SUBJECT:

Procedure Center of Irvine,

Petitioner,

Centers for Medicare & Medicaid Services.

DECISION

Petitioner, Procedure Center of Irvine, is an ambulatory surgical center (ASC) challenging the effective date for its participation in the Medicare program. The Centers for Medicare & Medicaid Services (CMS) moves for summary judgment. Because I agree that CMS has selected the earliest effective date of participation allowed by federal regulations, I grant CMS's motion.

Discussion

1. The effective date of Petitioner's participation agreement may not be any earlier than August 25, 2004, the date it became accredited by an approved national accrediting body. ⁽¹⁾

Medicare will pay for services furnished in connection with certain surgical procedures performed at a participating ASC. Social Security Act (Act), section 1832 (a)(2)(F). An ASC is a distinct entity that 1) operates exclusively for the purpose of providing surgical services to patients not requiring hospitalization, 2) has an agreement to participate in the Medicare program, and 3) meets certain other conditions set forth in 42 C.F.R. Part 416, subparts B and C. 42 C.F.R. �� 416.2; 416.25. An ASC may qualify for a participation agreement in one of two ways: 1) based on a survey by the state survey agency, CMS finds it in compliance with conditions for coverage (42 C.F.R. � 416.26(b)); or 2) CMS "deems" the ASC to be in compliance with conditions for coverage based on its accreditation by a national accrediting body that CMS has determined provides reasonable assurance that the conditions are met. This is referred to as "deemed status." 42 C.F.R. � 416.26(a). For a "deemed" entity, such as Petitioner, the effective date of its agreement is the date on which it meets all requirements. 42 C.F.R. � 489.13(d).

The facts of this case are not in dispute. In January 2004, Petitioner began performing surgical procedures. Tokita Declaration (Tokita Decl.) at 3 (�8). Fearful of lengthy delays in the state agency survey process, Petitioner opted to apply for accreditation by an accrediting body in order to qualify for a participation agreement on a "deemed status" basis, and, on April 21, 2004, Petitioner applied for accreditation by the Accreditation Association for Ambulatory Health Care, Inc. (AAAHC), a CMS-approved national accrediting body. Tokita Decl. at 3-5 (�� 9 - 12). AAAHC accredited Petitioner effective August 25, 2004 (CMS Attach. B), and CMS has certified Petitioner for participation in the Medicare program effective that same day, August 25, 2004.

Citing 42 C.F.R. � 489.13(d)(2), Petitioner argues that CMS has abused its discretion by not making its participation agreement retroactive to January 6, 2004. Under that "special rule," the effective date of a provider/supplier's Medicare participation may be retroactive for up to one year. However, the entity must also satisfy subsection (d)(1), which requires that the supplier be currently accredited by a CMS-approved national accrediting organization. 42 C.F.R. � 489.13(d)(1). CMS has not abused its discretion because CMS has no discretion here. A supplier, like Petitioner, who seeks a participation agreement based on its deemed status simply may not participate unless and until it is accredited.

Conclusion

No facts are in dispute, and CMS is entitled to judgment as a matter of law. The date of Petitioner's participation agreement may not be any earlier than August 25, 2004, the effective date of its accreditation, and CMS's motion for summary judgment is therefore granted.

Carolyn Cozad Hughes

Administrative Law Judge

1. There are no disputed issues of fact in this case. I make this one conclusion of law.