On May 8, 2013, the U.S. Department of Health and Human Services Office of Inspector General (OIG) issued an updated Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs (Special Advisory Bulletin). The Special Advisory Bulletin, which supersedes the OIG's original September 1999 bulletin, offers guidance to individuals and entities that have been excluded from federal healthcare programs, as well as to those who might employ or contract with an excluded individual or entity. In the decade since the release of the original bulletin, the OIG's exclusion authority has been strengthened and expanded by various statutory amendments. The OIG aggressively exercises its expanded exclusion authority, reportedly excluding 3,131 individuals and entities in FY 2012.

No payment will be made by Medicare, Medicaid or other federal healthcare program for any items or services furnished by an excluded individual or entity or at the medical direction or on the prescription of a physician or other authorized individual who is excluded when the person furnishing such item or service knew or had reason to know of the exclusion. In the Special Advisory Bulletin, the OIG reiterates that a provider could be subject to civil monetary penalty (CMP) liability if an excluded person participates in any way in the furnishing of items or services, including administrative and management services, that are payable by a federal healthcare program, regardless of whether the person is an employee, contractor or volunteer.

The OIG offers the following guidance regarding best practices for provider screening obligations:

  • Identify which individuals and entities to screen by reviewing each job category or contractual relationship to determine whether the item or service being provided is in any way payable by a federal healthcare program;
  • Perform initial and periodic (recommends but does not require monthly) checks of the List of Excluded Individuals and Entities (LEIE) online database maintained by the OIG, to determine the exclusion status of potential or current employees and contractors; and
  • Maintain documentation of the initial and subsequent name search performed (such as a printed screen-shot showing the results of the name search), in order to verify results.

Additionally, the OIG encourages providers that identify potential CMP liability on the basis of their relationship with an excluded person to use the recently updated OIG's Provider Self-Disclosure Protocol (SDP) to disclose and resolve the potential CMP liability. See the April 18, 2013, issue of the Health Law Update.