UNITED STATES CODE ANNOTATED
TITLE 42. THE PUBLIC HEALTH AND WELFARE
CHAPTER 7--SOCIAL SECURITY
SUBCHAPTER XI--GENERAL PROVISIONS, PEER REVIEW, AND ADMINISTRATIVE
SIMPLIFICATION
PART A--GENERAL PROVISIONS
Current
through P.L. 107-209, approved 8-06-02
(a) Mandatory exclusion
The Secretary shall exclude
the following individuals and entities from participation in any Federal health
care program (as defined in section 1320a- 7b(f) of this title):
(1) Conviction of program-related
crimes
Any individual or entity
that has been convicted of a criminal offense related to the delivery of an
item or service under subchapter XVIII of this chapter or under any State health
care program.
(2) Conviction relating
to patient abuse
Any individual or entity
that has been convicted, under Federal or State law, of a criminal offense relating
to neglect or abuse of patients in connection with the delivery of a health
care item or service.
(3) Felony conviction
relating to health care fraud
Any individual or entity
that has been convicted for an offense which occurred after August 21, 1996,
under Federal or State law, in connection with the delivery of a health care
item or service or with respect to any act or omission in a health care program
(other than those specifically described in paragraph (1)) operated by or financed
in whole or in part by any Federal, State, or local government agency, of a
criminal offense consisting of a felony relating to fraud, theft, embezzlement,
breach of fiduciary responsibility, or other financial misconduct.
(4) Felony conviction
relating to controlled substance
Any individual or entity
that has been convicted for an offense which occurred after August 21, 1996,
under Federal or State law, of a criminal offense consisting of a felony relating
to the unlawful manufacture, distribution, prescription, or dispensing of a
controlled substance.
(b) Permissive exclusion
The Secretary may exclude
the following individuals and entities from participation in any Federal health
care program (as defined in section 1320a- 7b(f) of this title):
(1) Conviction relating
to fraud
Any individual or entity
that has been convicted for an offense which occurred after August 21, 1996,
under Federal or State law-- (2) Conviction relating
to obstruction of an investigation
Any individual or entity
that has been convicted, under Federal or State law, in connection with the
interference with or obstruction of any investigation into any criminal offense
described in paragraph (1) or in subsection (a) of this section.
(3) Misdemeanor conviction
relating to controlled substance
Any individual or entity
that has been convicted, under Federal or State law, of a criminal offense consisting
of a misdemeanor relating to the unlawful manufacture, distribution, prescription,
or dispensing of a controlled substance.
(4) License revocation
or suspension
Any individual or entity-- (5) Exclusion or suspension
under Federal or State health care program
Any individual or entity
which has been suspended or excluded from participation, or otherwise sanctioned,
under-- for reasons bearing on
the individual's or entity's professional competence, professional performance,
or financial integrity.
(6) Claims for excessive
charges or unnecessary services and failure of certain organizations to furnish
medically necessary services
Any individual or entity
that the Secretary determines-- and has failed substantially
to provide medically necessary items and services that are required (under law
or the contract with the State under subchapter XIX of this chapter) to be provided
to individuals covered under that plan or waiver, if the failure has adversely
affected (or has a substantial likelihood of adversely affecting) these individuals;
or (7) Fraud, kickbacks,
and other prohibited activities
Any individual or entity
that the Secretary determines has committed an act which is described in section
1320a-7a, 1320a-7b, or 1320a-8 of this title.
(8) Entities controlled
by a sanctioned individual
Any entity with respect
to which the Secretary determines that a person-- is a person-- (9) Failure to disclose
required information
Any entity that did not
fully and accurately make any disclosure required by section 1320a-3 of this
title, section 1320a-3a of this title, or section 1320a-5 of this title.
(10) Failure to supply
requested information on subcontractors and suppliers
Any disclosing entity
(as defined in section 1320a-3(a)(2) of this title) that fails to supply (within
such period as may be specified by the Secretary in regulations) upon request
specifically addressed to the entity by the Secretary or by the State agency
administering or supervising the administration of a State health care program-- (11) Failure to supply
payment information
Any individual or entity
furnishing items or services for which payment may be made under subchapter
XVIII of this chapter or a State health care program that fails to provide such
information as the Secretary or the appropriate State agency finds necessary
to determine whether such payments are or were due and the amounts thereof,
or has refused to permit such examination of its records by or on behalf of
the Secretary or that agency as may be necessary to verify such information.
(12) Failure to grant
immediate access
Any individual or entity
that fails to grant immediate access, upon reasonable request (as defined by
the Secretary in regulations) to any of the following: (13) Failure to take corrective
action
Any hospital that fails
to comply substantially with a corrective action required under section 1395ww(f)(2)(B)
of this title.
(14) Default on health
education loan or scholarship obligations
Any individual who the
Secretary determines is in default on repayments of scholarship obligations
or loans in connection with health professions education made or secured, in
whole or in part, by the Secretary and with respect to whom the Secretary has
taken all reasonable steps available to the Secretary to secure repayment of
such obligations or loans, except that (A) the Secretary shall not exclude pursuant
to this paragraph a physician who is the sole community physician or sole source
of essential specialized services in a community if a State requests that the
physician not be excluded, and (B) the Secretary shall take into account, in
determining whether to exclude any other physician pursuant to this paragraph,
access of beneficiaries to physician services for which payment may be made
under subchapter XVIII or XIX of this chapter.
