By Matthew Santoni

Law360 (April 10, 2020, 4:51 PM EDT) -- A Philadelphia physician asked a federal court Thursday to lift a ban on her billing Medicare, claiming the federal government illegally lengthened the ban stemming from her obstruction of a fraud investigation and was preventing her from returning to practice at a time when the coronavirus pandemic makes her services vital.

Dr. Lilia Gorovits says she'd been banned from billing Medicare since October 2016, but through her appeals, the Centers for Medicare & Medicaid Services retroactively pushed the start date of her ineligibility back to March 2016, and in 2017 it restarted a three-year clock on when she could be allowed to bill the federal health care system again, leaving her unable to practice for more than four years.

"CMS erred in the application of its reenrollment bar adjudication and Dr. Gorovits should be permitted all appropriate relief, including the immediate ability to reenroll in Medicare, a matter of utmost importance given the current viral pandemic in this country," her complaint says. "CMS (through its contractor Novitas) has barred, for erroneous reasons, an able-bodied physician whose medical license is in good standing from serving citizens in a city hard hit by COVID-19."

Gorovits wants the court to overturn a decision by the Medicare Appeals Council that upheld the length of her billing ban; to erase $170,000 the government said she owed for services she billed to Medicare in the months between the original start of the ban and the new, earlier one; and to allow her to immediately re-enroll as a health care provider under Medicare so she can get back into practice.

According to the complaint, Gorovits had been working in private practice in northeast Philadelphia at Kindred Hospital and Holy Redeemer Hospital when she pled guilty in March 2016 to obstructing a federal investigation into a kickback scheme at a hospice. Neither Gorovits nor the hospice were ever charged criminally with any scheme, the complaint says, but her conviction came with a term of probation and the possibility that she could be excluded from billing any of her services to Medicare.

She continued providing care and billing Medicare until Sept. 30, 2016, when she got a letter from the U.S. Department of Health and Human Services inspector general saying that her privileges were being revoked, the suit says.

"While Dr. Gorovits was made aware of the fact that she could potentially be excluded by HHS from participating in federal healthcare programs, she was not put on notice that her Medicare billing privileges would be revoked (let alone retroactively) or would be subject to a subsequent bar on reenrolling in the Medicare program," the complaint says. "Dr. Gorovits reasonably believed that any potential exclusion by HHS would be permissive and a possibility, not a foregone conclusion. She expected that her extensive cooperation with the government would be considered by HHS-OIG."

Novitas Solutions Inc., the Medicare administrative contractor on Gorovits' case, said the Medicare ban took effect on Oct. 20, 2016, citing the HHS decision to exclude her from federal health care programs and her alleged failure to report her conviction within 30 days, the complaint says.

But Gorovits says that when she appealed, Novitas bumped the effective date of her suspension back to the date of her conviction, citing a CMS "determination that petitioner's conviction purportedly was detrimental to the Medicare program." That made her retroactively liable to repay the federal government $170,000 she received from Medicare between her conviction and the first notice that she was ineligible, the suit says.

Gorovits said the decision — and the administrative judge and departmental appeals board decisions upholding it — was arbitrary and capricious in violation of the Administrative Procedure Act and the Medicare Act. CMS had switched from basing its revocation of her billing rights on one set of rules to another rule mid-appeal, Gorovits said.

"The DAB suggested in its decision that CMS's change of opinion was due to CMS simply reevaluating the facts of the case. However, there is no evidence in the record (let alone substantial evidence) suggesting that CMS's change of opinion had any relation to a reevaluation of the facts of the case or the merits of CMS's approach at all," the complaint says. "All that the record demonstrates is CMS inexplicably revising its decision, after Dr. Gorovits appealed Novitas' initial decision."

Gorovits says her case was distinct from the cases the appeals board cited in upholding her suspension from the Medicare program, since she had not actually committed any fraud upon the program or violated the anti-kickback statute.

The decision to lengthen her suspension, both by making it start earlier and by restarting the three-year clock when Novitas revised its decision in June 2017, was also a violation of her due process rights because it effectively punished her for appealing, she says.

"These inexplicable increases in the retroactive revocation and reenrollment bar periods punished Dr. Gorovits for exercising her administrative and due process right to pursue her appeal," the complaint says.

The suit says that being barred from billing Medicare for anything kept her from being hired or reopening her medical practice during a critical period.

"Dr. Gorovits' remaining impediment to being hired as a physician is the fact that she remains prohibited from billing Medicare (and the related fact that by virtue of the March 11, 2016, retroactive billing revocation date, she owes substantial sums to CMS which will surely be garnished from any of her future billables to CMS)," the complaint says. "Given the current state of the COVID-19 epidemic and the consequent demand for medical services, Dr. Gorovits is particularly keen to return to medical practice but is unable to do so given this impediment."

Attorneys for Gorovits and representatives for the Department of Health and Human Services did not immediately respond to requests for comment Friday.

Gorovits is represented by Kevin E. Raphael and Alexander M. Owens of Pietragallo Gordon Alfano Bosick & Raspanti LLP.

Counsel information was not immediately available for HHS or for CMS.

The case is Gorovits v. Azar et al., case number 2:20-cv-01850, in the U.S. District Court for the Eastern District of Pennsylvania.

--Editing by Adam LoBelia.

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