OFFICE OF INSPECTOR GENERAL

1. OFFICE OF INSPECTOR GENERAL EXCLUSIONS

2. Exclusions • Implementing exclusions for over 30 years • Over 2,500 individuals and entities excluded in FY 2009 • Over 45,000 individuals and entities currently excluded

3. Statutory Authorities • Social Security Act (Act) • Section 1128 • Section 1156 • Section 1892

4. Statutory Authorities continued • Amendments to the Act • The Medicare and Medicaid Patient and Program Protection Act of 1987 • The Health Insurance Portability and Accountability Act of 1996 (HIPAA) • Balanced Budget Act of 1997 (BBA) • Medicare Prescription Drug Improvement and Modernization Act of 2003

5. Code of Federal Regulations • 42 CFR part 1001 • General Provisions • Mandatory Exclusions • Permissive Exclusions • Waivers & Effect of Exclusion • Notice & Appeals • Reinstatement

6. Exclusions • Exclusions • Mandatory • Permissive • Remedial in purpose • Protection of Federal health care programs and beneficiaries • Improper payment • Improper/abusive practices • No further program remuneration

7. Effect of Exclusion • Individuals and entities are excluded from • Medicare (Title XVIII) • Medicaid (Title XIX) • Maternal & Child Health Services Block Grants (Title V) • Block Grants to States for Social Services (Title XX) • State Children’s Health Insurance Program (Title XXI) • All Federal Health Care Programs

8. Effect of Exclusioncontinued • No program payment for ANY items or services • In ANY capacity • In ANY setting (except emergency items/services) • For ANY administrative or management services • For ANY salary or fringe benefits • DIRECTLY to anyone • INDIRECTLY on any cost reports or reimbursement mechanisms

9. Effect of Exclusioncontinued • No program payment may be made for items or services furnished, ordered or prescribed by excluded individual or entity • Includes services/items “directed by” (M.D. directs an order) • Whether billed separately, bundled, per cost reports, fee schedules or a PPS system • And even where the Federal payment is made to another provider or supplier who is not excluded, if provided/directed/ordered by the excluded individual or entity • Includes administrative/management services not directly related to patient care, but that are a necessary component of providing items or services to program beneficiaries • Exclusion is from all Federal health care programs • OIG excludes individuals, entities (corporation, partnership, LLC, etc.) and not just health care professionals

10. Effect of Exclusioncontinued • Government-wide debarment • OPM debarment • Does NOT effect ability to receive benefits as a beneficiary

11. Impact of Exclusion on Excluded Individual Limitations on ability to be employee or contractor or a Medicare or Medicaid provider Can’t order services or write prescriptions which will be billed to a Federal health care program

12. Impact of Exclusion on Employers Once Exclusion Occurs, Employers May Not: • Employ or contract with excluded person, allow excluded person to direct the ordering or delivery of services or supplies, or to undertake certain administrative duties • Whether or not direct care activities are involved • If any part of the task is reimbursed by Federal program dollars • Note: temporary staff sent by a staffing agency may not be excluded – consider contract provision with staffing agency that they must screen or face potential liability • Some LIMITED exceptions

13. Impact on Employerscontinued Screening • You are charged by law with knowing the exclusion status of employees and contractors • Not required by law to check the OIG database • But, there may be sanctions (later) if you “knew or should have known” of exclusion & submit the claim anyway • “Affirmative duty” to check status – online database makes it feasible • To minimize potential liability, screening all new hires and contractors, as well as regular, periodic screening of all existing employees is recommended • CMS has issued guidance to State Medicaid agencies that they should require Medicaid providers to screen monthly

14. Impact on Employerscontinued Potential Liability for Employing or Contracting with Excluded Individuals/Entities • For the excluded individual/entity submitting claims: • $10,000 fine for each item/service claimed or “caused to be” claimed (i.e. by another entity) • Plus treble damages = amount claimed for each item/service • Extension of existing exclusion period • Reinstatement is not automatic after exclusion • Also potentially amounts to a false claim under Federal False Claims Act • Separate basis for administrative sanctions or exclusion

