Bala,
I've heard of similar stories of this happening in various regions with switches from Noridian to Palmetto. Unfortunately, the only advice I can leave you with is give them what they want, when they want it....and always via some sort of certified mechanism. I know of some IDTF's having their reimbursements held up over 9+ months due to "lost" documentation. Also, if things start going south never be afraid to seek assistance politely from a supervisor or manager as soon as things appear to be going unfavorably. Sometimes it's your only option when "re-certifying".
Wish I had better advice for you.
Eric