The Centers for Medicare and Medicaid Services (CMS) has the authority to revoke the enrollment of a Medicare provider or supplier for various reasons, such as non-compliance with Medicare enrollment requirements, exclusion by the Office of Inspector General (OIG), and felony convictions, among other grounds. In the event of revocation, the provider or supplier is typically prohibited from reenrolling in Medicare for the duration of one to 10 years, depending on the severity of the basis for revocation. This 10-year prohibition is an extension of the previous maximum length for reapplication to the Medicare program.

Likewise, CMS reserves the right to reject the enrollment of a newly applying provider or supplier for any of the specified reasons. Additionally, CMS has made changes to regulations with respect to retroactive Medicare enrollment revocation, background check requirements in the wake of the COVID-19 Public Health Emergency (PHE), as well as implementing additional provider restrictions after felony convictions, and reducing the time period for deactivation of Medicare billing privileges in cases where providers do not submit claims. The following presents an overview of CMS’s broadening of its authority in Medicare program revocation and denial.

The existing regulation, 42 C.F.R. § 424.535(a)(1), allows revocation if the provider or supplier is found to be non-compliant with relevant enrollment requirements or the enrollment application for the respective provider or supplier type. The Medicare Physician Fee Schedule (MPFS) Rule modifies this to encompass non-compliance with the enrollment requirements outlined in “title 42, or the enrollment application,” which includes enrollment requirements situated outside of 42 C.F.R. part 424, subpart P.

The expanded MPFS Rule introduces civil judgment under the False Claims Act (FCA) within the past 10 years as a basis for enrollment denial or revocation. This applies to any provider or supplier, owner, managing employee or organization, officer, or director. Notably, the term “civil judgment” excludes FCA settlement agreements.

With regard to violation of provider and supplier standards, the MPFS Rule empowers CMS to deny or revoke enrollment for various Medicare provider types if any standard or condition specified in their respective enrollment conditions is breached.

Another recent change to the MPFS Rule replaces the term “existing debt” with “failure to repay a debt.” This modification enables CMS to exercise its revocation authority even if collection action has ceased and the debt has been terminated, emphasizing the provider’s or supplier’s failure to fulfill financial obligations to Medicare rather than the specific status or outcome of CMS’ collection efforts. However, certain situations are exempted from this revocation basis under the purview of CMS.

Medicare Provider Enrollment Revocation

Medicare enrollment revocations typically become effective 30 days after CMS notifies the provider or supplier of the revocation via mail, except in certain circumstances where retroactive revocation applies. Revocation due to adverse activity, like a Medicare exclusion or felony conviction of an owner, manager or supervising physician, can be reversed if the provider or supplier terminates its relationship with that provider and submits proof of said termination to CMS. The new MFPS rule has reduced the deadline to do so by 15 days. Providers and suppliers may also elect to voluntarily terminate their Medicare enrollment with a retroactive effective date. The new CMS rule allows Medicare providers to do so as long as no Medicare beneficiary received services on or after the requested termination date.

Reinstatement of Previously-Waived Background Checks Waived Due to COVID-19 PHE

CMS has also reinstated the requirement for fingerprint-based background checks for owners who own 5% or more of the entity and for home health agencies, DMEPOS suppliers, and skilled nursing facilities, among other types of health care entities. CMS previously waived this requirement during the COVID-19 public health emergency. Certain “high risk” providers or suppliers (which includes but is not limited to the aforementioned provider types) who received a background check waiver during the pandemic may be required to undergo Medicare revalidation, meaning that the provider or supplier must now pass the fingerprint criminal background check. CMS reserves the right to require a provider or supplier to undergo the revalidation process at any time in cases where background checks were waived due to the PHE.

Expanded Provider Restrictions With Felony Convictions

CMS implemented new rules to prevent providers subject to a reapplication bar due to a felony conviction from ordering, referring, certifying or prescribing certain services, durable medical equipment, or drugs covered by Medicare. Medicare will no longer pay claims for such services or drugs submitted by providers who have had felony convictions within the last decade. CMS can enforce this provision for any felony it deems detrimental to the interests of the Medicare program. However, CMS has not published or adopted a definitive list of felonies it deems detrimental, and reserves the right to consider the facts of each case.

Medicare Provider Deactivation for Non-Billing

Previously, CMS could deactivate billing privileges when the provider had not submitted any claims for a year. CMS recently reduced this time period to six months due to concerns over fraud schemes involving providers inappropriately circumventing government investigations, avoid obligations due to Medicare overpayments, or using an unassociated provider’s Medicare number to submit fraudulent claims to Medicare. The U.S. Department of Justice has taken additional measures to investigate and prosecute such cases in the wake of an increase in fraud due to the COVID-19 PHE, and this reduction of the deactivation period for non-billing is part of CMS’ ongoing efforts to stop Medicare fraud.

To view CMS’ fact sheet regarding the 2024 Medicare Physician Fee Schedule Final Rule directly, please visit this CMS Newsroom page.

Medicare Provider Revocation Attorney in Florida

The attorneys of Nicholson & Eastin routinely represent health care providers in connection with Medicare provider enrollment and revocation, Medicare payment suspensions, Medicare audits and other issues related to CMS. If you are a health care provider and would like regulatory and compliance advice regarding the 2024 changes to CMS regulations, or if you are facing revocation of your Medicare billing privileges, please do not hesitate to contact us.