Proposed Rule2024-26804
Health Care Programs: Fraud and Abuse; Revisions to the Office of Inspector General's Exclusion Authorities
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
December 2, 2024
Issuing agencies
Health and Human Services DepartmentInspector General Office, Health and Human Services Department
Abstract
This proposed rule proposes to amend the regulations relating to exclusion authorities under the authority of the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS or the Department). The proposed rule would codify changes made by the Medicaid Services Investment and Accountability Act of 2019 (MSIAA), that added exclusion authorities related to misclassification and false information about outpatient drugs. The proposed rule would also update and clarify OIG's procedures for excluding individuals and entities from participation in the Federal health care programs, including the factors that will be considered in determining the length of exclusions, the provisions governing notices of exclusions, and certain provisions related to reinstatement into the programs.
Full Text
<html>
<head>
<title>Federal Register, Volume 89 Issue 231 (Monday, December 2, 2024)</title>
</head>
<body><pre>
[Federal Register Volume 89, Number 231 (Monday, December 2, 2024)]
[Proposed Rules]
[Pages 95143-95167]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-26804]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Office of Inspector General
42 CFR Parts 1000 and 1001
RIN 0936-AA12
Health Care Programs: Fraud and Abuse; Revisions to the Office of
Inspector General's Exclusion Authorities
AGENCY: Office of Inspector General (OIG), Department of Health and
Human Services (HHS).
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: This proposed rule proposes to amend the regulations relating
to exclusion authorities under the authority of the Office of Inspector
General (OIG) of the Department of Health and Human Services (HHS or
the Department). The proposed rule would codify changes made by the
Medicaid Services Investment and Accountability Act of 2019 (MSIAA),
that added exclusion authorities related to misclassification and false
information about outpatient drugs. The proposed rule would also update
and clarify OIG's procedures for excluding individuals and entities
from participation in the Federal health care programs, including the
factors that will be considered in determining the length of
exclusions, the provisions governing notices of exclusions, and certain
provisions related to reinstatement into the programs.
[[Page 95144]]
DATES: To ensure consideration, public comments must be received no
later than 5 p.m. eastern time on January 31, 2025.
ADDRESSES: In commenting, please refer to file code OIG-2401-P. Because
of staff and resource limitations, we cannot accept comments by fax
transmission. You may submit comments in one of two ways (no
duplicates, please):
1. Electronically. You may submit comments electronically at
<a href="https://www.regulations.gov">https://www.regulations.gov</a>. Follow the ``Submit a comment''
instructions and refer to file code OIG-2401-P.
2. By regular, express, or overnight mail. You may send written
comments to the following address: OIG, Regulatory Affairs, HHS,
Attention: OIG-2401-P, Room 5267, Cohen Building, 330 Independence
Avenue SW, Washington, DC 20201. Please allow sufficient time for
mailed comments to be received before the close of the comment period.
For information on viewing public comments, please see the
SUPPLEMENTARY INFORMATION section.
Docket: Go to the Federal eRulemaking Portal at <a href="https://www.regulations.gov">https://www.regulations.gov</a> for access to the rulemaking docket, including any
background documents and the plain-language summary of the proposed
rule of not more than 100 words in length required by the Providing
Accountability Through Transparency Act of 2023.
FOR FURTHER INFORMATION CONTACT: David Fuchs, Deputy Branch Chief,
Office of Counsel to the Inspector General, at (202) 763-4750.
SUPPLEMENTARY INFORMATION:
Inspection of Public Comments: All comments received before the
close of the comment period are available for viewing by the public,
including any personally identifiable or confidential business
information that is included in a comment. We post all comments
received before the close of the comment period as soon as possible
after they have been received on the following website: <a href="https://www.regulations.gov">https://www.regulations.gov</a>.
I. Executive Summary
A. Purpose and Need for Regulatory Action
MSIAA expanded OIG's exclusion authority to protect the Federal
health care programs from fraud and abuse by allowing OIG to exclude
certain individuals and entities that knowingly misclassify a covered
outpatient drug, knowingly fail to correct such misclassification, or
knowingly provide false information related to drug pricing, drug
product information, or data related to drug pricing or drug product
information. OIG proposes to update its regulations to codify the
changes made by MSIAA in the regulations. At the same time, OIG
proposes to amend other sections of the exclusion regulations to ensure
consistency with statutory authority, decrease administrative burdens,
enhance transparency, and improve the efficiency and effectiveness of
government. The proposed amendments include factors that will be
considered in determining the lengths of exclusions, the processes
governing notices of exclusions, and certain provisions related to
reinstatement into the programs, as well as clarifying changes and
updates to the regulations.
B. Legal Authority
The legal authority for this regulatory action is found in: 42
U.S.C. 1302; 1320a-7; 1395u(j); 1395u(k); 1395y(e); and 1395hh.
II. Summary of Major Provisions
We propose changes to the exclusion regulations at 42 CFR parts
1000 and 1001 to codify an authority under MSIAA, update processes, and
make clarifying and technical changes to existing regulations.
Specifically, section 6(d) of MSIAA amended section 1128(b) of the
Social Security Act (the Act) to add an exclusion authority for certain
conduct related to the misclassification of outpatient drugs, and
knowingly providing false information related to drug pricing, drug
product information, or data related to drug pricing or drug product
information.
We propose clarifying changes to aggravating and mitigating factors
that are used to determine periods of exclusion under section 1128 of
the Act. We propose to simplify the mitigating factor relating to
cooperation and to consolidate certain aggravating factors relating to
other criminal, civil, and administrative sanctions into a single
factor. We propose to modify the exclusion authority under section
1128(b)(12) of the Act, for failure to grant immediate access, to
eliminate a requirement for OIG or a State Medicaid Fraud Control Unit
(MFCU) to demonstrate that the requested material is about to be
altered or destroyed in order to obtain access to the material at the
time the request is made. We propose to modify OIG's obligations with
respect to beneficiaries' access to physician services in imposing
exclusions under section 1128(b)(14) of the Act in accordance with the
Act. We propose to modify the regulatory language to align the
regulations with certain, current OIG practices for exclusions imposed
under sections 1128(a) and (b) of the Act and for waivers. We propose
certain changes to the definitions to remove duplication. We propose to
modify the circumstances under which early reinstatement is available
for individuals and entities excluded under section 1128(b)(4) of the
Act to permit individuals who lost their health care licenses for
reasons related to patient abuse and neglect to apply for early
reinstatement in limited circumstances.
III. Costs and Benefits
There are no significant costs associated with the proposed
regulatory revisions that would impose any mandates on State, local, or
Tribal governments or the private sector.
IV. Background
A. Exclusion Authority
The exclusion authorities found in section 1128 of the Act are
intended to protect the Federal health care programs and their
beneficiaries from untrustworthy individuals and entities whose
behavior has demonstrated that those individuals and entities pose a
risk to program beneficiaries or to the integrity of these programs.
These authorities encompass both mandatory exclusions (section 1128(a)
of the Act) and permissive exclusions (section 1128(b) of the Act). The
Secretary's authority under section 1128 of the Act has been delegated
to OIG. See 53 FR 12993 (Apr. 20, 1988).
The mandatory exclusion authorities require OIG to exclude from
program participation any individual or entity convicted of an offense
that is: related to items or services delivered under Medicare and
Medicaid; related to patient abuse or neglect; or a felony related to
health care delivery, governmental health care programs, or controlled
substances. Mandatory exclusions must be imposed for a minimum 5-year
period. The permissive authorities do not require the imposition of an
exclusion and may either be: (1) ``derivative'' exclusions that are
based on actions previously taken by a court, other law enforcement, or
regulatory agencies; or (2) ``non-derivative'' exclusions that are
based on OIG-initiated determinations of misconduct, e.g., poor quality
care or submission of false claims for Medicare or Medicaid payment.
With certain exceptions, there are no specified minimum periods of
exclusion under these permissive authorities.
Over the years, several statutory and regulatory provisions have
amended or
[[Page 95145]]
further clarified OIG's exclusion authorities. For example, the Health
Insurance Portability and Accountability Act of 1996 (HIPAA) expanded
OIG's authorities to add several exclusion authorities (sections
1128(a)(3), (a)(4), and (b)(15)) and increase minimum or benchmark
periods of exclusion for certain permissive exclusions. The Balanced
Budget Act (BBA) of 1997 further amended OIG's exclusion authorities
by: (1) extending the scope of an OIG exclusion beyond Medicare and
State health care programs to all Federal health care programs; (2)
establishing permanent exclusions for persons convicted of three or
more health care-related crimes and 10-year exclusions for persons
convicted of two health care-related crimes; and (3) expanding the
scope of exclusions under section 1128(b)(8) of the Act.
The Medicare Prescription Drug, Improvement, and Modernization Act
of 2003 (MMA) amended OIG's authority to waive mandatory exclusions. In
2010, the Patient Protection and Affordable Care Act, Public Law 111-
148, 124 Stat. 119 (2010), as amended by the Health Care and Education
Reconciliation Act of 2010, Public Law 111-152, 124 Stat. 1029 (2010)
(ACA), broadened OIG's waiver authority to permit the administrator of
a Federal health care program to request a waiver if the administrator
determines that exclusion would impose a hardship on beneficiaries of
that program. In addition, the ACA expanded OIG's exclusion authority
in several ways, including by establishing a new permissive exclusion
authority under section 1128(b)(16) of the Act. On January 17, 2017,
OIG published a final rule addressing new and revised exclusion
authorities in accordance with the ACA and the MMA, as well as
technical, policy, and clarifying changes to 42 CFR parts 1000, 1001,
1002, and 1006.
B. Changes Made by MSIAA
MSIAA expanded OIG's authority to exclude certain individuals and
entities from participation in the Federal health care programs under
section 1128 of the Act. Section 6(d) of MSIAA established a new
permissive exclusion authority applicable to any manufacturer, or
officer, director, agent, or managing employee of such manufacturer,
that knowingly misclassifies a covered outpatient drug, knowingly fails
to correct such misclassification, or knowingly provides false
information related to drug pricing, drug product information, or data
related to drug pricing or drug product information. The proposed rule
would codify this statutory authority within the existing regulatory
framework and address how OIG will set the length of exclusions imposed
under that authority.
C. Proposed Policy Changes and Clarifying Changes
The proposed rule would revise the section governing exclusions
under section 1128(b)(14) of the Act based on an individual's default
on a health education loan or scholarship obligation. The section
currently requires OIG to take into account access of beneficiaries to
physician services for which payment may be made under Medicare,
Medicaid, or other Federal health care programs in determining whether
to impose an exclusion. We propose to align the regulation with section
1128(b)(14) of the Act by limiting OIG's obligations under this section
to take into account access of beneficiaries to only Medicare and
Medicaid physician services. By aligning the regulation with the
statutory authority and removing the requirement for OIG to take into
account beneficiary access to physician services under Federal health
care programs other than Medicare and Medicaid, we hope to allow for
more efficient imposition of exclusions under this section.
We propose clarifying changes to aggravating and mitigating factors
that are used to determine periods of exclusion under section 1128 of
the Act. We propose to simplify the mitigating factor relating to
cooperation and to combine certain overlapping factors relating to
prior civil, criminal, and administrative sanctions into a single
factor. We propose to revise the regulation that permits OIG to exclude
individuals and entities who fail to grant OIG or a State MFCU
immediate access to certain records, to eliminate the requirement that
OIG or a MFCU demonstrate that the requested materials are about to be
altered or destroyed in order to obtain access to the materials at the
time the request is made, instead of within 24 hours of the request. We
propose to make technical changes to the regulations governing
exclusions under section 1128 of the Act and for waivers. We propose to
modify the circumstances under which early reinstatement is available
for individuals and entities excluded under section 1128(b)(4) of the
Act.
The proposed rule would also modify the sections governing notice
to the public and other agencies regarding exclusions, notice regarding
approval of reinstatement requests, and notice regarding denial of
reinstatement requests. These proposed changes would modernize notice
to the public and other agencies and more clearly outline OIG's process
for appeals of denials of reinstatement requests.
Finally, the proposed rule would also include clarifying changes
and updates to the exclusion regulations, including plain language
changes to definitions, phrasing, and verbiage ensuring higher
readability and comprehension for the public. Additionally, the
proposed rule proposes to modernize pronoun references.
V. Provisions of the Proposed Rule
A. Changes to Part 1000 (Definitions)
We propose to move the definitions of ``agent,'' ``indirect
ownership interest,'' ``ownership interest,'' and ``patient'' from
Sec. 1001.2 to Sec. 1000.10 (General definitions), because these
terms are used not only in part 1001 but also in other parts of
subchapter B. We propose to modify ``indirect ownership interest'' to
correct certain language. The current language states that ```Indirect
ownership interest' includes an ownership interest through any other
entities that ultimately have an ownership interest in the entity in
issue.'' We propose to modify this language to clarify that the
indirect ownership interest could be in one entity or through multiple
entities. We also propose a technical edit changing ``in issue'' to
``at issue.'' We propose to modify the definition of ``ownership
interest'' to correct certain language. The current language states
that an ownership interest includes any interest in any mortgage, deed,
trust or note, or other obligation secured in whole or in part by the
assets of the entity. We propose to replace the phrase ``deed, trust or
note, or other obligation'' with ``deed of trust, note, or other
obligation.'' The reference to ``deed of trust'' appears in the
definition of ``ownership or control interest'' at Sec. 1001.2 and in
section 1124 of the Act, and we believe that ``deed, trust or note''
was a typographical error in the regulatory definition because a ``deed
of trust'' is an obligation similar to a mortgage or note.
We also propose to modify the definition of ``patient'' to change
the reference to ``Medicare, Medicaid and any other Federal health care
program'' to ``any Federal health care program'' because ``Federal
health care program'' is a statutorily defined term that includes (and
is broader than) Medicare and State health care programs. See 42 U.S.C.
1320a-7b(f). Section 1320a-7b(f) of U.S. Code title 42 and Sec.
1000.10 define ``Federal health care program'' as
[[Page 95146]]
``(1) any plan or program that provides health benefits, whether
directly, through insurance, or otherwise, which is funded directly, in
whole or in part, by the United States Government (other than the
health insurance program under chapter 89 of title 5); or (2) any State
health care program, as defined as defined in section 1128(h).''
Lastly, we propose to add a regulatory definition of ``knowingly''
to Sec. 1000.10 because the term is used in the new exclusion
authority added by MSIAA. We propose the same definition of
``knowingly'' that appears in Sec. 1003.110, applicable to OIG's civil
monetary penalty authorities in section 1128A of the Social Security
Act (Act). By adding the definition to Sec. 1000.10, the definition
will apply to the regulations interpreting both the exclusion statute
(section 1128 of the Act) and the OIG's civil monetary penalty
authorities (section 1128A of the Act). The proposed language is as
follows: ``Knowingly means that a person, with respect to an act, has
actual knowledge of the act, acts in deliberate ignorance of the act,
or acts in reckless disregard of the act, and no proof of specific
intent to defraud is required.'' The definition mirrors the definition
used in the False Claims Act, and is the most widely used knowledge
standard for civil health care fraud.
B. Changes to Part 1001
References to Medicare, Medicaid, and State Health Care Programs.
Title, Sections 1001.1, 1001.2, 1001.101, 1001.102, 1001.201, 1001.301,
1001.401, 1001.701, 1001.1301, 1001.1401, 1001.1901, 1001.3002,
1001.3005
We propose to change the title of part 1001 from ``Medicare and
State health care programs'' to ``The Federal health care programs''
because the statutory basis for many of the OIG authorities in part
1001 derives from section 1128 of the Act, which references ``Federal
health care program,'' a defined term that includes (and is broader
than) Medicare and State health care programs, as described above.
Similarly, we propose removing references to Medicare and Medicaid in
variations of the phrase ``Medicare, Medicaid and all other Federal
health care programs'' throughout part 1001, because the statutorily
defined term ``Federal health care program'' encompasses Medicare and
Medicaid. We are proposing to remove the references to Medicare and
Medicaid in the following sections: 1001.1(a), 1001.101(b),
1001.401(c)(2)(ii), 1001.701(d)(2)(iv), 1001.1301(b)(2)(iii),
1001.1401(b)(1), 1001.1401(b)(4); 1001.1901(a), 1001.1901(b)(1),
1001.1901(c)(3), and 1001.1901(c)(5)(i), 1001.3002(b)(3), and
1001.3005(a). We also propose corresponding technical changes to the
phrases in those sections to account for the removal of the references
to Medicare and Medicaid. Neither the removal of the references to
Medicare and Medicaid, nor the technical conforming changes, are meant
to change the meaning of the phrases to which the changes are made.
Finally, we propose to modernize the pronouns throughout part 1001 and
make corresponding grammatical edits.
Section 1001.2 Definitions
We propose deleting the definition of ``Controlled substance'' from
1001.2 because the relevant regulations at Sec. Sec. 1001.101(d) and
1001.401 already indicate that the term ``controlled substance'' is
being used as defined in Federal or State law, so the definition of
``Controlled substance'' in Sec. 1001.2 is unnecessary. We also
propose to move certain definitions from Sec. 1001.2 to Sec. 1000.10
and modify them as described above.
Section 1001.101 Basis for Liability
In Sec. 1001.101(c) and (d), we propose to remove the date
limitation of August 21, 1996. The date limitation was included because
when HIPAA amended section 1128 of the Act to add new exclusion
authorities in sections 1128(a)(3) and (a)(4) of the Act, it specified
that only convictions after August 21, 1996 (the date of HIPAA's
enactment) would be subject to the exclusion authorities in those
subsections. We are proposing to delete the date limitation in the
corresponding regulatory authorities in Sec. 1001.101(c) and (d)
because it is now obsolete. We believe that this change will not impact
any future exclusions because virtually all criminal offenses before
August 21, 1996, are now time-barred from prosecution.
