Two New Proposed Rules Would Expand OIG Exclusion and CMP Authority

The Office of Inspector General (OIG) of the Department of Health and Human Services published two new proposed rules that would expand its exclusion authority and ability to impose civil monetary penalties (CMPs) and other statutory authority. The combination of the two rules would result in an expansion of the OIG’s ability to impose sanctions on entities and individuals that provide services to federal health care programs. In the May 9 Federal Register, the OIG proposed amending its exclusion authority to incorporate statutory changes resulting from the Affordable Care Act (ACA), propose early reinstatement procedures, and clarify existing regulatory provisions. The rule adds exclusion authority in the case of an offense in connection with the obstruction of an audit, failure to supply payment information, or making or causing false statements or omissions in a Medicare enrollment application. The proposed rule also established authority for the OIG to issue testimonial subpoenas in exclusion case investigations. Comments on this proposed rule are due by July 8. In the May 12 Federal Register, a proposed rule would amend CMP rules to incorporate changes required by the ACA and certain other legislation. The proposed rule would allow exclusion and provide for CMPs for:

• Failure to grant OIG timely access to records;

• Ordering or prescribing while excluded;

• Making false statements, omissions, or misrepresentations in an enrollment application;

• Failure to report and return an overpayment; and

• Making or using a false record or statement that is material to a false or fraudulent claim.

The rule also proposes to reorganize the regulations to make them more accessible to the public and to add some clarity. There is also a provision to change the calculation for penalties and assessments where an excluded individual is employed in a position not directly involved with claims submission. Comments on this proposed rule are due by July 19. These rules serve as notice to providers who would commit fraud against federal programs that the penalties outweigh any gains that might be obtained. However, as with many rules and regulations, in order to penalize the few bent on committing crimes against the government for financial gains, the many honest providers face ever more severe and escalated risks should they inadvertently violate a law or regulation. For instance, it is not that difficult to make an error when completing a Medicare enrollment application, but the penalty for doing so can be harsh and result in the individual or entity being excluded from doing business with the very government program they are applying to participate in. Takeaway: Laboratories and other providers must take care to ensure they do not accidentally violate any laws or regulations because the potential penalties involved are severe and can result in significant fines or exclusion from federal programs.