Health Law Daily Wrap Up, ADMINISTRATION OF MEDICARE/MEDICAID PROGRAMS—DAB DECISIONS: Reactivated billing privileges are effective day application processed to approval, (Oct 24, 2025)

By Sherri M. Schroeder, J.D.

Although the group practice argued that a subsequent application was merely a supplement to a prior application, the evidence showed that the Medicare contractor had “unambiguously” rejected that previous application.

The HHS Departmental Appeals Board (DAB) has found that the reactivated Medicare billing privileges of West Michigan Anesthesia, PC, (WMA) became effective April 10, 2023, which is the date of receipt of the Medicare enrollment application that Wisconsin Physicians Service Insurance Corporation (WPS), a Medicare administrative contractor, was able to process to approval. Although WMA argued that a previous application submitted March 1, 2023, was its actual re-enrollment application and that the April 10, 2023, application was a supplement to the prior application, the DAB did not agree. It found that the March 1 application had been “unambiguously” rejected, and that WMA had been informed that it would need to submit a new application. Therefore, based on the April 10, 2023, receipt date of the enrollment application, the DAB found that WPS did not err in assigning an April 10, 2023, effective date for reactivated billing privileges (West Michigan Anesthesia, PC v. CMS, DAB No. CR6493, Doc. No. C-23-781 (June 17, 2024)).

Facts. WMA is enrolled as a clinic/group practice in the Medicare program. On August 31, 2022, WMA’s Medicare administrative contractor, WPS, sent a letter informing WMA that it needed to update its enrollment record because a deceased managing employee continued to be listed on its enrollment record. WPS did not respond, and its billing privileges were deactivated effective February 27, 2023, pursuant to 42 C.F.R. § 424.540(a)(2). On March 1, 2023, WMA submitted an enrollment application to reactivate its Medicare billing privileges. On March 6, 2023, WPS informed WMA that three deceased managing employees had been listed on the application and that the application lacked an electronic funds transfer authorization agreement and confirmation of bank account information on a bank letterhead or voided check. WMA submitted a revised enrollment application on March 7, 2023, but did not forward the other requested information. WPS then rejected this application on April 4, 2023.

On April 10, 2023, WMA submitted another enrollment application. After WMA sent in additional information, WPS approved the reactivation enrollment application on April 21, 2023, with an effective date of April 10, 2023. WPS then requested reconsideration of the effective date, asking for a February 27, 2023, effective date. WPS denied the request, stating that the deceased managers were not removed from the group enrollment record until the completion of the enrollment CMS application processed to approval, which was the April 10, 2023, application. WMS then requested a hearing before the DAB’s administrative law judges.

Decision. In its decision, the DAB noted WMA did not claim it updated its enrollment record prior to the deactivation of its billing privileges on February 27, 2023. Rather, WMA claimed that March 1, 2023, is the date of submission of the enrollment application that was processed to approval because the April 10, 2023, application “was not a new application, rather, it was a supplement to the prior application.” However, the DAB disagreed. On April 4, 2023, WPS had “unambiguously” rejected the March 1. 2023, application, stating in its letter to WMA, “We received your Medicare enrollment application(s) on March 01, 2023. We are rejecting your applications for the following reason(s) . . . development was not completed.” Additionally, WPS “plainly” informed WMA that a new Medicare enrollment application must be completed if WMA wanted to resubmit an application.

Arguments. WMA’s argument that the tracking number on the March 1, 2023, and April 10, 2023, applications were the same was met by the Board with “[E]ven if true, the tracking number is not dispositive.” WMA then argued a WPS employee informed WMA that its March 1, 2023, application could be reopened. However, the court stated, “Inasmuch as WPS initially provided erroneous information, the record demonstrates that WPS, through a voicemail message that same day, subsequently provided the correct information to [WMA].” Furthermore, WMA “did not cite any authority supporting that a statement by a Medicare contractor can create a binding right that is inconsistent with law, presumably because there is no such authority.” Next, WMA argued that it should be authorized 30 days of retrospective billing privileges, but the Board countered with, “It appears that [WMA] is unaware that retrospective billing privileges during a period of deactivation can no longer be authorized by CMS or its administrative contractors,” per 42 C.F.R. § 424.540(e).

“There is simply no provision under law that allows for an effective date of reactivated billing privileges prior to a supplier’s submission of the required enrollment application that is processed to approval,” stated the DAB. Therefore, the Board upheld the April 10, 2023, effective date of WMA’s reactivated Medicare billing privileges.

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