Which Federal & State Exclusion Lists Should Be Screened?

Exclusion Lists

The complex web of regulation encompassing government health care dollars is a lot to take on. With 41 state exclusion lists and several federal lists, it can be difficult to know which exclusion lists to screen, let alone actually screening them all. Each government payor of healthcare dollars has a different set of rules on who is allowed and who isn’t allowed to bill their services. Healthcare providers are not legal experts, nor should they have to be. Rather than taking the risk of non-compliance, we break down exclusion regulations for you and explain which exclusion, sanction, debarment, or termination list you must check  as a healthcare provider.


 


What is an Exclusion?

Exclusions are a final administrative action that is intended to protect the financial integrity of health benefit programs and beneficiaries by removing individuals and entities that pose a risk to them. While a party does have right when noticed that they are about to be excluded, as a final administrative action, once excluded there is no further appeals process.

Impact of Exclusions

An exclusion is the nuclear bomb of administrative actions. As a result of an exclusion, a payment prohibition is enforced. Federal and State programs will not pay or items or services furnished, directly or indirectly, by excluded entities. In essence, the government has decided that they do not want programs to pay for the overhead or salaries of excluded parties. Therefore, to comply with exclusion regulations it is best to screen all employees, contractors, vendors and even volunteers.

Scope of the Payment Prohibition

The payment prohibition extends to anyone who has an effect on patient care. This extends to all services connected to a practice, including but not limited to:

  • Billing, Claim Processing, and Accounting Services
  • Leadership, Management, Administrative, and Strategic Services
  • Human Resource and Information Technology Services
  • Transportation Services – including drivers and dispatchers 
  • Even volunteers if their activities contribute to a bundle of services

Where are exclusions listed? How many exclusion lists are there?

Exclusion Screening recommends for best practice to screen against two Federal Exclusion lists, and 41 state lists. The primary healthcare exclusion list is the OIG/LEIE. Together with the GSA SAM, previously known as the EPLS, the LEIE and the SAM make up the two Federal Exclusion Lists. While the GSA/SAM is not a healthcare-specific list, it is a federal debarment list and any party on it cannot enter into any federal contract.

While screening these lists are best practice, there are many more exclusion lists such as the CMS Preclusion list, OFAC, SDN, among others. Depending on your organization’s payors, contracts, or state requirements you may have to screen more than our recommendation. 

Screening Obligations for Fee for Service Medicare

The Department of Health and Human Services, Office of Inspector General (OIG) maintains the List of Excluded Individuals and Entities (LEIE). This is considered the most comprehensive of all exclusion lists, with over 70,000 names on it. At a minimum, the OIG-LEIE must be checked to participate in Fee for Service Medicare.

However, checking only this list opens an entity up to risk. This is because although every state is required to send their exclusions-for-cause to the OIG, some states are slow to do so and often miss sending some parties. As a result, the OIG-LEIE is missing several excluded parties. Despite the OIG missing these parties on their list, an entity is still liable if they screen the LEIE and hire the party. For this reason, it is also important to check state-level exclusion lists. 

Screening for Medicare Advantage Providers

Medicare Advantage providers have unique screening requirements. They must screen both the OIG/LEIE and the CMS Preclusion list. Medicare Part C and Part D Plan Sponsors are unique because they are the only group of providers that must screen the Preclusion list and are the only ones to have access to the list (the Preclusion is not public).

The list differs from the OIG/LEIE because, unlike the OIG/LEIE, the Preclusion List does not require a final action for a party to be added to it. If there is a basis for revocation, such as participating in conduct that COULD result in revocation, whether or not the revocation happens, a party may be put on the preclusion list. While Medicaid Advantage Providers are the only ones to have access to the CMS Preclusion list, they may delegate screening of the list to a third-party such as Exclusion Screening. (Read more about the preclusion list here)

Screening Requirements Imposed by State Medicaid Programs

Most states have two different sets of screening requirements. The “Basic” screening requirements flows from letters issued by CMS to each state Medicaid director mandating monthly exclusion screening by Medicaid providers. This requires screening of the OIG/LEIE, the state exclusion list (if there is one), and some state have state-specific lists that must be searched (i.e. sex-offender list, elder abuse list).

