Exclusion Screening Basics for Providers

Doctor in Medical Records room. Exclusion Screening Basics

Exclusion Screening Is Mandatory

Providers of medical services that participate in Federal or State Health Care Programs are required to screen all of their employees, vendors, and contractors monthly to ensure that none have been excluded from either the Medicare or Medicaid programs. Practices that fail to meet this requirement risk Civil Monetary Penalties (CMPs) and overpayments because Federal and State regulations prohibit payment for any item or service that was provided, directly or indirectly, by an excluded person.

Enforcement cases involving the employment of excluded persons are increasing dramatically. The imposition of CMPs more than doubled from 2013 to 2014, and recent case investigations have been supported by data analysis projects by the Office of Audit Services and the Office of Evaluation and Inspections. In light of the increasing enforcement efforts and the potential consequences, it is critical that providers gain a basic understanding of the issues relating to Exclusion Screening and how they can be addressed.

What is an Exclusion?

HHS/OIG has the authority (by delegation from the Secretary) to deny persons and entities the ability to participate in federal healthcare programs. When such an action is taken by the OIG, that person or entity is said to be “excluded” and placed on the List of Excluded Individuals and Entities (commonly abbreviated “LEIE”).

Federal exclusions can be either mandatory or permissive, but both have the effect of barring participation in all federal healthcare programs until such time, if ever, that the government agrees to reinstatement. Mandatory exclusions last a minimum of 5 years and generally involve felony convictions for defrauding health care programs, felony drug offenses, and convictions for patient abuse or neglect. Permissive exclusions implicate a wider range of conduct and most often involve misdemeanor health care fraud, misdemeanor drug offenses, and licensing issues.

States also have the authority to exclude individuals and entities from participating in their own programs, such as Medicaid. Currently, 40 states maintain their own exclusion lists that are separate from the OIG’s LEIE. States will generally add OIG Exclusions to their own list, but they are also free to adopt their own exclusion criteria. It is important to note that states also often fail to report their own exclusions to CMS or the OIG such that it is not uncommon for an individual to end up on a state exclusion list and not the LEIE.

Federal and State Regulations Prohibit Payment for any Item or Service Performed by an Excluded Person

Neither Medicare nor Medicaid will pay for any item or service that results in a claim for reimbursement if an excluded individual contributed to it either directly or indirectly.  The so-called “payment prohibition” is broadly interpreted by the OIG. For instance, in it’s May, 2013 “Special Advisory on the Effect of Exclusions,” they expressed the view that the preparation of a surgical tray or the inputting of information by an excluded person or vendor could taint a claim. Even volunteer work by an excluded person could trigger the prohibition unless the volunteer activities were “wholly unrelated to federal health care programs.”

Thus, a practice that hires an excluded person or does business with an excluded vendor or contractor could find that every billable service he or it contributes to is tainted. They would then be liable for a potential overpayment. Most states have also adopted this rationale and apply it to their Medicaid claims.

Don’t Risk Civil Money Penalties, Overpayments and Potential Actions under the False Claims Act

CMPs are often employed by the OIG as an enforcement tool when it discovers that claims have been made for an item or service that was provided, or contributed to, by an excluded employee. CMPs are very difficult to defend since the OIG has interpreted the relevant federal regulations to mean that the entity either “knew” of the exclusion and still submitted the claim, or that the entity “should have known,” but failed to properly screen the employee. Either way, penalties are appropriate, according to the OIG.

It should also be noted that Section 6501 of the Affordable Care Act (ACA) requires “State Medicaid Agencies to terminate the participation of any individual or entity if such individual or entity is terminated under Medicare or any other State Medicaid plan.” As such, any person terminated under any federal or state authority is subject to exclusion by all federal or state authorities. Therefore, claims by them are potentially problematic.

The failure to screen also creates a risk for providers of being sued under the False Claims Act (FCA).  The theory behind FCA claims, which is employed with increasing frequency, asserts simply that since providers know that Medicare will not pay for a claim by an excluded person, a provider that fails to screen has constructive knowledge of the person’s status or is acting in deliberate ignorance.