15. Impact on Employerscontinued • For the provider who employs/contracts with excluded individual or entity: • Civil money penalties of up to $10,000 for each item or service furnished by the excluded individual/entity • Plus assessment of up to three times the amount claimed for each item or service • In extreme cases, exclusion from Federal health care programs • Note – some states have parallel state laws

16. Types of Exclusions • Mandatory – • 1128(a)(1) - (a)(4) • Permissive – • 1128(b)(1) - (b)(15)

17. Section 1128 Mandatory ExclusionsConvictions • 1128(a)(1) – Program-Related Fraud • 1128(a)(2) – Patient Abuse/Neglect • 1128(a)(3) – Health Care Fraud • 1128(a)(4) – Controlled Substance

18. Section 1128(a)(1) • 1128(a)(1) – Program-Related Fraud (Felony or Misdemeanor) • Related to the delivery of an item or service under the Medicare, Medicaid or State health care programs

19. Section 1128(a)(2) • 1128(a)(2) – Patient Abuse/Neglect (Felony or Misdemeanor) • In connection with the delivery of a health care item or service meeting physical, mental or emotional needs or well-being of any patient, in any setting

20. Section 1128(a)(3) • 1128(a)(3) - Health Care Fraud (Felony only) • Fraud, theft, embezzlement, breach of fiduciary responsibility or other financial misconduct, • in connection with the delivery of a health care item or service, or • with respect to any act or omission in any government health care program or agency

21. Section 1128(a)(4) • 1128(a)(4) - Controlled Substance (Felony only) • Unlawful manufacture, distribution, prescription or dispensing by one who is or has been a health care provider, who owns or controls a health care entity, or has been employed in any capacity in the health care industry • Not possession

22. Section 1128 Permissive Exclusions Convictions • 1128(b)(1)(A) – Health Care Fraud (Misdemeanor) • 1128(b)(1)(B) – Fraud in Non-Health Care Government Program (Felony or Misdemeanor) • 1128(b)(2) – Obstruction of a Criminal Investigation • 1128(b)(3) – Controlled Substance (misdemeanor)

23. Section 1128(b)(1) • 1128(b)(1) - Fraud • 1128(b)(1)(A) Health Care Fraud • Similar to (a)(3), but only misdemeanors • 1128(b)(1)(B) Fraud • Any non-health care government program, felony or misdemeanor

24. 1128(b)(2) - Obstruction of Justice (Felony or Misdemeanor) Interference or obstruction of any investigation into any criminal offense related to 1128(a), -or- 1128(b)(1) Section 1128(b)(2)

25. Section 1128(b)(3) • 1128(b)(3) - Controlled Substance (Misdemeanor) • Similar to 1128(a)(4)

26. Section 1128 Other Permissive Exclusions • 1128(b)(4) -- License Revocation/Suspension/Surrender • 1128(b)(5) -- Federal/State Health Care Program Exclusion/Suspension • 1128(b)(6) -- Excessive Claims, Unnecessary Items and Services, Failure to Provide Medically Necessary Items and Services • 1128(b)(7) -- False Claims, Fraud, Kickbacks, Prohibited Activities • 1128(b)(8) -- Entities Owned/Controlled by Excluded/Convicted Individual

27. Section 1128 Other Permissive Exclusionscontinued • 1128(b)(9) -- Failure to Disclose Required Information • 1128(b)(10) -- Failure to Supply Requested Information • 1128(b)(11) -- Failure to Provide Payment Information • 1128(b)(12) -- Failure to Grant Immediate Access • 1128(b)(13) -- Failure to Take Corrective Action • 1128(b)(14)/1892 -- Default on Health Education Loan or Scholarship Obligations • 1128(b)(15) -- Individual Owning/Controlling Excluded Entity

28. Section 1128(b)(4) • 1128(b)(4) – License Revocation, Suspension or Surrender • Any individual or entity whose license has been revoked, suspended, otherwise lost or voluntarily surrendered • For reasons bearing on professional competence, professional performance or financial integrity

29. Section 1128(b)(5) • 1128(b)(5) – Exclusion/Suspension from Government Health Care Program • Any individual or entity which has been excluded, suspended, otherwise sanctioned from participation in any Federal or State health care program • For reasons bearing on professional competence, professional performance or financial integrity

30. Section 1128(b)(8) • 1128(b)(8) – Entities Owned or Controlled by Sanctioned Person • Associated with an individual • Convicted under 1128(a) or 1128(b) • Had CMP or assessment imposed under 1128A • Excluded • Direct or indirect ownership or control interest of 5% or more in the entity, etc.