Section 1001.101(c)(2) states ``with respect to any act or omission
in a health care program (other than Medicare and a State health care
program). . . .'' We propose to make a technical change from the word
``and'' to the word ``or'' in the parenthetical for grammatical
accuracy. Similar language appears in Sec. 1001.201(a)(1)(ii). We
propose the same technical change for that section for grammatical
accuracy.
Aggravating Factors
When OIG imposes an exclusion under section 1128(a), the minimum
period of the exclusion is required by statute to be at least 5 years.
However, under the regulations the length of an exclusion may be
extended beyond the 5-year minimum period if certain aggravating
factors, as defined in the regulations, are present. OIG exclusions
under certain permissive authorities in section 1128(b) are for a
period of 3 years but may be lengthened if certain aggravating factors
(again, as defined in the regulations) are present. This section
discusses proposed changes to these aggravating factors.
Financial Loss
The financial loss aggravating factor at Sec. 1001.102(b)(1)
currently reads as follows: ``The acts resulting in the conviction, or
similar acts, caused, or were intended to cause, a financial loss to a
government agency or program or to one or more other entities of
$50,000 or more. (The entire amount of financial loss to such
government agencies or programs or to other entities, including any
amounts resulting from similar acts not adjudicated, will be considered
regardless of whether full or partial restitution has been made).'' A
similar aggravating factor appears in Sec. Sec. 1001.201 and 1001.301.
We believe that the language of this factor should be consistent in
each place it appears to avoid any question about whether court
decisions interpreting it under one section should apply to its
application under other sections. Therefore, we propose two technical
changes to Sec. 1001.102(b)(1) to match the language of this factor as
it appears in Sec. Sec. 1001.201(b)(2)(i) and 1001.301(b)(2)(viii): to
move the phrase ``of $50,000 or more'' to after ``a financial loss,''
and to delete the phrase in the parenthetical ``to such government
agencies or programs or to other agencies'' because it is duplicative
of language outside the parenthetical. In Sec. Sec. 1001.201(b)(2)(i)
and 1001.301(b)(2)(viii), we propose to delete the phrase ``or had a
significant financial impact on program beneficiaries or other
individuals'' because we propose adding this concept to a separate
aggravating factor at Sec. Sec. 1001.201(b)(2)(iii) and
1001.301(b)(2)(ii) as described in the next paragraph.
Impact on Beneficiaries and Other Individuals
Section 1001.102(b)(3), applicable to mandatory exclusions,
includes as an aggravating factor whether the acts that resulted in the
conviction, or similar acts, had a significant adverse physical,
mental, or financial impact on one or more program beneficiaries or
other individuals. A similar aggravating factor applies to certain
permissive exclusions under Sec. Sec. 1001.201 and 1001.301, but
[[Page 95147]]
those sections do not reference ``financial'' impact. In Sec. Sec.
1001.201(b)(2)(iii) and 1001.301(b)(2)(ii), we propose to add ``or
financial'' to the aggravating factor relating to impact on program
beneficiaries and other individuals. We believe it is appropriate to
consider all impacts on beneficiaries under the same aggravating
factor. This change would make this aggravating factor consistent with
a similar factor applicable to mandatory exclusions under Sec.
1001.102(b)(3) and would move the analysis of financial impact on
beneficiaries from the aggravating factor relating to financial loss
(discussed above) to the aggravating factor relating to impact on
beneficiaries.
In Sec. 1001.301(b)(2)(ii), the aggravating factor is applied to
convictions related to obstruction of an investigation or audit under
section 1128(b)(2) of the Act. We are proposing language changes to
this factor because we believe it is important to apply similar factors
consistently in all applicable exclusions. Consistent language ensures
that judicial interpretations of certain language will be applicable
wherever the language appears, and that the public can reasonably
expect OIG to apply the factors consistently. Therefore, we propose to
replace the words ``interference or obstruction'' with ``acts that
resulted in the conviction.'' When referring to the conduct leading to
a conviction, other sections of the regulation use the word ``acts,''
and interference or obstruction are the ``acts'' at issue in the
exclusion authority related to convictions for obstruction.
For the same reason, in Sec. 1001.401(c)(2)(ii), which applies
this aggravating factor to misdemeanor convictions relating to
controlled substances, we propose to reorder the words ``mental,
physical or financial impact'' to ``physical, mental, or financial
impact'' for consistency with the language as it appears in this factor
in other sections of the regulation. Neither of these modifications are
intended to change the substance of this aggravating factor in either
Sec. 1001.301 or Sec. 1001.401; instead, these changes are intended
to simplify the regulations by using consistent language across various
sections where the same meaning is intended.
Convictions Involving Patient Abuse and Neglect
Section 1001.102(b) includes the following as an aggravating
factor: ``In convictions involving patient abuse or neglect, the action
that resulted in the conviction was premeditated, was part of a
continuing pattern of behavior, or consisted of non-consensual sexual
acts.'' See Sec. 1001.102(b)(4). We propose a technical change to
change ``action'' to ``acts'' for consistency with Sec. 1001.102(b)(1)
through (3). We propose additional conforming and technical changes to
Sec. 1001.102(b)(4) to account for the grammatical change from
``action'' to ``acts'' so that the new language would read as follows:
``In convictions involving patient abuse or neglect, the acts that
resulted in the conviction were premeditated, were part of a continuing
pattern of behavior, or consisted of non-consensual sexual acts.''
These changes to Sec. 1001.102(b)(4) are not meant to change the
meaning of the phrases to which the changes are made.
Criminal, Civil, and Administrative Sanctions
We propose to modify the aggravating factors relating to criminal,
civil, and administrative sanctions. For mandatory exclusions, the
regulations contain four separate factors that can be overlapping:
``The convicted individual or entity has a prior criminal, civil or
administrative sanction record'' (Sec. 1001.102(b)(6)); ``The
individual or entity has previously been convicted of a criminal
offense involving the same or similar circumstances'' (Sec.
1001.102(b)(7)); ``The individual or entity has been convicted of other
offenses besides those that formed the basis for the exclusion'' (Sec.
1001.102(b)(8)); and ``The individual or entity has been the subject of
any other adverse action by any Federal, State or local government
agency or board if the adverse action is based on the same set of
circumstances that serves as the basis for the imposition of the
exclusion'' (Sec. 1001.102(b)(9)). We propose to modify these factors
to clarify how OIG would consider other civil, criminal, or
administrative actions involving the excluded person for purposes of
setting the period of exclusion.
First, we propose to modify Sec. 1001.102(b)(6) to replace the
phrase ``a prior'' with ``other documented instances'' and replace
``sanction record'' with ``wrongdoing.'' The proposed revised language
would read as follows: ``The individual or entity has other documented
instances of criminal, civil, or administrative wrongdoing.'' This
proposed language is intended to encompass any documented instances of
other criminal, civil, or administrative wrongdoing, including
convictions that occurred before, at the same time as, or after the
conviction forming the basis for exclusion. OIG may place greater
emphasis on this aggravating factor in determining the appropriate
period of exclusion if multiple documented instances exist (e.g., an
individual or entity has a prior conviction, the individual or entity
was found liable under the False Claims Act, or a licensing authority
imposed a sanction on the individual's or entity's license to provide
health care).
Second, we propose to remove Sec. 1001.102(b)(7) and (8) because
they are duplicative of proposed Sec. 1001.102(b)(6). Both a previous
conviction of a criminal offense involving the same or similar
circumstances (Sec. 1001.102(b)(7)) and a conviction for other
offenses besides those that formed the basis for the exclusion (Sec.
1001.102(b)(8)) would be included in the proposed aggravating factor
for other documented instances of criminal, civil, or administrative
wrongdoing in Sec. 1001.102(b)(6).
Third, we propose to remove the aggravating factor relating to
``any other adverse action'' in Sec. 1001.102(b)(9) because it would
be unnecessary with the new proposed language in Sec. 1001.102(b)(6).
Adverse actions by Federal, State, or local government agencies and
boards would be included in other documented instances of
administrative wrongdoing under proposed Sec. 1001.102(b)(6).
For permissive exclusions, the regulations contain three separate
aggravating factors relating to civil, criminal, and administrative
sanctions that can be overlapping: (1) ``Whether the individual or
entity has a documented history of criminal, civil, or administrative
wrongdoing;'' (2) ``Whether the individual or entity has been convicted
of other offenses besides those that formed the basis for the
exclusion;'' and (3) ``Whether the individual or entity has been the
subject of any other adverse action by any Federal, State, or local
government agency or board if the adverse action is based on the same
set of circumstances that serves as the basis for the imposition of the
exclusion.'' See, e.g., Sec. 1001.201(b)(2)(v) through (vii). One or
more of these three aggravating factors, with some language variations
(as addressed below) also appear in Sec. Sec. 1001.301, 1001.401,
1001.701, 1001.801, 1001.901, 1001.951, 1001.1101, 1001.1201,
1001.1301, 1001.1552, 1001.1601, and 1001.1701. We intend the proposed
changes described below to clarify how OIG would consider other civil,
criminal, and administrative sanctions involving an excluded person for
purposes of setting the length of exclusion.
First, we propose to modify Sec. Sec. 1001.201(b)(2)(v),
1001.301(b)(2)(v),
[[Page 95148]]
1001.401(c)(2)(iv), 1001.701(d)(2)(iii), 1001.801(c)(2)(iv),
1001.901(b)(3), 1001.951(b)(1)(iii), 1001.1101(b)(3), 1001.1201(b)(4),
1001.1301(b)(2)(iv), 1001.1401(b)(5), 1001.1552(d)(3),
1001.1601(b)(1)(iv), and 1001.1701(c)(1)(v) to make the first of the
three aggravating factors referenced above consistent in each section,
as ``The individual or entity has other documented instances of
criminal, civil, or administrative wrongdoing.'' The proposed language
is intended to encompass any documented instances of other criminal,
civil, or administrative wrongdoing, including convictions that
occurred before, at the same time as, or after the conviction forming
the basis for exclusion. OIG may place greater emphasis on this
aggravating factor in determining the appropriate period of exclusion
if multiple documented instances exist (e.g., an individual or entity
has a prior conviction, the individual or entity was previously found
liable under the False Claims Act, or a licensing authority imposed a
sanction on the individual's or the entity's license to provide health
care).
Several of the permissive exclusion authority sections (Sec. Sec.
1001.901, 1001.951, 1001.1101, 1001.1201, 1001.1301, 1001.1401,
1001.1601, and 1001.1701) include a parenthetical stating that ``the
lack of any prior record is to be considered neutral.'' In these
sections, we propose to replace ``lack'' with ``absence'' to increase
readability and ``prior record'' with ``such instances'' for
consistency within the factor. In Sec. 1001.1401(b)(5), the proposed
language would use ``hospital'' instead of ``individual or entity,'' as
that section applies to hospitals only. In Sec. Sec.
1001.1601(b)(1)(iv) and 1001.1701(c)(1)(v), the proposed language would
use ``physician'' instead of ``individual or entity,'' as those
sections apply to physicians only. The change from ``lack'' to
``absence'' is not meant to change the meaning of the phrase to which
the change is made. Lastly, in Sec. Sec. 1001.201(b)(2)(v),
1001.301(b)(2)(v), 1001.401(c)(2)(iv), 1001.701(d)(2)(iii), and
1001.801(c)(2)(iv), the proposed language would remove the word
``whether'' at the beginning of this factor, as the word is extraneous.
This technical change is not meant to change the meaning of the phrases
to which the changes are made. In Sec. 1001.801(c)(2)(iv), which
currently reads, ``Whether the individual or entity has a documented
history of criminal, civil or administrative wrongdoing,'' we propose
to remove the words ``Whether the individual or'' because this
authority only applies to entities.
Second, we propose to remove the second aggravating factor
discussed above (whether the individual or entity has been convicted of
other offenses besides those that formed the basis for the exclusion)
found in Sec. Sec. 1001.201(b)(2)(vi), 1001.301(b)(2)(vi), and
1001.401(c)(2)(v) as duplicative of the proposed aggravating factor in
Sec. Sec. 1001.201(b)(2)(v), 1001.301(b)(2)(v), and
1001.401(c)(2)(iv), described in the preceding paragraph. A conviction
for other offenses besides those that formed the basis for the
exclusion would be included in the proposed aggravating factor for
other documented instances of criminal, civil, or administrative
wrongdoing.
We also propose to remove the aggravating factor relating to ``any
other adverse action'' in Sec. Sec. 1001.201(b)(2)(vii),
1001.301(b)(2)(vii), 1001.401(c)(2)(vi), 1001.701(d)(2)(v),
1001.801(c)(2)(v), 1001.901(b)(4), and 1001.951(b)(iv) because it would
be unnecessary. Adverse actions by Federal, State, or local government
agencies and boards would be included in other documented instances of
administrative wrongdoing under the proposed changes to Sec. Sec.
1001.201(b)(2)(v), 1001.301(b)(2)(v), 1001.401(c)(2)(iv),
1001.701(d)(2)(iii), 1001.801(c)(2)(iv), 1001.901(b)(3),
1001.951(b)(1)(iii), 1001.1101(b)(3), 1001.1201(b)(4),
1001.1301(b)(2)(iv), 1001.1552(d)(3), 1001.1601(b)(1)(iv), and
1001.1701(c)(1)(v). We propose technical changes renumbering Sec.
1001.901(b)(5) to Sec. 1001.901(b)(4) and technical changes to the
other sections to account for the deletions described above.
Effect on Civil and Administrative Investigations
The exclusion authority in section 1128(b)(2) of the Act and in
Sec. 1001.301, in part, allows OIG to exclude for convictions for
obstruction of or interference with investigations related to the use
of funds received from the Federal health care programs. We propose to
remove the aggravating factors at Sec. 1001.301(b)(2)(i) (the
interference or obstruction caused the expenditure of significant
additional time and resources) and Sec. 1001.301(b)(2)(iii) (the
interference or obstruction also affected a civil or administrative
investigation). We propose removing Sec. 1001.301(b)(2)(i) because in
our experience the subjectivity of the language makes it challenging to
apply consistently. We propose removing Sec. 1001.301(b)(2)(iii)
because it is OIG's position that this exclusion authority already
includes administrative and civil investigations in the scope of the
term ``investigations.'' We are concerned that including a separate
aggravating factor at Sec. 1001.301(b)(2)(iii) where the interference
or obstruction affected a civil or administrative investigation could
be misconstrued as suggesting that the exclusion authority does not
include civil and administrative investigations. Also, the application
of this factor in matters where the obstruction or interference
occurred in a civil or administrative investigation would be
duplicative of the statutory basis for exclusions under section
1128(b)(2) of the Act. To avoid confusion, we propose to remove this
aggravating factor. Lastly, we propose to renumber the aggravating
factors consistent with the proposed changes described above.
Nature of Violations, Length of Scheme, and Impact on Beneficiaries
We propose to modify the aggravating factor at Sec.
1001.701(d)(2)(i) for exclusions related to excessive claims or
furnishing of unnecessary or substandard care. The aggravating factor
currently reads ``the violations were serious in nature, and occurred
over a period of one year or more.'' We propose to replace the phrase
``violations were serious in nature, and'' with ``conduct.'' The
severity of the conduct is considered under the impact on beneficiaries
aggravating factor at Sec. 1001.701(d)(2)(ii) (``the violations had a
significant adverse physical, mental or financial impact on program
beneficiaries or other individuals'') and does not also need to be
separately considered under the length of scheme factor at Sec.
1001.701(d)(2)(i). We also propose to modify the aggravating factor at
Sec. 1001.701(d)(2)(ii), by replacing the word ``violations'' with
``conduct.''
Finally, we propose to modify the aggravating factor at Sec.
1001.701(d)(2)(iv), which currently reads, ``The violation resulted in
financial loss to Medicare, Medicaid, or any other Federal health care
program of $15,000 or more'' to change ``violation'' to ``conduct,'' to
increase the amount of financial loss from $15,000 to $50,000, and to
change ``Medicare, Medicaid, or any other Federal health care program''
to ``any Federal health care program'' as described above.
The use of the word ``conduct'' in this section reflects that Sec.
1001.701 contemplates behavior that may not be easily characterized as
a set of identifiable violations or acts, such as the provision of
health care that, over time or in one instance, may be of a
[[Page 95149]]
quality that fails to meet professionally recognized standards of
health care. Also, the change in the financial loss amount makes this
section consistent with Sec. Sec. 1001.102(b)(1), 1001.201(b)(2)(i),
and 1001.301(b)(2)(viii) (proposed to become Sec. 1001.301(b)(2)(i))
and reflects that the passage of time and inflation have increased the
average amount of financial loss to the Federal health care programs in
fraud schemes.
Serious Adverse Effect
We propose technical changes to Sec. 1001.801(c)(2)(iii), for
exclusions relating to the failure of health maintenance organizations
to furnish medically necessary care. For Sec. 1001.801(c)(2)(iii),
which currently reads, ``The entity's failure to provide a necessary
item or service that had or could have had a serious adverse effect,''
we propose to remove ``that'' after ``service'' as an unnecessary word
that causes the language to be confusing and grammatically incorrect
(and therefore difficult to apply). The revised language would read:
``The entity's failure to provide a necessary item or service had or
could have had a serious adverse effect.''
