Recently updated provider enrollment, compliance obligations

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In September 2023, the Office of Management and Budget (OMB) recently approved revisions to Form CMS 855A. Subsequently, the Centers for Medicare and Medicaid Services (CMS) issued a Fact Sheet – New Ownership Reporting Requirements for Providers Using the Form CMS-855A. For those new to healthcare, the Form CMS 855 A is the Medicare Enrollment Application for Institutional Providers, which is also used to submit changes to enrollment data. And, revalidation is required every five (5) years. For those who are familiar with the Medicare Enrollment, Chain, and Ownership System (PECOS), this internet-based application is the on-line equivalent of the Form CMS 855A.

Here are a couple of the key take-aways:

1. PEC: A publicly traded or non-publicly traded company that collects capital investments from individuals or entities (that’s, investors) and purchases a direct or indirect ownership share of a provider
2. REIT: Real estate investment trust means a real estate investment trust as defined in 26 U.S.C. 856.
3. NOTE: The new definitions go together with new PEC and REIT checkboxes in the revised Form CMS-855A, 2023 version. Although I have omitted the footnotes in 1 and 2 above, they are important to read because of the references to the Federal Register, United States Code, and the Code of Federal Regulations.
4. The specific Medicare Audit Contractor (MAC) stopped accepting the July 2011 version of the Form CMS 855 A on December 17, 2023. It is imperative to ensure that the correct version, the September 2023 (hyperlink provided supra) is utilized.

Last amended on January 16, 42 C.F.R. 424, Subpart P expanded the scope of CMS' authority to revoke or deny enrollment in the Medicare program and contains additional material changes that create new and ongoing compliance obligations for providers and suppliers. “Providers and suppliers must meet and maintain these enrollment requirements to bill either the Medicare program or its beneficiaries for Medicare covered services or supplies.”

A key definition is Disclosable event means, for purposes of § 424.519, any of the following:

1. Currently has an uncollected debt to Medicare, Medicaid, or CHIP, regardless of –
   1. The amount of the debt;
   2. Whether the debt is currently being repaid (for example, as part of a repayment plan); or
   3. Whether the debt is currently being appealed;
2. Has been or is subject to a payment suspension under a federal health care program (as that latter term is defined in section 1128B(f) of the Act), regardless of when the payment suspension occurred or was imposed;
3. Has been or is excluded by the OIG from participated in Medicare, Medicaid, or CHIP, regardless of whether the exclusion is currently being appealed or when the exclusion occurred or was imposed; or
4. Has had its Medicare, Medicaid, or CHIP enrollment denied, revoked, or terminated, regardless of –
   1. The reason for the denial, revocation, or termination;
   2. Whether the denial, revocation, or termination is currently being appealed; or
   3. When the denial, revocation, or termination occurred or was imposed.

Section 424 P, although it is broader than just institutional investors, dovetails with the September 2023 Form CMS 855 A. In addition to the definition of “disclosable event”, specific attention should be given to what constitutes a “high categorical risk”, “high screening level” (including the “[r]equire[d] the submission of a set of fingerprints for a national background check from all individuals who maintain a 5 percent or greater direct or indirect ownership interest in the provider or supplier; and [c]onducts a finger-print based criminal history record check of the Federal Bureau of Investigation’s Integrated Automated Fingerprint Identification System on all individuals who maintain a 5 percent or greater direct or indirect ownership interest in the provider or supplier.”

Finally, the False Claims Act is expressly stated under 17. If a “provider or supplier, or any owner, managing employee or organization, officer, or director of the provider or supplier, has had a civil judgment under the FCA (31 U.S.C. 3729 through 3733) imposed against them within the previous 10 years.”

Overall, both the Form 855 A and Section 424 P need to be read closely and adhered to. Failure to do so may lead to increased liability and exclusion from participating in Medicare and Medicaid Programs.

Rachel V. Rose, JD, MBA, advises clients on compliance, transactions, government administrative actions, and litigation involving healthcare, cybersecurity, corporate and securities law, as well as False Claims Act and Dodd-Frank whistleblower cases.