Providers in many states should have received notices from state Medicaid agencies asking them to perform monthly checks of their employees and contractors to determine if they have been excluded from participation in federal health care programs. Many providers are unaware of this development, which stems from a 2009 CMS letter. On January 16, 2009, CMS issued a letter to state Medicaid directors recommending that the Medicaid programs require providers to check the Office of the Inspector General (OIG) of the U.S. Department of Health & Human Services List of Excluded Individuals/Entities (LEIE) on a monthly basis. According to CMS, “most” states have implemented CMS' recommendations over the past year through a variety of ways.

For example, the Massachusetts Medicaid (MassHealth) program issued a provider bulletin in October 2009 (All Provider Bulletin No. 196) instructing providers that they must check the OIG's LEIE “both upon initial hiring or contracting and on an ongoing monthly basis.” In addition, MassHealth instructed providers that they must “immediately report any discovered exclusion of an employee or contractor” to the MassHealth program. Virginia issued a similar instruction through a “special memo” on April 9, 2009.

Providers may argue that these instructions from CMS are mandated by neither statute nor regulation. Additionally, the OIG has never mandated any particular schedule for checking these lists. The OIG typically requires providers under corporate integrity agreements to check the lists annually. The OIG's compliance program guidelines also recommend annual checks. Many providers already take steps to prevent the hiring of excluded individuals or contractors under the requirements of the Social Security Act and have compliance plans that require an annual check of their employees against these lists.

Nevertheless, it is clear that several state agencies are treating the CMS recommendations as mandatory. Providers in states that have been silent on the issue should watch for upcoming bulletins or new enrollment instructions and certifications. Systems should be put in place now to be ready for the new state mandates.