Federal and State Screening Requirements

Federal screening requirements, as contained in the May, 2013 Special Advisory Bulletin, requires providers to check the LEIE for employees and contractors. According to the Bulletin’s guidance, providers should “review each job category or contractual relationship to determine whether the item or service being provided is directly or indirectly, in whole or in part, payable by a Federal health care program.” Then, providers should “screen everyone that perform[s] under that contract or in that job category” on a regular (read monthly) basis. If only it was that simple.

It is important to remember that the OIG’s guidance addresses only federal concerns. State Medicaid programs also have screening requirements that generally require, at a minimum, that providers screen their own State Exclusion List (37 States have them plus Washington, D.C.) in addition to the LEIE. Many also require screening of the System for Award Management list (SAM), and/or other State specific exclusions lists (such as sex offender lists, elder abuse lists, etc.). Furthermore, it is not uncommon for States to add onerous screening requirements in enrollment or re-enrollment applications and provider agreements. For example, a number of states require a certification that it has no employees that are suspended or excluded from any Federal or State Health Care Program. Some even require certification that their employees have never been excluded or suspended from any Federal or State exclusion list.

The Difficulty in Meeting Federal and State Exclusion Screening Requirements

Despite the OIG suggestions, the ability of individual practices to meet their federal screening requirements is difficult for a provider of any size. The current web-based LEIE interface allows only five employees to be screened at a time, each of which must be entered manually. Subsequently, potential matches must be verified individually by entering their Social Security Number. This might work for a provider who only has to screen a handful of employees or contractors. For a provider with a large number of employees, however, this would be a long and difficult undertaking.

The alternative OIG suggestion is to download the entire LEIE database and compare it to an employee list, but this is equally problematic – if not more so. The LEIE currently contains almost 60,000 names and few providers have the ability to compare that to their own employee database in any reliable or economically viable way.

Even if a provider has the ability to meet the OIG’s screening obligation, State exclusion lists must also be checked and they present additional problems. To start, State lists come in a variety of formats (Word, Excel, or PDF) with different data fields. Indeed, some State lists have little more than a name and an address. Furthermore, many states have additional state-specific screening requirements for lists. Finally, as previously indicated, practices need to be aware that a number of States have enrollment applications and provider agreements that require providers to certify that they have screened all employees and contractors with all federal and state exclusion lists.

Outsourcing is the Solution that makes Sense

In addition to the logistical problems associated with screening federal and state exclusion lists, there are the practical concerns associated with ensuring compliance with a repetitive and difficult task that may be viewed as “unnecessary” by the person tasked with the job. The best solution all around is to find a vendor who will perform the task for you for a reasonable fee. This fee will probably be considerably less than the cost of doing the screening yourself.

A provider’s choice of a company price is an obvious concern, but there are other important factors to consider. For instance, a provider should ask: What is the company’s background in healthcare? Does it have an understanding of exclusion related issues? Does it have a willingness and ability to assist the provider in determining vendor related issues (such as who to screen and vendor certifications)? Will it provide support as needed? Does it have complimentary products such as hotline services that it can provide at little or no cost? 

Conclusion

Exclusion Screening, LLC is one such vendor that is worthy of consideration. It’s co-founders, Robert Liles and Paul Weidenfeld, have both served as National Health Care Fraud Coordinators for the Department of Justice, and for the last several years they have both represented healthcare providers nationwide. They are healthcare lawyers who saw a problem that healthcare providers were having, and through Exclusion Screening, LLC they have created a simple and cost effective solution. A provider need only put together a list of employees and vendors (with our assistance), and it does the rest for prices that are hard to believe. Please contact us to discuss your particular needs and get a free cost estimate today.

OIG Exclusion

Paul Weidenfeld is the author of this article. Contact Paul should you have any  questions at: pweidenfeld@exclusionscreening.com or 1-800-294-0952.

CMP Liabilities: Why Are Some Much Higher Than Others?

A quick review of the Office of Inspector General’s (OIG) exclusion enforcement actions might make one wonder why the Civil Monetary Penalties (CMPs) for some entities are only $10,000 while others are closer to $2,000,000. We were curious as well, and took a look into the factors that might contribute to the vast differences in money owed.

 CMP Liabilities Higher

The easiest answer is that CMPs tend to be lower for entities that self-disclosed the exclusion violation as opposed to entities that were subject to an OIG investigation. “Tend” is the key word here. You’ll notice that the August 5, 2014 case (see “CMP Liabilities Higher” link above) was self-disclosed and has the highest CMP amount listed at $1,983,907.51.

