The July 2011 version of the CMS-855A, Medicare Enrollment Application (the “855A”) contains new disclosure requirements arising from risk screening criteria found in the Affordable Care Act (the “Act”). These reporting requirements apply not only to applications for new providers enrolling in the Medicare program, but to existing providers that will be required, under Section 6401a of the Act, to revalidate their qualifications for the Medicare program.
Section 5 of the revised 855A asks providers to list those organizations with ownership and/or managing control of the provider. “Ownership” is defined to include entities with at least a 5% mortgage, deed of trust or other security interest in the provider, including but not limited to banks and financial institutions. As a result of this new reporting requirement, providers with outstanding debt obligations, including tax-exempt bonds, the terms of which provide a mortgage or other security interest (e.g., a pledge of revenues, accounts receivable or personal property) to a lender or a master trustee, will need to consider whether disclosure is necessary. Pursuant to the instructions, the mortgage/security interest percentage is calculated by dividing the dollar amount of the mortgage or security interest by the dollar amount of the total property and assets of the provider. In addition, a filer will need to identify, from a list provided in the 855A, whether an organization reported under Part 5 ever had a final adverse legal action imposed against it.
All providers who enrolled in the Medicare Program prior to March 25, 2011 will be required to submit their enrollment information so they can be revalidated under the new risk screening criteria imposed by the Act. Revalidations will take place between now and March 2015. However, revalidations should not be submitted until providers are notified by their Medicare Administrative Contractor.
How We Can Help
Those providers with outstanding tax-exempt bonds will need to review their bond documents to determine whether a potentially reportable mortgage or other security interest was created in connection with the issuance of the bonds. Hall Render’s Health Care and Public Finance Section can assist with reviewing the relevant bond documents, identifying a potentially reportable mortgage or other security interest and calculating the percentage of the interest for purposes of Section 5 of the 855A.
Should you need assistance with your organization’s evaluation of disclosure issues related to the CMS Form 855A, please contact Kendall A. Schnurpel at(317) 977-1480 or kschnurpel@hallrender.com or Patrick D. Walsh at(414) 721-0450 or pwalsh@hallrender.com or your regular Hall Render attorney
