Healthcare Exclusion Checks: The Difference Between Mandatory and Permissive Exclusions

Healthcare Exclusion Checks: The Difference Between Mandatory and Permissive Exclusions
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The Office of Inspector General (OIG) List of Excluded Individuals and Entities (LEIE) contains over 66,000 healthcare providers that are currently excluded from all federal healthcare programs. Any healthcare organization that hires an individual or entity on the LEIE can be subject to civil monetary penalties (CMP). That’s why most healthcare employers have ongoing exclusion screening programs to protect their organizations from incurring federal fines—penalties that can quickly add up. Under sections 1128 and 1156 of the Social Security Act, there are two types of exclusions that the OIG has authority to impose: mandatory and permissive exclusions. This article discusses the differences between each type of exclusion and what they mean for healthcare organizations.

Mandatory Exclusions

The OIG is required by law to exclude from participation in all federal healthcare programs individuals and entities on a number of grounds. Mandatory exclusions can be imposed for the following six reasons:

  • Conviction of program-related crimes. Minimum period: 5 years.
  • Conviction relating to patient abuse or neglect. Minimum period: 5 years.
  • Felony conviction relating to healthcare fraud. Minimum period: 5 years.
  • Felony conviction relating to controlled substance: Minimum period: 5 years.
  • Conviction of two (2) mandatory exclusion offenses. Minimum period: 10 years.
  • Conviction on three (3) or more occasions of mandatory exclusion offenses. Permanent exclusion.

Permissive Exclusions

With permissive exclusions, the OIG can, at their discretion, choose to exclude individuals and entities for a number of reasons, including:

  • Misdemeanor conviction relating to healthcare fraud. Minimum period: 3 years.
  • Conviction relating to fraud in non-healthcare programs. Minimum period: 3 years.
  • Conviction relating to obstruction of an investigation. Minimum period: 3 years.
  • Misdemeanor conviction relating to controlled substance. Minimum period: 3 years.
  • License revocation or suspension. Minimum period: Based on the period imposed by state licensing authority.
  • Exclusion or suspension under federal or state healthcare program. Minimum period: Based on the period imposed by the federal or state healthcare program.
  • Claims for excessive charges, unnecessary services or services which fail to meet professionally recognized standards of healthcare, or failure of an HMO to furnish medically necessary services. Minimum period: 1 year.
  • Fraud, kickbacks, and other prohibited activities. Minimum period: None.
  • Entities controlled by a sanctioned individual. Minimum period: Same length as individual’s exclusion.
  • Entities controlled by a family or household member of an excluded individual and where there has been a transfer of ownership or control. Minimum period: Same length of individual’s exclusion.
  • Failure to disclose required information, supply requested information on subcontractors and suppliers, or supply payment information. Minimum period: None.
  • Failure to grant immediate access. Minimum period: None.
  • Failure to take corrective action. Minimum period: None.
  • Default on health education loan or scholarship obligations. Minimum period: Until default has been cured or obligations have been resolved to Public Health Service’s (PHS) satisfaction.
  • Individuals controlling a sanctioned entity. Minimum period: Same period as entity.
  • Making false statement or misrepresentations of material fact. Minimum period: None.
  • Failure to meet statutory obligations of practitioners and providers to provide medically necessary services meeting professionally recognized standards of healthcare (Peer Review Organization (PRO) findings). Minimum period: 1 year.

To summarize, the OIG is required by law to impose mandatory exclusions for the six reasons outlined in the Social Security Act. Permissive exclusions, on the other hand, can be imposed by the OIG at their discretion for a much greater number of reasons, some of which can be non-healthcare related. Furthermore, in 2014, the OIG released a proposed new rule calling for the expansion of its permissive exclusion authority based on the Affordable Care Act’s provisions, which is currently the law.

Are you reviewing your healthcare organization’s exclusion screening program for 2015? Contact us to learn how PreCheck can help you streamline your exclusion screening process.

Source: Office of Inspector General