Mitigating Factors
When OIG is determining the length of exclusion for a mandatory
exclusion with a minimum exclusion period of 5 years, if any of the
aggravating factors described in the regulations are present and result
in a period of exclusion longer than 5 years, OIG may consider the
mitigating factors specified in the regulations as a basis for reducing
the period of exclusion to no less than 5 years. For exclusions imposed
under the permissive authorities with a baseline period of 3 years
(Sec. Sec. 1001.201, 1001.301, and 1001.401) the presence of any of
the mitigating factors specified in the regulations may provide a basis
for shortening the period of exclusion. Proposed changes to some of
these mitigating factors are described below.
We propose to remove Sec. Sec. 1001.102(c)(1) and
1001.201(b)(3)(i), which are mitigating factors for situations in which
a person was convicted of three or fewer misdemeanors and caused less
than $5,000 of loss. First, in our experience, this factor is very
rarely present in mandatory exclusion cases that present aggravating
factors warranting an exclusion period longer than the minimum period
of 5 years. Second, we question whether it is appropriate to shorten an
exclusion for conduct involving patient harm, a criminal scheme that
extended beyond 1 year, an individual or entity with a record of
additional sanctions, or conduct that warranted incarceration, simply
because the person was convicted of three or fewer misdemeanors. Third,
in the case of permissive exclusions under Sec. 1001.201 we believe
this factor should be considered by OIG in determining whether a
permissive exclusion should be imposed, but not whether to reduce the
length of exclusion.
Reduced Culpability
Sections 1001.102(c)(2), 1001.201(b)(3)(ii), and 1001.301(b)(3)(i)
describe a mitigating factor that considers whether the record in the
criminal proceedings, including sentencing documents, demonstrates that
the court determined that the individual had a mental, emotional, or
physical condition before or during the commission of the offense that
reduced the individual's culpability.
We propose to revise Sec. Sec. 1001.102(c)(2), 1001.201(b)(3)(ii),
and 1001.301(b)(3)(i) to remove the phrase ``including sentencing
documents'' because those documents are clearly part of the record in
the criminal proceedings. We also propose to delete the phrase
``mental, emotional or physical'' prior to ``condition'' to allow OIG
to consider any condition that a court determines to have reduced an
individual's culpability. We also propose to renumber the remaining
paragraphs accordingly.
Addition of Mitigating Factor to Sec. 1001.401
In Sec. 1001.401(c)(3), we propose to add a mitigating factor
relating to whether a court determined that the excluded individual had
a condition that reduced their culpability for the underlying criminal
offense. Section 1001.401 permits OIG to exclude individuals or
entities convicted of misdemeanors related to controlled substances,
while Sec. 1001.101(d) mandates OIG exclude individuals and entities
for felonies related to controlled substances. The mandatory authority
permits consideration of a mitigating factor relating to whether a
court determined that the excluded individual had a condition that
reduced their culpability for the underlying criminal offense
(currently Sec. 1001.102(c)(2)). We propose adding the same factor to
Sec. 1001.401 because we believe it is appropriate to consider the
same mitigating circumstances under the permissive authority and the
mandatory authority.
Cooperation
Sections 1001.102(c)(3), 1001.201(b)(3)(iii), 1001.301(b)(3)(ii),
and 1001.401(c)(3) include a mitigating factor that reads as follows:
``The individual's or entity's cooperation with Federal or State
officials resulted in--(A) Others being convicted or excluded from
Medicare, Medicaid, and all other Federal health care programs, (B)
Additional cases being investigated or reports being issued by the
appropriate law enforcement agency identifying program vulnerabilities
or weaknesses, or (C) The imposition of a civil money penalty against
others.'' We propose to revise Sec. Sec. 1001.102(c)(3),
1001.201(b)(3)(iii), 1001.301(b)(3)(ii), and 1001.401(c)(3) to allow
the mitigating factor of cooperation to be demonstrated based on the
record in the criminal proceedings or a written statement by a
government official that demonstrates that the individual's or entity's
cooperation resulted in other individuals or entities being excluded,
indicted, or otherwise charged, convicted, or investigated. Under the
proposed language, the application of the cooperation mitigating factor
would be based on documentation provided by an official involved in the
underlying criminal proceedings rather than OIG's later independent
assessment of the criminal proceedings. In OIG's experience, it is not
always possible to obtain court records relating to cooperation because
they may be sealed or otherwise unavailable at the time the exclusion
is processed. In addition, the proposed language would broaden the
first criteria for cooperation (i.e., the cooperation resulted in
others being convicted or excluded) to include circumstances in which
others have been indicted or otherwise charged or investigated. In
OIG's experience, subjects have not relied on reports being issued by
law enforcement agencies identifying program vulnerabilities or
weaknesses, or civil monetary penalties being imposed against other
individuals or entities as a basis to demonstrate cooperation, so we
are proposing to remove those criteria.
Alternative Sources of Health Care Items and Services Mitigating Factor
We propose to delete Sec. Sec. 1001.201(b)(3)(iv) and
1001.301(b)(3)(iii), a mitigating factor applicable to exclusions
related to misdemeanor convictions for health care fraud and
convictions for obstruction. The factor allows OIG to consider whether
alternative sources of the type of health care items or services
furnished by the individual or entity are not available. We propose to
remove this factor from these two sections because we believe this
factor should be considered by OIG in determining
[[Page 95150]]
whether a permissive exclusion should be imposed and whether a waiver
is appropriate but does not relate to the length of exclusion.
Therefore, we propose removing this mitigating factor.
Few Violations Over a Short Period of Time Mitigating Factor
We propose to modify Sec. 1001.701(d)(3), which currently reads:
``Only the following factor may be considered mitigating and a basis
for reducing the period of exclusion: Whether there were few violations
and they occurred over a short period of time,'' to read as follows:
``Only the following factor may be considered mitigating and a basis
for reducing the period of exclusion: Whether there were few
occurrences of the conduct, and the conduct occurred over a short
period of time.'' This change makes this section consistent with the
changes from ``violations'' to ``conduct'' in Sec. 1001.701(d)(2)
discussed above.
Other Changes to Sec. 1001.102 (Length of Exclusion)
Section 1001.102(d) describes the requirement, added by HIPAA, that
OIG impose exclusions for at least 10 years or permanently in certain
situations involving multiple criminal convictions. We propose to
modify Sec. 1001.102(d) to remove the reference to August 5, 1997, in
the flush language, as unnecessary because virtually all criminal
offenses before August 5, 1997, are now time-barred from prosecution.
We propose a technical modification to Sec. 1001.102(d)(1) and (2)
to replace ``effected'' with ``imposed'' for consistency with Sec.
1001.102(a), which references exclusions being imposed. The revision is
not intended to change the meaning of Sec. 1001.102(d)(1) and (2). In
Sec. 1001.102(d)(1), we propose to revise the parenthetical language
(which allows OIG to lengthen exclusions beyond 10 years if aggravating
and mitigating factors are present) to remove the reference to
mitigating factors because only aggravating factors can be used to
impose a period of more than 10 years.
Section 1001.401 Conviction Relating to Controlled Substances
We propose removing Sec. 1001.401(b), which states ``the
definition of controlled substance will be the definition that applies
to the law forming the basis for the conviction,'' because it is
unnecessary. This definition is already incorporated into Sec.
1001.401(a) by the phrase ``as defined under Federal or State law.'' In
other words, the definition of controlled substance will be based on
the Federal or State law under which the individual or entity is
convicted. We also propose corresponding technical changes renumbering
Sec. 1001.401(c) to Sec. 1001.401(b).
Section 1001.501 Exclusions Based on the Loss or Suspension of a Health
Care License
We propose removing the aggravating factors outlined in Sec.
1001.501(b)(2), which permit OIG to lengthen periods of exclusion based
on the loss of the individual's or entity's health care license, and
the mitigating factors outlined in Sec. 1001.501(b)(3), which could be
considered by OIG if aggravating factors are applied. Because
exclusions under section 1128(b)(4) of the Act are derivative of a
licensing board action, OIG generally imposes exclusions under this
section for the same period of time as that of the licensing board's
action. As a result, an individual is generally eligible for
reinstatement once they regain the health care license on which the
exclusion is based. Our proposed removal of these aggravating and
mitigating factors would make the regulations consistent with OIG's
general practice of imposing exclusions under this section that are the
same length as the licensing board actions. We propose corresponding
technical changes by renumbering Sec. 1001.501(b)(4) to Sec.
1001.501(b)(2) and modifying the flush language at Sec. 1001.501(b)(1)
to remove language referring to Sec. 1001.501(b)(2).
We are also proposing adding the word ``surrendered'' to Sec.
1001.501(b)(1) so that this section addresses all the bases upon which
an exclusion may be imposed under this section, which includes when an
individual's or entity's license is revoked, suspended, surrendered, or
otherwise lost. See section 1128(b)(4)(B) of the Act.
We also propose changes to Sec. 1001.501(c). In 2017, OIG
published a Final Rule implementing a process that allows individuals
and entities excluded under section 1128(b)(4) of the Act to request
reinstatement before regaining the license that was lost and on which
the exclusion is based (referred to as ``early reinstatement'') under
two sets of circumstances. 82 FR 4100, 4105 (Jan. 12, 2017). We propose
modifications to both sets of circumstances.
First, under Sec. 1001.501(c)(1), an individual or entity excluded
under Sec. 1001.501 can apply for reinstatement if, after fully and
accurately disclosing the circumstances surrounding the original
license action that formed the basis for the exclusion, the individual
or entity obtained a health care license in another State or a
different health care license in the same State, or was allowed to
retain a health care license in another State or a different health
care license in the same State. We discuss proposed changes to this
section below.
Second, under Sec. 1001.501(c)(2), a person excluded under this
section could request early reinstatement if they did not have a valid
license to provide health care of any kind, based on OIG's
consideration of several factors outlined in the regulation. One of
these factors is the length of time the person has been excluded. The
regulation states that OIG will apply a presumption against early
reinstatement if the individual or entity has been excluded for less
than 3 years and, if the revocation or suspension on which the
exclusion was based was for a set period of longer than 3 years, the
presumption against reinstatement would be coterminous with the period
set by the licensing board.
We propose modifying Sec. 1001.501(c)(2)(i) to state that, rather
than applying a presumption against early reinstatement for persons who
are excluded less than 3 years, OIG will not consider a request for
early reinstatement submitted by an individual or entity if such
individual or entity has been excluded for less than 3 years. We think
this change is appropriate because the statute provides a 3-year
baseline period in certain other permissive exclusion authorities
(Sec. Sec. 1001.201, 1001.301, and 1001.401). The proposal would
further modify the language in the second clause of the second sentence
of Sec. 1001.501(c)(2)(i). This clause of Sec. 1001.501(c)(2)(i)
states that if the action on which the exclusion is based is for a set
period longer than 3 years, OIG will apply a presumption against early
reinstatement ``coterminous with the period set by the licensing
board.'' We propose to modify this language to state that when the
action underlying the exclusion is for a set period longer than 3
years, OIG will not consider a request for early reinstatement at any
time before the expiration of the period set by the licensing board. We
believe this change is appropriate because the period of exclusion
should be at least as long as the period of the underlying action.
At Sec. 1001.501(c)(3), the early reinstatement regulation
includes a bar to early reinstatement for individuals excluded under
this section whose license revocation or suspension was for reasons
related to patient abuse or neglect. We propose to modify this
prohibition. In OIG's experience, the bar has the unintended
consequence of
[[Page 95151]]
creating a permanent period of exclusion for certain individuals and
entities who have been excluded under Sec. 1001.501 due to a license
revocation or suspension related to patient abuse or neglect, unless
that individual or entity has regained the original license. This de
facto permanent bar to reinstatement creates an imbalance between
mandatory and permissive exclusion because individuals and entities
that have been convicted of an offense related to the neglect or abuse
of a patient and excluded under section 1128(a)(2) of the Act are
eligible to apply for reinstatement at the end of their period of
exclusion, which may be the statutory minimum period of 5 years. OIG
recognizes that the loss of a professional license for issues related
to patient abuse or neglect is significant and the circumstances of the
loss of such license in those instances should be taken into
consideration in determining whether early reinstatement should be
granted. Therefore, we propose to modify Sec. 1001.501(c)(1)(i) and
(ii) such that, in reviewing requests for early reinstatement, OIG will
consider the circumstances that formed the basis for the exclusion,
including whether such circumstances were related to patient abuse or
neglect. In addition, we propose to modify this section to require
that, in the case of a license revocation or suspension for reasons
related to patient abuse or neglect, OIG will not consider a request
for early reinstatement until the individual or entity has been
excluded for at least 5 years for parity with those excluded for the
statutory minimum period of 5 years for a conviction related to the
neglect or abuse of a patient.
We also propose several clarifying changes throughout Sec.
1001.501(c). These changes are not intended to change the meaning of
Sec. 1001.501 but are intended to make the language clearer based upon
our experience implementing this section since 2017. We propose to add
references to ``entity'' every time the word ``individual'' is used in
Sec. 1001.501 to clarify that, consistent with section 1128(b)(4) of
the Act, entities as well as individuals are subject to exclusion under
this section. In Sec. 1001.501(c)(1)(iii), we propose replacing
``Evidence that'' with ``Documentation from'' to clarify that OIG
expects documentation from the second licensing authority and not
evidence from a proceeding with that authority. We also propose adding
``indicating that it'' after ``second licensing authority'' to clarify
that the documentation must indicate that the licensing authority knew
of the circumstances surrounding the action that formed the basis for
the exclusion. In Sec. 1001.501(c)(1)(iv), we propose removing
``satisfactorily'' and adding ``to OIG's satisfaction'' after ``has
demonstrated'' to clarify that whether the individual or entity has
resolved any underlying problem is in the opinion of OIG and not the
excluded party. We propose a nearly identical change in Sec.
1001.501(c)(2)(iii) for the same reason.
Section 1001.601 Exclusion or Suspension Under a Federal or State
Health Care Program
We propose a technical change to Sec. 1001.601(a)(1)(ii) to offset
the phrase ``for reasons bearing on the individual's or entity's
professional competence, professional performance or financial
integrity,'' as it applies to both circumstances under Sec.
1001.601(a)(1). As currently written, the phrase could be read to
modify only Sec. 1001.601(a)(1)(ii), referring to actions by State
health care programs, but the statute clearly requires that this clause
apply to all exclusions under section 1128(b)(5) of the Act.
We propose revising Sec. 1001.601(a)(2) by replacing the phrase
``is intended to cover'' with ``means'' to clarify that ``otherwise
sanctioned'' is limited to the definition provided (and does not
include anything else). We also propose adding the phrase ``or
otherwise sanctioned'' to Sec. 1001.601(b)(1) for consistency with
Sec. 1001.601(a)(1) and section 1128(b)(5) of the Act, and changing
the word ``from'' to ``by'' for grammatical accuracy.
We propose removing the aggravating and mitigating factors outlined
in Sec. 1001.601(b)(2) and (3), which permit OIG to lengthen periods
of exclusion based on an individual's or entity's exclusion,
suspension, or other sanction by a Federal or State health care
program, so that all exclusions under this section would be coterminous
with the period of time that the individual or entity is excluded,
suspended, or otherwise sanctioned by the applicable Federal or State
health care program. Because exclusions under section 1128(b)(5) of the
Act are derivative of a Federal or State health care program action,
OIG generally imposes exclusions under this section for the same period
of time as the agency's action. As a result, individuals and entities
are generally eligible to apply for reinstatement once the individual
or entity is allowed to resume participation in the Federal or State
health care program under which the individual or entity was previously
suspended, excluded, or sanctioned. Our proposed removal of these
aggravating and mitigating factors would make the regulations
consistent with OIG's general practice under this section and clarifies
our intention. Due to the removal of Sec. 1001.601(b)(2) and (3), we
propose a technical change renumbering Sec. 1001.601(b)(4) to Sec.
1001.601(b)(2).
Section 1001.901 False or Improper Claims
In Sec. 1001.901(b), we propose to change ``will'' to ``may'' to
reflect OIG's discretion to consider only the factors that are
appropriate according to the facts and circumstances of each case and
to reflect that not every factor will be present in every case.
Section 1001.951 Fraud and Kickbacks and Other Prohibited Activities
We propose several changes to Sec. 1001.951 to align the factors
with those found in the proposed revisions to Sec. 1001.901. These two
sections should align because both authorities are based on section
1128(b)(7) of the Act and require OIG to affirmatively prove fraud,
kickbacks, or other prohibited activities. Because neither authority is
derivative of other actions taken by adjudicative bodies, aligning the
factors for determining length of exclusions under Sec. 1001.951 with
the factors under Sec. 1001.901 would create parity and provide OIG
discretion to consider relevant facts and circumstances under both
authorities that are not derivative of the actions of other courts or
adjudicative bodies, as is appropriate for derivative exclusions.
Specifically, to align Sec. Sec. 1001.951 and 1001.901, we are
proposing a series of revisions and technical changes, which
collectively will result in both authorities having the same factors
for determining length of exclusion, as follows. We propose to remove
the numbering for Sec. 1001.951(b)(1) to make it flush language and to
revise the language to mirror the proposed language in proposed Sec.
1001.901(b) by changing ``will'' to ``may.'' We propose to modify the
numbering of the factors to change the factor at Sec.
1001.951(b)(1)(i) to Sec. 1001.951(b)(1) and to modify the language to
mirror Sec. 1001.901(b)(1). The proposed language would read: ``The
nature and circumstances surrounding the actions that are the basis for
liability, including the period of time over which the acts occurred,
the number of acts, whether there is evidence of a pattern and the
amount claimed.''
