Background: OIG Exclusion
Almost thirty years ago, Congress enacted the Medicare and Medicaid Patient and Program Protection Act of 1987. That legislation granted the OIG exclusionary powers to help the agency combat fraud and abuse and better safeguard the Medicare and Medicaid programs. Since 1987, Congress has enacted further legislation several times that strengthened and expanded the OIG's power to exclude individuals and entities from participating in federally funded health care programs. In the 2013 bulletin mentioned earlier, the OIG explains that,
"The effect of an OIG exclusion is that no Federal health care program payment may be made for any items or services furnished (1) by an excluded person or (2) at the medical direction or on the prescription of an excluded person."
Liability for Organizations that Employ Excluded Individuals
Federal law also authorizes the imposition of a civil monetary penalty of $10,000 for each claim against providers that employ and/or contract excluded individuals to provide items and services covered by Medicare and Medicaid. The same laws provide for an assessment of up to three times the amount of the claim. In addition, the organization that employs/contracts with excluded individuals could face exclusion itself from participation in federally funded health care programs.
Liability for Organizations that Perform Tests and Services Ordered by Excluded Individuals
The OIG states the following in its 2013 bulletin,
"Many providers that furnish items and services on the basis of orders or prescriptions, such as laboratories, imaging centers, durable medical equipment suppliers, and pharmacies, have asked whether they could be subject to liability if they furnish items or services to a Federal program beneficiary on the basis of an order or a prescription that was written by an excluded physician. Payment for such items or services is prohibited. To avoid liability, providers should ensure, at the point of service, that the ordering or prescribing physician is not excluded."
Providers that submit claims for services ordered by excluded individuals may face liability under the Civil False Claims Act, as well as CMPs. Please remember that the Civil False Claims Act provides for penalties as high as $11,000 per claim.
To avoid the significant sanctions listed above, clinical laboratories should include rigorous screenings as part of their compliance programs.
OIG Screening Website
To aid providers in determining if an individual or organization has been excluded, the OIG maintains the List of Excluded Individuals and Entities (LEIE). Providers may access the LEIE via either a searchable online database or downloadable data files. Both may be found by clicking here. The online database presently contains the following information:
the name of the excluded person at the time of the exclusion
the person’s provider type
the authority under which the person was excluded
the State where the excluded individual resided at the time of exclusion or the State where the entity was doing business
a mechanism to verify search results via Social Security Number. This is useful if the person being screened has a common name such as John Smith.
Screening Policies and Procedures: Employees
Most providers screen prospective employees to ensure the applicant is not excluded. In addition, many provider organizations screen all existing employees on an annual basis to ensure their workforce is able to participate in federally funded health care programs.
To determine which employees and contractors should be screened, the OIG recommends that provider organizations assess each and every job category or contractual relationship individually. If that job or contract involves the provision, either directly or indirectly, of any item or service that is payable by a federally funded health care program, the individual fulfilling that position should be screened. Although no law or regulation explicitly requires providers to screen employees, the OIG recommends screening employees before they are hired, and thereafter on a regular periodic basis. Also, the OIG includes employee screening requirements in almost every Corporate Integrity Agreement it writes for providers and organizations that settle out-of-court for allegations of wrong-doing. The 2013 OIG bulletin offers the following guidance concerning employee screening:
Concerning documentation, the Bulletin states the following:
"When checking the LEIE, providers should maintain documentation of the initial name search performed (such as a printed screen-shot showing the results of the name search) and any additional searches conducted, in order to verify results of potential name matches."
Concerning how to screen employees, the Bulletin states,
"We recommend that providers use the LEIE as the primary source of information about OIG exclusions because the LEIE is maintained by OIG; is updated monthly; and provides more details about persons excluded by OIG than GSA’s SAM."
In past settlement agreements and Corporate Integrity Agreements the OIG has required providers to screen employees against both the LEIE and the list maintained by the General Service Administration (GSA). The Bulletin appears to lessen these requirements by allowing providers to only query the LEIE.
Screening Policies and Procedures: Customers
Previously, not many provider organizations screened their customers as well as their employees. However, we are hearing from more and more subscribers that their organizations have begun this practice to protect against the significant liability that results from submitting claims to Medicare for services ordered by excluded customers. Last year's OIG Bulleting also prompted many organizations to begin screening customers. We agree that this is a prudent practice, however, we also recognize that such a compliance effort may require significant time and resources. One way to control these costs may be to limit the number of customers the organization screens. For example, a laboratory may choose to only screen customers that have ordered tests in the past 1, 2, or 5 years. Such a limit will greatly reduce the number of individuals and/or organizations that must be screened. Likewise, a laboratory may choose to only screen customers that order more than a set number of tests annually or whose orders represent a minimum threshold of revenue/reimbursement.
Until the OIG publishes updated compliance guidance for clinical laboratories, our subscribers do not have any set and/or specific rules as to how they should screen customers. However, just because such bright line rules do not exist, does not indicate that providers should ignore the potential liability of not screening customers.