Medicare Provider Reinstatement After Involuntary Termination: A Step-by-Step Guide

Involuntary termination from the Medicare program can have severe and lasting consequences for healthcare providers, disrupting operations and financial stability. This comprehensive guide is designed to walk health facilities through the complex Medicare provider re-enrollment process after an involuntary termination, outlining the CMS facility readmission requirements and demonstrating how to regain reinstating Medicare billing privileges. While this article primarily focuses on health facilities, many of the underlying principles may also apply to individual providers or group practices.

An involuntary termination occurs when the Centers for Medicare & Medicaid Services (CMS) discontinues a provider’s participation agreement due to non-compliance with federal regulations, program requirements, or other serious issues, distinguishing it from a voluntary withdrawal. Understanding the involuntary Medicare termination consequences is the first step towards recovery.

Appealing an Involuntary Medicare Termination Decision

While this guide focuses on the readmission process, it’s crucial to acknowledge that providers may have the right to appeal an involuntary termination decision during or immediately after it is issued. Consulting with legal counsel specialized in healthcare law is highly recommended to explore all potential avenues for appeal and due process before pursuing re-enrollment.

Understanding the Medicare Provider Re-enrollment Process After Involuntary Termination

After the involuntary termination of its agreements, a health facility cannot participate again as a provider unless:

• The reasons for termination of the prior agreement have been removed, and
• There is reasonable assurance that they will not recur.

The Regional Office (RO), which is part of CMS, makes the final decision as to whether the facility is eligible for readmission. In doing so, it reviews the case in its entirety and makes the final decision regarding the following:

• Correction of deficiencies upon which the termination was based;
• Reasonable assurance of continued compliance, and
• Reasonable assurance of availability of information pertinent to reasonable cost reimbursement.

The RO will then process the case in the same way as an initial Medicare enrollment certification.

Common Reasons for Involuntary Termination

Involuntary terminations often stem from serious compliance or fiscal issues. Common reasons include, but are not limited to:

• Non-compliance with Medicare health and safety standards (e.g., patient care deficiencies, inadequate staffing).
• Fraudulent billing practices or submitting false claims.
• Failure to meet financial viability standards or unresolved overpayments.
• Repeated audit failures or persistent non-adherence to compliance regulations.
• Exclusion from other federal healthcare programs.

Addressing these specific issues is paramount for successful re-enrollment.

Demonstrating ‘Reasonable Assurance’ for Readmission

Since one of the key issues is whether the facility has furnished “reasonable assurance” that the reasons for termination will not recur, the provider agreement cannot be effective before the date on which “reasonable assurance” is deemed to have been provided.

Beyond simply correcting past deficiencies, demonstrating “reasonable assurance” involves proving systemic, sustainable changes. This might include:

• Implementing new, robust compliance regulations and internal control policies.
• Conducting comprehensive staff training on new procedures and Medicare requirements.
• Hiring new leadership or compliance officers.
• Upgrading technological systems to improve data accuracy and reporting.
• Establishing a transparent and accountable reporting structure.

Generally, a facility will be required to operate for a period of 60 days without recurrence of the deficiencies that were the basis for the termination. The provider agreement will be effective with the end of the 60-day period. If corrections were made before filing the new request for participation, the period of compliance before filing the new request will be counted as part of the 60-day period; however, in no case can the effective date of the provider agreement be earlier than the date of the new request for participation. It’s important to note that while 60 days is a minimum for demonstrating compliance, the overall administrative process for reinstating Medicare billing privileges and gaining full readmission can extend significantly longer due to reviews, certifications, and potential backlogs at CMS.

Exceptions to the 60-day Period of Compliance

Exceptions to the 60-day period of compliance will be made where:

• Structural changes have eliminated the reasons for termination. “Reasonable assurance” will be considered established as of the date such structural changes were completed. The effective date will be that date or the date of filing the new request to participate, whichever is later.
• “Reasonable assurance” is not established even after 60 days of compliance, because of the facility’s history of misrepresentation or of making temporary corrections and then relapsing into the old deficiencies that were the basis for termination. The effective date in such cases would be the earliest date after 60 days at which “reasonable assurance” is deemed to have been established, or the filing date of the new request to participate, whichever is later.

Fiscal Considerations for CMS Facility Readmission Requirements

Upon being notified that a terminated provider has filed a request for participation, the RO telephones the Medicare Administrative Contractor (MAC), which previously serviced the facility (formerly known as a Fiscal Intermediary or FI), and requests information concerning any unresolved financial problems (e.g., an overpayment that must be recovered) so that the RO can determine whether such issues must be resolved before the facility is permitted to participate.

The RO also contacts the MAC that will service the facility upon readmission (this may be either the MAC which previously serviced the facility or another MAC) and asks it to make sure that the facility has made adequate provisions for furnishing the financial and accounting data required under the participation agreement. Where termination was based on fiscal considerations, either entirely or in combination with deficiencies in health and safety factors, the MAC will also be requested to check and report on whether the deficiencies have been corrected. This report should include:

• The basis for believing that the deficiencies that led to termination of the provider agreement have (or have not) been corrected.
• If corrected, a description of:
• When and how this was done;
• The evidence showing compliance has existed for a sufficient period of time; and
• The MAC’s reasons for concluding that the deficiencies will not recur.
• A description of any other fiscal and reimbursement problems and the basis of believing these should (or should not) affect certification of the facility.

Seeking Professional Guidance

Navigating the Medicare provider re-enrollment process after an involuntary termination is a complex undertaking with significant legal and operational implications. Given the intricacies of CMS facility readmission requirements and the potential for substantial delays, it is highly advisable for health facilities to seek professional legal counsel specializing in healthcare law or to contact CMS directly for guidance specific to their unique situation. Proper preparation and expert advice can significantly improve the chances of successful reinstating Medicare billing privileges.