We propose to delete the factor at Sec. 1001.951(b)(1)(ii), which
is not a factor in Sec. 1001.901(b). We propose to add a factor at new
Sec. 1001.951(b)(2), ``the
[[Page 95152]]
degree of culpability,'' which appears at Sec. 1001.901(b)(2). We
propose to change the numbering of Sec. 1001.951(b)(1)(iii) (related
to other documented instances of wrongdoing) to Sec. 1001.951(b)(3)
and modify its language consistent with proposed Sec. 1001.901(b)(3)
and the other places this language appears in part 1001 as described
above. We propose to add new Sec. 1001.951(b)(4), ``Other matters as
justice may require,'' consistent with the proposed Sec.
1001.901(b)(4). We further propose to remove the factors at Sec.
1001.951(b)(1)(iv) and (v) and remove the mitigating factors at Sec.
1001.951(b)(2) to align Sec. 1001.951 with Sec. 1001.901. Removal of
mitigating factors under this section is appropriate because the
factors proposed for Sec. 1001.951 allow OIG to consider all the
relevant facts and circumstances, aggravating and mitigating, in
setting lengths of exclusion under this section.
Section 1001.1301 Failure To Grant Immediate Access
This section provides OIG with the authority to exclude individuals
and entities that fail to grant immediate access to, among others, OIG
or a State MFCU. Section 1001.1301(a)(2) currently defines a ``failure
to grant immediate access'' for purposes of paragraphs (a)(1)(i) and
(ii) of this section (applying to requests for immediate access by the
Secretary or a State survey agency) as ``the failure to grant access at
the time of a reasonable request or to provide a compelling reason why
access may not be granted.'' The regulation does not explain what
circumstance would constitute ``a compelling reason.''
We propose to revise the definition of ``failure to grant immediate
access'' in Sec. 1001.1301(a)(2) to specify what would constitute ``a
compelling reason,'' namely, that the requested material does not exist
or is not at the location where the request is presented. The proposed
language is consistent with OIG's general practice in evaluating
immediate access requests.
Section 1001.1301(a)(3) provides a separate definition of ``failure
to grant immediate access'' for purposes of paragraphs (a)(1)(iii) and
(iv) of the section (applying to requests for immediate access by OIG
and State MFCUs) as ``(i) The failure to produce or make available for
inspection and copying the requested material upon reasonable request,
or to provide a compelling reason why they cannot be produced, within
24 hours of such request, except when the OIG or State Medicaid Fraud
Control Unit (MFCU) reasonably believes that the requested material is
about to be altered or destroyed, or (ii) When the OIG or MFCU has
reason to believe that the requested material is about to be altered or
destroyed, the failure to provide access to the requested material at
the time the request is made.'' We propose to revise this section so
that the definition of ``failure to grant immediate access'' for
purposes of Sec. 1001.1301(a)(1)(iii) and (iv) is consistent with the
proposed definition of ``failure to grant immediate access'' for
purposes of Sec. 1001.1301(a)(1)(i) and (ii). The impact of this
change would be that all immediate access requests will require
production of materials at the time the request is made unless the
records do not exist or are in a different location and would eliminate
the analysis of whether records are about to be altered or destroyed.
We believe this change is appropriate because it is consistent with the
common meaning of ``immediate'' as requiring something instantly or
without delay, and it removes the burden from the requesting agency to
determine whether records may be altered or destroyed in the
intervening 24 hours, which may be impossible to know.
Section 1001.1501 Default of Health Education Loan or Scholarship
Obligations
Section 1128(b)(14) of the Act, which authorizes OIG to exclude
individuals who default on repayments of health education loan or
scholarship obligations, or the obligations of any loan repayment
program, requires OIG to take into account ``access of beneficiaries to
physician services for which payment may be made under title XVIII or
XIX.'' \1\ Section 1001.1501(a)(3) of the regulations expands this
requirement to access to physicians' services for which payment may be
made under Medicare, Medicaid, or other Federal health care programs,
expanding OIG's obligations beyond Medicare and Medicaid. As a result,
we propose modifying Sec. 1001.1501(a)(3) to limit the requirement in
this section to the Medicare and Medicaid programs, consistent with
section 1128(b)(14) of the Act. We propose a technical modification to
Sec. 1001.1501(a)(3) to replace ``physicians' services'' with
``physician services'' for consistency with section 1128(b)(14) of the
Act. The revision is not intended to change the meaning of Sec.
1001.1501(a)(3).
---------------------------------------------------------------------------
\1\ Section 1128(b)(14) has been used by OIG to exclude
borrowers that have defaulted on loans from the Health Education
Assistance Loan (HEAL) Program. The HEAL program is a program of
Federal insurance of educational loans that were made to graduate
students in the fields of medicine, osteopathic medicine, dentistry,
veterinary medicine, optometry, podiatric medicine, pharmacy, public
health, chiropractic, health administration, and clinical
psychology. See 34 CFR 681.1. Authorization to fund new HEAL loans
expired September 30, 1998. 82 FR 53374 (Nov. 15, 2017). A list of
borrowers currently in default can be found at 86 FR 54950 (Oct. 5,
2021).
---------------------------------------------------------------------------
Next, Sec. 1001.1501(b) indicates that an individual excluded
under this section will remain excluded until OIG receives notice that
the individual has cured the payment default that provided the basis
for the exclusion, at which time OIG notifies the individual that the
individual is eligible to apply for reinstatement. However, it has been
OIG's longstanding practice to allow individuals excluded under this
section to participate in the Federal health care programs prior to
their health education loan or scholarship obligation being completely
repaid if such individual has entered into a repayment agreement with
the administrator of the health education loan, scholarship, or loan
repayment program following an initial payment default. We propose
modifying Sec. 1001.1501(b) so that an individual who has entered into
such repayment agreements would be eligible to obtain a ``stay'' of
their exclusion for as long as the individual remains in compliance
with the terms of the agreement. While this ``stay'' is in place, the
individual would be eligible to participate in the Federal health care
programs. However, if OIG receives notice from the administrator of the
health education loan, scholarship, or loan repayment program that the
individual is no longer in compliance with the repayment agreement, the
``stay'' would be lifted and the exclusion would be given full effect.
This proposed change would make the regulations consistent with OIG's
current practice.
Section 1001.1551 Exclusion of Individuals With Ownership or Control
Interest in Sanctioned Entities
We propose modifying Sec. 1001.1551(b)(2) to change ``Medicare,
Medicaid and all other Federal health care programs'' to ``Medicare or
a State health care program'' and to remove the phrase ``terminated
or'' for consistency with the language of section 1128(b)(15), which
does not reference all Federal health care programs or use the word
``terminated.''
We also propose modifying Sec. 1001.1551(c)(1) to clarify that the
length of the individual's term of exclusion will be the same as that
of the sanctioned entity, regardless of whether the individual
terminates their relationship with the sanctioned entity after they
have been excluded. For example, if Entity A is excluded by OIG
[[Page 95153]]
for a period of 5 years and Person A (who has an ownership interest in
Entity A) is excluded by OIG under section 1128(b)(15) of the Act 6
months later, the term of Person A's exclusion will be for 5 years,
starting from the effective date of Person A's exclusion. Also, Person
A will remain excluded for the entire 5-year term even if Person A
divests their ownership interest in Entity A at any point during the 5-
year term of Person A's exclusion. It would be inequitable for an
individual with knowledge of the conduct that resulted in an entity
being excluded by OIG and who had an ownership interest in the entity
at the time the conduct occurred to be able to avoid exclusion by
divesting their interest after the entity's term of exclusion is
imposed.
Section 1001.1553 Establishment of a New Permissive Exclusion Authority
Section 6(d) of MSIAA granted a new permissive exclusion authority
to the Secretary under Section 1128(b) of the Act. Under the newly
enacted section 1128(b)(17) of the Act, the Secretary may exclude any
manufacturer or an officer, director, agent, or managing employee of
such manufacturer that knowingly misclassifies a covered outpatient
drug under an agreement under section 1927 of the Act, knowingly fails
to correct such misclassification, or knowingly provides false
information related to drug pricing, drug product information, or data
related to drug pricing or drug product information. Accordingly, we
propose adding a new Sec. 1001.1553 entitled ``Knowingly
misclassifying covered outpatient drugs.'' Under this proposal, OIG
would have the authority to exclude any manufacturer (as defined in
section 1927 of the Act) or an officer, director, agent, or managing
employee of such manufacturer that knowingly misclassifies a covered
outpatient drug, knowingly fails to correct such misclassification, or
knowingly provides false information to HHS related to drug pricing,
drug product information, or data related to drug pricing or drug
product information. This exclusion authority applies to covered
outpatient drugs supplied by manufacturers under agreements under
section 1927 of the Act in effect on or after April 18, 2019. The
definitions proposed for Sec. 1000.10 would apply to the terms
``agent,'' ``managing employee,'' and ``knowingly.''
Under this proposal, we would determine the length of exclusion
based on five factors consistent with OIG's other non-derivative
exclusion authorities in Sec. Sec. 1001.901 and 1001.951: the nature
and circumstances surrounding the actions that are the basis for
liability, including the period of time over which the acts occurred,
the number of acts, whether there is evidence of a pattern, and the
amount claimed; the degree of culpability; whether the entity has other
documented instances of criminal, civil, or administrative wrongdoing;
or other matters as justice may require. Because this authority
requires OIG to prove that the manufacturer knowingly misclassified a
drug or made false statements and is not derivative of actions taken by
other adjudicative bodies, we believe it is appropriate to apply the
same factors to this authority that apply to Sec. Sec. 1001.901 and
1001.951, which are also non-derivative authorities.
Section 1001.1801 Waivers of Exclusions
We propose deleting the cross-reference to the statutory definition
of Federal health care program in Sec. 1001.1801(a) as unnecessary
because the term ``Federal health care program'' is defined in Sec.
1000.10. We also propose revising Sec. 1001.1801(d), which currently
states that ``if the basis for the waiver ceases to exist, the waiver
will be rescinded, and the individual or entity will be excluded for
the period remaining on the exclusion, measured from the time the
exclusion would have been imposed if the waiver had not been granted,''
to state: ``If the basis for the waiver ceases to exist, the waiver
will be rescinded.'' The existing reference to ``the time the exclusion
would have been imposed if the waiver had not been granted'' implies
that the waiver stops the exclusion from being imposed; however,
exclusions typically are imposed prior to a waiver being put in place.
We do not intend for the proposal to change the current meaning of the
original provision, which is: If the basis for a waiver ceases to
exist, the waiver will be rescinded, and the existing exclusion will
then be in effect.
Section 1001.1901 Scope and Effect of Exclusion
At the end of Sec. 1001.1901(a), we propose to correct a cross-
reference to the definition of ``Federal health care programs'' from
Sec. 1001.2 to Sec. 1000.10 because the definition does not appear in
Sec. 1001.2. We also propose inserting the phrase ``Federal health
care'' prior to the word ``program'' and ``programs'' in Sec.
1001.1901(b)(2) and (4), respectively, for clarity. Finally, we propose
deleting the parenthetical in Sec. 1001.1901(c)(3)(iii) because it
refers to an exemption that was limited to the period between October
2, 1998, and October 4, 1999, and therefore is no longer applicable.
None of the proposed changes to Sec. 1001.1901 are intended to change
the meaning of the provisions of that section.
Section 1001.2001 Notice of Intent To Exclude
Under the current regulatory text in this section, OIG is only
required to issue a notice of intent to exclude with respect to
mandatory exclusions under section 1128(a) of the Act if the proposed
period of exclusion is for longer than 5 years. We propose modifying
Sec. 1001.2001(a) to provide that OIG will issue a notice of intent to
exclude for all mandatory and permissive exclusions, of any length,
that are proposed under subpart B or C of part 1001. The notice of
intent to exclude affords individuals and entities the opportunity to
provide OIG with information related to the proposed exclusion before
it goes into effect and, in our experience, the process allows OIG to
impose exclusions after considering as much relevant information as
possible. We therefore believe it should apply to all exclusions under
subparts B and C of part 1001.
We also propose modifying this section to indicate that a notice of
intent to exclude will be deemed to have been received 7 days after the
date of the notice (instead of 5 days, as currently specified), based
on changes in service standards and expected delivery times for First-
Class Mail.
Sections 1001.2004 Through 1001.2006 Notice to State Agencies, State
Licensing Agencies, and Others Regarding Exclusion
We propose to clarify that the notice to State Medicaid program
agencies, State licensing authorities, and others required by
Sec. Sec. 1001.2004, 1001.2005, and 1001.2006 is made by OIG, not by
HHS. In Sec. 1001.2005(a), we propose to remove the words ``from
participation'' and the parenthetical ``(or directed to be excluded),''
and to reword the sentence so that this section now reads as follows:
``OIG will promptly notify the appropriate State(s) or local agencies
or authorities having responsibility for the licensing or certification
of an excluded individual or entity of the facts and circumstances of
the exclusion.'' These changes are not intended to change the meaning
of this section.
Section 1001.2006 currently provides that OIG will give notice of
an exclusion and the effective date to the public, beneficiaries, and
as appropriate to various agencies and entities specified in the
regulation including: (1) any entity in which the excluded individual
[[Page 95154]]
is known to be serving as an employee, administrator, or operator, or
in which the individual is serving in any other capacity and is
receiving payment for providing services; (2) medical societies and
other professional organizations; and (3) other Federal agencies or
organizations, as appropriate. However, many of these notifications are
not required by the statute and it is impractical for OIG to provide
individual notice of each exclusion imposed by OIG to all the entities
listed in Sec. 1001.2006. Furthermore, OIG has made exclusion
information available online since at least 1999. As a result, we
propose to modify Sec. 1001.2006(a) by stating that OIG will give
notice of exclusions to the public, beneficiaries, and others via
monthly online updates to the List of Excluded Individuals/Entities
(commonly referred to as ``the LEIE''), which reflects OIG's
longstanding practice.
Section 1001.2007 Appeal of Exclusions
We propose a few technical changes in Sec. 1001.2007. First, in
Sec. 1001.2007(a)(1)(i) we propose to change the word ``sanction'' to
``exclusion'' for consistency with other parts of this section and
because the only relevant actions under this section are exclusions.
Second, we propose to replace the word ``should'' with ``shall'' in
Sec. 1001.2007(a)(3) to reflect that certain information must be
included in the request for a hearing. For example, Sec. 1005.2(d)
requires a request for a hearing to contain certain information, and
Sec. 1005.2(e)(4) requires dismissal of a hearing request that fails
to raise any issues which may be properly addressed in a hearing.
Third, in Sec. 1001.2007(b), we propose to add ``the'' before ``notice
of exclusion'' and delete ``such'' before ``a hearing.'' Finally, in
Sec. 1001.2007(d) we propose to change ``Government'' to
``government.'' These changes are not intended to change the meaning of
this section.
Sections 1001.3001 Through 1001.3002 Timing and Method of Request and
Basis for Reinstatement
We propose making changes to Sec. Sec. 1001.3001(a)(1) and
1001.3002(b)(5) to replace references to ``program provider number''
with ``Federal health care program provider number'' for clarity.
Section 1001.3003 Approval of Request for Reinstatement
We propose changes to Sec. 1001.3003 to track the statutory
language in section 1128(g) of the Act, which requires that notice of
reinstatement be provided to each appropriate State agency
administering or supervising the administration of each State health
care program and requires notice to the Attorney General in the case of
exclusions under section 1128(a) of the Act to which section 304(a)(95)
of the Controlled Substances Act may apply. We also are proposing to
revise this section to state that OIG will notify the public and others
through posting of reinstatement information on OIG's website. We are
proposing to limit the direct notice requirements for reinstatements to
reduce the burden on OIG and to reflect OIG's longstanding practice of
providing general notice of all reinstatements through the posting of a
monthly reinstatement file on OIG's public website. Lastly, we are
proposing to modify Sec. 1001.3003(b) to clarify that a reinstatement
by OIG does not require any other Federal health care program to
reinstate such individual or entity into that program if the program
has taken an action against the individual or entity under its own
authority. This proposal is intended to clarify the language of this
section and is not intended to change the substance of the provision.
The current language, which states that a reinstatement by OIG has no
effect if a Federal health care program has imposed a longer period of
exclusion under its own authorities, is imprecise and confusing because
a reinstatement by OIG has effect independent of the actions of
individual Federal health care programs.
Section 1001.3004 Denial of Request for Reinstatement
We propose several changes to Sec. 1001.3004 to better reflect
OIG's current processes regarding denial of reinstatement appeal
requests and to clarify for the public the process by which an
individual or entity may appeal the denial of their request for
reinstatement. We propose to modify Sec. 1001.3004(a) to reflect a
three-step process when a request for reinstatement is denied. First,
OIG would send a written notice to the individual or entity notifying
them that their request for reinstatement has been denied and the basis
for the denial. Second, the individual or entity would then have 30
days from the date of the notice of the reinstatement denial to submit
a written request to appeal the denial. Third, once the individual or
entity has submitted a written appeal request, the individual would
have 30 days from the date of the written request for appeal to submit:
(1) any written argument or additional evidence the individual or
entity has regarding the basis for the denial of reinstatement
identified in the denial notice, or (2) a written request to present
oral argument or any additional evidence to an OIG official. The
proposed language would provide requesters with an additional 30 days
to submit the documentary evidence or the request for oral argument
allowed under Sec. 1001.3004(a).
We also propose to clarify Sec. 1001.3004(b) to indicate that OIG
will only issue a decision regarding a reinstatement denial if a
written argument or additional evidence are submitted to OIG or any
oral argument or additional evidence are presented to an OIG official.