I.  CMP Liability Depends on How Many Excluded Individuals Are Hired

Another contributing factor is the number of excluded individuals that the provider employed or contracted with. More individuals means that more claims were likely submitted for payment. Therefore, the government likely paid more money to these providers than providers who only employed or contracted with one excluded person. This is evident in the two exclusion actions which took place on August 5, 2014. The University Hospital employed one excluded individual and owed $10,000 in CMP liabilities, while the laboratory owed nearly $2,000,000 because it knew or should have known that four employees were excluded from participation in the federal health care programs. However, it’s important to note that the March 7, 2014 case which totaled $243,266.31 in CMPs only involved one excluded individual. So what is going on?

II.  CMP for Each Item or Service Provided

OIG has discretion to impose CMPs of up to $10,000 for each item or service that the excluded individual provided. Hence, the length of time and the number of items or services provided by the excluded individual directly contribute to the total CMP amount imposed on a provider. The March 7, 2014 case involved a nursing and rehabilitation center, so it is likely that a large majority of the entity’s claims were submitted to the Federal health care programs for payment. Additional information about the excluded individual is not available, but the rules governing CMPs lead us to believe that this individual was employed with the facility for a fairly substantial period of time and provided a large number of items and services that were directly or indirectly billed to the Federal health care programs.

The Federal health care program monies may not be used for activities that violate the law. Therefore, even a self-disclosing entity[1] will be subject to large CMPs if the excluded individual performed a lot of services that were billed (directly or indirectly) to the Federal health care programs.

III.  Our Take-Away

Our take-away from this closer look at CMPs confirms that it is best to identify an individual or entity that is excluded as soon as possible. This is where monthly screening comes in. You might screen your employee or contractor before hiring, but if you continue to let that employee or contractor conduct services that are billed directly or indirectly, you may be responsible for paying that money back. Finding out a person is excluded one month into a relationship with them is much better than learning about the exclusion six months or a year later because the person will not have had an opportunity to perform an extreme amount of services that will get you into hot water. 

CMP Liabilities

Paul Weidenfeld, Co-Founder and CEO of Exclusion Screening, LLC, is the author of this article. He is a longtime health care lawyer whose practice has focused on False Claims Act cases and health care fraud matters generally. Contact Paul should you have any questions at: pweidenfeld@exclusionscreening.com or 1-800-294-0952.


[1] Providers are reminded that OIG may use a lower multiplier for damages in self-disclosure cases, but it is under no obligation to do so. Dep’t of Health and Human Servs. Office of the Inspector Gen., Updated OIG’s Provider Self-Disclosure Protocol, 14 (Apr. 17, 2013).

OIG Proposes Amending Rules to Increase its Civil Monetary Penalty and Exclusion Authority

exclusion authority

In May 2014, the Office of the Inspector General (OIG) for the U.S. Department of Health and Human Services published two proposed rules to implement provisions of the Affordable Care Act (ACA). The new rules add and expand upon OIG’s current exclusion and Civil Monetary Penalty (CMP) authority.

I.  Revisions to OIG’s Exclusion Authority 

The new exclusion rule would incorporate ACA provisions that give OIG additional permissive exclusion authority for persons who:

  • Are convicted of an offense in connection with the obstruction of an audit;
  • Fail to supply payment information (ACA expanded this to apply to individuals who “order, refer for furnishing, or certify the need for” items or services for which payment may be made under Medicare or any State health care program); and
  • Make or cause to be made, any false statement, omission, or misrepresentation of a material fact in applications to participate as a provider of services or supplier under a Federal health care program.[1]

With respect to the new permissive exclusion for the obstruction of an audit, the OIG would have authority under section 6408(c) of the ACA to increase the length of the exclusion if the acts that resulted in the obstruction conviction caused a financial loss of $15,000 or more.

