The
Office of Inspector General of the U.S. Department of Health & Human
Services (“OIG”) recently issued its updated Special Advisory Bulletin on the Effect
of Exclusion from Participation in Federal Health Care Programs (“Special
Advisory Bulletin”), which describes the scope and effect of the legal
prohibition on payments by federal health care programs for services and items
furnished by or at the direction of an excluded individual.
The OIG
is empowered to impose civil money penalties against health care providers who
employ or contract with an excluded person to provide items and services for
which payments may be made under a federal health care program. Additionally,
the OIG is further authorized to impose liability on an excluded person if the
person orders or prescribes an item or a service while excluded and knows or
should know that a claim for the item or service may be made to a federal
health care program. For health care providers enrolled in Medicare and
Medicaid, ensuring regulatory compliance remains crucial and screening for
excluded persons is a key element in compliance.
Exclusion From Federal Health Care
Programs
The
effect of an OIG exclusion is broad—no payment may be made by a federal health
care program for any items or services furnished (1) by an excluded person or
(2) at the medical direction or on the prescription of an excluded person. This
broad prohibition also extends beyond direct patient care. For example, the
following instances of indirect services
are prohibited:
o Services performed by excluded
individuals who work for or with a hospital, nursing home, home health agency,
or managed care entity when such services are related to, for instance,
preparation of surgical trays or review of treatment plans, regardless of whether
such services are separately billable or are part of a bundled payment;
o Services performed by excluded
pharmacists or other excluded individuals who input prescription information
for pharmacy billing or who are involved in any way in filling prescriptions
for drugs that are billed to a federal health care program; and
o Transportation services that are paid for
by a federal health care program, such as those provided by excluded ambulance
drivers or ambulance company dispatchers.
Excluded
persons are also prohibited from furnishing administrative and management
services that are payable by federal health care programs, even where the
administrative and management services are not separately billable. For
example, the following would be prohibited:
o An excluded individual serving in an
executive or leadership role at a provider that furnishes items or services
payable by federal health care programs; and
o An excluded individual providing other
types of administrative and management services, such as health information
technology services and support, strategic planning, billing, accounting, staff
training and human resources, unless wholly unrelated to
federal health care programs.
Additionally,
items or services furnished at the medical direction of or on the prescription
of an excluded person are not payable when the person furnishing the item or
services knows or should
know of the exclusion. This prohibition applies even where the
federal payment itself is made to a state agency or provider that is not
excluded.
CMP Liability
An
excluded person violates the exclusion if the person furnishes to federal
health care program beneficiaries items or services to be paid by federal
health care programs. An excluded person that submits such a claim or causes
such a claim to be submitted may be subject to a civil money penalty of $10,000
for each claimed item or service furnished during the period of exclusion. The
individual may also be further subjected to an assessment of up to three times
the amount claimed as well as subsequent denial of reinstatement into the
program. Similarly, such conduct may also lead to criminal prosecutions or
civil actions. For example, knowingly presenting or causing to be presented a
false or fraudulent claim may subject the individual to criminal liability for
fraud as well as civil money penalties.
CMP Liability For Employing Or
Contracting With An Excluded Person
A
provider may be subject to liability if an excluded person participates in any
way in the furnishing of items or services (including providing direct or
indirect patient care, administrative and management services, and items or
services furnished at the medical direction of or on the prescription of an
excluded person) when the provider knows or should know of the exclusion.
Liability may result even if the excluded person does not receive payments from
the provider for his or her services. Similarly, an excluded person may not
provide services payable by federal health care programs, regardless of whether
the person is an employee, a contractor, or a volunteer or has any other
relationship with the provider.
Under
certain and limited conditions, an excluded person may be employed by or
contract with a provider that receives payments from federal health programs:
o Where the federal health care program
does not pay, directly or indirectly, for the items or services furnished by
the excluded person;
o Where a provider employs or contracts
with an excluded person to furnish items or services solely to a non-federal
health care program beneficiary.
Providers
that identify potential liability on the basis of the employment of,
contracting with, or arranging for services with an excluded person may be
required to use the OIG’s Provider Self-Disclosure Protocol (“SDP”) to disclose
and resolve the potential liability.
How To Determine Whether A Person Is
Excluded
To aid
providers, the OIG maintains a List of Excluded Individuals and Entities (the
“LEIE”) on its website. The New York State Office of the Medicaid Inspector
General maintains its own list as well. When verifying individuals and
entities using the LEIE, the Special Advisory Bulletin recommends that
providers maintain documentation of the initial name search performed, such as
a screen-shot and any additional searches. Because the LEIE contains
information available at the time of the exclusion, providers should also
verify by searching for other names (e.g. maiden name) as well. Additionally,
although a provider may contract with another entity to screen a person or
entity against the LEIE, a provider is nonetheless charged with the
responsibility of determining and knowing whether an individual or entity has
been excluded.
Conclusion
For
health care providers enrolled in Medicare and Medicaid, due diligence and
monitoring of employees and contractors, as well as potential employees and
contractors, is absolutely necessary. The failure to do so may result in
liability such as exclusions and civil monetary penalties. Moreover, in light
of the Federal and State governments ongoing and increased efforts to protect
against fraud and abuse, effective regulatory compliance efforts remain
crucial.