The current language may incorrectly suggest that a decision might be
issued at the end of the 30-day appeal period even if no written or
oral argument and additional evidence are submitted or presented
regarding the denial of the request for reinstatement.
Section 1001.3005 Withdrawal of Exclusion for Reversed or Vacated
Decisions
We propose a technical change to clarify Sec. 1001.3005(b) by
deleting the words ``CMS and other'' before Federal health care
programs (because the Centers for Medicare & Medicaid Services (CMS) is
not itself a Federal health care program but the agency that
administers Medicare and Medicaid). Finally, we propose to change the
word ``exclusion'' to ``action'' in Sec. 1001.3004(d) to reflect the
fact that all other Federal health care programs do not use the term
``exclusion.''
VI. Regulatory Impact Statement
We have examined the impacts of this rulemaking as required by
Executive Order 12866 on Regulatory Planning and Review (September 30,
1993), Executive Order 13563 on Improving Regulation and Regulatory
Review (January 18, 2011), Executive Order 14094 entitled ``Modernizing
Regulatory Review'' (April 6, 2023), the Regulatory Flexibility Act
(RFA) (September 19, 1980, Pub. L. 96-354), section 1102(b) of the
Social Security Act, section 202 of the Unfunded Mandates Reform Act of
1995 (March 22, 1995; Pub. L. 104-4), and Executive Order 13132 on
Federalism (August 4, 1999).
Executive Order Nos. 12866 13563, and 14094
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and
[[Page 95155]]
equity). The Executive Order 14094 entitled ``Modernizing Regulatory
Review'' (hereinafter, the Modernizing E.O.) amends section 3(f)(1) of
Executive Order 12866 (Regulatory Planning and Review). A Regulatory
Impact Analysis (RIA) must be prepared for significant rules with
significant effects ($200 million or more in any 1 year).
Based on our estimates, OMB's Office of Information and Regulatory
Affairs (OIRA) has determined this rulemaking is not significant per
section 3(f)(1) as measured by the $200 million or more in any given
year. This is not a major rule as defined at 5 U.S.C. 804(2); it is not
economically significant because it does not reach that economic
threshold 1 year.
This proposed rule is designed to propose implementation of one,
new statutory provision consisting of a new exclusion authority. It is
also designed to clarify existing regulatory requirements. The vast
majority of providers and the Federal health care programs would be
minimally, if at all, impacted by these proposed revisions.
The proposed changes to the exclusion regulations would have little
economic impact. On average per year, OIG excludes approximately 3,000
individuals and entities, defends 100 appeals of exclusions, and hears
2 reinstatement denial appeals. Historically, one waiver of exclusion
has been requested and granted in any given year. Thus, we believe that
any aggregate economic effect of the proposed modifications would be
minimal and the likely aggregate economic effect of these proposed
modifications to the regulations would be significantly less than the
monetary thresholds under Executive Order 12866, as amended by
Executive Order 14094, and 5 U.S.C. 804(2).
Regulatory Flexibility Act
The RFA and the Small Business Regulatory Enforcement and Fairness
Act of 1996, which amended the RFA, require agencies to analyze options
for regulatory relief of small businesses. For purposes of the RFA,
small entities include small businesses, nonprofit organizations, and
government agencies. Providers are considered small entities by having
revenues of less than $8.0 million to $41.5 million in any 1 year. For
purposes of the RFA, most physicians and suppliers are considered small
entities.
The aggregate economic impact of the exclusion provisions on small
entities would be minimal. The rulemaking directly impacts small
entities that may be excluded by clarifying how OIG determines
exclusion lengths, waivers, reinstatement, and affirmative exclusion.
It also codifies exclusion authorities added to section 1128 of the Act
by MSIAA, adding clarity for members of the health care community
regarding the scope of OIG's actions. Because the rulemaking adds
transparency to OIG's process and implements exclusion authorities
designed to protect the Federal health care programs and their
beneficiaries from untrustworthy individuals and entities, we believe
any resulting impact will be positive for the health care community. In
summary, this notice of proposed rulemaking will not have a significant
impact on the operations of a substantial number of small providers and
a regulatory flexibility analysis is not required for this rulemaking.
Unfunded Mandates Reform Act
The Unfunded Mandates Reform Act of 1995 (UMRA) generally requires
that each agency conduct a cost-benefit analysis, identify and consider
a reasonable number of regulatory alternatives, and select the least
costly, most cost-effective, or least burdensome alternative that
achieves the objectives of the rule before promulgating any proposed or
final rule that includes a Federal mandate that may result in
expenditures of more than $100 million (adjusted for inflation) in at
least one year by State, local, and Tribal governments, or by the
private sector. Each agency must also seek input from State, local, and
Tribal governments. The current threshold after adjustment for
inflation using the Implicit Price Deflator for the Gross Domestic
Product is $183 million, reported in 2023 dollars. This proposed rule,
if finalized, would not result in an unfunded mandate in any year that
meets or exceeds this amount.
Executive Order 13132
Executive Order 13132, Federalism, establishes certain requirements
that an agency must meet when it promulgates a rule that imposes
substantial direct requirements or costs on State and local
governments, preempts State law, or otherwise has federalism
implications. In reviewing this rulemaking under the threshold criteria
of Executive Order 13132, we have determined that this proposed rule
would not significantly affect the rights, roles, or responsibilities
of State or local governments.
VII. Paperwork Reduction Act
These proposed changes impose no new information collection and
recordkeeping requirements. Consequently, it need not be reviewed by
the Office of Management and Budget under the authority of the
Paperwork Reduction Act of 1995.
List of Subjects in 42 CFR Parts 1000 and 1001
Administrative practice and procedure, Fraud, Grant programs--
health, Health facilities, Health professions, Maternal and child
health, Medicaid, Medicare.
For the reasons stated in the preamble, OIG proposes to amend 42
CFR parts 1000 and 1001 as set forth below:
PART 1000--INTRODUCTION; GENERAL DEFINITIONS
0
1. The authority citation to part 1000 continues to read as follows:
Authority: 42 U.S.C. 1320 and 1395hh.
0
2. Revise and republish Sec. 1000.10 to read as follows:
Sec. 1000.10 General definitions.
In this chapter, unless the context indicates otherwise--
Act means the Social Security Act, and titles referred to are
titles of that Act.
Administrator means the Administrator, Centers for Medicare &
Medicaid Services (CMS), formerly the Health Care Financing
Administration (HCFA).
Agent means any person who has express or implied authority to
obligate or act on behalf of an entity.
ALJ means an Administrative Law Judge.
Beneficiary means any individual eligible to have benefits paid to
the beneficiary, or on the beneficiary's behalf, under Medicare or any
State health care program.
CFR stands for Code of Federal Regulations.
CMS stands for Centers for Medicare & Medicaid Services, formerly
the Health Care Financing Administration (HCFA).
Department means the Department of Health and Human Services (HHS),
formerly the Department of Health, Education, and Welfare.
Directly, as used in the definition of ``furnished'' in this
section, means the provision or supply of items and services by
individuals or entities (including items and services provided or
supplied by them but manufactured, ordered, or prescribed by another
individual or entity) who request or receive payment from Medicare,
Medicaid, or other Federal health care programs.
ESRD stands for end-stage renal disease.
[[Page 95156]]
Exclusion means that items and services furnished, ordered, or
prescribed by a specified individual or entity will not be reimbursed
under Medicare, Medicaid, or any other Federal health care programs
until the individual or entity is reinstated by OIG.
Federal health care program means any plan or program that provides
health benefits, whether directly, through insurance, or otherwise,
which is funded directly, in whole or in part, by the United States
Government (other than the Federal Employees Health Benefits Program),
or any State health care program as defined in this section.
FR stands for Federal Register.
Furnished refers to items or services provided or supplied,
directly or indirectly, by any individual or entity.
HHS stands for the Department of Health and Human Services.
HHA stands for home health agency.
HMO stands for health maintenance organization.
ICF stands for intermediate care facility.
Indirect ownership interest includes an ownership interest through
any other entity or entities that ultimately have an ownership interest
in the entity at issue. (For example, an individual has a 10-percent
ownership interest in the entity at issue if they have a 20-percent
ownership interest in a corporation that wholly owns a subsidiary that
is a 50-percent owner of the entity at issue.)
Indirectly, as used in the definition of ``furnished'' in this
section, means the provision or supply of items and services
manufactured, distributed, supplied, or otherwise provided by
individuals or entities that do not directly request or receive payment
from Medicare, Medicaid, or other Federal health care programs, but
that provide items and services to providers, practitioners, or
suppliers who request or receive payment from these programs for such
items or services.
Inspector General means the Inspector General for the Department of
Health and Human Services.
Knowingly means that a person, with respect to an act, has actual
knowledge of the act, acts in deliberate ignorance of the act, or acts
in reckless disregard of the act, and no proof of specific intent to
defraud is required.
Managing employee means an individual (including a general manager,
business manager, administrator, or director) who exercises operational
or managerial control over the entity or part thereof or directly or
indirectly conducts the day-to-day operations of the entity or part
thereof.
Medicaid means medical assistance provided under a State plan
approved under Title XIX of the Act.
Medicare means the health insurance program for the aged and
disabled under Title XVIII of the Act.
OIG means the Office of Inspector General within HHS.
Ownership interest means an interest in:
(1) The capital, the stock, or the profits of the entity; or
(2) Any mortgage, deed of trust, note, or other obligation secured
in whole or in part by the property or assets of the entity.
Patient means any individual who is receiving health care items or
services, including any item or service provided to meet their
physical, mental, or emotional needs or well-being (including a
resident receiving care in a facility as described in part 483 of this
chapter), whether or not reimbursed under any Federal health care
program and regardless of the location in which such item or service is
provided.
QIO means a quality improvement organization as that term is used
in section 1152 of the Act (42 U.S.C. 1320c-1) and its implementing
regulations.
Secretary means the Secretary of the Department or the Secretary's
designees.
SNF stands for skilled nursing facility.
Social Security benefits means monthly cash benefits payable under
section 202 or 223 of the Act.
SSA stands for Social Security Administration.
State includes the 50 States, the District of Columbia, Puerto
Rico, the Virgin Islands, Guam, American Samoa, the Northern Mariana
Islands, and the Trust Territory of the Pacific Islands.
State health care program means:
(1) A State plan approved under title XIX of the Act (Medicaid);
(2) Any program receiving funds under title V of the Act or from an
allotment to a State under such title (Maternal and Child Health
Services Block Grant program);
(3) Any program receiving funds under subtitle A of title XX of the
Act or from any allotment to a State under such subtitle (Block Grants
to States for Social Services); or
(4) A State child health plan approved under title XXI (Children's
Health Insurance Program).
United States means the 50 States, the District of Columbia, the
Commonwealth of Puerto Rico, the Virgin Islands, Guam, American Samoa,
and the Northern Mariana Islands.
U.S.C. stands for United States Code.
PART 1001--PROGRAM INTEGRITY--THE FEDERAL HEALTH CARE PROGRAMS
0
3. The authority citation to part 1001 continues to read as follows:
Authority: 42 U.S.C. 1302; 1320a-7; 1320a-7b; 1395u(j);
1395u(k); 1395w-104(e)(6), 1395y(d); 1395y(e); 1395cc(b)(2)(D), (E),
and (F); 1395hh; 1842(j)(1)(D)(iv), 1842(k)(1), and sec. 2455, Pub.
L. 103-355, 108 Stat. 3327 (31 U.S.C. 6101 note).
0
4. Revise the heading to part 1001 as set forth above.
0
5. Revise and republish subpart A, consisting of Sec. Sec. 1001.1 and
1001.2 to read as follows:
Subpart A--General Provisions
Sec. 1001.1 Scope and purpose.
(a) The regulations in this part specify certain bases upon which
individuals and entities may, or in some cases must, be excluded from
participation in all Federal health care programs. They also state the
effect of exclusion, the factors that will be considered in determining
the length of any exclusion, the provisions governing notices of
exclusions, and the process by which an excluded individual or entity
may seek reinstatement into the programs.
(b) The regulations in this part are applicable to and binding on
the Office of Inspector General (OIG) in imposing and proposing
exclusions, as well as to Administrative Law Judges (ALJs), the
Departmental Appeals Board, and Federal courts in reviewing the
imposition of exclusions by OIG (and, where applicable, in imposing
exclusions proposed by OIG).
Sec. 1001.2 Definitions.
For purposes of this part:
Convicted means that--
(1) A judgment of conviction has been entered against an individual
or entity by a Federal, State, or local court, regardless of whether:
(i) There is a post-trial motion or an appeal pending; or
(ii) The judgment of conviction or other record relating to the
criminal conduct has been expunged or otherwise removed;
(2) A Federal, State, or local court has made a finding of guilt
against an individual or entity;
(3) A Federal, State, or local court has accepted a plea of guilty
or nolo contendere by an individual or entity; or
(4) An individual or entity has entered into participation in a
first offender, deferred adjudication, or other program or arrangement
where judgment of conviction has been withheld.
[[Page 95157]]
HHS means Department of Health and Human Services.
Immediate family member means a person's husband or wife; natural
or adoptive parent; child or sibling; stepparent, stepchild,
stepbrother, or stepsister; father-, mother-, daughter-, son-, brother-
, or sister-in-law; grandparent or grandchild; or spouse of a
grandparent or grandchild.
Incarceration means imprisonment or any type of confinement with or
without supervised release, including, but not limited to, community
confinement, house arrest, and home detention.
Member of household means, with respect to a person, any individual
with whom the person is sharing a common abode as part of a single-
family unit, including domestic employees and others who live together
as a family unit. A roomer or boarder is not considered a member of a
household.
Ownership or control interest means, with respect to an entity, a
person who:
(1) Has a direct or an indirect ownership interest (or any
combination thereof) of 5 percent or more in the entity;
(2) Is the owner of a whole or part interest in any mortgage, deed
of trust, note, or other obligation secured (in whole or in part) by
the entity or any of the property assets thereof, if such interest is
equal to or exceeds 5 percent of the total property and assets of the
entity;
(3) Is an officer or a director of the entity;
(4) Is a partner in the entity if the entity is organized as a
partnership;
(5) Is an agent of the entity; or
(6) Is a managing employee of the entity.
Professionally recognized standards of health care are statewide or
national standards of care, whether in writing or not, that
professional peers of the individual or entity whose provision of care
is an issue, recognize as applying to those peers practicing or
providing care within a State. When the Department has declared a
treatment modality not to be safe and effective, practitioners who
employ such a treatment modality will be deemed not to meet
professionally recognized standards of health care. This definition
will not be construed to mean that all other treatments meet
professionally recognized standards.
Sole community physician means a physician who is the only
physician who provides primary care services to Federal or State health
care program beneficiaries within a defined service area.
Sole source of essential specialized services in the community
means that an individual or entity--
(1) Is the only practitioner, supplier, or provider furnishing
specialized services in an area designated by the Health Resources
Services Administration as a health professional shortage area for that
medical specialty, as listed in 42 CFR part 5, appendices B through F;
(2) Is a sole community hospital, as defined in Sec. 412.92 of
this title; or
(3) Is the only source of specialized services in a reasonably
defined service area where services by a non-specialist could not be
substituted for the source without jeopardizing the health or safety of
beneficiaries.
State Medicaid Fraud Control Unit means a unit certified by the
Secretary as meeting the criteria of 42 U.S.C. 1396b(q) and Sec.
1002.305 of this chapter.
0
6. Revise and republish subpart B, consisting of Sec. Sec. 1001.101
and 1001.102, to read as follows:
Subpart B--Mandatory Exclusions
Sec. 1001.101 Basis for liability.
OIG will exclude any individual or entity that--
(a) Has been convicted of a criminal offense related to the
delivery of an item or service under Medicare or a State health care
program, including the performance of management or administrative
services relating to the delivery of items or services under any such
program;
(b) Has been convicted, under Federal or State law, of a criminal
offense related to the neglect or abuse of a patient, in connection
with the delivery of a health care item or service, including any
offense that OIG concludes entailed, or resulted in, neglect or abuse
of patients (the delivery of a health care item or service includes the
provision of any item or service to an individual to meet the
individual's physical, mental, or emotional needs or well-being,
whether or not reimbursed under a Federal health care program);
(c) Has been convicted, under Federal or State law, of a felony
relating to fraud, theft, embezzlement, breach of fiduciary
responsibility, or other financial misconduct--
(1) In connection with the delivery of a health care item or
service, including the performance of management or administrative
services relating to the delivery of such items or services; or
(2) With respect to any act or omission in a health care program
(other than Medicare or a State health care program) operated or
financed in whole or in part by any Federal, State, or local government
agency; or
(d) Has been convicted, under Federal or State law, of a felony
relating to the unlawful manufacture, distribution, prescription, or
dispensing of a controlled substance, as defined under Federal or State
law. This applies to any individual or entity that--
(1) Is, or has ever been, a health care practitioner, provider, or
supplier, or furnished or furnishes items or services;
(2) Holds, or has held, a direct or an indirect ownership or
control interest in an entity that furnished or furnishes items or
services or is, or has ever been, an officer, director, agent, or
managing employee of such an entity; or
(3) Is, or has ever been, employed in any capacity in the health
care industry.
Sec. 1001.102 Length of exclusion.
(a) No exclusion imposed in accordance with Sec. 1001.101 will be
for less than 5 years.
