Before You Voluntarily Surrender Your State Medical License, Consider That Medicare May Revoke Your Privileges or Exclude You

Medical-License-e1644515318522For various reasons, licensed medical providers may choose to voluntarily surrender their state licensure.  Sometimes, the provider does not intend to work in the state anymore and no longer wishes to maintain the licensure.  Other times, the licensing agency may intend to discipline the provider and the provider chooses to surrender their license in lieu of receiving discipline.  Surrendering your license, however, may have unintended consequences to include revocation of your Medicare privileges and instituting a Medicare enrollment bar.  This post outlines what actions the Centers for Medicare and Medicaid (CMS) or one of its Medicare Administrative Contractors (MAC) may take in response to a provider surrendering their state licensure.  A forthcoming post will outline potential options a provider may have if their Medicare privileges have been revoked.  If you have questions regarding this blog post or wish to discuss your medical license or Medicare privileges, you may contact us at (404) 685-1662 (Atlanta) or (706) 722-7886 (Augusta), or by email, You may also learn more about our law firm by visiting


There are two main ways a CMS or a MAC can revoke a provider’s Medicare privileges after they voluntarily surrender their state medical licensure:

  1. Non-Compliance Under 42 C.F.R. 424.535(a)(1)

CMS or a MAC can revoke a provider’s privileges for Non-Compliance, which occurs when: “the provider or supplier is determined not to be in compliance with the enrollment requirements in Subpart P (of Part 424) or in the enrollment application applicable to its provider or supplier type, and has not submitted a plan of corrective action as outlined in 42 C.F.R. Part 488.”  Surrendering a license could move the provider into noncompliance because (a) licensure is required for enrollment or (b) the provider failed to report her voluntary surrender.

(a) When Licensure is a Requirement

Not all enrolled providers are licensed providers (see CMS Form 855O).  Medicare privileges are state-by-state, so no longer being licensed in one state does not necessarily mean the provider is unable to be licensed in any state.  However, if licensure is a requirement of enrollment and the provider surrenders their license, the provider needs to move to deactivate her privileges in that state, which can usually be done by resubmitting the CMS enrollment form marking the appropriate box.

(b) When Provider Fails to Report

Even if licensure is not a requirement, the provider may be obligated to report the change in her status as a “Final Adverse Action.”  The failure to report could result in revocation of privileges.  42 C.F.R. 424.502 defines “Final Adverse Action” as a “[s]uspension or revocation of a license to provide health care by any State licensing authority.”  The Medicare Program Integrity Manual expounds that reportable “Exclusions, Revocations, or Suspensions” include “any current or past revocation, suspension, or voluntary surrender of a medical license in lieu of further disciplinary action.”  MPIM, Ch. 10, Sect. 10.1.1.  It is not always clear what it means to surrender “in lieu of further disciplinary action,” which is why it is useful to consult with counsel prior to making decisions regarding your licensure and reporting obligations.  Reporting a final adverse action that need not be reported is unlikely to result in serious consequences; however, failing to report could result in suspension and a bar to reenrollment.  42 C.F.R. 424.535(c) allows CMS to establish a re-enrollment bar for a period of at least one (1) year after the revocation.  As such, even if the state-specific Medicare revocation does not interfere with your ability to practice, the re-enrollment bar generally applies across the country to prevent you from becoming enrolled elsewhere.


  1. Exclusion Under 42 U.S.C. 1320a-7

Section 1320a-7 includes both mandatory and permissive exclusions from Medicare.  One reason for permissive exclusion is for a provider “who surrendered such a license while a formal disciplinary proceeding was pending before such an authority and the proceeding concerned the individual’s or entity’s professional competence, professional performance, or financial integrity.”

The situations in which permissive exclusion for surrender is triggered are more defined than for non-compliance in that the disciplinary proceeding must concern professional competence or performance or financial integrity.  Appeal cases reflect that “formal disciplinary proceeding” may, however, be interpreted broadly to include a pending investigation.  See Crews v. Shalala, 40 F. Supp. 2d 350, 355 (E.D. Va. 1999) (finding formal disciplinary proceeding when he surrendered after receiving “a letter warning him of a pending investigation and the possibility of “disciplinary sanction[s] in the form of a Consent Order.’”).

If you have questions regarding this blog post or are considering surrendering your medical license, you may contact us at (404) 685-1662 (Atlanta) or (706) 722-7886 (Augusta), or by email, You may also learn more about our law firm by visiting


*Disclaimer: Thoughts shared here do not constitute legal advice.






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