections in its challenge to the reactivation effective date.
Complying with Medicare program enrollment requirements can be challenging, and we have seen a recent increase in the frequency of Medicare billing privileges deactivations resulting from non-compliance with Medicare enrollment requirements. McGuireWoods’ team of healthcare attorneys regularly assists providers and suppliers with addressing Medicare enrollment issues and challenging adverse enrollment actions, including deactivations and terminations. For assistance with Medicare enrollment issues, including addressing late changes to enrollment information, deactivations and terminations, please contact one of the authors of this article.
[1] See 42 C.F.R. § 424.540 et. seq.
[2] 42 C.F.R. § 424.515. 42 C.F.R. § 424.57(g).
[3] The rejection of an 855 Application is not an initial determination and is therefore not appealable through the administrative process. See 42 C.F.R. § 498.3(b). While it may not be possible to directly challenge the rejection of an 855 Application, wrongful rejections can often be addressed in settlement discussions with CMS during the pendency of an administrative law judge (ALJ) appeal of a reactivation effective date, and, for sufficiently egregious conduct, in District Court.
[4] See 42 C.F.R. § 424.540(d)(2).
[5] See Medicare Program Integrity Manual (PIM), Chapter 10, Section 10.4.8.1; 42 C.F.R. § 424.546. Rebuttal decisions are not appealable through the administrative process.
[6] Deactivations can potentially be challenged on the basis that the MAC did not implement the deactivation in a manner consistent with Medicare Program Rules. 5 U.S.C. § 706 authorizes courts to set aside agency action that is arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law.
[7] See 42 U.S.C. § 405(g); See also Golden Home Health Care, LLC v. Verma, 2020 U.S. Dist. LEXIS 154896 (S.D. Ohio August 26, 2020)
[8] See PIM, Chapter 10, Section 10.4.8.1; 42 C.F.R. § 424.546.
[9] See PIM, Chapter 10, Section 10.4.9.
[10] See 42 C.F.R § 424.525.
[11] See PIM, Chapter 10, Section 10.4.1.3.3.
[12] The effective date of enrollment is an initial determination under Medicare Program Rules, which entitles a provider or supplier to administrative appeal rights. See 42 C.F.R. § 498.3(b)(15). However, a deactivation and the rejection of an 855 Application are not initial determinations under Medicare Program Rules and do not entitle providers and suppliers to full administrative appeal rights.
[13] See 5 U.S.C. § 706.
[14] See 42 U.S.C. § 405(g); See, e.g. Golden Home Health Care, LLC v. Verma, 2020 U.S. Dist. LEXIS 154896 (S.D. Ohio August 26, 2020) (finding that a provider must challenge the reactivation effective date through the administrative process and raise its objections to the deactivation and reactivation in that process in order to later bring claims in District Court).