Wachler & Associates Health Law Blog

Published on: August 28, 2025

Concierge Medicine and Medicare Opt-Out

Physicians and other healthcare professionals who labor under the decreasing reimbursement and increasing administrative burden of insurance companies and government healthcare programs, especially Medicare, may wonder if there is a way to accept payment directly from patients and avoid the obstacles presented by billing third-party payors.

While a strictly cash-pay or “concierge” practice is not a viable business model for many providers, for certain providers responding to the needs of certain patient populations, it can be a highly successful model that avoids many of the costs, delays, and administrative issues created by the need to bill third-party payors and comply with payors’ endlessly complex and shifting rules. Practice structures and pricing models can be highly variable and customizable to the needs of the practice and its patients. State law and licensing rules may in some cases limit certain structures or activities, but these would apply to a provider regardless and are generally far less burdensome than the restrictions imposed by payors.

Some practices may choose a more limited route and choose to accept commercial insurance plans, while not accepting Medicare or Medicaid plans. This approach can often limit many of the worst downsides of accepting third-party payment, while still leaving the practice open to a large patient population.

Published on: August 25, 2025

When Is a Medicare Audit Win Not a Win?

by Wachler & Associates, P.C.

Generally, in the Medicare claims appeal process, a determination that is favorable to the provider ends the appeal process. Only under very limited circumstances can the Centers for Medicare & Medicare Services (“CMS”) or its contractors directly appeal a favorable appeal determination. However, there are certain mechanisms that can be used to reopen, review, and change favorable determinations with which CMS disagrees.

The Medicare claims appeal process is a lengthy, complex, and administratively burdensome process for providers. It includes five levels of appeal, the first four of which are directly controlled by CMS or The Department of Health and Human Services (“HHS”) itself. First is Redetermination by a Medicare Administrative Contractor (“MAC”). Second is Reconsideration by a Qualified Independent Contractor (“QIC”). Third is review by an Administrative Law Judge (“ALJ”) employed by the Office of Medicare Hearings and Appeals (“OMHA”), a division of HHS. Fourth is review by the Medicare Appeals Council, another division of HHS. Fifth is review by a federal court.

Where a provider prevails at the ALJ review, a distinct CMS contractor, the Administrative QIC (“AdQIC”) is tasked with reviewing an ALJ decision. Where CMS, through the AdQIC, disagrees with the ALJ, in some limited circumstances, the AdQIC can directly file an appeal of the ALJ decision to the Appeals Council. However, more often the AdQIC will simply “refer” a provider’s victory to the Appeals Council for the Appeals Council to considering review of its “own” accord. The Appeals Council nearly always takes such cases and often overturns the provider’s favorable determination. CMS and/or HHS may also simply direct the ALJ, who is employed by HHS, to change the decision.

Published on: August 18, 2025

Dangers of PPEO Audits

by Wachler & Associates, P.C.

Medicare-enrolled hospice providers are under increasingly close scrutiny. Due to concerns regarding hospice compliance and with fraud, waste, and abuse by hospice providers, both the Centers for Medicare & Medicaid Services (“CMS”) and the Department of Health and Human Services Office of Inspector General (“OIG”) have stepped up audits, investigations, and enforcement actions against hospice providers. One of these measures are Provisional Period of Enhanced Oversight (“PPEO”) audits of Medicare-enrolled hospices. Providers should be aware that the stakes in a PPEO audit can be unexpectedly high, while the margin for error unexpectedly low.

CMS implemented PPEO audits as a direct response to concerns regarding hospice fraud and compliance issues. Pursuant to the PPEO program, since mid-2023, CMS audits all “newly-enrolled” hospice providers in Arizona, California, Nevada, and Texas. “Newly-enrolled” is not limited to hospice providers enrolling in Medicare for the first time, but also includes those that undergo a Change of Ownership (“CHOW”) as that term is defined under the Medicare program, those that undergo a 100% change in ownership, and those reactivating Medicare enrollment after being in a deactivated status.

PPEO audits have been compared to Targeted Probe and Educate (“TPE”) audits because, like a TPE audit, a PPEO audit can include multiple rounds of review between which the provider may receive education and an opportunity to address the issue or issues identified by the review. However, this comparison only goes so far and in practice TPE and PPEO are often very different. TPE generally consists of three rounds of review, occasionally four, and the contractor conducting the review is required by CMS rules to offer education to the provider and to wait between rounds of review to give the provider a chance to implement changes and address any issues that have been identified. Further, under TPE, providers are generally not referred to CMS for sanctions until they have failed three consecutive rounds of review by demonstrating consistently high error rates across all three rounds. TPE can, and often does, result in revocation of billing privileges, but generally not before the provider has failed three rounds of review.

