Per 42 CFR §424.530(a) and Pub 100-8, Chapter 10, Section 6.2, carriers must deny and intermediaries must recommend a denial of an enrollment application if any of the situations described below are present. If an application is denied, the supplier will receive a letter detailing why the application was denied and explaining the
appeal options available.
Denial Reason 1 (42 CFR §424.530(a)(1))
The supplier is determined not to be in compliance with the enrollment requirements described in this section or in the enrollment application applicable for its supplier type and has not submitted a plan of corrective action as outlined in part 488 of this chapter.
Denial Reason 2 (42 CFR §424.530(a)(2))
The supplier, or any owner, managing employee, authorized or delegated official, medical director, supervising physician, or other health care personnel of the provider or supplier who is required to be reported on the CMS 855 is:
- Excluded from the Medicare, Medicaid, or any other Federal health care program, as defined in 42 CFR §1001.2, in accordance with section 1128, 1128A, 1156, 1842, 1862, 1867 or 1892 of the Social Security Act
- Debarred, suspended, or otherwise excluded from participating in any other Federal procurement or nonprocurement program or activity in accordance with section 2455 of the Federal Acquisition Streamlining Act
Denial Reason 3 (42 CFR §424.535(a)(3))
The supplier or any owner of the supplier was, within the 10 years preceding enrollment or revalidation of enrollment, convicted of a Federal or State felony offense that CMS has determined to be detrimental to the best interests of the program and its beneficiaries. Offenses include:
- Felony crimes against persons, such as murder, rape, assault, and other similar crimes for which the individual was convicted, including guilty pleas and adjudicated pretrial diversions
- Financial crimes, such as extortion, embezzlement, income tax evasion, insurance fraud and other similar crimes for which the individual was convicted, including guilty pleas and adjudicated pretrial diversions
- Any felony that placed the Medicare program or its beneficiaries at immediate risk, such as a malpractice suit that results in a conviction of criminal neglect or misconduct
Denial Reason 4 (42 CFR §424.530(a)(4))
The supplier certified as 'true' false or misleading information on the enrollment application to be enrolled or maintain enrollment in the Medicare program.
Denial Reason 5 (42 CFR §424.530(a)(5))
CMS has instructed the NSC to implement this directive on February 1, 2007.
CMS determines, upon onsite review or other reliable evidence, the supplier is not operational to furnish Medicare covered items or services, or does not meet Medicare enrollment requirements to furnish Medicare covered items or services.
42 C.F.R. 424.502 defines operational as follows:
'Operational means the provider or supplier has a qualified physical practice location, is open to the public for the purpose of providing health care related services, is prepared to submit valid Medicare claims, and is properly staffed, equipped and stocked to furnish these items or services.'
This includes the following situations:
- The applicant does not have a license(s) or is not authorized by the Federal/State/local government to perform the services for which it intends to render
- The applicant does not have a physical business address where services can be rendered and/or does not have a place where patient records are stored to determine the amounts due such provider or other person as set forth in §1833(e) of the Social Security Act
- The applicant does not meet CMS regulatory requirements for the specialty
- The applicant does not qualify as a supplier of medical and health services. An entity seeking Medicare payment must be able to receive reassigned benefits from physicians in accordance with the Medicare reassignment statute in §1842(b)(6) of the Act (42 U.S.C. 1395u(b)).
- The applicant does not provide a valid SSN/EIN for the applicant, owner, partner, managing organization/employee, officer, director, ambulance crewmember, medical director, and/or delegated or authorized official
- A home health agency (HHA) does not meet the capitalization requirements per 42 CFR § 489.28
Note: If a site visit cannot be completed because the business is not yet open, vacant, under construction, etc, the application will be closed and the supplier will be required to reapply and begin the process again. A denial will not be issued.