CMS wants “bad apples” out of the Medicare program. The agency has issued a final rule that expands the circumstances under which CMS may deny or revoke Medicare enrollment, cracking down on issues like unpaid Medicare debts, management with felony convictions, or abusive billing.

The new rule heightens the burden on providers to make sure that their affiliates and managing employees are fully compliant with the requirements of the Medicare program.

Among other changes, the rule gives CMS the authority to:

  • deny Medicare enrollment to providers and suppliers previously affiliated with entities that have been terminated from the Medicare program or that have unpaid Medicare debts;  
  • deny or revoke Medicare billing privileges to providers that employ managers with felony convictions in the last 10 years; and 
  • revoke Medicare billing privileges of providers with patterns of abusive billing.

Given the severity of the consequences of denied or revoked Medicare billing privileges, providers should consider additional practices to strengthen their compliance practices. For example:

  • In the context of screening and monitoring, providers may wish to consider more robust background checks. Regular review of the LEIE database for purposes of detecting any individuals excluded from federal programs would not likely reveal all felony convictions in the last 10 years for managers, which could jeopardize Medicare billing privileges. 
  • In the context of mergers and acquisitions, due diligence should include careful scrutiny of any issues that could support revoked Medicare billing privileges (such as a history of abusive billing patterns or unpaid Medicare debts).

CMS has reportedly removed nearly 25,000 providers from Medicare for a variety of reasons. We would expect that CMS will continue—and likely heighten efforts—to remove non-compliant providers under its expanded authority.

Read the final rule: Medicare Program; Requirements for the Medicare Incentive Reward Program and Provider Enrollment. 42 CFR Parts 405, 424, and 498; CMS–6045–F.