Managing a home health or hospice agency involves navigating a maze of regulations to ensure compliance, quality patient care, and operational efficiency.
Two critical compliance tools used by federal agencies are the CMS Preclusion List and the OIG Exclusion List. These lists might seem similar on the surface, but they have distinct implications for your agency’s operations, financial health, and reputation.
What are these lists, and how do they differ? More importantly, what steps can you take to avoid appearing on either of them?
At The Home Health Consultant, we’ve guided many agencies through complex Medicare regulations, including how you can avoid getting on these lists.
This article dives into the key distinctions between the CMS Preclusion List and the OIG Exclusion List, clarifying their respective purposes, the consequences of being listed, and strategies for prevention. By the end, you’ll understand:
- The differences between the CMS Preclusion List and the OIG Exclusion List.
- The specific implications of being listed on either.
- How to safeguard your agency against these risks.
What Is the CMS Preclusion List?
The CMS Preclusion List is a federal database of providers, suppliers, and prescribers barred from receiving payments through Medicare Advantage (MA) and Medicare Part D. Established in 2019, it enables CMS to swiftly identify and exclude problematic providers.
The preclusion list is primarily intended for Part D sponsors and Medicare Advantage organizations. It guides insurers by identifying problematic prescribers and companies, and directing them not to work with those on the list. Agencies cannot access the CMS preclusion list directly, but they will receive a notification letter from CMS if they are placed on it.
Agencies may find themselves on this list due to Medicare revocations resulting from conduct deemed harmful to the program. Placement on this list can have devastating consequences for agencies.
These include:
- the loss of Medicare Advantage and Part D payments
- significant damage to the agency’s reputation
- financial strain that could lead to closure
Agencies excluded from receiving payments under these programs often struggle to sustain operations.
What is the OIG List and How Does It Differ From the CMS Preclusion List?
The OIG Exclusion List, managed by the Office of Inspector General, is broader in scope than the CMS Preclusion List. It excludes individuals and entities from participating in any federal health care programs for 1-10 years, depending on the severity of the offense. This includes Medicare and Medicaid.
Reasons for placement on the OIG Exclusion List include
- Criminal convictions related to Medicare or Medicaid fraud
- Patient abuse
- Other health care-related felonies
- Loss or surrender of licenses due to major failed compliance
The implications for agencies placed on the OIG Exclusion List are severe. Agencies and individuals are barred from receiving payments from all federal healthcare programs, or working with any companies that do receive these payments, depending to the severity of the infractions. Employing excluded individuals can result in substantial civil monetary penalties. These combined factors can make continued operation of the agency virtually impossible.
How Do Home Health and Hospice Agencies Get Placed on the OIG or CMS Preclusion Lists?
Understanding the reasons behind placement on the CMS Preclusion List and OIG Exclusion List is crucial for preventing your agency from facing these regulatory consequences.
Each list has specific criteria and processes that determine inclusion, with overlapping and unique aspects for each.
How Agencies Get Placed on the CMS Preclusion List
Prescribers are placed on the CMS Preclusion List when they are deemed by CMS to pose a risk to the Medicare Advantage (MA) and Part D programs. Common reasons include:
- Medicare Revocation and Reenrollment Bar: Your agency’s Medicare billing privileges can be revoked due to conduct harmful to the Medicare program. In this case, CMS may include the agency on the Preclusion List.
The duration aligns with the reenrollment bar, typically ranging from 1 to 10 years. Not all revocations result in placement on the preclusion list. For example, 6 consecutive months of non-billing can result in Medicare billing revocation without the prescriber or agency being placed on the CMS Preclusion List. - Behavior Warranting Revocation: CMS may place a prescriber/organization on the list even if the agency is not actively enrolled in Medicare. This can happen if you engaged in behaviors that would warrant revocation if they were enrolled.
- Felony Convictions: Prescribers and companies are automatically placed on the Preclusion List if they or key stakeholders have been convicted of felonies within the past 10 years. Specifically felonies that CMS considers detrimental to the integrity of Medicare. Examples include health care fraud, financial crimes, sexual crimes or patient abuse.
Once an entity is identified for preclusion, CMS notifies the entity, and they have a limited window to appeal. However, exclusion often stems from clear evidence of non-compliance, making appeals challenging.
How Agencies Get Placed on the OIG Exclusion List
The OIG Exclusion List encompasses a wider range of violations and impacts all federal healthcare programs. Not just Medicare Advantage and Part D. Agencies and individuals working with Medicare are placed on this list for reasons including:
- Criminal Convictions Related to Federal Health Care Programs: The most common cause of exclusion is a conviction for Medicare or Medicaid fraud. Other offenses, such as patient abuse or neglect, can also lead to exclusion.
- License Revocations or Surrender: Agencies or individuals who lose or surrender their licenses due to gross professional misconduct, negligence, or regulatory non-compliance may be excluded by the OIG.
