On February 13, 2015, the U.S. Department of Health and Human Services’ Office of Inspector General (OIG) posted an advisory opinion regarding the effect of exclusion from Medicare, Medicaid and other federal health care programs.

Pursuant to a criminal plea and a civil False Claims Act settlement to resolve allegations of health care fraud, the requestor was excluded from participation in Medicare, Medicaid, and all other federal health care programs for twenty (20) years and was required to divest all ownership in his or her medical practice.The requestor and his or her practice performed services, and submitted claims for those services to federal health care programs, prior to the exclusion’s effective date. However, the claims were not paid by the federal health care programs until after the exclusion’s effective date and were, therefore, paid to the buyer of the medical practice. The requestor and the medical practice’s buyer contemplated an arrangement in which the buyer would transfer these payments to the requestor. The parties sought the OIG’s opinion as to whether the contemplated arrangement would violate the terms of the requestor’s exclusion and result in the imposition of administrative penalties.

No payment may be made by Medicare, Medicaid or any other federal health care program for any item or service furnished by that individual on or after the effective date of the exclusion. Similarly, no federal health care program payments may be made for items or services furnished at the medical direction or on the prescription of an excluded physician, if the person furnishing the item or service knew or had reason to know of the exclusion. An excluded individual who submits, or causes to be submitted, claims to federal health care programs for items or services furnished during the exclusion period is subject to civil monetary penalty liability.

The OIG opined that the arrangement would not violate the terms of the requestor’s exclusion and would not constitute grounds for the imposition of civil monetary penalties because the items and services were rendered prior to the exclusion’s effective date.

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