The proposed rule would also implement section 6402(d) of the ACA and expand OIG’s permissive exclusion authority to “any individual or entity that knowingly makes or causes to be made any false statement, omission, or misrepresentation of a material fact in any application, agreement, bid, or contract to participate or enroll as a provider of services or supplier under a Federal health care program.” OIG’s permissive exclusion authority would also reach to “[a]ny individual or entity furnishing, ordering, referring for furnishing, or certifying the need for items or services.”[2]

II. OIG Considerations for Exclusion Penalty

OIG states that it would base its decision on whether to inflict an exclusion by weighing information from a variety of sources like: Centers for Medicare and Medicaid Services (CMS), Medicaid state agencies, fiscal agents or contractors, private insurance companies, state or local licensing authorities, and law enforcement agencies. Then, OIG would decide the period of exclusion by considering “the repercussions of the false statement . . . and whether the individual or entity has a documented history of criminal, civil, or administrative wrongdoing.”[3]

OIG also addressed the current six year statute of limitations on exclusion claims. It concluded that conduct older than six years “may sometimes form a proper basis to conclude that a person should be excluded.” OIG supported its position, stating that often in False Claims Act cases, OIG does not decide to impose an exclusion until after the case reaches a settlement or judgment, which may take longer than six years. Additionally, OIG considers “whether the provider has agreed to pay appropriate restitution, fines, or penalties and whether it will agree to appropriate compliance measures,” which all require a settlement or judgment. OIG claims that adhering to a six year statute of limitations would force it to “file exclusion actions prematurely,” which may disrupt civil cases.[4]

III. Exclusion Lengths Amended

The proposed rules additionally modernize the financial loss number that is used to help determine an exclusion’s length. The rules would increase the “aggravating factor” threshold of the financial loss to the government to $15,000 or more. According to OIG, this number is a “realistic marker for determining whether someone is untrustworthy.”[8] In addition, OIG wants to update the claims mitigating factor relating to misdemeanor offenses and loss to government programs from $1,000 to $5,000. OIG also clarified that this misdemeanor provision only applies to section 1128(a)(1). Furthermore, OIG stated that this number is consistent with the justification for the original amount, and explained that using this dollar threshold as a mitigating factor would help OIG differentiate between less serious and more serious conduct.

OIG’s proposed exclusion rule also recommends clarifying how the length of an exclusion is calculated for individuals with ownership interests in sanctioned entities. Under the new rule, the length of a person’s exclusion would be “for the same period as that of the sanctioned entity with which the individual has or had the prohibited relationship.”[9] OIG would also exclude individuals who terminated their relationship with a sanctioned entity after it had been excluded for the same period that the entity is excluded.

IV. Other Added Provisions of the Proposed Rules

The proposed rules would update the waiver provision to make it consistent with the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) and the ACA. Under section 949 of the MMA, a Federal health care program administrator may request a waiver if he or she believes that the exclusion would impose a hardship on a Medicare beneficiary. On the other hand, section 6402(k) of the ACA permits a Federal health care program administrator to request a waiver if he or she concludes that the exclusion will impose a hardship on any beneficiary eligible to receive items or services under a Federal health care program. Therefore, the new rule will expand OIG’s waiver authority and permit Federal health care program administrators to request a waiver if any beneficiary will suffer a hardship due to the exclusion.[5]

OIG also introduced a provision that would permit those who are excluded under section 1128(b)(4) to apply for early reinstatement in select situations. Providers are excluded under section 1128(b)(4) due to the loss of a health care license for professional competence, professional performance, or financial integrity. The first set of scenarios would permit an excluded person to request an early reinstatement if “after fully and accurately disclosing the circumstances surrounding the original license action that formed the basis for the exclusion, the individual obtained a health care license, was allowed to retain a health care license in another state, or retained a different health care license in the same state.”[6] Alternatively, the rule would permit an excluded individual to request early reinstatement “if he or she did not have a valid health care license of any kind provided that the individual could demonstrate that he or she would no longer pose a threat to Federal health care programs and their beneficiaries.”[7]

Furthermore, the new rule would permit CMS to pay claims submitted by Medicare enrollees even if the item or service was furnished by an excluded individual, so long as the “enrollee does not know or have reason to know of the exclusion.”[10] Currently, this payment exception is limited to Medicare Part B enrollees, but the new provision would extend to Part C and D enrollees as well.