Additional requirements are associated with Provider Agreement and Reenrollment forms. These contain significant disclosure and verification requirements. However, there is no consistent standard between the states. For example, as part of the Texas Medicaid participation agreement, a provider must check ALL states and federal databases and certify, under penalty of perjury, that none of their employees, contractors, and vendors are on them. While in Louisiana a provider must certify that no employee, vendor or contractor has EVER been excluded from ANY program. Although many state requirements do not explicitly say what must be screened, how could a provider give an honest answer and protect themselves from perjury without screening all exclusion lists.

A map of states with their own exclusion list (in red) can be found below.

Exclusion Lists

Medicaid Advantage Care Screening Requirements

Medicaid Managed Care Plans may not work with any of the following to provide, directly or indirectly, “the administration, management, or medical services or establishment of policies or provision of operational support for such services.”

  • Any individual or entity that is (or affiliated with a person or entity that is) debarred, suspended, or excluded from participating in procurement activities under the Federal Acquisition Requirement (FAR) or,
  • Any individual or entity that is excluded from participation in any Federal healthcare program…
To ensure that your organization is complying with the FAR regulation, it is important to screen against the GSA/SAM, as well as the OIG/LEIE and the 41 state exclusion lists. 

Enforcement Mechanisms

OIG’s Civil Money Penalties Authority for Exclusion Related Violations:

Exclusion Lists

It is important to remember that each of these Civil Money Penalties is for each offense. A provider who has worked with an excluded party can quickly rack up several offenses with each claim submitted to a health benefits program.

Failure to screen can also result in False Claims Act liability. While a provider must “knowingly” hire an excluded party to be open to False Claims Act liability, “knowingly” by statute includes reckless disregard or deliberate ignorance, such as not doing exclusion screening. 

Additional Consideration #1: Almost Every Risk Area is Directly Related to Employees or Contractors

Human capital is the heart of your practice, but also is the biggest risk in your organization. Any plan to lessen risk needs to start with ensuring that all employees and contractors are screened.

Additional Consideration #2: Screening is part of an effective compliance plan

As of 2017, the OIG has included “screening and evaluation of employees, physicians, vendors, etc.” as part of the seven elements of an effective compliance plan. The OIG views screening as an important step to mitigate risk.

Additional Consideration #3: Exclusions show up on different lists at different times. And sometimes not on lists you expect.

When states take an exclusion action they are supposed to report it to other states and the OIG so they can be added to other lists. However, it doesn’t always happen. Even the OIG/LEIE, the biggest list of them all, doesn’t have all exclusion records. It is important to remember that as public knowledge, a provider is presumed to know if any employees or contractors are on ANY of the exclusion lists. Screening only the OIG/LEIE is not enough and will not shield a practice from liability. 

Additional Consideration #4: Can Failure to Screen be Excused?

Imagine this, an accident or incident resulting in patient harm or financial loss to the practice occurs and the harm was caused by or related to an employee on one of the exclusion list. A judge or jury would have no sympathy for the practice that failed to screen. There is no excuse not to screen all State and Federal exclusion lists. 

Final Thoughts

Screening the OIG-LEIE, GSA-SAM, and the 41 State exclusion lists is not only good business practice, it is essential to protecting your organization from legal implications. At Exclusion Screening, LLC. we provide a simple, automated, and cost-effective solution to the complexity of monthly screening of over 40 exclusion lists. We use the sophisticated algorithms in our SAFER system to screen all lists, including variations of individual names, to ensure your organization complies with exclusion screening obligations.

Call 1-800-294-0952 or fill out the form below to discuss your exclusion screening needs and a free assessment.




 

Health Care Providers Should Consider the Ramifications of “Taking a Plea” in a Criminal Case or Agreeing to a Licensure Action. It May Trigger a Mandatory or Permissive OIG Exclusion Action.

exclusion action(July 16, 2018):  Perhaps the most severe administrative sanction available under the Social Security Act stems from the authority of the Secretary for the Department of Health and Human Services (HHS) to exclude individuals and entities from participating in Federal and State health benefits programs.[1]  The Secretary has delegated[2] this authority to the HHS, Office of Inspector General (OIG)[3]. As a recent comprehensive, first-of-its-kind study by ExclusionScreening.com found that during the period 2013 to 2017, approximately 90% of the permissive OIG exclusion actions taken were based on an adverse administrative action taken against a healthcare provider’s license.  This article examines a decision issued earlier this year by the HHS Departmental Appeals Board (DAB or Board) where the Board examined a licensure-related exclusion action in considerable detail.  

