Health Law Daily Wrap Up, BILLING AND CODING—DAB DECISIONS: Gap in medical practice’s Medicare billing privileges upheld by administrative law judge, (May 26, 2026)

By Steven Melendez

The practices billing privileges had been deactivated after failing to respond to a revalidation request.

An HHS Departmental Appeals Board (DAB) administrative law judge declined to adjust a gap in a medical practice’s Medicare billing practices that came after it failed to respond to revalidation request, finding limited authority to review the deactivation or the ultimate reactivation date despite claims of financial hardship (Wayne K. Tsang, MD, Inc., DAB No. CR6762, Doc. No. C-25-430 (Aug. 25, 2025)).

Background. On February 21, 2024, Medicare administrative contractor (MAC Noridian Healthcare Solutions advised the medical practice that it needed to revalidate its Medicare enrollment record by May 31, 2024, warning that failure to do so could result in deactivation of its billing privileges. On June 5, 2024, the contractor advised the practice it had placed a stay on its enrollment record effective that day, due to its failure to respond.

On July 11, 2024, the contractor notified the medical practice that its billing privileges were deactivated effective June 1, 2024, pursuant to 42 C.F.R. § 424.540(a)(3) due to its failure to revalidate its enrollment record, meaning that its claims would not be paid. On July 19, 2024, the contractor received an application from the practice to revalidate its Medicare enrollment and reactivate its billing privileges.

On Sept. 9, 2024, the contractor advised the practice that its revalidation application had been approved. A gap in billing privileges from June 1 through July 18, 2024 remained. The medical practice requested reconsideration on Oct. 9, 2024. On Jan. 7, 2025, a MAC hearing officer upheld the revalidation with gap. On March 6, 2025, the practice filed a request for hearing before an administrative law judge (ALJ). CMS on May 2, 2025, filed for summary judgment, and the medical practice filed an opposition on June 25, 2025.

Summary judgment. Summary judgment is “appropriate when there is no genuine dispute as to any issue of material fact for adjudication and/or the moving party is entitled to judgment as a matter of law,” the ALJ wrote.

And here, according to the ruling, there is no such dispute and CMS is entitled to judgment as a matter of law, making summary judgment appropriate.

Deactivation. Deactivation of Medicare enrollment and billing privileges differs from revocation of enrollment and such privileges, according to the ruling. Regulations promulgated by the HHS secretary allow for deactivation for a variety of reasons, including failure to revalidate enrollment information within 90 days of a notice to do so. Providers may not receive payment from Medicare for services provided within the period of deactivation, according to the ruling.

The medical practice argued that three issues prevented timely revalidation. Its clearinghouse was the victim of cyberattacks that forced it to switch to another clearinghouse; calls to the MAC failed to resolve issues with the revalidation process and provided “inconsistent responses and misdirection,” with a staff member believing simply starting the revalidation process by the deadline was sufficient; and staff had difficulty accessing a CMS online portal for revalidation, according to the ruling. The medical practice also says it derives about 70 percent of its income from Medicare, making the billing gap a “significant financial hardship.

But the ALJ found that he lacked authority to review the decision by the MAC to deactivate the practice’s enrollment.

Reactivation. The ALJ found that he only had authority to review the decision to uphold the reactivation date, derived from 42 C.F.R. § 498.3(b)(15), which finds "[t]he effective date of a Medicare provider agreement or supplier approval” to be subject to ALJ review and Departmental Appeals Board rulings finding that includes the effective date of reactivation.

In this case, under 42 C.F.R. § 424.540(d)(2), the effective date of reactivation is the date the MAC or CMS itself received the Medicare enrollment application: July 19, 2024. The regulations did not allow the MAC, CMS, or the ALJ to select another date, according to the ruling.

To the extent the medical practice argues the government is estopped from treating that as the effective date, estoppel is presumed unavailable against the government in the absence of “affirmative misconduct” like fraud, which isn’t alleged here, since the allegations of confusing responses from the MAC don’t rise to that level.

The ALJ also lacks authority to grant equitable relief related to the alleged financial hardship, according to the ruling, which upheld the July 19, 2024, reactivation date.

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