In a pair of proposed rules published in May, the HHS OIG unveiled changes to the regulations concerning OIG’s authority to impose civil monetary penalties (CMPs) and exclude individuals and entities from participation in federal healthcare programs. The changes are largely driven by provisions in the Affordable Care Act (ACA) and illustrate OIG’s expansion of its fraud and abuse enforcement mechanisms.

With respect to OIG’s exclusion authority, the proposed rule will incorporate three of the ACA’s new permissive exclusion grounds: (1) failure by an individual or entity that orders, refers for furnishing or certifies the need for an item or service, to supply payment information; (2) making or causing to be made false statements in enrollment applications, agreements, bids or contracts; and (3) convictions related to obstruction of an audit. OIG also is proposing to modify the mitigating and aggravating factors affecting the length of a permissive exclusion. Importantly, the proposed rule would establish that there is no time limitation on OIG’s exclusion power, even when the conduct at issue falls within a time period that would be barred by a statute of limitations for other enforcement purposes. The proposed rule further incorporates the ACA provision that granted OIG testimonial subpoena authority to investigate potential exclusion matters similar to the U.S. Department of Justice’s civil investigative demand. The proposed rule also would modify the reinstatement rules that relate to exclusions predicated on licensure actions. An excluded person could request early reinstatement if, after disclosure of the basis for the exclusion, the individual was granted a healthcare license in the same state or a different state. This is a particularly important proposal given that exclusions related to licensure actions are prevalent.

The proposed rule concerning the CMP regulations also incorporates five ACA bases for CMPs: (1) ordering or prescribing items or services while excluded; (2) making false statements, omissions or misrepresentations in an enrollment application, agreement, bid or contract; (3) failing to report and return a known overpayment; (4) failing to grant OIG timely access to records; and (5) making or using a false record or statement that is part of a false or fraudulent claim. In addition to the inclusion of these new grounds for imposing CMPs, OIG proposes to reorganize and clarify the existing CMP regulation. A new mechanism also is proposed for calculating CMPs for services or items provided by an excluded individual that are not separately billable. In such cases, OIG’s assessment would be based on the number of days the person was employed or under contract to provide the non-separately billable items or services. The proposed regulation also clarifies the CMP liability of on-call physicians related to EMTALA obligations.

Providers are encouraged to review the rules carefully and identify any concerns before the July comment deadlines.