 I.  Brief Overview of OIG Licensure-Related Exclusion Action: 

With the passage of the Medicare-Medicaid Anti-Fraud and Abuse Amendments[4] in 1977, mandatory OIG exclusion became mandated in cases where a physician and other practitioner has been convicted of program-related crimes. (now codified at section 1128 of the Social Security Act).  Since that time, various additional bases for both mandatory[5] and permissive[6] exclusion have been enacted. Collectively assessed, the most frequent statutory basis relied on by the OIG when seeking to exclude an individual from participation in Federal and State health care programs is “42 USC §1320a-7(b)(4) License Revocation or Suspension.[7]”  As this provision set out:

“Any individual or entity—
(A) whose license to provide health care has been revoked or suspended by any State licensing authority, or who otherwise lost such a license or the right to apply for or renew such a license, for reasons bearing on the individual’s or entity’s professional competence, professional performance, or financial integrity, or
 
(B) who surrendered such a license while a formal disciplinary proceeding was pending before such an authority and the proceeding concerned the individual’s or entity’s professional competence, professional performance, or financial integrity.”

   OIG Exclusion Check exclusion action

 II.  Case Study: DAB ALJ Decision No. CR4985[8]; DAB Appellate Div. Decision #2848.[9] 

In this case, a Virginia-licensed Chiropractor pled guilty in 2016 to one count of manufacturing marijuana, a felony. He was sentenced by the Court to 5 years of incarceration (4 years and 11 months suspended) and ordered him to pay a $2,500.  Based on this felony conviction, the Virginia Board of Medicine suspended the individual’s license to practice chiropractic indefinitely.[10]
  • The OIG excluded the individual under 42 USC §1320a-7(b)(4).
The OIG based its exclusion on the indefinite suspension, which links reinstatement to the term of the licensure suspension. The OIG cited 42 USC §1320a-7(b)(4) as its basis for exclusion. 
  • ALJ review of the OIG’s exclusion action.
The Chiropractor (Petitioner) subsequently filed a timely request for review by an Administrative Law Judge (ALJ).  Both the OIG and the Petitioner subsequently filed arguments and related documentation in support of their position.  Notably, the Petitioner’s submissions included (but were not limited to) a copy of his North Carolina chiropractic license and certificates showing his successful completion of chiropractic training courses.  As the ALJ’s decision reflects, after the record had closed, the Petitioner submitted additional documentation, including a letter attesting to his competence and a copy of his active North Carolina chiropractic license.  The ALJ refused to admit the additional materials into record based on the fact that were not submitted in a timely fashion and were irrelevant.  
Further complicating the case was the fact while the matter was pending before the ALJ, the OIG issued a second exclusion notice, advising the Petitioner that pursuant to section 1128(a)(4) of the Social Security Act (as codified at 42 USC §1320a-7(a)(4)), he was being mandatorily excluded from program participation for five years. As set out under 42 USC §1320a-7(a) Mandatory exclusion

 
“The Secretary shall exclude the following individuals and entities from participation in any Federal health care program (as defined in section 1320a-7b(f) of this title). . . ”
Since this mandatory exclusion action was based on the Petitioner’s felony conviction of a criminal offense related to the manufacture, distribution, prescription, or dispensing of a controlled substance, it fell under the following exclusion provision:
 
“(4) Felony conviction relating to controlled substances:
 
Any individual or entity that has been convicted for an offense which occurred after August 21, 1996, under Federal or State law, of a criminal offense consisting of a felony relating to the unlawful manufacture, distribution, prescription, or dispensing of a controlled substance.”

Notably the Petitioner does not appear to have appealed the five-year exclusion action. 
Upon consideration of the facts and the evidence, the ALJ sustained the OIG’s decision to exclude the Petitioner from participating in Medicare, Medicaid, and other federal health care programs.
  • Appellate review of the ALJ’s decision.
The Petitioner appealed the ALJ’s decision sustaining the OIG’s decision to exclude him from participation in Medicare, Medicaid and all Federal health care programs. As the ALJ’s ruling reflects, the Petitioner was to be excluded as least until he regained his Virginia chiropractic license. On appeal, the Petitioner raised several issues that were addressed by the Appellate Board:

Petitioner Issue #1:  First, the Petitioner argued that the time frame for exclusion was not adequately addressed by the judge.  The Petitioner further stated that he “did not agree with the length of exclusion because it was excessive and unjust.”

