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Why EMS agencies need to check the List of Excluded Individuals and Entities

An EMS agency’s failure to routinely check the Office of Inspector General’s List of Excluded Individuals and Entities can be costly


A section of the Social Security Act authorizes the Office of the Inspector General (OIG) to exclude from participating in federal health care programs, such as Medicare, Medicaid, and TRICARE, individuals and entities (hereafter “persons”) who engage in conduct described in that statute, including various types of convictions, licensure actions, and several other types of misconduct.  

For example, consider the case of an EMS agency that hired an individual with a nursing license to bill ambulance trips for reimbursement. That license was later revoked. The OIG acted months later to exclude the individual from participating in federal health care programs and listed the exclusion on its List of Excluded Individuals and Entities (LEIE).

After listing, the individual continued to bill ambulance service claims for the EMS agency, including claims for reimbursement from federal health care programs. Notwithstanding that the individual did not perform any nursing services for the EMS agency, the agency will be subject to a civil money penalty calculated from the date the individual’s name appeared in the LEIE.

Civil money penalties may be imposed against an EMS agency that employs or contracts with an excluded person

More troublesome for an EMS agency, another federal statute, commonly referred to as the Civil Monetary Penalties Law (CMPL), provides for civil money penalties to be assessed against a provider (government agencies included) who employs or contracts with an excluded person who the provider knew or should have known was excluded from participation. Those penalties may be imposed on the provider if that excluded person performs work for it that is linked to services for which the provider receives federal health care program reimbursement.

Under the CMPL an EMS agency may incur a civil money penalty not only if it employs or contracts with an excluded person who furnishes for it a service for which the agency receives federal health care program reimbursement, but also if it employs or contracts with an excluded person who performs work for it that is in some other manner connected to that service. This was spelled out in the Updated Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs published by the OIG in May 2013.

The OIG states that if a provider is reimbursed for services by a federal health care program, a civil money penalty may be imposed against the provider if the excluded person serves it in an executive or leadership role. The OIG further advises that a civil money penalty may be imposed against the provider if an excluded person performs administrative or management services for it unless those services are completely unrelated to services paid by a federal health care program.

Health information technology services, strategic planning, billing and accounting, staff training, and human resources services are listed as examples of services that would subject the provider to civil money penalties if provided by an excluded person unless that work was isolated from the service for which the provider receives federal health care program payment. Achieving that separation is a hard thing to do when Medicare patients are such a high percentage of EMS patients.

The OIG’s position is that if a person is listed on the LEIE a provider should know that the person is excluded

The LEIE contains OIG federal health care program exclusion information and can be found on the OIG website.

There is no legal requirement that an EMS agency check the LEIE before employing or contracting with a person, or that it routinely check the LEIE for exclusions of its employees and contractors. However, an EMS agency that does not do so has made an unwise decision, because if the person is listed on the LEIE the agency will be subject to civil money penalties if the person performs work for it directly or indirectly reimbursed with federal health care program money. In some cases the EMS agency will also need to deal with overpayments made to the agency.

Federal health care program payment is prohibited for any service an excluded person participates in furnishing

EMS agencies should know that federal health care program payment is prohibited for services furnished for a provider by an excluded person. This is because, by virtue of the exclusion, that person is not “qualified” to provide that service. So, if an EMS agency employs an excluded individual as an EMT, paramedic or ambulance driver, and it receives payment from a federal health care program for ambulance transports in which that individual participates, the EMS agency must treat each of those payments as an overpayment.

The pros and cons of using the OIG Self-Disclosure Protocol to report the CMPL violation

If an EMS agency determines that it has employed or contracted with an excluded person in a manner that may violate the CMPL, it should immediately contact legal counsel knowledgeable about this law. One option available to the EMS agency, which should only be taken after consulting legal counsel, is to self-report the violation to the OIG using the OIG’s Provider Self-Disclosure Protocol (SDP). There are pros and cons to doing so.

The first con is reporting through the SDP does not guarantee that the EMS agency will be accepted into the SDP Program. The OIG has the discretion to accept or reject the applicant into the program.

If it accepts the agency, and is satisfied with the information the agency has provided, including the agency’s calculation of damages, the OIG will offer a settlement to the agency which will require the agency to pay to the U.S. Department of Health and Human Services the damages times a multiplier. Except in extraordinary cases, the multiplier is 1.5.  

Of course another con is that the EMS agency is reporting to the OIG that it believes it has violated the CMPL. This is an SDP requirement. The OIG will evaluate the reported information and, if it believes the information presents a potential civil or criminal matter, it will coordinate with the Department of Justice.

On the other hand, there are also significant pros or benefits to using the SDP. One upside is that if the exclusion resulted in the EMS agency receiving overpayments, the 60-day time period for refunding overpayments is tolled when the OIG acknowledges receipt of the self-disclosure. If the EMS agency is accepted into the program and a settlement is reached, upon payment of the agreed upon amount the OIG will release the agency from liability under the CMPL and from its overpayment refund obligations.

Of course, those overpayments will be included in the calculation of damages. Additionally, reporting of the exclusion and associated overpayments through the SDP may, in some cases, provide protection from qui tam (whistleblower) suits filed thereafter.

Another benefit if a settlement is reached is that the EMS agency will likely not be required to admit wrongdoing in the settlement agreement. Still another likely benefit is that the OIG will release the EMS agency from any right the OIG may otherwise have to permissively exclude the agency from participating in federal health care programs for conduct covered by the agreement, and do so without requiring the agency to agree to a corporate integrity agreement.

One additional possible benefit to using the SDP is that if the EMS agency asserts and establishes that it does not have the financial ability to pay the damages times the multiplier, the OIG may agree to payment of a reduced amount, or terms of payment that are more lenient than that customarily accepted by the OIG.

Steps to avoid employing or contracting with excluded persons

The choice of dealing with a violation of the CMPL by using the SDP or by handling the violation in another manner is not a choice an EMS agency wants to be forced to make. An EMS agency needs to do its utmost to avoid employing or contracting with an excluded person to perform work for it that would expose it to civil money penalties and possible other adverse consequences.

So, the most prudent course of action for an EMS agency to take is to check the LEIE before making a decision to employ or contract with a person, and to routinely check its employees and contractors against the LEIE, perhaps monthly, as the LEIE is updated monthly. Doing so will maximize the EMS agency’s ability to prevent its impermissible use of excluded persons and the costly consequences of such use.

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