The Affordable Care Act defines enhanced screening and enrollment requirements for medical providers wishing to enroll and maintain enrollment in the Medicare and Medicaid programs.1 The heightened integrity compliance provisions include the automatic revalidation and screening of all providers on a periodic basis.2 Providers may discover their ongoing mandatory reporting requirements at that time in the most unpleasant fashion: a revocation letter from the Medicare Contractor. Providers cannot solely rely on the reporting requirements listed in the Medicare Enrollment Application Form 855I and should become familiar with the Centers for Medicare & Medicaid Services (CMS) regulations.3

Physicians, non-physician practitioners such as nurse practitioners and physician assistants, and all physician and non-physician practitioner organizations must report the following events to CMS within 30 days: (1) a change of ownership; (2) any adverse legal action; or (3) a change in practice location. All other changes must be reported within 90 days. Failure to report such events within the specified timeframes is in itself a basis for revocation of Medicare privileges.4 Thus, revocation of privileges triggers a one-to-three-year bar on re-enrollment, depending on the severity of the basis for revocation.

Some providers have interpreted the second reportable event, “any adverse legal action,” to mean “any final adverse legal action,” as listed on Form 855I. Final adverse legal action is a term clearly defined in the regulations as one or more of the following actions:5 (1) a Medicare-imposed revocation of any Medicare billing privileges; (2) suspension or revocation of a license to provide health care by any state licensing authority; (3) revocation or suspension by an accreditation organization such as Boards or the Joint Commission; (4) a conviction of a federal or state felony offense (as defined in § 424.535(a)(3)(i)) within the last ten years preceding enrollment, revalidation, or re-enrollment; or (5) exclusion or debarment from participation in a federal or state health care program.

The felonies listed at § 424.535(a)(3)(i) include felony offenses deemed “detrimental to the best interests of the Medicare program and its beneficiaries,” including, but not limited in scope or severity to: (1) felonies against persons, such as murder, rape, assault, and other similar crimes for which the individual was convicted; (2) financial crimes, such as extortion, embezzlement, income tax evasion, insurance fraud, and other similar crimes; (3) felonies that placed the Medicare program or its beneficiaries at immediate risk, such as medical malpractice actions resulting in a conviction of criminal neglect or misconduct; and (4) felonies that would result in mandatory exclusion under the Social Security Act. Section 1128(a) requires the Secretary of the U.S. Department of Health and Human Services to exclude individuals or entities from participating in any federal health care program if the person or entity is convicted of: (1) any Medicare program-related crime; (2) any crime relating to patient abuse; (3) any felony relating to health care fraud; and (4) any felony relating to a controlled substance.6

“Any adverse legal action” on the other hand is not a defined term in the regulations. A narrow interpretation emulating the defined term “final adverse legal action” is most congruent with the regulators’ intent to safeguard the integrity and best interests of Medicare and its beneficiaries because disclosing adverse legal actions unrelated to the provision of health care services such as divorce decrees, dog bites, and neighbors’ disputes is futile and burdensome. Further, the content of Form 855I, which only references “final adverse legal action” clearly supports this narrow construction. Some CMS Contractors have however taken a more expansive view and have, in some instances, penalized providers for failing to disclose adverse legal actions totally unrelated to health care, drugs, fraud, violent crimes, or malpractice. Some providers and legal practitioners feel strongly that CMS should apply the rules using the definition of “final adverse legal action,” but until such a time, providers should carefully consider how they respond to this inquiry.