(b) Any of the following factors may be considered to be
aggravating and a basis for lengthening the period of exclusion--
(1) The acts resulting in the conviction, or similar acts, caused,
or were intended to cause, a financial loss of $50,000 or more to a
government agency or program or to one or more other entities. (The
entire amount of financial loss, including any amounts resulting from
similar acts not adjudicated, will be considered regardless of whether
full or partial restitution has been made.);
(2) The acts that resulted in the conviction, or similar acts, were
committed over a period of 1 year or more;
(3) The acts that resulted in the conviction, or similar acts, had
a significant adverse physical, mental, or financial impact on one or
more program beneficiaries or other individuals;
(4) In convictions involving patient abuse or neglect, the acts
that resulted in the conviction were premeditated, part of a continuing
pattern of behavior, or consisted of non-consensual sexual acts;
(5) The sentence imposed by the court included incarceration; or
(6) The convicted individual or entity has other documented
instances of criminal, civil, or administrative wrongdoing.
(c) Only if any of the aggravating factors set forth in paragraph
(b) of this section justifies an exclusion longer than 5 years, may
mitigating factors be considered as a basis for reducing the period of
exclusion to no less than 5 years. Only the following factors may be
considered mitigating--
(1) The record in the criminal proceedings demonstrates that the
court
[[Page 95158]]
determined that the individual had a condition before or during the
commission of the offense that reduced the individual's culpability; or
(2) The record in the criminal proceedings or a written statement
by a government official demonstrates that the individual's or entity's
cooperation with Federal or State officials resulted in other
individuals or entities being excluded, indicted, or otherwise charged,
convicted, or investigated.
(d) In the case of an exclusion under this subpart, an exclusion
will be--
(1) For not less than 10 years if the individual has been convicted
on one previous occasion of one or more offenses for which an exclusion
may be imposed under section 1128(a) of the Act. (The aggravating
factors in paragraph (b) of this section can be used to impose a period
of time in excess of the 10-year minimum.); or
(2) Permanent if the individual has been convicted on two or more
previous occasions of one or more offenses for which an exclusion may
be imposed under section 1128(a) of the Act.
Subpart C--Permissive Exclusions
0
7. Revise and republish Sec. Sec. 1001.201 through 1001.951 to read as
follows:
Sec.
1001.201 Conviction relating to program or health care fraud.
1001.301 Conviction relating to obstruction of an investigation or
audit.
1001.401 Conviction relating to controlled substances.
1001.501 License revocation or suspension.
1001.601 Exclusion or suspension under a Federal or State health
care program.
1001.701 Excessive claims or furnishing of unnecessary or
substandard items and services.
1001.801 Failure of HMOs and CMPs to furnish medically necessary
items and services.
1001.901 False or improper claims.
1001.951 Fraud and kickbacks and other prohibited activities.
* * * * *
Sec. 1001.201 Conviction relating to program or health care fraud.
(a) Circumstance for exclusion. OIG may exclude an individual or
entity convicted under Federal or State law of--
(1) A misdemeanor relating to fraud, theft, embezzlement, breach of
fiduciary responsibility, or other financial misconduct--
(i) In connection with the delivery of any health care item or
service, including the performance of management or administrative
services relating to the delivery of such items or services; or
(ii) With respect to any act or omission in a health care program,
other than Medicare or a State health care program, operated or
financed in whole or in part by any Federal, State, or local government
agency; or
(2) Fraud, theft, embezzlement, breach of fiduciary responsibility,
or other financial misconduct with respect to any act or omission in a
program, other than a health care program, operated or financed in
whole or in part by any Federal, State, or local government agency.
(b) Length of exclusion. (1) An exclusion imposed in accordance
with this section will be for a period of 3 years unless aggravating or
mitigating factors listed in paragraphs (b)(2) and (3) of this section
form a basis for lengthening or shortening that period.
(2) Any of the following factors may be considered to be
aggravating and a basis for lengthening the period of exclusion--
(i) The acts resulting in the conviction, or similar acts, caused
or reasonably could have been expected to cause a financial loss of
$50,000 or more to a government agency or program or to one or more
other entities. (The entire amount of financial loss will be
considered, including any amounts resulting from similar acts not
adjudicated, regardless of whether full or partial restitution has been
made.);
(ii) The acts that resulted in the conviction, or similar acts,
were committed over a period of 1 year or more;
(iii) The acts that resulted in the conviction, or similar acts,
had a significant adverse physical, mental, or financial impact on one
or more program beneficiaries or other individuals;
(iv) The sentence imposed by the court included incarceration; or
(v) The individual or entity has other documented instances of
criminal, civil, or administrative wrongdoing.
(3) Only the following factors may be considered as mitigating and
a basis for reducing the period of exclusion--
(i) The record in the criminal proceedings demonstrates that the
court determined that the individual had a condition, before or during
the commission of the offense, that reduced the individual's
culpability; or
(ii) The record in the criminal proceedings or a written statement
by a government official demonstrates that the individual's or entity's
cooperation with Federal or State officials resulted in other
individuals or entities being excluded, indicted, or otherwise charged,
convicted, or investigated.
Sec. 1001.301 Conviction relating to obstruction of an investigation
or audit.
(a) Circumstance for exclusion. OIG may exclude an individual or
entity that has been convicted, under Federal or State law, in
connection with the interference with or obstruction of any
investigation or audit related to--
(1) Any offense described in Sec. 1001.101 or Sec. 1001.201; or
(2) The use of funds received, directly or indirectly, from any
Federal health care program.
(b) Length of exclusion. (1) An exclusion imposed in accordance
with this section will be for a period of 3 years, unless aggravating
or mitigating factors listed in paragraphs (b)(2) and (3) of this
section form the basis for lengthening or shortening that period.
(2) Any of the following factors may be considered to be
aggravating and a basis for lengthening the period of exclusion--
(i) The acts resulting in the conviction, or similar acts, caused,
or reasonably could have been expected to cause a financial loss of
$50,000 or more to a government agency or program or to one or more
other entities. (The entire amount of financial loss will be
considered, including any amounts resulting from similar acts not
adjudicated, regardless of whether full or partial restitution has been
made.);
(ii) The acts that resulted in the conviction had a significant
adverse physical, mental, or financial impact on one or more program
beneficiaries or other individuals;
(iii) The sentence imposed by the court included incarceration;
(iv) The individual or entity has other documented instances of
criminal, civil, or administrative wrongdoing.
(3) Only the following factors may be considered as mitigating and
a basis for reducing the period of exclusion--
(i) The record of the criminal proceedings demonstrates that the
court determined that the individual had a condition, before or during
the commission of the offense, that reduced the individual's
culpability; or
(ii) The record in the criminal proceedings or a written statement
by a government official demonstrates that the individual's or entity's
cooperation with Federal or State officials resulted in other
individuals or entities being excluded, indicted, or otherwise charged,
convicted, or investigated.
Sec. 1001.401 Conviction relating to controlled substances.
(a) Circumstance for exclusion. OIG may exclude an individual or
entity convicted under Federal or State law of a misdemeanor relating
to the unlawful
[[Page 95159]]
manufacture, distribution, prescription, or dispensing of a controlled
substance, as defined under Federal or State law. This section applies
to any individual or entity that--
(1) Is, or has ever been, a health care practitioner, provider, or
supplier, or furnished or furnishes items or services;
(2) Holds, or held, a direct or indirect ownership or control
interest in an entity that furnished or furnishes items or services or
is or has ever been an officer, director, agent, or managing employee
of such an entity; or
(3) Is, or has ever been, employed in any capacity in the health
care industry.
(b) Length of exclusion. (1) An exclusion imposed in accordance
with this section will be for a period of 3 years, unless aggravating
or mitigating factors listed in paragraphs (c)(2) and (3) of this
section form a basis for lengthening or shortening that period.
(2) Any of the following factors may be considered to be
aggravating and to be a basis for lengthening the period of exclusion--
(i) The acts that resulted in the conviction or similar acts were
committed over a period of 1 year or more;
(ii) The acts that resulted in the conviction or similar acts had a
significant adverse physical, mental, or financial impact on program
beneficiaries or other individuals or a Federal health care program;
(iii) The sentence imposed by the court included incarceration; or
(iv) The individual or entity has other documented instances of
criminal, civil, or administrative wrongdoing.
(3) Only the following factors may be considered to be mitigating
and to be a basis for shortening the period of exclusion--
(i) The record of the criminal proceedings demonstrates that the
court determined that the individual had a condition, before or during
the commission of the offense, that reduced the individual's
culpability; or
(ii) The record in the criminal proceedings or a written statement
by a government official demonstrates that the individual's or entity's
cooperation with Federal or State officials resulted in other
individuals or entities being excluded, indicted, or otherwise charged,
convicted, or investigated.
Sec. 1001.501 License revocation or suspension.
(a) Circumstance for exclusion. OIG may exclude an individual or
entity that has--
(1) Had a license to provide health care revoked or suspended by
any State licensing authority, or has otherwise lost such a license
(including the right to apply for or renew such a license), for reasons
bearing on the individual's or entity's professional competence,
professional performance, or financial integrity; or
(2) Has surrendered such a license while a formal disciplinary
proceeding concerning the individual's or entity's professional
competence, professional performance, or financial integrity was
pending before a State licensing authority.
(b) Length of exclusion. (1) An exclusion imposed in accordance
with this section will not be for a period of time less than the period
during which an individual's or entity's license is revoked, suspended,
or otherwise not in effect as a result of, or in connection with, a
State licensing agency action.
(2) When an individual or entity has been excluded under this
section, OIG will consider a request for reinstatement in accordance
with Sec. 1001.3001 if:
(i) The individual or entity obtains the license in the State where
the license was originally revoked, suspended, surrendered, or
otherwise lost; or
(ii) The individual meets the conditions for early reinstatement
set forth in paragraph (c) of this section.
(c) Consideration of early reinstatement. (1) If an individual or
entity that is excluded in accordance with this section fully and
accurately discloses the circumstances surrounding the action that
formed the basis for the exclusion to a licensing authority of a
different State or to a different licensing authority in the same State
and that licensing authority grants the individual or entity a new
health care license or has decided to take no adverse action as to a
currently held health care license, OIG will consider a request for
early reinstatement. OIG will consider the following factors in
determining whether a request for early reinstatement under this
paragraph (c)(1) will be granted:
(i) The circumstances that formed the basis for the exclusion,
including whether the circumstances were related to patient abuse or
neglect;
(ii) Whether the second licensing authority is in a State that is
not the individual's or entity's primary place of practice;
(iii) Documentation from the second licensing authority indicating
that it was aware of the circumstances surrounding the action that
formed the basis for the exclusion;
(iv) Whether the individual or entity has demonstrated that the
individual or entity has satisfactorily resolved any underlying problem
that caused or contributed to the basis for the initial licensing
action;
(v) The benefits to the Federal health care programs and program
beneficiaries of early reinstatement;
(vi) The risks to the Federal health care programs and program
beneficiaries of early reinstatement;
(vii) Any additional or pending license actions in any State;
(viii) Any ongoing investigations involving the individual or
entity; and
(ix) All the factors set forth in Sec. 1001.3002(b).
(2) If an exclusion has been imposed under this section and the
individual or entity does not have a valid health care license of any
kind in any State, that individual or entity may request OIG to
consider whether the individual or entity may be eligible for early
reinstatement. OIG will consider the following factors in determining
whether a request for early reinstatement under this paragraph (c)(2)
will be granted:
(i) The length of time the individual or entity has been excluded.
OIG will not consider a request for early reinstatement under paragraph
(c)(2) of this section if the individual or entity has been excluded
for less than 3 years; however, if the action on which the exclusion is
based was for a set period longer than 3 years, OIG will not consider a
request for early reinstatement at any time prior to the expiration of
the period set by the licensing board;
(ii) The circumstances that formed the basis for the exclusion,
including whether the circumstances were related to patient abuse or
neglect;
(iii) Whether the individual or entity has demonstrated that the
individual or entity has satisfactorily resolved any underlying problem
that caused or contributed to the basis for the initial licensing
action;
(iv) The benefits to the Federal health care programs and program
beneficiaries of early reinstatement;
(v) The risks to the Federal health care programs and program
beneficiaries of early reinstatement;
(vi) Any additional or pending license actions in any State;
(vii) Any ongoing investigations involving the individual or
entity; and
(viii) All the factors set forth in Sec. 1001.3002(b).
(3) Notwithstanding paragraphs (c)(1) and (2) of this section, if
an individual's or entity's license revocation or suspension was for
reasons related to patient abuse or neglect, OIG will not consider an
application for early reinstatement if the individual or entity has
been excluded for less than 5 years.
[[Page 95160]]
(4) Except for Sec. 1001.3002(a)(1)(i), all provisions of subpart
F (Sec. Sec. 1001.3001 through 1001.3005) apply to early
reinstatements under this section.
Sec. 1001.601 Exclusion or suspension under a Federal or State health
care program.
(a) Circumstance for exclusion. (1) OIG may exclude an individual
or entity suspended or excluded from participation, or otherwise
sanctioned, under--
(i) Any Federal program involving the provision of health care; or
(ii) A State health care program, for reasons bearing on the
individual's or entity's professional competence, professional
performance, or financial integrity.
(2) The term ``or otherwise sanctioned'' in paragraph (a)(1) of
this section means all actions that limit the ability of a person to
participate in the program at issue regardless of what such an action
is called, and includes situations where an individual or entity
voluntarily withdraws from a program to avoid a formal sanction.
(b) Length of exclusion. (1) An exclusion imposed in accordance
with this section will not be for a period of time less than the period
during which the individual or entity is excluded or suspended, or
otherwise sanctioned, from a Federal or State health care program.
(2) If the individual or entity is eligible to apply for
reinstatement in accordance with Sec. 1001.3001, and the sole reason
why the State or Federal health care program denied reinstatement to
that program is the existing exclusion imposed by OIG as a result of
the original State or Federal health care program action, OIG will
consider a request for reinstatement.
Sec. 1001.701 Excessive claims or furnishing of unnecessary or
substandard items and services.
(a) Circumstance for exclusion. OIG may exclude an individual or
entity that has--
(1) Submitted, or caused to be submitted, bills or requests for
payments under Medicare or any of the State health care programs
containing charges or costs for items or services furnished that are
substantially in excess of such individual's or entity's usual charges
or costs for such items or services; or
(2) Furnished, or caused to be furnished, to patients (whether or
not covered by Medicare or any of the State health care programs) any
items or services substantially in excess of the patient's needs, or of
a quality that fails to meet professionally recognized standards of
health care.
(b) Sources. OIG's determination under paragraph (a)(2) of this
section--that the items or services furnished were excessive or of
unacceptable quality--will be made on the basis of information,
including sanction reports, from the following sources:
(1) The QIO for the area served by the individual or entity;
(2) State or local licensing or certification authorities;
(3) Fiscal agents or contractors, or private insurance companies;
(4) State or local professional societies; or
(5) Any other sources deemed appropriate by OIG.
(c) Exceptions. An individual or entity will not be excluded for--
(1) Submitting, or causing to be submitted, bills or requests for
payment that contain charges or costs substantially in excess of usual
charges or costs when such charges or costs are due to unusual
circumstances or medical complications requiring additional time,
effort, expense or other good cause; or
(2) Furnishing, or causing to be furnished, items or services in
excess of the needs of patients, when the items or services were
ordered by a physician or other authorized individual, and the
individual or entity furnishing the items or services was not in a
position to determine medical necessity or to refuse to comply with the
order of the physician or other authorized individual.
(d) Length of exclusion. (1) An exclusion imposed in accordance
with this section will be for a period of 3 years, unless aggravating
or mitigating factors set forth in paragraphs (d)(2) and (3) of this
section form a basis for lengthening or shortening the period. In no
case may the period be shorter than 1 year for any exclusion taken in
accordance with paragraph (a)(2) of this section.
(2) Any of the following factors may be considered aggravating and
a basis for lengthening the period of exclusion--
(i) The conduct occurred over a period of 1 year or more;
(ii) The conduct had a significant adverse physical, mental, or
financial impact on program beneficiaries or other individuals;
(iii) The individual or entity has other documented instances of
criminal, civil, or administrative wrongdoing; or
(iv) The conduct resulted in financial loss to any Federal health
care program of $50,000 or more.
(3) Only the following factor may be considered mitigating and a
basis for reducing the period of exclusion: Whether there were few
occurrences of the conduct, and the conduct occurred over a short
period of time.
Sec. 1001.801 Failure of HMOs and CMPs to furnish medically necessary
items and services.
(a) Circumstances for exclusion. OIG may exclude an entity--
(1) That is a--
(i) Health maintenance organization (HMO), as defined in section
1903(m) of the Act, providing items or services under a State Medicaid
Plan;
(ii) Primary care case management system providing services, in
accordance with a waiver approved under section 1915(b)(1) of the Act;
or
(iii) HMO or competitive medical plan (CMP) providing items or
services in accordance with a risk-sharing contract under section 1876
of the Act;
(2) That has failed substantially to provide medically necessary
items and services that are required under a plan, waiver or contract
described in paragraph (a)(1) of this section to be provided to
individuals covered by such plan, waiver or contract; and
(3) Where such failure has adversely affected or has a substantial
likelihood of adversely affecting covered individuals.
(b) Sources. OIG's determination under paragraph (a)(2) of this
section--that the medically necessary items and services required under
law or contract were not provided--will be made on the basis of
information, including sanction reports, from the following sources:
(1) The QIO or other quality assurance organization under contract
with a State Medicaid plan for the area served by the HMO or
competitive medical plan;
(2) State or local licensing or certification authorities;
(3) Fiscal agents or contractors, or private insurance companies;
(4) State or local professional societies;
(5) CMS's HMO compliance office; or
(6) Any other sources deemed appropriate by OIG.
(c) Length of exclusion. (1) An exclusion imposed in accordance
with this section will be for a period of 3 years, unless aggravating
or mitigating factors set forth in paragraphs (c)(2) and (3) of this
section form a basis for lengthening or shortening the period.