Board Response to #1: As the Board noted in its appellate ruling, in situations where the OIG has excluded an individual’s health care license is revoked or suspended for reasons bearing on the individual’s professional competence, professional performance or financial integrity, the Social Security Act does not delegate an ALJ the discretion to set the length of the exclusion for less than the period during which the individual’s license is suspended. (See, Social Security Act Act § 1128(c)(3)(E); 42 C.F.R. § 1001.501(b)). 

Petitioner Issue #2:  Petitioner argued that the ALJ failed to consider letters from patients and colleagues attesting to the Petitioner’s professional competence and good character in support of a reduction in the length of Petitioner’s exclusion.
 
Board Response to #2: As the Board noted in its decision, neither it nor the ALJ has the authority to consider the letters from the Petitioner’s patients and colleagues attesting to his professional competence and good character for the purpose of reducing the length of Petitioner’s exclusion.  Simply put, equitable arguments and evidence submitted in an effort to obtain a reduction in the length of exclusion cannot be considered.

Petitioner Issue #3:  The Petitioner’s appeal also raised the imposition of a second and separate OIG five-year exclusion action (based on 1128(a)(4) of the Social Security Act; 42 USC §1320a-7(a)) that was imposed while the Petitioner’s appeal was pending before the ALJ.  In the Board proceeding, the Petitioner argued that he was “appealing the five-year exclusion because it is excessive and unreasonable in [his] case.”  He further stated that he was “requesting that [his] exclusion remain as originally reported: three years or until I regain my Virginia license because that would support my position for Inclusion.”

Board Response to #3:  As the Board noted in its decision, the Petitioner only appealed the initial permissive exclusion action under 1128(b)(4), 42 USC §1320a-7(b)(4).  There was no evidence that the Petitioner had requested an ALJ hearing to contest the OIG’s second exclusion action brought under 1128(a)(4) of the Social Security Act; 42 USC §1320a-7(a).  As a result, the Board could not consider the second exclusion action.
  • Lessons to be learned from this case.
Both the ALJ and Board decisions in this case really highlight the lack of discretion that these adjudicators have when it comes to “adjusting” or “reducing” a health care provider’s length of exclusion for less than the period during which the individual’s license is suspended.  As the case noted, the Petitioner was also licensed in North Carolina, and presumably there were no restrictions on his North Carolina.[11]  Unfortunately, the fact that the Petitioner was fully licensed in North Carolina was irrelevant to the decisions of both the ALJ and the Board.  As 42 C.F.R. § 1001.501(b) expressly provides: 

“(b)Length of exclusion.
(1) Except as provided in paragraph (b)(2) of this section, an exclusion imposed in accordance with this section will not be for a period of time less than the period during which an individual’s or entity’s license is revoked, suspended, or otherwise not in effect as a result of, or in connection with, a State licensing agency action.”  (Emphasis Added).

So, what should a health care provider do if he or she receives notice that the OIG is seeking to exclude him or her based on a licensure suspension action?  It is important to keep in mind that a licensure-based exclusion action is a permissive action that may or may not be pursued by the OIG.  To the extent that there is any chance to convince the OIG that the agency should decline to exercise it permissive exclusion authority, now is the time for your legal counsel to make its pitch.

Once the OIG has formally exercised its permissive exclusion authority, the restrictions set forth under 42 C.F.R. § 1001.501(b) must be applied.  Neither an ALJ nor the Board has the discretion to deviate from the time period requirements imposed by statute.  Although the OIG rarely waives its discretion to pursue a permissive licensure-based exclusion action, providers should.

This case also serves as a stark reminder that neither an ALJ nor the Board is in a position to “weigh” the equities in a licensure-based exclusion case when assessing the length of time imposed for the exclusion.  Adjudicators are required by statute to determine whether an exclusion determination made by the OIG was consistent with the law.  Equitable arguments and evidence such as those submitted by the Petitioner in this case cannot be considered in a licensure-based exclusion case.  An individual cannot have an exclusion lifted until his or her license is reinstated.  Period. 