31. Section 1128(b)(15) • 1128(b)(15) – Individuals Owning or Controlling Excluded Entity • Any individual who has a direct or indirect ownership/control interest in an excluded entity AND who knows or should know of action constituting the basis for exclusion or conviction

32. Section 1128(b)(14)/1892 • 1128(b)(14) – Default on Health Education Loan (HEAL) or Scholarship Obligations • Over 2,000 HEAL debtors are currently repaying their debts pursuant to settlement agreements or have paid their debts in full for a total of over $145,000,000 • Remain excluded until they make arrangements to repay the debt

33. Reinstatement • Excluded until reinstated by OIG, regardless of the length of exclusion imposed EXAMPLES: • A doctor who is excluded under section 1128(a)(1) for the minimum period of 5 years is eligible to apply for reinstatement 120 days before the 5-year period expires • A nurse who is excluded under section 1128(b)(4) is eligible to apply for reinstatement once the license has been returned to active status by the licensing board

34. Reinstatementcontinued • Excluded individuals and entities must submit a written request for reinstatement • The excluded individual or entity must complete a reinstatement application and sign an authorization which allows the OIG to request information from employers • An investigation is conducted based on the information provided in the completed application • Average processing time is 90-120 days

35. Reinstatement continued • OIG notifies the individual or entity of the decision on reinstatement by letter • Reinstated individuals and entities are removed from the LEIE • If reinstatement is denied, the individual or entity may request a review • If reinstatement is denied, the individual or entity is eligible to apply again in 1 year

36. Withdrawal • Basis for exclusion is reversed or vacated • Reinstated back to date of exclusion EXAMPLE: • A pharmacist excluded under section 1128(a)(4) has his conviction overturned on appeal

37. Waiver • Waiver may be granted for mandatory exclusions (except 1128(a)(2) patient abuse/neglect) if the subject is the • Sole community physician • Sole source of essential specialized services in a community • Waiver may be granted for permissive exclusions if • OIG determines that imposition of exclusion is not in the public’s interest

38. Waivercontinued • Requires a written request from the individual administering the Federal or State health care program • Applies to a limited geographical area • Exclusion remains in effect elsewhere

39. Reinstatement/Withdrawal • Reinstatement • Excluded until reinstated by OIG, regardless of assigned length of exclusion • Withdrawal • Basis for exclusion reversed or vacated – reinstated back to date of exclusion

40. Waivers • Waiver may be granted under sections 1128(a)(1), (a)(3) and (a)(4) if the subject is the • Sole community physician • Sole source of essential specialized services in a community No waiver under section 1128(a)(2) • Waiver may be granted under section 1128(b) if • the OIG determines that imposition of exclusion is not in the public’s interest

41. Waiverscontinued • Written request from the individual administering the Federal or State health care program • Limited geographical area • Exclusion remains in effect elsewhere • Program that requested waiver must contact OI immediately if basis for waiver no longer exists

42. Appeals • Exclusion remains in effect during appeal process (limited exceptions) • Written request for hearing within 60 days • Hearing before an ALJ • ALJ decisions can be appealed to DAB then Federal Court • Standard of proof is preponderance of evidence

43. Dissemination of Exclusion Information • OIG website – http://oig.hhs.gov • Individuals and entities currently excluded • Downloadable site available since September 1995 • Online searchable site available since March 1999 • Both updated monthly • GSA website – http://www.epls.gov • parties excluded from receiving Federal contracts, certain subcontracts, and certain Federal financial and nonfinancial assistance and benefits

44. Information Contained in the LEIE • The LEIE contains only exclusion actions currently in effect • The LEIE contains only exclusion actions taken by the OIG • The LEIE does NOT contain actions taken by any other agencies

47. Robin E. Schneider Robin.Schneider@oig.hhs.gov Senior Counsel & Exclusions Policy Coordinator, Office of Counsel to the Inspector General