Changes of Ownership

While there may be a variety of legal definitions and purchase options, most of the changes of ownership received by the NPE West are completed using one of the following methods, which are defined as follows:

An asset purchase is the purchase of the assets of a business only. The buyer will be operating the business under a new tax identification number (TIN).

A stock purchase is the purchase of all assets and liabilities where the buyer will retain and operate the business under its existing TIN.

Suppliers should keep the following in mind with regards to changes in ownership:

Supplier Standard #2 requires a supplier to report to the NPE West any change in information within 30 days of the change
Supplier numbers are associated with the TIN. If the buyer chooses to purchase the assets and liabilities, retaining the TIN, then the supplier file only needs to be updated. If there is a change in TIN, then the new owner must obtain a new Medicare Identification Number.

No Change in TIN (Stock Purchase)

I am purchasing all assets and liabilities and will be using the existing TIN. Specifically, how do I report this change?
As the buyer, you must submit a change of information to update the ownership on file. Changes may be reported via PECOS or by completing the following sections of the current CMS 855S Version:

Section 1B – (Basic Information - Reason for submitting the CMS 855S)

Enter the Tax Identification Number
Enter the Supplier Billing Number (PTAN)
Enter the National Provider Identifier (NPI) and include a copy of the NPI notification
Enter the Legal Business Name (LBN)
Suppliers notifying the NPE West of an ownership change, whether it was through an asset or stock purchase, must provide their NPI and a copy of the NPI notification furnished by the National Plan and Provider Enumeration System (NPPES). The notification must list the supplier's business name, physical address and be submitted with any type of enrollment documentation. If you are unable to locate your NPI notification you may contact the NPPES at 800-465-3203 or send an email to customerservice@npienumerator.com.

Applying for the NPI is a process separate from Medicare enrollment. To obtain an NPI, you may apply online. For more information about NPI enumeration, visit the CMS website.

Section 1C – (Reason for Submitting this application)
Here you will indicate what information will be changing. Depending on the information that needs to be reported, check one or both of the following boxes:

Select the box in section 1C indicating the nature of the ownership change
Section 1D - (What information is changing)

Select the box for Ownership/Managing Control Information
(Be certain to check any other boxes that apply to the change i.e. delegated/authorized official)

Section 2A1 – (Identifying Information – Supplier Identification)
The instructions require suppliers to complete this section in its entirety when submitting a change. This information will assist the NPE West in verifying the change is being made for the correct supplier.

Section 7 – (Final Adverse Legal Actions)
Please review the information in this section and check the appropriate box. Do not leave this section blank. If the section does not apply, check 'No'. If you need to report any information, check 'Yes' and provide the required information.

Section 8 – (Ownership Interest and/or Managing Control Information (Organizations))
Please complete this section only if there are organizations that need to be added or deleted with regards to the ownership change.

Section 8A (Organization Identification Information)
To remove an organization as an owner complete section 8A:
Please check the 'Remove' box
Enter an effective date (mm/dd/yyyy)
Complete the section as it applies to the organization being deleted
To add an organization as an owner complete section 8A:
Please check the 'Add' box
Enter an effective date (mm/dd/yyyy)
Complete the section as it applies to the organization being added
To change information about a currently reported owning or managing organization complete section 8A:

Please check the 'Change' box
Enter an effective date (mm/dd/yyyy)
Complete the section as it applies to the changes of the organization
Section 8B (Final Adverse Legal Action History)
Please review the information in this section and check the appropriate box as it applies to the organization being added. Do not leave this section blank. If the section does not apply, check 'No'. If you need to report any information, check 'Yes' and provide the required information.

Section 9 - (Ownership Interest and/or Managing Control Information (Individuals))
This section should be completed for individuals only.

Section 9A (Individual Identification Information)
To remove an individual as an owner or manager:
Please check the 'Remove' box
Enter an effective date (mm/dd/yyyy)
Complete the section as it applies to the individual being deleted
To add an individual as an owner or manager:
Please check the 'Add' box
Enter an effective date (mm/dd/yyyy)
Complete the section as it applies to the individual being added
To change information about a currently reported individual owner or manager

Please check the 'Change' box
Enter an effective date (mme/dd/yyyy)
Complete the section as it applies to the changes of the individual
Section 9B (Adverse Legal History)
Please review the information in this section and check the appropriate box as it applies to the individual being added. Do not leave this section blank. If the section does not apply, check 'No'. If you need to report any information, check 'Yes' and provide the required information.