Finally, the proposed rules would alter two of OIG’s procedural authorities. First, it would give the individuals who OIG intends to exclude an opportunity to present oral argument in front of an OIG official before the exclusion is imposed.[11] Second, it would expand its ability to use testimonial subpoenas as an investigative tool for all section 1128 cases instead of just section 1128A cases.[12]

V.  Revisions to CMP Authority

The new rule to amend the CMP regulations[13] would implement authorities under the ACA. Specifically, ACA permits CMPs to be imposed for:

  • Failure to grant OIG timely access to records, upon reasonable request;
  • Ordering or prescribing while excluded when the person knows or should know that the item or service may be paid for by a Federal health care program;
  • Making false statements, omissions, or misrepresentations in an enrollment application to participate in a Federal health care program;
  • Failure to report and return an overpayment that is known to the person; and
  • Making or using a false record or statement that is material to a false or fraudulent claim.[14]

In an effort to add clarity and transparency to the OIG CMP calculation process, OIG proposed five new factors to guide its decision making process:

  • The nature and circumstances of the violation,
  • The degree of culpability of the person,
  • The history of prior offenses,
  • Other wrongful conduct, and
  • Other matters as justice may require.[15]

OIG notes that this is an “illustrative” rather than comprehensive list. Also, the five new factors apply to “both exclusion determinations under part 1003 as well as penalty and assessment amount determinations.”[16]

VI. New Method to Calculate Penalties

OIG also proposed a new method to calculate “penalties and assessments for employing excluded individuals for positions in which the individuals do not directly bill the Federal health care programs for furnishing items or services.”[17] It focuses on two specific kinds of violations: (1) when the items or services provided by the excluded person are identifiable on the submitted claims and may therefore be billed separately to the federal health care programs; and (2) when the items or services provided by the excluded person are not separately billable to the federal health care programs but are reimbursed by the federal health care program in some manner as part of the item or service claimed.[18]

For items or services that may be billed separately, the employer would be subject to penalties and assessments based on the number and value of those separately billed items and services. For non-separately billable items or services, OIG recommends a new method to calculate penalties and assessments. Penalties would be based on the number of days the excluded individual was employed. Assessments would be based on the total cost to the employer during the exclusion. The total cost includes the person’s salary, benefits, and other items of value.[19]

VII. Conclusion

Finally, the proposed rules clarify liability guidelines as they pertain to the Civil Monetary Penalties Law (CMPL), the Emergency Medical Treatment and Labor Act (EMTALA), section 1140 of the Social Security Act for conduct involving electronic mail, Internet, and telemarketing solicitations; and section 1927 of the Social Security Act for late or incomplete reporting of drug-pricing information.[20]

 Ashley Hudson 

Ashley Hudson, Associate Attorney at Liles Parker, LLP and former Chief Operating Officer for Exclusion Screening, LLC, is the author of this article. Feel free to contact us at 1-800-294-0952 or online for a free consultation.


[1] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,810 (proposed May 9, 2014) (to be codified at 42 C.F.R. §§ 1000, 1001, 1002, 1006).

[2] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,816.

[3] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,817.

[4] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,815–16.

[5] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,817.

[6] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,823.

[7] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,823.

[8] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,813.

[9] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,816.

[10] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,817.

[11] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,817–18.

[12] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Exclusion Authority, 79 Fed. Reg. 26,819.

[13] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Civil Monetary Penalty Rules, 79 Fed. Reg. 27,080 (proposed May 12, 2014) (to be codified at 42 C.F.R. §1003,1005).

[14] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Civil Monetary Penalty Rules, 79 Fed. Reg. 27,081.

[15] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Civil Monetary Penalty Rules, 79 Fed. Reg. 27,082.

[16] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Civil Monetary Penalty Rules, 79 Fed. Reg. 27,082.

[17] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Civil Monetary Penalty Rules, 79 Fed. Reg. 27,080.

[18] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Civil Monetary Penalty Rules, 79 Fed. Reg. 27,085.

[19] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Civil Monetary Penalty Rules, 79 Fed. Reg. 27,085.

[20] Medicare and State Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General’s Civil Monetary Penalty Rules, 79 Fed. Reg. 27,080.

What is an OIG Exclusion?

an OIG Exclusion

By Paul Weidenfeld

I.  What is an OIG Exclusion?

An OIG Exclusion is a final administrative action by the Office of the Inspector General (OIG)  that  prohibits participation in any Federal Health Care Program.  Exclusions are imposed because the individual or entity is found to pose unacceptable risks to patient safety and/or program fraud.  As a result, Federal health care programs such as  MedicareMedicaid and TRICARE will not pay for any service provided — either directly or indirectly — by an excluded person or entity. 