Published on: August 13, 2025

CY 2026 Medicare Physician Fee Schedule: CMS Proposes Permanent Telehealth Changes

by Wachler & Associates, P.C.

Recently, the Centers for Medicare & Medicaid Services (CMS) published the calendar year (CY) 2026 Medicare Physician Fee Schedule (PFS) Proposed Rule. The Proposed Rule includes significant changes to Medicare telehealth policies, among other proposals. Healthcare providers that utilize telehealth in their practices should understand the proposed changes and be prepared to comply with any shifts in Medicare policy if the proposed changes become final.

In the proposed rule, CMS proposes simplifying the current five-step process to determine if a service qualifies for the Medicare Telehealth Services List. Under the new process, CMS would only keep three criteria: the service must be separately payable under the PFS; fall within the scope of certain federal laws regulating telehealth services; and be deliverable through real-time, two-way interactive communication. This change aims to lower provider burden and speed up access to new telehealth services.

Based on the revised review process, CMS proposes adding five new services to the Medicare Telehealth Services List for CY 2026:

Published on: August 11, 2025

Medicare Deactivation Versus Revocation

by Wachler & Associates, P.C.

Medicare-enrolled providers have seen a recent increase in the number of deactivations issued by the Centers for Medicare & Medicaid Services (CMS) and its contractors. A deactivation of Medicare billing privileges effectively turns off a provider’s ability to bill Medicare and at first glance may appear to be similar to a Medicare revocation. However, the two are very different in practice and in how a provider may respond.

A revocation of Medicare billing privileges has long been a punitive measure to remove a provider or supplier’s ability to bill Medicare. CMS usually imposes these based on alleged misconduct by the provider, such as repeatedly billing claims that do not comply with Medicare requirements or being convicted of a felony. CMS will generally impose a bar of how long the provider must wait before it can attempt to re-enroll with Medicare, usually ten years. A Medicare revocation may also lead to a provider’s termination by other payors, including Medicaid and Medicare Advantage plans. A revocation can be a very serious sanction.

A deactivation of Medicare billing privileges is often more administrative in nature. It removes a provider’s ability to bill Medicare, but generally on different grounds, such as not billing Medicare for six months, not reporting a change in information, or not being in full compliance with all enrollment requirements, among others. When a provider is deactivated, it can generally reactivate its billing privileges by correcting the administrative issue and recertifying that its enrollment information is correct. Some provider types, especially home health agencies, may have additional requirements. Where a “gap” exists between when the provider’s billing privileges are deactivated and when they are reactivated, Medicare will likely deny claims from that period. The provider may consider whether to appeal the deactivation itself, in addition to any reactivation. The provider may also need to appeal any denied claims from such a period.

Published on: July 29, 2025

Basics of the Medicare Claims Appeal Process

by Wachler & Associates, P.C.

The regulatory process for appealing Medicare claim denials and overpayments is a complex, lengthy, and administratively burdensome process. Through up to five levels of appeals, Medicare-enrolled providers and suppliers, and their representatives, must contend with inflexible deadlines, tight procedural and bureaucratic requirements, and biased reviewers, all while contesting the denials and asserting the medical necessity of the items or services at issue.

After a Medicare Administrative Contractor (MAC) has issued an Initial Demand, the letter that informs the provider of the claim denials, the reasons for the denials, and the amount of repayment demanded, the first step in appeal is Redetermination. Redetermination review is conducted by the same MAC who issued the Initial Demand and the contractor nearly always upholds its earlier decision. A provider can stop or halt recoupment of the alleged overpayment at this stage of appeal, but only if it requests Redetermination within a certain timeframe.

After Redetermination, the next level of appeal is Reconsideration. Reconsideration is conducted by a Qualified Independent Contractor (QIC), a separate Medicare contractor than the contractor that conducted Redetermination. The QIC is generally more impartial than the MAC, but often finds against the provider. A provider can stop or halt recoupment of the alleged overpayment at this stage of appeal as well, but only if it requests Reconsideration within a certain timeframe.

Published on: July 25, 2025

CY 2026 Physician Fee Schedule: Proposed Overhaul of Skin Substitutes

by Wachler & Associates, P.C.

Recently, the Centers for Medicare & Medicaid (CMS) released the CY 2026 Physician Fee Schedule (PFS) Proposed Rule, introducing sweeping changes to Medicare Part B payment policy. Among the most significant updates is a restructuring of how Medicare pays for skin substitute products commonly used by wound care providers.