Section 11 (Contact Person)
Please list the name and contact information of an individual the NPE West analyst can easily reach that is knowledgeable about the information being submitted. It is important to list a contact person so that if the NPE West analyst needs additional information or clarification, the analyst will be able to obtain the information as quickly as possible.

Section 14 (Delegated Officials)
Appointing delegated officials is optional. However, if adding delegated officials, please complete this section as follows:

The individual(s) being added as the delegated official(s) must meet the definition of a delegated official. A delegated official means an individual who is delegated by an authorized official the authority to report changes and updates to the supplier’s enrollment record. The delegated official must be an individual with 'ownership or control interest in' as that term is defined in Section 1124(a)(3) of the Social Security Act) or be a W-2 managing employee of the supplier.

Delegated officials may not delegate their authority to any other individual. Only an authorized official may delegate the authority to make changes and/or updates to the supplier’s Medicare status.

To add the delegated official(s), check the 'Add' box enter an effective 'Date' in the proper format and complete the rest of this section making sure both the authorized and delegated official have signed appropriately.

Note: Delegated officials being added must be reported in section 9 of the CMS 855S.

To delete the delegated official(s), check the 'Delete' box, enter an effective 'Date' in the proper format and complete this section for the individual(s) being deleted. Have both the authorized and delegated official sign and date this section with an original signature.

Section 9 is not required for individual(s) being removed as delegated official(s).

Section 15 (Certification Statement)
Please complete this section for the new authorized official(s) and to remove the previous authorized official(s).

The individual(s) being added as the authorized official(s) must meet the definition of an authorized official. An authorized official means an appointed official (for example, chief executive officer, chief financial officer, general partner, chairman of the board or direct owner) to whom the organization has granted the legal authority to enroll it in the Medicare program, to make changes or updates to the organization’s status in the Medicare program, and to commit the organization to fully abide by the statutes, regulations and program instructions of the Medicare program.

To add the new authorized official(s), check the 'Add' box enter an effective 'Date' in the proper format and complete the rest of this section making sure the authorized official(s) has signed appropriately.

Note: Authorized officials being added must be reported in section 9 of the CMS 855S.

To delete an authorized official(s), check the 'Delete' box, enter an effective 'Date' in the proper format and complete this section for the individual being deleted. Have the authorized official(s) being deleted sign and date this section with an original signature.

Section 9 is not required for individual(s) being removed as authorized official(s).

Change in TIN (Asset Purchase):

I have purchased the assets of an existing Medicare supplier. What are my responsibilities as the buyer?
As the buyer, you are required to complete the CMS 855S in its entirety, via hardcopy or PECOS. Submit all required documentation and a copy of the bill of sale within 30 days of the transaction.

Suppliers notifying the NPE West of an ownership change, whether it was through an asset or stock purchase, must provide their NPI and a copy of the NPI notification furnished by the NPPES. The notification must list the supplier's business name, physical address and be submitted with any type of enrollment documentation. If you are unable to locate your NPI notification you may contact the NPPES at 800-465-3203 or send an email to customerservice@npienumerator.com.

Applying for the NPI is a process separate from Medicare enrollment. To obtain an NPI, you may apply online. For more information about NPI enumeration, visit the CMS website. 

Please remember when submitting the CMS 855S to complete the Authorization Agreement for Electronic Funds Transfer (CMS 588). With regard to DMEPOS enrollment, suppliers should submit the CMS 588 when initially enrolling or submitting an application for an additional location. Therefore, suppliers who have acquired a company through an asset purchase are required to submit the CMS 588 form to the NPE West. It is important to ensure the form has the original signature of the authorized or delegated official. Suppliers should submit a separate form for each DME MAC where it submits claims. Also, suppliers must include with each form submitted a voided check, preprinted deposit slip or confirmation of account information on bank letterhead for verification of the account number. Once verified, the NPE West will send the agreements to the appropriate DME MAC for processing.

