I. Excluded Employees cost Hospitals $1.64 Million in Penalties

In the past two months, the Health and Human Services, Office of Inspector General (HHS/OIG) has announced the imposition of over $2 million in penalties in cases involving excluded employees.  The total amounted to more than $2 million in Civil Money Penalty (CMP) settlements. Out of these settlements, three hospitals paid a combined share of $1.64 million for employing a total of only five excluded individuals!  

One of these hospitals was located in Massachusetts, and agreed to pay $807,856.65 for employing two individuals that it allegedly knew or should have known were excluded from participation in Federal health care programs. The size of the settlement is also significant in that the hospital turned itself in by participating in the OIG’s self-disclosure program.

II. Other Hospital Settlements

Another hospital settlement included a Texas Medical Center, which paid $545,995.62  after it self-disclosed the employment of a single excluded employee. Also, the OIG imposed $285,683.03 in civil money penalties against an Illinois hospital for employing a single individual that it allegedly knew or should have known was excluded from participation in Federal health care programs.

The size of these settlements may suggest that “direct billers,” such as physicians, could be involved. However, the “Updated Special Advisory Bulletin for the Employment of Excluded Individuals and Entities” of May, 2013, makes clear that any contribution by an excluded employee can create overpayment liability. 

III. Conclusion

Finally, this recent activity may suggest that the OIG is focusing on hospitals, but the sample size is far too small to reach any conclusions. Also, there were several other settlements during the aforementioned time frame against other providers. One certainty is that the recent activity provides ongoing evidence that providers should not risk employing excluded individuals!

 Robert W. Liles, Managing Partner of Liles Parker, LLP and Paul Weidenfeld, CEO of Exclusion Screening, LLC are the Co-Founders of Exclusion Screening. Contact Robert through this link to the Liles Parker website or by phone to (202) 298-8750, or contact Paul at pweidenfeld@www.exclusionscreening.com or 1-800-294-0952 if you have any questions.