If you were a minority owner with no management responsibilities in a Medicare enrolled clinic that has any unpaid “Medicare Debt, ” you can now be prevented from re-enrolling in the Medicare program.
A little noticed announcement of a new final rule issued by the Centers for Medicare and Medicaid Services (CMS) in December2015 titled: “Medicare Provider Oversight, ” (http://federalregister.gov/a/2014-28505), ” will deny enrollment in the Medicare program to any person who was an owner of a practice that has an outstanding Medicare debt. It applies even to those physicians who had a minority ownership in the practice and did not participate in the management of that practice.
The previous rule, according to Keith Dennen, an attorney with Dickinson Wright PLLC writing in a recent issue of the National Law Review, limited the responsibility for Medicare overpayments to the entity or billing physician. Now anyone who was an “owner” of the practice during the one year prior to termination of the entity’s Medicare enrollment is responsible for the debt.
“Medicare Debt”
Dennen says “Medicare Debt” is a new term that means any amount owned to Medicare regardless of the basis for the liability. Debt “includes overpayments, but it is not limited to overpayments. Finally, a liability is a “Medicare Debt” even if the practice is appealing the determination and the appeal has not been fully resolved, ” wrote Dennen.
According to the CMS announcement, the new rules “strengthen oversight of Medicare providers and protect taxpayer dollars from bad actors.” The new oversight is designed to “prevent physicians and other providers with unpaid debt from re-entering Medicare, remove providers with patterns or practices of abusive billing, and implement other provisions to help save more than $327 million annually.”
If a physician wants back into Medicare, he or she must pay the full amount of the practice’s Medicare Debt or enter into a payment arrangement with Medicare to pay the amount in full.
Felony Convictions Added
Also, according to Dennen, felons are not allowed. “A felony conviction is now grounds for denial or revocation of Medicare enrollment. In its final rule, CMS announced that it intends to deny and revoke Medicare privileges of any provider or supplier ‘convicted’ of a federal or state felony within the preceding 10 years. More importantly, Medicare extends this taint to any person who was an owner or ‘managing employee’ of a provider or supplier.”
Dennen said the offenses include traditional crimes: murder, rape, assault; financial crimes: extortion, embezzlement, income tax evasion and crimes that result in mandatory exclusion from Medicare. In addition, CMS adds “any felony that placed the Medicare program or its beneficiaries at immediate risk. CMS, however, states that the term “Offenses” is not “limited in scope or severity” to these crimes. Further, CMS includes “pretrial diversion” in its definition of “conviction.”
According to CMS, it is up to the enrollee to determine whether a person has a felony conviction within the past ten years and the agency will not provide any guidance on whether a particular felony will result in revocation.
Abuse of Billing Privileges
Medicare also announced that it would revoke the privileges of any provider or supplier that it determines engages in “abuse of billing privileges.”
“Abuse of billing practices, ” according to Dennen, occurs when CMS determines that a provider “has a pattern or practice of submitting claims that fail to meet Medicare requirements.”
In making this determination CMS considers:
- The percentage of submitted claims that were denied.
- The reason(s) for the claim denials.
- Whether the provider or supplier has any history of final adverse actions (as that term is defined under § 424.502) and the nature of any such actions.
- The length of time over which the pattern has continued.
- How long the provider or supplier has been enrolled in Medicare.
- Any other information regarding the provider’s or supplier’s specific circumstances that CMS deems relevant to its determination as to whether the provider or supplier has or has not engaged in the pattern or practice described in this paragraph.
Once revoked, the provider, supplier, owner or managing employee is barred from participation in Medicare for a period ranging from one to three years.
Fraud Not Required
Significantly, adds Dennen, CMS can take this action without any finding of “fraud” or other intentional action. “Thus, revocation can occur simply because the physician’s staff makes mistakes.”
Dennen said one area that is likely to create issues for physicians is CMS’ position on “medical necessity.” The agency will not inform the medical community of its position on “medical necessity” and has stated on numerous occasions that decision is one left to medical practitioners. “But, CMS in its commentary to its rule, refused to include an exception to revocation for “good faith” disagreement among medical practitioners about medical necessity. Instead, CMS stated that it would make the decision of medical necessity when it revokes the practitioner’s Medicare billing privileges. At that point, the practitioner may appeal the decision through CMS’ administrative appeal process.”
Finally, wrote Dennen, CMS announced that the time period for submission of claims once billing privileges are revoked has been reduced to 60 days from 180 days