II.  Who Has the Authority to Impose an OIG Exclusion?

The Department of Health and Human Services (HHS) has the overall responsibility of administering the Medicare and Medicaid Programs. HHS decides who may receive benefits under these programs and who will be allowed to provide them.  

The authority to exclude individuals and entities from federal health care programs is delegated to OIG.[1] OIG enforces the exclusion penalty through its authority to impose civil money penalties (CMPs) where claims are submitted for services performed or furnished by an excluded person or entity and the person making the claim “knew or should have known” of the exclusion. 

III. OIG Exclusion Types

There are two types of OIG exclusions, mandatory and permissive, and both have the effect of barring an individual or entity from participating in all Federal health care programs from the time they are excluded until such time, if ever, that their privilege is reinstated.[2]  Mandatory exclusions last a minimum of 5 years and must be imposed if a person or entity is convicted of certain criminal offenses.  These include:

  • Conviction for Medicare or Medicaid fraud, or any other offense related to the fraudulent delivery of items or services to Federal or State health care programs;
  • Patient abuse or neglect;
  • Felony convictions for other health care related fraud, theft, or other financial misconduct; and
  • Felony convictions relating to unlawful manufacture, distribution, prescription, or dispensing of controlled substances.

The discretionary authority to exclude individuals and entities implicates a much wider range of conduct. We discuss this topic in a later article, but examples for which permissive exclusions may be imposed include:

  • Misdemeanor convictions related to defrauding a heath care fraud program,
  • Misdemeanor convictions relating to the unlawful manufacture, distribution, prescription, or dispensing of controlled substances,
  • Suspension, revocation, or surrender of a license to provide health care for reasons bearing on professional competence, performance, or financial integrity,
  • Provision of unnecessary or substandard services;
  • Submission of false or fraudulent claims to a Federal health care program,
  • Engaging in unlawful kickback arrangements,
  • Defaulting on health education loan or scholarship obligation, and
  • Controlling a sanctioned entity as an owner, officer, or managing employee.

IV.  Consequences of OIG Exclusion

Federal health care programs, principally Medicare and Medicaid, will not pay for any item or service that is furnished or performed by, or on the prescription or direction of, an excluded individual.[3] Since federal health programs subsidize virtually all hospitals and account for 60-65% of all health care dollars spent, exclusion is a severe restriction and is often a death knell to providers.

Providers of the federal health care programs must ensure that their employees, contractors, and vendors are not excluded and the failure to do so can result in significant penalties.  The OIG has the authority to impose penalties of up to$21,562.80 for each item or service furnished by the excluded person or entity, as well as assessments of up to three times the amount claimed.[4]  In addition, providers may be liable for overpayments.  

Even when a provider is unaware that a person was excluded at the time the claim was made, OIG has issued guidance advising that such inadvertent violations must be reported and repaid.[5] In light of this guidance, any claim that might involve an excluded person or entity could potentially have False Claims Act implications under the Affordable Care Act if it is not dealt with in a timely and proper manner.

v. Conclusion

This article is just intended to be an introductory outline of the basics to answer the question, What is an OIG Exclusion? Our other posts have additional information, but if you have any questions about exclusions and your screening obligations, feel free to contact any of us at Exclusion Screening, LLCSM

Read more on OIG Exclusion

an OIG ExclusionPaul Weidenfeld, Co-Founder and CEO of Exclusion Screening, LLC, is the author of this article. He is a longtime health care lawyer whose practice has focused on False Claims Act cases and health care fraud matters generally. Contact Paul should you have any questions at: pweidenfeld@exclusionscreening.com or 1-800-294-0952.




[1]
Sections 1128 and 1156 of the Social Security Act.

[2] Mandatory exclusions are found at 42 USC § 1320a-7; permissive exclusions are principally found at 42 USC § 1320a-7(b).

[3] Section 1862(e)(1) of the Social Security Act and 42 CFR § 1001.1901(b)(1).

[4] 42 CFR §1003.102 (a)(2).

[5] It was issued April 17, 2013 and it is also the subject of an article posted on our site.