CMS Administrator Declines To Review Board's Ruling That
Provider's Residency Program Did Not Qualify As A New Program
December 31, 1995, St. Joseph Community Hospital (St. Joseph or
Provider) merged with St. Mary Community Hospital (St. Mary) into
Ancilla Health Care, Inc. (Ancilla). An acute care license was
maintained for each facility. Ancilla was the sponsoring institution for
an American Osteopathic Association (AOA) graduate medical education
(GME) internship and family practice residency program at St. Mary. On
June 27, 1997, St. Mary surrendered its license, and the AOA residency
program was consolidated at St. Joseph.
The Provider contended the
residency program at St. Joseph qualified as a new medical residency
program pursuant to 42 C.F.R. � 413.86(g)(7) and HCFA Program
Memorandum, Transmittal No. A-99-51 (Dec. 1, 1999). The Provider argued
it did not have a residency program, and therefore no residents, prior
to 1995. The Provider further argued that sponsorship of a residency
program was not a determinating factor of new program status.
Intermediary held the Provider's residency program was an established
program relocated from St. Mary. Ancilla's correspondence to AOA
regarding the residency program requested continuation of approval of
its residency program now located at St. Joseph, not for initial
accreditation. Ancilla noted in its request that the boards of the two
hospitals were consolidated effective with the merger so the governance
of the program remained the same. The Executive Committee of the Council
on Postdoctoral Training (ECCOPT) recognized Ancilla as the sponsoring
institution of the residency program and granted continuing approval of
the residency program at St. Joseph/St. Mary. In addition, AOA's
instructional publication states a new application is not required when
there is only a change in the training site name.
The Board found
that both the controlling regulation and HCFA Program Memorandum A-99-51
defined a new residency program by the existence of the program, not the
facility at which the program was located. The Board held the residency
program was certified and in existence prior to its relocation to St.
Joseph. The Board also found the program's full-time equivalents (FTEs)
were counted in prior years for cap purposes when the program was
located at St. Mary. The Board concluded: (1) the residency program did
not qualify as a new program under 42 C.F.R. � 413.86(g)(7), and
(2) the Intermediary's adjustment of the intern and resident counts to
the limits established for St. Mary was proper. The Board affirmed the
Intermediary's determination. The CMS Administrator declined to review
the Board's ruling.
St. Joseph Community Hosp. v.
BlueCross BlueShield Ass'n\AdminaStar Fed. � Ind. , CMS Adm'r
Dec., declining to review, PRRB Hearing Dec. No. 2005-D71 (C.M.S.
Adm'r Nov. 10, 2005).
CMS Administrator Declines To Review
Board's Ruling That Provider's Skilled Nursing Facility Routine Cost
Limits Exemption Request Was Timely Filed
The Provider applied
for an exemption to the routine cost limits (RCLs) for its skilled
nursing facility (SNF) as a new provider. CMS found the Provider failed
to support its exemption request due to lack of documentation. On
October 20, 1999, the Intermediary requested the Provider submit a new
SNF RCL exemption request with additional documentation within
forty-five days from the date of the notification letter. On Monday,
December 6, 1999, the Provider submitted its new exemption request via
facsimile (received December 6, 1999), Federal Express (received
December 7, 1999), and certified U.S. mail (received December 8,
The Intermediary denied the Provider's exemption request
stating the Provider failed to timely file a new SNF RCL exemption
request. The Intermediary contended the starting point for counting
forty-five days was the date of its letter, October 20, 1999, making the
due date December 3, 1999. In the alternative, the Intermediary
contended that if the starting point was the day after the date stamped
on its letter, the Provider was responsible to submit its request by
Saturday, December 4, 1999. The Board held that pursuant to 42 C.F.R.
� 1005.12, the proposed rule for 42 C.F.R. � 405.1801(d)(1) at
65 Fed. Reg. 35,716 (June 25, 2004), Rule 6(a) of the Federal Rules of
Civil Procedure, and the practices of the CMS Administrator and the
Board, the day following the date of notice is the starting point for
computing a deadline. The Board noted the Intermediary did not cite any
authority for its position that the starting point was the date stamped
on its denial letter. The Board also found the Medicare statute states
that when a deadline falls on a weekend, the submission deadline is
automatically extended until the first business day thereafter. Again,
the Board noted that CMS did not furnish any specific guidelines
regarding this issue. The Board concluded the Provider's SNF RCL
exemption request was timely filed. The Board reversed the
Intermediary's determination and remanded the exemption request to the
Intermediary to be considered on its merits. The CMS Administrator
declined to review the Board's ruling.
Saddleback Mem'l Med.
Ctr. v. BlueCross BlueShield Ass'n\United Gov't Servs., CMS Adm'r
Dec, declining to review, PRRB Hearing Dec. No. 2005-D72 (C.M.S.
Adm'r Nov. 11, 2005).
CMS Administrator Reverses Board's
Ruling And Finds Provider Untimely Filed Its TEFRA Adjustment
The Provider requested an adjustment to its Tax Equity
and Fiscal Responsibility Act (TEFRA) target amount for fiscal year
1994. The Provider mailed its request 181 days after the date of its
Notice of Program Reimbursement (NPR) since the 180th day
fell on a Sunday. The Intermediary denied the Provider's request due to
untimely filing. The Provider contended its request was timely filed
pursuant to Provider Reimbursement Manual � 3004.2 which required
the request be submitted, as opposed to being received, within 180 days
from the date of the NPR. The Provider recognized the regulation at 42
C.F.R. � 413.40, which requires receipt within 180 days was a
higher authority, but asserts it should have been able to reasonably
rely on the program instructions. The Provider also noted that prior to
September 1, 1995 and during the cost reporting year at issue, the
regulation required TEFRA adjustment requests be made within 180 days of
an NPR. The Intermediary argued the regulation in place in 1997, when
the Provider submitted its TEFRA adjustment request, was the applicable
regulation. The manual instruction relied on by the Provider was issued
in August 1994 and was tightened up by the regulation in September
The Board found it was appropriate to associate the
regulation in effect during the Provider's cost reporting period. The
TEFRA request process is based on the issuance of an NPR and can span
several years in which there may be many regulatory changes. It would be
unreasonable to require providers to rely upon multiple rules that may
apply to a particular cost reporting period. The Board held that
pursuant to the regulation and program instructions in effect during the
cost reporting period at issue, the date a request was made is the same
as the date a request was submitted. Finally, the Board noted the
Provider's filing of the request on the 181st day because the
180th day fell on a Sunday was not in dispute. The Board
reversed the Intermediary's decision.
The CMS Administrator found
the preamble to the September 1, 1995 final regulation confirmed CMS'
policy that a TEFRA adjustment request must be received by the
Intermediary within 180 days from the date of the NPR. The Administrator
found this clarified that CMS consistently interpreted the regulation to
mean that "made" equaled "received by the intermediary." The language of
the regulation was changed to more clearly reflect longstanding
interpretation. The Administrator found the agency's interpretation was
not erroneous or inconsistent with the governing regulation. The
Provider's reliance on the manual instruction was not warranted as the
manual, unlike the regulation, does not define "submitted." The CMS
Administrator reversed the Board's ruling.
St. Mary's Hosp. v.
BlueCross BlueShield Ass'n\Noridian Admin. Servs., CMS Adm'r Dec.,
rev'g, PRRB Hearing Dec. No. 2006-D1 (C.M.S. Adm'r Jan. 3,
Health Lawyers thanks Leslie Demaree Goldsmith of Ober,
Kaler, Grimes & Shriver, in Baltimore, Maryland for writing these summaries.