In a notice published on January 28, the Centers for Medicare and Medicaid Services (“CMS”) explained that it has imposed a temporary moratorium on new ambulance suppliers and home health agencies enrolling in Medicare, Medicaid, or CHIP in counties in Florida, Illinois, Michigan, New Jersey, Pennsylvania, and Texas.  CMS analyzed data from counties across the country with 200,000 or more Medicare beneficiaries in order to determine which counties should be subject to the moratorium.

The Office of Inspector General and CMS believe that certain fraud schemes are “viral, meaning that they replicate rapidly within communities, and that healthcare fraud also migrates – as law enforcement cracks down on a particular scheme, the criminals may redesign the scheme or relocate to a new geographic area.”  The moratorium will allow CMS to investigate existing providers and suppliers while mitigating the risk that those under investigation will relocate, or apply for a new provider number, and continue their operations under a different identity or in another location.

Federal regulations established under the Affordable Care Act give CMS the power to “impose a temporary moratorium on newly enrolling Medicare providers and suppliers if it determines that there is a significant potential for fraud, waste, or abuse with respect to a particular provider or supplier type or particular geographic locations.”  CMS first used its power to implement moratoria in July 2013.

In accordance with 1866(j)(7)(B) of the Affordable Care Act, there is no judicial review of the decision to impose this type of moratorium.  Providers or suppliers affected may use the administrative appeal process; however, the scope of such an appeal is limited to assessing whether the temporary moratorium applies to the provider or supplier in question.

The CMS Notice is available online and will be published in the Federal Register on February 4, 2014.

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