CMS Finalized Rule Banning Troubled Clinicians from Medicare

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Several months ago we reported on CMS’ proposal in the Medicare Physician Fee Schedule that would allow federal officials an expanded ability to revoke or deny clinicians’ participation in Medicare, claiming new authority to bar those who have harmed patients. As an update to that original article, we can now report that CMS did ultimately finalize its proposal in the final Medicare Physician Fee Schedule, released on November 1.

New Rule

As described by CMS, the rule allows CMS to revoke the Medicare billing privileges of any physician who has “been subject to prior action from a state oversight board, federal or state health care program, Independent Review Organization (IRO) determination(s), or any other equivalent governmental body or program that oversees, regulates, or administers the provision of healthcare with underlying facts reflecting improper physician or other eligible professional conduct that led to patient harm.”

As was reported in Medscape, the rule was not popular with physician groups. Medscape cites several comment letters to highlight this opposition.

“We urge CMS to not finalize this ill-defined and overly broad proposal that could have a devastating impact on physicians, and to instead focus on ways to identify and discipline the truly bad actors,” wrote David B. Hoyt, MD, executive director of the American College of Surgeons, in a September 26 comment to CMS.

Others, like the American Medical Association, accused CMS of burying the controversial plan. CMS tucked the bid for new authority to revoke Medicare billing privileges into a section of the draft rule that deals with opioid treatment, several major associations noted in their comments to the agency.

This gave the appearance that the proposed change would apply only to “high-risk” Medicare-enrolled opioid treatment programs, when in fact it could affect all clinicians, wrote James L. Madara, MD, AMA’s chief executive.

“The CMS proposal is a broad overreach and the lack of deference to state medical boards and other oversight entities is troubling,” he wrote in a September 24 comment to CMS.

Final Rule Feedback

In a follow up article, Medscape notes CMS sought to assuage concerns in the final rule about whether the expansion of revocation authority would discourage clinicians from seeking treatment for their own mental health issues. It gave these three examples to show when the new authorities would — and would not — kick in:

  1. In a case involving patient harm, a state oversight board requires Dr X to enter a rehabilitation program. There are no other sanctions in the state’s order. Since the state’s action is restricted exclusively to rehabilitation, Medicare’s new revocation authorities, known as § 424.530(a)(15) or § 424.535(a)(22), would not apply.
  2. In a case not involving patient harm, a state oversight board issues a decision pertaining to Dr X that: (1) requires the physician to enter a rehabilitation program; and (2) imposes a fine. Medicare’s new revocation authority would not apply in any event because no patient harm was present.
  3. In a case involving patient harm, a state oversight board issues a decision pertaining to Dr X that: (1) requires the physician to enter a rehabilitation program; and (2) restricts the doctor’s license for a 60-day period due to, for example, sexual misconduct.


For patients this seems like reasonable oversight for Medicare to undertake.  It is amazing the number of clinicians who are caught up in state license issues.   Thus far in  2019  California has over 800 physicians with disciplinary actions.  This could also could exasperate a already tenuous shortage of healthcare professionals.


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