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OIG Issues Updated Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs

A Health Care Client Alert

By: E. William S. Shipman


Earlier this year, the Department of Health and Human Services Office of the Inspector General (OIG) issued an updated Special Advisory Bulletin describing “the scope and effect of the legal prohibition on payment by Federal health care programs for items or services furnished (1) by an excluded person or (2) at the medical direction or on the prescription of an excluded person.” The 2013 bulletin attempts to address questions received by the OIG in response to its prior guidance issued in 1999.

The OIG reaffirmed that it is authorized to impose Civil Monetary Penalties (CMPs) on providers that “employ or enter into contracts with excluded persons to provide items or services payable by Federal health care programs.” For each item or service furnished, the OIG may impose penalties of up to $10,000 and assessments up to three times the amount claimed. Criminal, civil, and administrative penalties and program exclusion are also possible.

The bulletin provided significant guidance regarding the scope and frequency of the obligation to screen current and potential employees and contractors against OIG’s List of Excluded Individuals and Entities (LEIE). Although not statutorily mandated to be completed monthly, the bulletin states that “screening employees and contractors each month best minimizes potential overpayment and CMP liability.” This new recommendation for screening could be a significant financial and administrative burden on providers.

Bodman can provide practical advice and guidance on this matter and others and help your organization review and develop policies and procedures that meet your needs. If you would like to discuss these or any other legal issues affecting your organization, please contact the chair of our Healthcare Law Group, Bill Shipman, at (313) 393-7562 or wshipman@bodmanlaw.com.

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