(2) Any of the following factors may be considered aggravating and
a basis for lengthening the period of exclusion--
(i) The entity failed to provide a large number or a variety of
items or services;
(ii) The failures occurred over a lengthy period of time;
[[Page 95161]]
(iii) The entity's failure to provide a necessary item or service
had or could have had a serious adverse effect; or
(iv) The entity has other documented instances of criminal, civil,
or administrative wrongdoing.
(3) Only the following factors may be considered as mitigating and
a basis for reducing the period of exclusion--
(i) There were few violations and they occurred over a short period
of time; or
(ii) The entity took corrective action upon learning of
impermissible activities by an employee or contractor.
Sec. 1001.901 False or improper claims.
(a) Circumstance for exclusion. OIG may exclude any individual or
entity that it determines has committed an act described in section
1128A of the Act. The imposition of a civil money penalty or assessment
is not a prerequisite for an exclusion under this section.
(b) Length of exclusion. In determining the length of an exclusion
imposed in accordance with this section, OIG will consider the
following factors--
(1) The nature and circumstances surrounding the actions that are
the basis for liability, including the period of time over which the
acts occurred, the number of acts, whether there is evidence of a
pattern, and the amount claimed;
(2) The degree of culpability;
(3) Whether the individual or entity has other documented instances
of criminal, civil, or administrative wrongdoing (the absence of any
such instances is to be considered neutral); or
(4) Other matters as justice may require.
(c) Limitations. OIG may not impose an exclusion under this section
more than 10 years after the date when an act which is described in
section 1128A of the Act occurred.
Sec. 1001.951 Fraud and kickbacks and other prohibited activities.
(a) Circumstance for exclusion. (1) Except as provided for in
paragraph (a)(2)(ii) of this section, OIG may exclude any individual or
entity that it determines has committed an act described in section
1128B(b) of the Act.
(2) With respect to acts described in section 1128B of the Act,
OIG--
(i) May exclude any individual or entity that it determines has
knowingly and willfully solicited, received, offered or paid any
remuneration in the manner and for the purposes described therein,
irrespective of whether the individual or entity may be able to prove
that the remuneration was also intended for some other purpose; and
(ii) Will not exclude any individual or entity if that individual
or entity can prove that the remuneration that is the subject of the
exclusion is exempted from serving as the basis for an exclusion.
(b) Length of exclusion. In determining the length of an exclusion
imposed in accordance with this section, OIG may consider the following
factors--
(1) The nature and circumstances surrounding the actions that are
the basis for liability, including the period of time over which the
acts occurred, the number of acts, whether there is evidence of a
pattern and the amount claimed;
(2) The degree of culpability;
(3) Whether the individual or entity has other documented instances
of criminal, civil, or administrative wrongdoing (the absence of any
such instances is to be considered neutral); or
(4) Other matters as justice may require.
(c) Limitations. OIG may not impose an exclusion under this section
more than 10 years after the date when an act which is described in
section 1128B(b) of the Act occurred.
0
8. Revise and republish Sec. Sec. 1001.1101 through 1001.1552 to read
as follows:
Sec.
* * * * *
1001.1101 Failure to disclose certain information.
1001.1201 Failure to provide payment information.
1001.1301 Failure to grant immediate access.
1001.1401 Violations of Prospective Payment System corrective
action.
1001.1501 Default of health education loan or scholarship
obligations.
1001.1551 Exclusion of individuals with ownership or control
interest in sanctioned entities.
1001.1552 Making false statements or misrepresentation of material
facts.
Sec. 1001.1101 Failure to disclose certain information.
(a) Circumstance for exclusion. OIG may exclude any entity that did
not fully and accurately, or completely, make disclosures as required
by section 1124, 1124A or 1126 of the Act, and by part 455, subpart B
and part 420, subpart C of this title.
(b) Length of exclusion. The following factors will be considered
in determining the length of an exclusion under this section--
(1) The number of instances where full and accurate, or complete,
disclosure was not made;
(2) The significance of the undisclosed information;
(3) Whether the individual or entity has other documented instances
of criminal, civil, or administrative wrongdoing (the absence of such
instances is to be considered neutral);
(4) Any other facts that bear on the nature or seriousness of the
conduct; and
(5) The extent to which the entity knew that the disclosures made
were not full or accurate.
Sec. 1001.1201 Failure to provide payment information.
(a) Circumstance for exclusion. OIG may exclude any individual or
entity that furnishes, orders, refers for furnishing, or certifies the
need for items or services for which payment may be made under Medicare
or any of the State health care programs and that--
(1) Fails to provide such information as is necessary to determine
whether such payments are or were due and the amounts thereof; or
(2) Has refused to permit such examination and duplication of its
records as may be necessary to verify such information.
(b) Length of exclusion. The following factors will be considered
in determining the length of an exclusion under this section--
(1) The number of instances where information was not provided;
(2) The circumstances under which such information was not
provided;
(3) The amount of the payments at issue; and
(4) Whether the individual or entity has other documented instances
of criminal, civil, or administrative wrongdoing (the absence of such
instances is to be considered neutral).
Sec. 1001.1301 Failure to grant immediate access.
(a) Circumstance for exclusion. (1) OIG may exclude any individual
or entity that fails to grant immediate access upon reasonable request
to--
(i) The Secretary, a State survey agency or other authorized entity
for the purpose of determining, in accordance with section 1864(a) of
the Act, whether--
(A) An institution is a hospital or skilled nursing facility;
(B) An agency is a home health agency;
(C) An agency is a hospice program;
(D) A facility is a rural health clinic as defined in section
1861(aa)(2) of the Act, or a comprehensive outpatient rehabilitation
facility as defined in section 1861(cc)(2) of the Act;
(E) A laboratory is meeting the requirements of section 1861(s)
(15) and (16) of the Act, and section 353(f) of the Public Health
Service Act;
(F) A clinic, rehabilitation agency or public health agency is
meeting the
[[Page 95162]]
requirements of section 1861(p)(4) (A) or (B) of the Act;
(G) An ambulatory surgical center is meeting the standards
specified under section 1832(a)(2)(F)(i) of the Act;
(H) A portable x ray unit is meeting the requirements of section
1861(s)(3) of the Act;
(I) A screening mammography service is meeting the requirements of
section 1834(c)(3) of the Act;
(J) An end-stage renal disease facility is meeting the requirements
of section 1881(b) of the Act;
(K) A physical therapist in independent practice is meeting the
requirements of section 1861(p) of the Act;
(L) An occupational therapist in independent practice is meeting
the requirements of section 1861(g) of the Act;
(M) An organ procurement organization meets the requirements of
section 1138(b) of the Act; or
(N) A rural primary care hospital meets the requirements of section
1820(i)(2) of the Act;
(ii) The Secretary, a State survey agency or other authorized
entity to perform the reviews and surveys required under State plans in
accordance with sections 1902(a)(26) (relating to inpatient mental
hospital services), 1902(a)(31) (relating to intermediate care
facilities for individuals with intellectual disabilities), 1919(g)
(relating to nursing facilities), 1929(i) (relating to providers of
home and community care and community care settings), 1902(a)(33), and
1903(g) of the Act;
(iii) OIG for reviewing records, documents, and other material or
data in any medium (including electronically stored information and any
tangible thing) necessary to OIG's statutory functions; or
(iv) A State Medicaid fraud control unit (MFCU) for the purpose of
conducting its activities.
(2) For purposes of paragraphs (a)(1)(i) and (ii) of this section--
(i) Failure to grant immediate access means the failure to grant
access at the time of a reasonable request unless the requested
material does not exist or is not at the location where the request is
presented.
(ii) Reasonable request means a written request made by a properly
identified agent of the Secretary, of a State survey agency, or of
another authorized entity, during hours that the facility, agency or
institution is open for business.
(iii) The request will include a statement of the authority for the
request, the rights of the entity in responding to the request, the
definitions of reasonable request and failure to grant immediate
access, and the penalties for failure to comply, including when the
exclusion will take effect.
(3) For purposes of paragraphs (a)(1)(iii) and (iv) of this
section--
(i) Failure to grant immediate access means the failure to produce
or make available for inspection and copying the requested material at
the time of a reasonable request unless the requested material does not
exist or is not at the location where the request is presented.
(ii) Reasonable request means a written request, signed by a
designated representative of OIG or a MFCU and made by a properly
identified agent of OIG or a MFCU during reasonable business hours,
where there is information to suggest that the person has violated
statutory or regulatory requirements under titles V, XI, XVIII, XIX, or
XX of the Act.
(iii) The request will include a statement of the authority for the
request, the person's rights in responding to the request, the
definitions of reasonable request and failure to grant immediate
access, and the effective date, length, and scope and effect of the
exclusion that would be imposed for failure to comply with the request,
and the earliest date that a request for reinstatement would be
considered.
(4) Nothing in this section shall in any way limit access otherwise
authorized under State or Federal law.
(b) Length of exclusion. (1) An exclusion of an individual under
this section may be for a period equal to the sum of:
(i) The length of the period during which the immediate access was
not granted; and
(ii) An additional period of up to 90 days.
(2) The exclusion of an entity may be for a longer period than the
period in which immediate access was not granted based on consideration
of the following factors--
(i) The impact of the failure to grant the requested immediate
access on Medicare or any of the State health care programs,
beneficiaries, or the public;
(ii) The circumstances under which such access was refused;
(iii) The impact of the exclusion on any Federal health care
program, beneficiaries, or the public; and
(iv) Whether the entity has other documented instances of criminal,
civil, or administrative wrongdoing (the absence of any such instances
is to be considered neutral).
(3) For purposes of paragraphs (b)(1) and (2) of this section, the
length of the period in which immediate access was not granted will be
measured from the time the request is made, or from the time by which
access was required to be granted, whichever is later.
(c) The exclusion will be effective as of the date immediate access
was not granted.
Sec. 1001.1401 Violations of Prospective Payment System corrective
action.
(a) Circumstance for exclusion. OIG may exclude any hospital that
CMS determines has failed substantially to comply with a corrective
action plan required by CMS under section 1886(f)(2)(B) of the Act.
(b) Length of exclusion. The following factors will be considered
in determining the length of exclusion under this section--
(1) The impact of the hospital's failure to comply on any Federal
health care program, program beneficiaries, or other individuals;
(2) The circumstances under which the failure occurred;
(3) The nature of the failure to comply;
(4) The impact of the exclusion on any Federal health care program,
beneficiaries, or the public; and
(5) Whether the hospital has other documented instances of
criminal, civil, or administrative wrongdoing (the absence of any such
instances is to be considered neutral).
Sec. 1001.1501 Default of health education loan or scholarship
obligations.
(a) Circumstance for exclusion. (1) Except as provided in paragraph
(a)(4) of this section, OIG may exclude any individual that the
administrator of the health education loan, scholarship, or loan
repayment program determines is in default on repayments of scholarship
obligations or loans, or the obligations of any loan repayment program,
in connection with health professions education made or secured in
whole or in part by the Secretary.
(2) Before imposing an exclusion in accordance with paragraph
(a)(1) of this section, OIG must determine that the administrator of
the health education loan, scholarship, or loan repayment program has
taken all reasonable administrative steps to secure repayment of the
loans or obligations. When an individual has been offered a Medicare
offset arrangement as required by section 1892 of the Act, OIG will
find that all reasonable steps have been taken.
(3) OIG will take into account access of beneficiaries to physician
services for
[[Page 95163]]
which payment may be made under the Medicare and Medicaid programs in
determining whether to impose an exclusion.
(4) OIG will not exclude a physician who is the sole community
physician or the sole source of essential specialized services in a
community if a State requests that the physician not be excluded.
(b) Length of exclusion. The individual will be excluded until the
administrator of the health education loan, scholarship, or loan
repayment program notifies OIG that the individual has entered into an
agreement with the administrator of the health education loan,
scholarship, or loan repayment program to cure the default or that
there is no longer an outstanding debt. If the administrator of the
health education loan, scholarship, or loan repayment program notifies
OIG that the individual has entered into an agreement to cure the
default, the individual may be eligible for a stay of the effect of
exclusion by OIG for as long as the individual remains in compliance
with the terms of the agreement. If the administrator of the health
education loan, scholarship, or loan repayment program notifies OIG
that there is no longer an outstanding debt, OIG will inform the
individual of the individual's right to apply for reinstatement.
Sec. 1001.1551 Exclusion of individuals with ownership or control
interest in sanctioned entities.
(a) Circumstance for exclusion. OIG may exclude any individual
who--
(1) Has a direct or indirect ownership or control interest in a
sanctioned entity, and who knows or should know (as defined in section
1128A(i)(6) of the Act) of the action constituting the basis for the
conviction or exclusion set forth in paragraph (b) of this section; or
(2) Is an officer or managing employee (as defined in section
1126(b) of the Act) of such an entity.
(b) For purposes of paragraph (a) of this section, the term
``sanctioned entity'' means an entity that--
(1) Has been convicted of any offense described in Sec. Sec.
1001.101 through 1001.401; or
(2) Has been excluded from participation in Medicare or a State
health care program.
(c) Length of exclusion. (1) If the entity has been excluded, the
length of the individual's exclusion will be for the same length as
that of the sanctioned entity, regardless of whether the individual
terminates the relationship with the sanctioned entity.
(2) If the entity was not excluded, the length of the individual's
exclusion will be determined by considering the factors that would have
been considered if the entity had been excluded.
(3) An individual excluded under this section may apply for
reinstatement in accordance with the procedures set forth in Sec.
1001.3001.
Sec. 1001.1552 Making false statements or misrepresentation of
material facts.
(a) Circumstance for exclusion. OIG may exclude any individual or
entity that it determines has knowingly made or caused to be made any
false statement, omission, or misrepresentation of a material fact in
any application, agreement, bid, or contract to participate or enroll
as a provider of services or supplier under a Federal health care
program, including Medicare Advantage organizations under Part C of
Medicare, prescription drug plan sponsors under Part D of Medicare,
Medicaid managed care organizations, and entities that apply to
participate as providers of services or suppliers in such managed care
organizations and such plans.
(b) Definition of ``material.'' For purposes of this section, the
term ``material'' means having a natural tendency to influence or be
capable of influencing the decision to approve or deny the request to
participate or enroll as a provider of services or supplier under a
Federal health care program.
(c) Sources. OIG's determination under paragraph (a) of this
section will be made on the basis of information from the following
sources:
(1) CMS;
(2) Medicaid State agencies;
(3) Fiscal agents or contractors or private insurance companies;
(4) Law enforcement agencies;
(5) State or local licensing or certification authorities;
(6) State or local professional societies; or
(7) Any other sources deemed appropriate by OIG.
(d) Length of exclusion. In determining the length of an exclusion
imposed in accordance with this section, OIG will consider the
following factors:
(1) The nature and circumstances surrounding the false statement;
(2) Whether and to what extent payments were requested or received
from the Federal health care program under the application, agreement,
bid, or contract on which the false statement, omission, or
misrepresentation was made; and
(3) Whether the individual or entity has other documented instances
of criminal, civil, or administrative wrongdoing (the absence of any
such instances is to be considered neutral).
0
9. Add Sec. 1001.1553 to read as follows:
Sec. 1001.1553 Knowingly misclassifying covered outpatient drugs.
(a) Circumstance for exclusion. OIG may exclude any manufacturer
(as defined in section 1927 of the Act), or officer, director, agent,
or managing employee of such manufacturer that:
(1) Knowingly misclassifies a covered outpatient drug;
(2) Knowingly fails to correct such misclassification; or
(3) Knowingly provides false information related to drug pricing,
drug product information, or data related to drug pricing or drug
product information.
(b) This section applies to covered outpatient drugs supplied by
manufacturers under agreements under section 1927 of the Act in effect
on or after April 18, 2019.
(c) Length of exclusion. The following factors will be considered
in determining the length of an exclusion under this section:
(1) The nature and circumstances surrounding the actions that are
the basis for liability, including the period of time over which the
acts occurred, the number of acts, and whether there is evidence of a
pattern;
(2) The degree of culpability;
(3) Whether the entity has other documented instances of criminal,
civil, or administrative wrongdoing (the absence of any such instances
is to be considered neutral); or
(4) Other matters as justice may require.
0
10. Revise and republish Sec. Sec. 1001.1601 and 1001.1701 to read as
follows:
Sec. 1001.1601 Violations of the limitations on physician charges.
(a) Circumstance for exclusion. (1) OIG may exclude a physician
whom it determines--
(i) Is a non-participating physician under section 1842(j) of the
Act;
(ii) Furnished services to a beneficiary;
(iii) Knowingly and willfully billed--
(A) On a repeated basis for such services actual charges in excess
of the maximum allowable actual charge determined in accordance with
section 1842(j)(1)(C) of the Act for the period January 1, 1987 through
December 31, 1990; or
(B) Individuals enrolled under part B of title XVIII of the Act
during the statutory freeze for actual charges in excess of such
physician's actual charges determined in accordance with section
1842(j)(1)(A) of the Act for the period July 1, 1984, to December 31,
1986; and
[[Page 95164]]
(iv) Is not the sole community physician or sole source of
essential specialized services in the community.
(2) OIG will take into account access of beneficiaries to
physicians' services for which Medicare payment may be made in
determining whether to impose an exclusion.
(b) Length of exclusion. (1) In determining the length of an
exclusion in accordance with this section, OIG will consider the
following factors--
(i) The number of services for which the physician billed in excess
of the maximum allowable charges;
(ii) The number of beneficiaries for whom services were billed in
excess of the maximum allowable charges;
(iii) The amount of the charges that were in excess of the maximum
allowable charges; and
(iv) Whether the physician has other documented instances of
criminal, civil, or administrative wrongdoing (the absence of any such
instances is to be considered neutral).