Skin Substitutes Reclassified as Incident-to Supplies

Historically, Medicare has paid for skin substitutes as biological products under the Social Security Act, using the Average Sales Price (ASP) methodology to determine reimbursement rates. However, CMS has raised concerns about increasing costs and utilization rates, noting that Medicare Part B spending on skin substitutes rose from millions in 2019 to billions in 2024.

Published on: July 16, 2025

Heightened FCA Scrutiny for Providers: DOJ and HHS Renew Enforcement Task Force

by Wachler & Associates, P.C.

The False Claims Act (FCA) remains a crucial focus for healthcare providers and hot-button issue under the current Administration. On July 2, 2025, the U.S. Department of Justice (DOJ) and the Department of Health and Human Services (HHS) announced they are teaming up once again. This signals a resurgence of the DOJ-HHS False Claims Act (FCA) Working Group and a revival of another healthcare enforcement initiative from the past. The main goal of the Working Group is to move fast, improve interagency collaboration, and strengthen FCA oversight with advanced data analysis tools, all focused on healthcare.

What Providers Need to Know: Enforcement Priorities

The Working Group will be co-led by senior officials from HHS’s Office of the General Counsel (OGC), the HHS Office of Inspector General (OIG), and DOJ’s Commercial Litigation Branch. U.S. Attorneys’ Offices and CMS’s Center for Program Integrity will also be actively involved.

Published on: July 3, 2025

Are More Medicare Advantage Audits on the Horizon?

by Wachler & Associates, P.C.

The Department of Health and Human Services (HHS) and the Centers for Medicare & Medicaid Services (CMS) recently announced two major policy efforts directed at Medicare Advantage (MA) plans. As MA plans have become a significant share of the healthcare insurance market, healthcare providers are left wondering what impacts these attempts at MA reform will have on providers.

First, CMS has announced a significant expansion of its auditing efforts for Medicare Advantage (MA) plans. Beginning in May 2025, CMS began to audit all eligible MA contracts for each payment year and invest additional resources to expedite the completion of audits for payment years 2018 through 2024. These audits primarily involve Risk Adjustment Data Validation (RADV) audits to confirm that diagnoses used for payment are supported by medical records. CMS reported that it is several years behind in completing these audits, but that recent estimates suggest that MA plans may have been overpaid by several billion dollars.

If CMS demands that MA plans return significant overpayments, the MA plans may seek to pass this cost along to providers. Namely, where an MA plan experiences an unexpected expense in the form of an overpayment demand, it will likely seek to decrease its costs elsewhere. This may lead to increased scrutiny of claims billed to MA plans, meaning more audits and overpayment demands aimed at healthcare providers.

Published on: June 30, 2025

Increasing Scrutiny of Medicare Hospice Providers

by Wachler & Associates, P.C.

The Department of Health and Human Services Office of Inspector General (“OIG”) recently announced that it would closely examine data relating to new Medicare hospice provider enrollments. These efforts build on existing practices by the Centers for Medicare & Medicaid Services (“CMS”) to increase oversight of certain Medicare hospice providers.

Hospice provides palliative care and support for patients who are terminally ill and for their families. Medicare covers hospice care only where certain criteria are met, including that a qualifying physician has certified that the patient has a terminal illness and a life expectancy of six months or less. Medicare-enrolled hospice providers are also required to be certified by CMS, be licensed as required by State and local law, and meet Medicare Conditions of Participation to receive payment.

For the past several years CMS has been concerned with hospice compliance and with fraud, waste, and abuse by hospice providers. To this end, CMS has increased audits of hospice providers, adjusted the 36-month rule restricting certain sales of hospice providers, and implemented the Provisional Period of Enhanced Oversight (“PPEO”) pilot program. Pursuant to the PPEO program, since mid-2023, CMS audits all “newly-enrolled” hospice providers in Arizona, California, Nevada, and Texas. “Newly-enrolled” is not limited to hospice providers enrolling in Medicare for the first time, but also includes those that undergo a Change of Ownership (“CHOW”) as that term is defined under the Medicare program, those that undergo a 100% change in ownership, and those reactivating Medicare enrollment after being in a deactivated status. PPEO audits function similar to TPE audits, but tend to be more rushed and less forgiving in terms of the education provided to the hospice under review. Hospices under PPEO audits should treat them with due caution and take measures to ensure that their claims and documentation meet Medicare requirements.