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Importance of Screening Employees Against Medicare Exclusion Database


Are you screening your employees against the Medicare Exclusion Database?

(July 18, 2014): In May 2013, the Office of the Inspector General (OIG) published a Special Advisory Bulletin describing the scope and effect of involvement with an excluded individual or entity. Involvement entails illegal payments by Federal health care programs for items or services furnished by or at the medical direction or prescription of an excluded person. The Bulletin described how exclusions can be violated and the administrative sanctions OIG can bring against those who have violated an exclusion. The Bulletin also provided guidance as to how the health care industry can screen employees and contractors to determine whether they are excluded persons.

I.          The OIG Exclusion Authority:

The OIG has authority to exclude individuals and entities from participation in Medicare, Medicaid, and other Federal health care programs if they have engaged in fraud or abuse related to Federal health care programs. Federal health care program payments cannot be made for any items or services furnished by an excluded person. Exclusion and payment prohibitions do not stop just because an individual changes from one health care profession to another while excluded. Exclusion durations are at the discretion of OIG.

Exclusion and consequences of working with someone who has been excluded applies to all methods of Federal health care program payment, including itemized claims, fee schedules, cost reports, capitated payments, a prospective payment system, bundled payments, and other payment systems. It also applies even if the payment is made to a State agency or a person that is not excluded.

II.        Risks of Employing or Contracting with an Excluded Individual:

The Balanced Budget Act (BBA) authorizes the imposition of Civil Monetary Penalties (CMPs) against providers that employ or enter into contracts with excluded persons to provide items or services payable by Federal health care programs.

If a health care provider employs or contracts with a person that the provider knows or should know is excluded by OIG, the provider will be subject to such CMP liability if the excluded person provides services payable by a Federal health care program. OIG may impose CMPs of up to $10,000 for each item or service furnished by the excluded person for which Federal program payment is sought. The health care provider even risks being excluded themselves, and could face fines of up to three times the amount claimed in a request for payment.

CMP liability would apply to the furnishing of all categories of items or services that are violations of an OIG exclusion, including indirect patient care, direct patient care, administrative and management services.

III.       How to Determine Whether Someone is Excluded:

To avoid any possibility of employing or contracting with an excluded person and facing large CMPs, providers should screen employees against the List of Excluded Individuals and Entities (LEIE), which is available on OIG’s Web site, to determine whether a person is excluded.

Providers are not legally required to check the LEIE, but should check it prior to employing or contracting with anyone, and then periodically check the LEIE thereafter to determine the exclusion status of current employees and contractors. OIG updates the LEIE monthly, so screening employees and contractors at that frequency could minimize potential overpayment and CMP liability

IV.       Conclusion:

Especially in light of the OIG’s proposed increase in exclusion authority (79 Fed. Reg. 26810), it is critical that healthcare providers create a compliance program that implements screening all existing and potential employees and contractors for possible exclusion. Avoiding excluded individuals can help a provider also avoid thousands of dollars of CMPs and facing exclusion themselves.

Robert W. Liles, Esq., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law.  Liles Parker attorneys represent health care providers around the country in connection with both regulatory and transactional legal projects. For a free consultation, call Robert at (800) 475-1906.


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