- Non-Compliance with Medicare or Medicaid Program Requirements: Serious or repeated failures to meet participation standards. This could include improper billing, providing substandard care, or non-cooperation with audits.
- Fraudulent or Abusive Practices: Engaging in activities that violate the integrity of federal health care programs. This could be falsifying records or overbilling.
Once the OIG identifies an agency or individual for exclusion, the entity is notified and given an opportunity to appeal or provide mitigating evidence. However, exclusions resulting from mandatory offenses, such as criminal convictions, leave little room for negotiation.
How Long Do Agencies Stay on the CMS Preclusion List or OIG Exclusion List?
The duration of placement on the CMS Preclusion List depends on the reason for inclusion. Agencies facing Medicare revocation typically remain on the list for the same length of time as their reenrollment bar. This can range from one to ten years.
Felony convictions generally result in a default ten-year placement. However, CMS may adjust this based on the circumstances.
For the OIG Exclusion List, the duration could be for a specified period, such as five years, or indefinite depending on the severity of the offense.
While getting off of these lists is possible, it is incredibly difficult. Removal requires diligence, corrective actions, and clear evidence of compliance.
However, despite their best efforts, many agencies and individuals are not successful in getting off of the list. So, prevention is your best defense.
How to Avoid Being Placed on the CMS Preclusion List
Preventing placement on the CMS Preclusion List demands proactive compliance management. Agencies must audit their compliance with Medicare Conditions of Participation (CoPs) regularly and address deficiencies promptly.
Staff and contractors should be thoroughly vetted. Background checks, OIG checks and credential verifications should be conducted before hiring and annually after. Ongoing compliance training is also essential to ensure staff are aware of regulatory changes and billing accuracy standards.
How to Avoid Exclusion from Federal Health Care Programs by the OIG
To avoid placement on the OIG Exclusion List, agencies must monitor employees and contractors to ensure they are not excluded individuals. Licensure compliance is critical, as disciplinary actions or unresolved revocations can trigger exclusion.
Agencies should also establish robust internal controls to prevent fraudulent or abusive practices and cooperate fully with any OIG investigations or audits.
What Happens If Your Agency Is on the CMS Preclusion List or OIG Exclusion List?
Both lists pose significant risks to agencies, but the scope of their impacts differs. Agencies on the CMS Preclusion List lose payments only from Medicare Advantage and Part D.
In contrast, placement on the OIG Exclusion List results in a total loss of federal health care program payments. This broader exclusion can make it nearly impossible for agencies to sustain operations, especially in cases where federal payments constitute a substantial portion of revenue. State licensing authorities typically will revoke licensure based on the OIG Exclusion list as well.
How to Keep Your Home Health or Hospice Agency Off Preclusion and Exclusion Lists
Protecting your agency from both lists starts with consistent monitoring and documentation. Set up an annual screening routine where you check all employees, contractors, and vendors against the OIG database.
Make this a fixed part of your schedule, just like payroll or billing. Create a simple spreadsheet to track your screenings and set calendar reminders to ensure nothing falls through the cracks.
Your documentation and billing practices form your next line of defense. Make sure every visit note includes detailed care descriptions, accurate times, and required signatures. Monitor for, and report any identified overpayments to Medicare immediately through the Medicare Credit Balance Reporting Process.
Build a strong compliance culture through regular staff training and clear policies. Staying up to date with required inservices is half the battle. Designate a compliance officer who stays updated on Medicare regulations and handles any concerns. You can also seek the help of a compliance consultant. These professionals can help identify any processes or individuals that create a vulnerability in your company.
Lastly, have a “0 Tolerance” policy for fraud, waste and abuse. There’s a good reason the penalties for being on the OIG list are so severe—crime has no place in home health or hospice care.
Your staff should know exactly what to do if they spot a potential issue, and you should have a clear process for investigating and resolving compliance concerns. Remember, it's much easier to prevent problems than to fix them later.
Why Home Health and Hospice Agencies Need a Compliance Plan to Stay Off Preclusion Lists
While the CMS Preclusion List and the OIG Exclusion List serve different purposes, both have the potential to significantly disrupt home health and hospice agencies, and the lives of shareholders and key staff members. Understanding the distinctions between these lists, as well as the steps to avoid and address placement, is critical to protecting your agency.
A proactive, compliance-focused approach will not only safeguard your operations but also build a strong foundation for long-term success.
At The Home Health Consultant, we offer structured administrative compliance program. To read more about our program, check out our article explaining Our Solution to Administrative Compliance.
Agencies that invest in preventative measures, ongoing education, and expert guidance are better equipped to navigate these regulatory challenges confidently.
*This article was written in consultation with Mariam Treystman.
Disclaimer: The content provided in this article is not intended to be, nor should it be construed as, legal, financial, or professional advice. No consultant-client relationship is established by engaging with this content. You should seek the advice of a qualified attorney, financial advisor, or other professional regarding any legal or business matters. The consultant assumes no liability for any actions taken based on the information provided.
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