I have a Medicare Identification Number and have sold my company to another entity. What is my responsibility?
As the seller, you are required to ensure the NPE West has been notified of the sale within 30 days of the date of sale. Complete the CMS 855S form as a voluntary termination or voluntarily withdraw via PECOS. To complete the CMS 855S form as a voluntary termination, complete the following sections:

Section 1B – (Basic Information - Reason for submitting the CMS 855S)

Enter the Tax Identification Number
Enter the Supplier Billing Number (PTAN)
Enter the National Provider Identifier (NPI) and include a copy of the NPI notification
Enter the Legal Business Name (LBN)

Section 1C – (Reason for Submitting this application)
Here you will indicate what information will be changing. Depending on the information that needs to be reported, check one or both of the following boxes:

Select the box in section 1C indicating the nature of the ownership change
Section 1D - (What information is changing)

Select the box for Ownership/Managing Control Information
(Be certain to check any other boxes that apply to the change i.e. delegated/authorized official)

Section 11 – (Contact Person)

Please list the name and contact information of an individual the NPE West analyst may contact to obtain additional information or to obtain clarification

Section 14 or 15 – (Certification Statement/Delegated Official)
If the authorized official is signing the application, this individual should sign section 14. If the delegated official is signing the application, this individual should sign section 15. Signatures and dates must be original. If they are not original the CMS 855S will be returned.

Please note the NPE West and CMS would prefer to have suppliers report the voluntary termination on the CMS 855S form, but will accept the request to terminate on company letterhead. In order to accept the request on company letterhead, the supplier must specifically request to voluntarily terminate the supplier number, provide an effective date of termination and ensure the request has the original signature of either the authorized of delegated official.

As the buyer, may I use the Medicare Identification Number of the company I purchased until I receive my own?
Supplier standard #18 states that a supplier may not reassign or convey an Medicare Identification Number.

Medicare Identification Numbers cannot be transferred. If this is an asset purchase only and you will operate your new business under a different TIN, do not use the Medicare Identification Number for your current business activities. You will need to obtain your own Medicare Identification Number.

When I apply for my new Medicare Identification Number, will that number be retroactive back to the date I purchased the company?
Your number can be made retroactive to the date on the bill of sale or to the date of your newest license, insurance document, permit, etc.

If all licenses, insurance, permits and/or certificates required for your specialty are effective under your new business name as of the date of the bill of sale and you are in compliance with the supplier standards, then the new number will be retroactive to the date on the bill of sale.

Please note, 42 CFR 424.57 establishes the criteria DMEPOS suppliers must meet in order to be eligible to receive payment for a Medicare-covered item. Therefore, if a license has a date after the date on the bill of sale, this does not show full compliance and the new supplier number can only be retroactive back to the date of the license. The NPE West is aware that some states allow new owners to operate under the existing license until the new license has been issued. Therefore, it would be advantageous to submit documentation or contact information to this effect.
 
What is the difference between a merger and an asset acquisition in regards to Medicare enrollment?
The application requirements and processes for mergers and acquisitions are the same, and are dependent on the tax ID being reported for the enrolled entity.

If the merger results in a new tax ID not previously enrolled with the NPE West, a new application is required. A new PTAN will be issued.
If the merger results in a new tax ID for the enrolling location, but is using a tax ID already enrolled with the NPE West, an additional location application is required. A new PTAN will be issued.
If the merger results in no change in tax ID for the enrolling location, a Change of Information is required to report new “ownership”. A new PTAN will not be issued.
Exactly what do I need to have in order to be in compliance and obtain a new Medicare Identification Number?
Please review the information under Standards & Compliance to obtain a copy of the supplier standards.  If you have any questions, contact the NPE West Customer Service Line at 866-238-9652.

There is also a license directory available on the website. Simply select a state and then a specialty for detailed information about licensure requirements. Please note this directory should only be used as a guide. Your state has the final authority to determine what licenses are required. It is the responsibility of the supplier to obtain all required licenses.