HHS Announces Proposed Rule to Enhance Fraud Fighting

On May 9, 2014, the Department of Health and Human Services (HHS) issued a Proposed Rule amending the regulations relating to the Office of Inspector General’s (OIG) exclusion authorities.  The OIG has the ability to exclude providers from participation in Federal healthcare programs for activities related to healthcare fraud, patient abuse, and other activities.  The Proposed Rule would enhance the OIG’s exclusion authority and clarify existing regulatory provisions.

You may comment on this Proposed Rule up until July 8, 2014. The best way to comment is by submitting comments through the Federal eRulemaking Portal at:  www.regulations.gov.  Commenters should reference file code OIG–403–P2.

Summary of the Proposed Rule

The Patient Protection and Affordable Care Act (ACA) significantly expanded the OIG's authority to protect Federal healthcare programs from fraud and abuse. In order to codify the changes made by the ACA, the OIG has proposed changing regulations to allow for exclusions imposed in the following circumstances:

  • Conviction of an offense in connection with obstruction of an audit;
  • Failure to supply payment information (the ACA expanded this provision to apply to individuals who "order, refer for furnishing, or certify the need for" items or services for which payment may be made under Medicare or any State healthcare program); and 
  • Making, or causing to be made, any false statement, omission, or misrepresentation of a material fact in applications to participate as a provider of services or supplier under a Federal healthcare program.

The Proposed Rule would also grant new authority to the OIG to issue testimonial subpoenas in investigations of exclusion cases.  Prior to the ACA, the testimonial subpoena authority was limited to cases where the OIG was pursuing a civil monetary penalty.  

Finally, HHS is proposing a modification to the reinstatement rules for individuals excluded as a result of losing their licenses to allow them to rejoin the programs earlier when appropriate.  Under the Proposed Rule, authorities would have more latitude to reinstate doctors and other professionals banned from Medicare after they’ve been punished by states for misconduct.