(2) The period of exclusion may not exceed 5 years.
Sec. 1001.1701 Billing for services of assistant at surgery during
cataract operations.
(a) Circumstance for exclusion. OIG may exclude a physician whom it
determines--
(1) Has knowingly and willfully presented or caused to be presented
a claim, or billed an individual enrolled under Part B of the Medicare
program (or the individual's representative) for:
(i) Services of an assistant at surgery during a cataract
operation; or
(ii) Charges that include a charge for an assistant at surgery
during a cataract operation;
(2) Has not obtained prior approval for the use of such assistant
from the appropriate Utilization and Quality Control Quality
Improvement Organization (QIO) or Medicare carrier; and
(3) Is not the sole community physician or sole source of essential
specialized services in the community.
(b) Access to services. OIG will take into account access of
beneficiaries to physicians' services for which Medicare payment may be
made in determining whether to impose an exclusion.
(c) Length of exclusion. (1) In determining the length of an
exclusion in accordance with this section, OIG will consider the
following factors--
(i) The number of instances for which claims were submitted or
beneficiaries were billed for unapproved use of assistants during
cataract operations;
(ii) The amount of the claims or bills presented;
(iii) The circumstances under which the claims or bills were made,
including whether the services were medically necessary;
(iv) Whether approval for the use of an assistant was requested
from the QIO or carrier; and
(v) Whether the physician has other documented instances of
criminal, civil, or administrative wrongdoing (the absence of any such
instances is to be considered neutral).
(2) The period of exclusion may not exceed 5 years.
Subpart D--Waivers and Effect of Exclusion
0
11. Revise and republish Sec. Sec. 1001.1801 and 1001.1901 to read as
follows:
Sec. 1001.1801 Waivers of exclusions.
(a) OIG has the authority to grant or deny a request from the
administrator of a Federal health care program that an exclusion from
that program be waived with respect to an individual or entity, except
that no waiver may be granted with respect to an exclusion under Sec.
1001.101(b). The request must be in writing and from an individual
directly responsible for administering the Federal health care program.
(b) With respect to exclusions under Sec. 1001.101(a), (c), or
(d), a request from a Federal health care program for a waiver of the
exclusion will be considered only if the Federal health care program
administrator determines that--
(1) The individual or entity is the sole community physician or the
sole source of essential specialized services in a community; and
(2) The exclusion would impose a hardship on beneficiaries (as
defined in section 1128A(i)(5) of the Act) of that program.
(c) With respect to exclusions imposed under subpart C of this
part, a request for waiver will only be granted if OIG determines that
imposition of the exclusion would not be in the public interest.
(d) If the basis for the waiver ceases to exist, the waiver will be
rescinded.
(e) In the event a waiver is granted, it is applicable only to the
program(s) for which waiver is requested.
(f) The decision to grant, deny, or rescind a request for a waiver
is not subject to administrative or judicial review.
Sec. 1001.1901 Scope and effect of exclusion.
(a) Scope of exclusion. Exclusions of individuals and entities
under this title will be from all Federal health care programs, as
defined in Sec. 1000.10 of this chapter.
(b) Effect of exclusion on excluded individuals and entities. (1)
Unless and until an individual or entity is reinstated into the Federal
health care programs in accordance with subpart F of this part, no
payment will be made by any Federal health care program for any item or
service furnished, on or after the effective date specified in the
notice--
(i) By an excluded individual or entity; or
(ii) At the medical direction or on the prescription of a physician
or an authorized individual who is excluded when the person furnishing
such item or service knew, or had reason to know, of the exclusion.
(2) This section applies regardless of whether an individual or
entity has obtained a Federal health care program provider number or
equivalent, either as an individual or as a member of a group, prior to
being reinstated.
(3) An excluded individual or entity may not take assignment of an
enrollee's claim on or after the effective date of exclusion.
(4) An excluded individual or entity that submits, or causes to be
submitted, claims for items or services furnished during the exclusion
period is subject to civil money penalty liability under section
1128A(a)(1)(D) of the Act and criminal liability under section
1128B(a)(3) of the Act and other provisions. In addition, submitting
claims, or causing claims to be submitted or payments to be made, for
items or services furnished, ordered, or prescribed, including
administrative and management services or salary, may serve as the
basis for denying reinstatement to the Federal health care programs.
(c) Exceptions to paragraph (b)(1) of this section. (1) If an
enrollee of Part B of Medicare submits an otherwise payable claim for
items or services furnished by an excluded individual or entity, or
under the medical direction or on the prescription of an excluded
physician or other authorized individual after the effective date of
exclusion, CMS will pay the first claim submitted by the enrollee and
immediately notify the enrollee of the exclusion.
(2) CMS will not pay an enrollee for items or services furnished by
an excluded individual or entity, or under the medical direction or on
the prescription of an excluded physician or other authorized
individual more than 15 days after the date on the notice to the
enrollee, or after the effective date of the exclusion, whichever is
later.
(3) Unless the Secretary determines that the health and safety of
[[Page 95165]]
beneficiaries receiving services under any Federal health care program
warrants the exclusion taking effect earlier, payment may be made under
such program for up to 30 days after the effective date of the
exclusion for--
(i) Inpatient institutional services furnished to an individual who
was admitted to an excluded institution before the date of the
exclusion;
(ii) Home health services and hospice care furnished to an
individual under a plan of care established before the effective date
of the exclusion; and
(iii) Any health care items that are ordered by a practitioner,
provider, or supplier from an excluded manufacturer before the
effective date of the exclusion and delivered within 30 days of the
effective date of such exclusion.
(4) CMS will not pay any claims submitted by, or for items or
services ordered or prescribed by, an excluded provider for dates of
service 15 days or more after the notice of the provider's exclusion
was mailed to the supplier.
(5)(i) Notwithstanding the other provisions of this section,
payment may be made under any Federal health care program for certain
emergency items or services furnished by an excluded individual or
entity, or at the medical direction or on the prescription of an
excluded physician or other authorized individual during the period of
exclusion. To be payable, a claim for such emergency items or services
must be accompanied by a sworn statement of the person furnishing the
items or services specifying the nature of the emergency and why the
items or services could not have been furnished by an individual or
entity eligible to furnish or order such items or services.
(ii) Notwithstanding paragraph (c)(5)(i) of this section, no claim
for emergency items or services will be payable if such items or
services were provided by an excluded individual who, through an
employment, contractual or any other arrangement, routinely provides
emergency health care items or services.
Subpart E--Notice and Appeals
0
12. Revise and republish Sec. 1001.2001 to read as follows:
Sec. 1001.2001 Notice of intent to exclude.
(a) Except as provided in paragraph (c) of this section, if OIG
proposes to exclude an individual or entity in accordance with subpart
B or C of this part, it will send written notice of its intent, the
basis for the proposed exclusion, and the potential effect of an
exclusion. Within 30 days of receipt of notice, which will be deemed to
be 7 days after the date on the notice, the individual or entity may
submit documentary evidence and written argument concerning whether the
exclusion is warranted and any related issues.
(b) If OIG intends to exclude an individual or entity under the
provisions of Sec. 1001.701, Sec. 1001.801, or Sec. 1001.1552, in
conjunction with the submission of documentary evidence and written
argument, an individual or entity may request an opportunity to present
oral argument to an OIG official.
(c) Exception. If OIG intends to exclude an individual or entity
under the provisions of Sec. 1001.901, Sec. 1001.951, Sec.
1001.1301, Sec. 1001.1401, Sec. 1001.1601, or Sec. 1001.1701,
paragraph (a) of this section will not apply.
(d) If an entity has a provider agreement under section 1866 of the
Act, and OIG proposes to terminate that agreement in accordance with
section 1866(b)(2)(C) of the Act, the notice provided for in paragraph
(a) of this section will so state.
0
13. Revise and republish Sec. 1001.2004 through 1001.2007 to read as
follows:
Sec.
* * * * *
1001.2004 Notice to State agencies.
1001.2005 Notice to State licensing agencies.
1001.2006 Notice to others regarding exclusion.
1001.2007 Appeal of exclusions.
Sec. 1001.2004 Notice to State agencies.
OIG will promptly notify each appropriate State agency
administering or supervising the administration of each State health
care program of:
(a) The facts and circumstances of each exclusion; and
(b) The period for which the State agency is being directed to
exclude the individual or entity.
Sec. 1001.2005 Notice to State licensing agencies.
(a) OIG will promptly notify the appropriate State(s) or local
agencies or authorities having responsibility for the licensing or
certification of an excluded individual or entity of the facts and
circumstances of the exclusion.
(b) OIG will request that appropriate investigations be made and
sanctions invoked in accordance with applicable State law and policy,
and will request that the State or local agency or authority keep the
Secretary and OIG fully and currently informed with respect to any
actions taken in response to the request.
Sec. 1001.2006 Notice to others regarding exclusion.
(a) OIG will give notice of the exclusion and the effective date to
the public and others via online publication of the List of Excluded
Individuals/Entities (commonly referred to as ``the LEIE'').
(b) In the case of an exclusion under Sec. 1001.101, if section
304(a)(5) of the Controlled Substances Act (21 U.S.C. 824(a)(5))
applies, OIG will give notice to the Attorney General of the United
States of the facts and circumstances of the exclusion and the length
of the exclusion.
Sec. 1001.2007 Appeal of exclusions.
(a)(1) Except as provided in Sec. 1001.2003, an individual or
entity excluded under this part may file a request for a hearing before
an ALJ only on the issues of whether:
(i) The basis for the imposition of the exclusion exists; and
(ii) The length of exclusion is unreasonable.
(2) When OIG imposes an exclusion under subpart B of this part for
a period of 5 years, paragraph (a)(1)(ii) of this section will not
apply.
(3) The request for a hearing shall contain the information set
forth in Sec. 1005.2(d) of this chapter.
(b) The excluded individual or entity has 60 days from the receipt
of notice of exclusion provided for in Sec. 1001.2002 to file a
request for a hearing.
(c) The standard of proof at a hearing is preponderance of the
evidence.
(d) When the exclusion is based on the existence of a criminal
conviction or a civil judgment imposing liability by a Federal, State,
or local court, a determination by another government agency, or any
other prior determination where the facts were adjudicated and a final
decision was made, the basis for the underlying conviction, civil
judgment, or determination is not reviewable and the individual or
entity may not collaterally attack it either on substantive or
procedural grounds in this appeal.
(e) The procedures in part 1005 of this chapter will apply to the
appeal.
0
14. Revise and republish subpart F to read as follows:
Subpart F--Reinstatement Into the Programs
Sec.
1001.3001 Timing and method of request for reinstatement.
1001.3002 Basis for reinstatement.
1001.3003 Approval of request for reinstatement.
1001.3004 Denial of request for reinstatement.
[[Page 95166]]
1001.3005 Withdrawal of exclusion for reversed or vacated decisions.
Subpart F--Reinstatement Into the Programs
Sec. 1001.3001 Timing and method of request for reinstatement.
(a)(1) Except as provided in paragraph (a)(2) of this section or in
Sec. 1001.501(b)(2), Sec. 1001.501(c), or Sec. 1001.601(b)(2), an
excluded individual or entity (other than those excluded in accordance
with Sec. Sec. 1001.1001 and 1001.1501) may submit a written request
for reinstatement to OIG only after the date specified in the notice of
exclusion. Obtaining a Federal health care program provider number or
equivalent does not reinstate eligibility.
(2) An entity excluded under Sec. 1001.1001 may apply for
reinstatement prior to the date specified in the notice of exclusion by
submitting a written request for reinstatement that includes
documentation demonstrating that the standards set forth in Sec.
1001.3002(c) have been met.
(b) Upon receipt of a written request, OIG will require the
requestor to furnish specific information and authorization to obtain
information from private health insurers, peer review bodies, probation
officers, professional associates, investigative agencies, and such
others as may be necessary to determine whether reinstatement should be
granted.
(c) Failure to furnish the required information or authorization
will result in the continuation of the exclusion.
(d) If a period of exclusion is reduced on appeal (regardless of
whether further appeal is pending), the individual or entity may
request reinstatement once the reduced exclusion period expires.
Sec. 1001.3002 Basis for reinstatement.
(a) OIG will authorize reinstatement if it determines that--
(1) The period of exclusion has expired;
(2) There are reasonable assurances that the types of actions that
formed the basis for the original exclusion have not recurred and will
not recur; and
(3) There is no additional basis under sections 1128(a) or (b) or
1128A of the Act for continuation of the exclusion.
(b) In making the reinstatement determination described in
paragraph (a) of this section, OIG will consider--
(1) Conduct of the individual or entity occurring prior to the date
of the notice of exclusion, if not known to OIG at the time of the
exclusion;
(2) Conduct of the individual or entity after the date of the
notice of exclusion;
(3) Whether all fines and all debts due and owing (including
overpayments) to any Federal, State, or local government that relate to
any Federal health care program have been paid or satisfactory
arrangements have been made to fulfill obligations;
(4) Whether CMS has determined that the individual or entity
complies with, or has made satisfactory arrangements to fulfill, all
the applicable conditions of participation or supplier conditions for
coverage under the statutes and regulations;
(5) Whether the individual or entity has, during the period of
exclusion, submitted claims, or caused claims to be submitted or
payment to be made by any Federal health care program, for items or
services the excluded party furnished, ordered, or prescribed,
including health care administrative services. This section applies
regardless of whether an individual or entity has obtained a Federal
health care program provider number or equivalent, either as an
individual or as a member of a group, prior to being reinstated; and
(c) If OIG determines that the criteria in paragraphs (a)(2) and
(3) of this section have been met, an entity excluded in accordance
with Sec. 1001.1001 will be reinstated upon a determination by OIG
that the individual whose conviction, exclusion, or civil money penalty
was the basis for the entity's exclusion--
(1) Has properly reduced the individual's ownership or control
interest in the entity below 5 percent;
(2) Is no longer an officer, director, agent, or managing employee
of the entity; or
(3) Has been reinstated in accordance with paragraph (a) of this
section or Sec. 1001.3005.
(d) Reinstatement will not be effective until OIG grants the
request and provides notice under Sec. 1001.3003(a). Reinstatement
will be effective as provided in the notice.
(e) A determination with respect to reinstatement is not appealable
or reviewable except as provided in Sec. 1001.3004.
(f) An ALJ may not require reinstatement of an individual or entity
in accordance with this chapter.
Sec. 1001.3003 Approval of request for reinstatement.
(a) If OIG grants a request for reinstatement, OIG will--
(1) Give written notice to the excluded individual or entity
specifying the date of reinstatement;
(2) Notify each appropriate State agency administering or
supervising the administration of each State health care program (and,
in the case of an exclusion effected pursuant to Sec. 1001.101 and to
which 21 U.S.C. 824(a)(5) may apply, the Attorney General) of the date
of the individual's or entity's reinstatement; and
(3) Notify the public and others through posting of reinstatement
information on OIG's website.
(b) An action taken by OIG under this section will not require a
Federal health care program to reinstate the individual or entity if
such program has imposed an action under its own authority.
Sec. 1001.3004 Denial of request for reinstatement.
(a) If a request for reinstatement is denied, OIG will give written
notice to the requesting individual or entity that the request for
reinstatement has been denied and the basis for the denial. Within 30
days of the date on the notice, the excluded individual or entity may
submit a written request to appeal the denial of the individual's or
entity's reinstatement. The individual or entity will have 30 days from
the date of the written request to appeal to submit:
(1) Any written argument or additional evidence the individual or
entity has regarding the basis for the denial of reinstatement; or
(2) A written request to present oral argument or any additional
evidence to an OIG official regarding the basis for the denial of
reinstatement.
(b) After evaluating any written argument or additional evidence
submitted by the excluded individual or entity or any oral argument and
additional evidence presented to an OIG official, OIG will send written
notice either confirming the denial and indicating that a subsequent
request for reinstatement will not be considered until at least 1 year
after the date of denial, or approving the request consistent with the
procedures set forth in Sec. 1001.3003(a).
(c) The decision to deny reinstatement will not be subject to
administrative or judicial review.
Sec. 1001.3005 Withdrawal of exclusion for reversed or vacated
decisions.
(a) An exclusion will be withdrawn and an individual or entity will
be reinstated into all Federal health care programs retroactive to the
effective date of the exclusion when such exclusion is based on--
(1) A conviction that is reversed or vacated on appeal;
(2) An action by another agency, such as a State agency or
licensing board, that is reversed or vacated on appeal; or
(3) An OIG exclusion action that is reversed or vacated at any
stage of an individual's or entity's administrative appeal process.
[[Page 95167]]
(b) If an individual or entity is reinstated in accordance with
paragraph (a) of this section, the Federal health care programs will
make payment for services covered under such programs that were
furnished or performed during the period of exclusion.
(c) OIG will give notice of a reinstatement under this section in
accordance with Sec. 1001.3003(a).
(d) An action taken by OIG under this section will not require a
Federal health care program to reinstate the individual or entity if
such program has imposed an exclusion under its own authority.
(e) If an action which results in the retroactive reinstatement of
an individual or entity is subsequently overturned, OIG may reimpose
the exclusion for the initial period of time, less the period of time
that was served prior to the reinstatement of the individual or entity.
Xavier Becerra,
Secretary.
[FR Doc. 2024-26804 Filed 11-29-24; 8:45 am]
BILLING CODE P
</pre></body>
</html>Indexed from Federal Register on December 2, 2024.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.