October 3, 2012 | Comments Off on OIG Issues Memo Regarding Excluded Individuals
Posted by Sharlene Hunt
Last week, the HHS Office of the Inspector General (OIG) issued a memorandum to the Centers for Medicare and Medicaid Services regarding the employment of excluded individuals by service providers participating in Medicaid managed care entities. The OIG reviewed a sample of 500 providers and identified 16 individuals who were employed by the providers who were excluded from the Medicare and Medicaid programs.
If an individual employed by a provider is excluded under a federal program, including Medicare and Medicaid, the federal government will not pay the employer for services provided by the excluded individual. The federal government has previously indicated that this applies not only to individuals who provide clinical services, but also to individuals who provide administrative services, such as billing and claims processing. Thus, a provider who employs an excluded individual is not entitled to reimbursement for services provided by the excluded individual, including claims for clinical services provided by the individual, but also claims on which the individual only provided billing services. In addition, a provider who employs an excluded individual may face civil monetary penalties.
In its report, the OIG limited its review to hospitals, nursing facilities, home health agencies and pharmacies. Of the 16 excluded individuals employed by these facilities, 7 were employed in nursing facilities, 5 were employed in hospitals, and 4 were employed by home health agencies. Of the 16 individuals, 7 were excluded because their licenses had been revoked, 5 were excluded because of program related convictions (such as Medicare fraud), 3 were excluded because of convictions for patient abuse or neglect, and 1 was excluded because of a felony conviction of health care fraud involving privately funded health insurance.
In examining the reasons behind the failure of these providers to identify excluded individuals, the most common reason was that the individuals gave names on their employment applications that differed from the names listed on the OIG’s List of Excluded Individuals and Entities (LEIE). The OIG posts tips on its website on how to improve accuracy and increase name verification. Other problems arose for providers who relied on contracted companies to check the exclusion of contracted employees or to perform background checks on behalf of the provider.
Of all of the providers reviewed, 78% used the LEIE to check the exclusion status of their employees. Seventy-eight percent (78%) of providers checked the exclusion status at the time of hire, and also conducted periodic checks (i.e., monthly, quarterly or annually). Forty-two percent (42%) of providers required prospective employees to sign an affidavit or attestation regarding their exclusion status. Only 4% had a policy requiring contracted companies to check the exclusion status of their employees. Fifty-five percent (55%) of providers said costs and resource burdens are challenges to compliance. Only 7% of the providers reviewed did not check the exclusion status of their employees, primarily due to lack of knowledge regarding the requirement to do so.
The report serves as an important reminder to all providers who participate in Medicare and Medicaid or other federal programs to check their employees and contractors against the LEIE database and to have in place other safeguards against hiring individuals excluded from federal programs. The OIG tips provide some useful advice for improving provider practices in this area.