In recent years, the number of exclusion actions imposed by the OIG has continued to grow. While there is little or no flexibility with respect to some of the bases for exclusion, every case is based on a unique set of facts, some of which may present opportunities to negotiate a more favorable period of exclusion with OIG, or even avoid exclusion all together. 

We strongly recommend that you contact experienced health law counsel at the first sign that you may be excluded from participation in Federal and State health care programs.  In terms of strategy, a health care provider’s best course of action is to engage experienced health law counsel at the earliest opportunity, preferably before an adverse action has been taken against your professional license.  A comprehensive response strategy is essential so that you minimize the adverse collateral effects of an adverse licensure action.  The attorneys at Liles Parker have extensive experience representing health care providers in exclusion-related proceedings. 


Need help with your required monthly Exclusion Screening verification? Call us at 1-800-294-0952 or fill out the form below for more information and a free consultation and assessment of your needs!






OIG Exclusion exclusion actionRobert W. Liles serves as Managing Partner at the health law firm, Liles Parker, Attorneys and Counselors at Law.  Liles Parker attorneys represent health care providers and suppliers around the country in connection with UPIC audits, OIG exclusion actions and state licensure board disciplinary proceedings.  Has an exclusion action been proposed against your license?  We can help.  For a free initial consultation regarding your situation, call Robert at:  1 (800) 475-1906.

[1] The term “Federal health care programs” is defined under Section 1128B(f) of the Social Security Act as:
(1) any plan or program that provides health benefits, whether directly, through insurance, or otherwise, which is funded directly, in whole or in part, by the United States Government (other than the health insurance program under chapter 89 of title 5, United States Code); or
(2) any State health care program, as defined in section 1128(h).
42 U.S.C. § 1320a-7b(f) (2012).
[2]See Updated: Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs, U.S. Dep’t of Health & Human Servs.: Office of Inspector Gen., at 2-3 (May 8, 2013) (stating that ““. . . the Secretary has delegated authority to OIG to exclude from participation in Medicare, Medicaid, and other Federal health care programs persons that have engaged in fraud or abuse and to impose civil money penalties (CMPs) for certain misconduct related to Federal health care programs”).
[3] The OIG maintains a website containing up-to-date information on federal health care program exclusion rules, which can be found at http://oig.hhs.gov/fraud/exclusions.asp.
[4] While Public Law 95-142’s “exclusion” provisions are important, the legislation is best known for its impact on the Federal Anti-Kickback Statute.  More specifically, the legislation made violations of the Federal Anti-Kickback Statute a felony. It also made those who offered remuneration for referrals and those who received them, subject to various penalties.
[5] Under the government’s mandatory exclusion authority (as set out under Section 1128(a) of the Social Security Act), any individual or entity convicted of certain offenses must be excluded from participation in federal health care programs.  The length of a mandatory exclusion action taken can last a minimum of five years.
[6] Depending on the circumstances, OIG may also exercise “permissive” or discretionary authority to exclude an entity or an individual from participation in federal health care programs.
[7] Under 42 USC §1320a-7(b)(4), any individual or entity whose professional license to provide health care has been revoked or suspended, or has lost the right to apply for a license, CAN be excluded from participation, at OIG’s options.
[8] DAB ALJ Decision No. CR4985, dated December 13, 2017.
[9] DAB Appellate Div. Decision No. 2848, dated February 6, 2018.
[10] Under the Virginia Code, the Board of Medicine may suspend a license indefinitely for “acts of unprofessional conduct,” which include “knowingly and willfully” committing a felony; violating any statute or regulation relating to the manufacture, distribution, dispensing, or administration of drugs; and conviction of a felony.  See Virginia Code §§ 54.1-2915(A)(10), (17), and (20).
[11] This is an interesting point raised by the Petitioner. In some states, the revocation of a professional license is permanent and can only be reinstated upon the submission of a new application.  Even then the state board has the discretion of whether or not to consider the new application.  Theoretically, a health care provider could be licensed in 49 states and still be excluded due to a suspension action in the 50th state.
As an aside, the public record does not address whether North Carolina, like many states, normally imposes reciprocal disciplinary actions based on those taken in other jurisdictions.