From the Contributor’s Corner: Medicaid Sanction Screening

“To obtain/maintain active enrollment status, providers may not employ or contract with individuals/entities excluded from participation in any federal health care program or debarred by the GSA from any other executive branch program or activity”.[1]

This means that Medicare and Medicaid payments are prohibited for all items and services furnished by excluded persons and entities.  In order for providers to enroll or maintain active enrollment status, they may not employ or contract with individuals/entities excluded from participation in any federal health care program or debarred by the GSA.

State Medicaid agencies must report final actions against providers that affect their participation in the Medicaid program promptly to Office of Inspector General (OIG). The OIG then determines whether to exclude the provider based on federal criteria for exclusion and includes the individual/entity on the OIG List of Excluded Individuals and Entities (LEIE).  Unfortunately all parties excluded by states may not appear on the LEIE.  In a study of state reporting conducted by the OIG, the office found that many were not sending their sanction information to the OIG.   The OIG noted that two-thirds of providers with final actions imposed by state agencies were not included on the LEIE. The majority of states even had a match rate of less than twenty-five percent.  The response from most of the states was that this was due to uncertainty about when to notify the OIG of such final actions and what kind of information to provide. I believe this is just an excuse.

Meanwhile the Centers for Medicare & Medicaid Services (CMS) has been taking action to ensure providers and programs are screening for Medicaid exclusions.  Beginning in 2008, they have been sending letters to the State Medicaid Directors to give them guidance on their interpretation of the regulations as they relate to sanctioned and excluded individuals/entities.   It called for State Medicaid Directors to mandate monthly checking of their enrolled providers for exclusions.  CMS also stated the states should advise providers upon enrollment and re-enrollment of their obligation to screen all employees and contractors against the OIG LEIE monthly and explicitly require providers to agree to comply with this obligation as a condition of enrollment.

At this urging by CMS, states are moving to develop and maintain their own Medicaid exclusion lists, followed by mandates for providers to screen against them on a monthly basis.  This movement has been slow and steady.

In response to CMS, nearly half of the states have moved to develop their own sanction and exclusion databases, along with statutes and regulations mandating monthly screening.[2]  It is reasonable to assume that this trend will continue and that eventually all states will be doing this.  In addition to the development of state Medicaid exclusion lists, more and more states are also following the CMS guidance that calls for monthly screening of the database. Most of those that have gone this route have published those lists on their websites, but not all.  As such, it may be necessary to contact the state Medicaid agency or health department directly in order to access the necessary information.

The following are suggestions and best practices for providers when it comes to meeting sanction screening obligations:

  1. It is mandatory to screen against the LEIE; therefore, screen in advance of hiring or engaging any individual or entity, as well as granting staff privilege to physicians.  Thereafter it is advisable to screen all affected parties at least annually, but if possible monthly.
  2. Check with the state jurisdictions where a provider does business for any Medicaid sanction screening mandates.  Note that states are moving to follow CMS guidance for monthly screening.
  3. If the state requires monthly screening, then it is advisable to consider screening against the LEIE as often.
  4. The OIG suggests also screening affected parties against the GSA debarment list, formerly called the EPLS, now SAM.  CMS more directly says this should be done.  However, neither the OIG nor CMS state the frequency with which this should be done.  I strongly recommend doing this only at the time of engagement of a vendor, contractor, physician, or employee and thereafter only annually.  GSA’s debarment list program has been fraught with technical deficiencies, flaws, and security breaches. In my opinion, screening more often is unnecessary and a waste of time and resources.

[1] (42 CFR 424.516)

[2]Alabama, Arkansas, California, Connecticut, Florida, Hawaii, Idaho, Illinois, Kentucky, Maine, Maryland, Michigan, Mississippi, Nebraska, Nevada, New Jersey, New York, South Carolina, Texas, and West Virginia

Richard P. Kusserow served 11 years as the DHHS Inspector General and currently is CEO of the Compliance Resource Center (CRC).  CRC includes Sanction Screening Services (S³), which provides sanction screening tools and also provides full outsourcing of sanction screening. For more information, he can be contacted at

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Copyright © 2013 Strategic Management Services, LLC.  Published with permission.