Updated OIG Bulletin on Effect of Exclusion from Federal Health Care Programs


On May 8, 2013, the U.S. Department of Health & Human Services, Office of Inspector General (“OIG”), issued an updated “Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs” (“Bulletin”), which replaces the 1999 version of this document. This Bulletin reiterates the OIG’s long standing position on the far reaching consequences of exclusions, emphasizes harsh sanctions the OIG may take if a provider bills Federal health care programs for services provided by or at the direction of excluded persons and advises providers to adopt best practices for exclusion screenings. The highlights of the Bulletin are described below:

Effect and Scope of Exclusion. The Bulletin makes abundantly clear that no Federal health care program dollars may be paid for services provided by an excluded person or at the medical direction or on the prescription of an excluded person. This payment prohibition applies to all methods of Federal health care program payment (e.g., prospective payment system, fee schedules, capitated payments, cost reports, etc.) and therefore affects all health care providers. This prohibition applies even if an excluded person furnishes services not separately billable to Federal health care programs (e.g., nursing services at a hospital, services of pharmacy technicians of inputting prescription information for pharmacy billing, etc.). The prohibition also reaches individuals providing administrative and management type services (e.g., information technology staff at a hospital, practice manager at a physician practice, accounting staff at a nursing home, etc.) as those services may be reimbursed by Federal health care programs indirectly. In addition, any items and services furnished at the medical direction or on the prescription of an excluded person are not payable when the person furnishing the items or services knows or should know of the exclusion (e.g., imaging centers and laboratories providing services based on orders of excluded persons). Given the broad sweep of the exclusion prohibition, from a practical standpoint, this means that it is essential for all health care providers to take measures to ensure that the provider does not employ or contract with any excluded individuals and does not provide any services based on a prescription or order of an excluded individual if the provider is reimbursed by any Federal health care program.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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