(15) Individuals controlling
a sanctioned entity
(A) Any individual-- (c) Notice, effective
date, and period of exclusion
(1) An exclusion under
this section or under section 1320a-7a of this title shall be effective at such
time and upon such reasonable notice to the public and to the individual or
entity excluded as may be specified in regulations consistent with paragraph
(2). until the passage of 30
days after the effective date of the exclusion. (d) Notice to State agencies
and exclusion under State health care programs
(1) Subject to paragraph
(3), the Secretary shall exercise the authority under this section and section
1320a-7a of this title in a manner that results in an individual's or entity's
exclusion from all the programs under subchapter XVIII of this chapter and all
the State health care programs in which the individual or entity may otherwise
participate. (e) Notice to State licensing
agencies
The Secretary shall-- (f) Notice, hearing, and
judicial review
(1) Subject to paragraph
(2), any individual or entity that is excluded (or directed to be excluded)
from participation under this section is entitled to reasonable notice and opportunity
for a hearing thereon by the Secretary to the same extent as is provided in
section 405(b) of this title, and to judicial review of the Secretary's final
decision after such hearing as is provided in section 405(g) of this title,
except that, in so applying such sections and section 405(l) of this title,
any reference therein to the Commissioner of Social Security or the Social Security
Administration shall be considered a reference to the Secretary or the Department
of Health and Human Services, respectively. (g) Application for termination
of exclusion
(1) An individual or entity
excluded (or directed to be excluded) from participation under this section
or section 1320a-7a of this title may apply to the Secretary, in the manner
specified by the Secretary in regulations and at the end of the minimum period
of exclusion provided under subsection (c)(3) of this section and at such other
times as the Secretary may provide, for termination of the exclusion effected
under this section or section 1320a-7a of this title. (h) "State health
care program" defined
For purposes of this section
and sections 1320a-7a and 1320a-7b of this title, the term "State health
care program" means-- (i) "Convicted"
defined
For purposes of subsections
(a) and (b) of this section, an individual or entity is considered to have been
"convicted" of a criminal offense-- (j) Definition of immediate
family member and member of household
For purposes of subsection
(b)(8)(A)(iii) of this section:
(A) of a criminal offense consisting of a misdemeanor relating to fraud, theft,
embezzlement, breach of fiduciary responsibility, or other financial misconduct--
(i) in connection with the delivery of a health care item or service, or
(ii) with respect to any act or omission in a health care program (other than
those specifically described in subsection (a)(1) of this section) operated
by or financed in whole or in part by any Federal, State, or local government
agency; or
(B) of a criminal offense relating to fraud, theft, embezzlement, breach of
fiduciary responsibility, or other financial misconduct with respect to any
act or omission in a program (other than a health care program) operated by
or financed in whole or in part by any Federal, State, or local government agency.
(A) whose license to provide health care has been revoked or suspended by any
State licensing authority, or who otherwise lost such a license or the right
to apply for or renew such a license, for reasons bearing on the individual's
or entity's professional competence, professional performance, or financial
integrity, or
(B) who surrendered such a license while a formal disciplinary proceeding was
pending before such an authority and the proceeding concerned the individual's
or entity's professional competence, professional performance, or financial
integrity.
(A) any Federal Program, including programs of the Department of Defense or
the Department of Veterans Affairs, involving the provision of health care,
or
(B) a State health care program,
(A) has submitted or caused to be submitted bills or requests for payment (where
such bills or requests are based on charges or cost) under subchapter XVIII
of this chapter or a State health care program containing charges (or, in applicable
cases, requests for payment of costs) for items or services furnished substantially
in excess of such individual's or entity's usual charges (or, in applicable
cases, substantially in excess of such individual's or entity's costs) for such
items or services, unless the Secretary finds there is good cause for such bills
or requests containing such charges or costs;
(B) has furnished or caused to be furnished items or services to patients (whether
or not eligible for benefits under subchapter XVIII of this chapter or under
a State health care program) substantially in excess of the needs of such patients
or of a quality which fails to meet professionally recognized standards of health
care;
(C) is--
(i) a health maintenance organization (as defined in section 1396b(m) of this
title) providing items and services under a State plan approved under subchapter
XIX of this chapter, or
(ii) an entity furnishing services under a waiver approved under section 1396n(b)(1)
of this title,
(D) is an entity providing items and services as an eligible organization under
a risk-sharing contract under section 1395mm of this title and has failed substantially
to provide medically necessary items and services that are required (under law
or such contract) to be provided to individuals covered under the risk-sharing
contract, if the failure has adversely affected (or has a substantial likelihood
of adversely affecting) these individuals.
(A)(i) who has a direct or indirect ownership or control interest of 5 percent
or more in the entity or with an ownership or control interest (as defined in
section 1320a-3(a)(3) of this title) in that entity,
(ii) who is an officer, director, agent, or managing employee (as defined in
section 1320a-5(b) of this title) of that entity; or
(iii) who was described in clause (i) but is no longer so described because
of a transfer of ownership or control interest, in anticipation of (or following)
a conviction, assessment, or exclusion described in subparagraph (B) against
the person, to an immediate family member (as defined in subsection (j)(1) of
this section) or a member of the household of the person (as defined in subsection
(j)(2) of this section) who continues to maintain an interest described in such
clause--
(B)(i) who has been convicted of any offense described in subsection (a) of
this section or in paragraph (1), (2), or (3) of this subsection;
(ii) against whom a civil monetary penalty has been assessed under section 1320a-7a
of this title or 1320a-8 of this title; or
(iii) who has been excluded from participation under a program under subchapter
XVIII of this chapter or under a State health care program.
(A) full and complete information as to the ownership of a subcontractor (as
defined by the Secretary in regulations) with whom the entity has had, during
the previous 12 months, business transactions in an aggregate amount in excess
of $25,000, or
(B) full and complete information as to any significant business transactions
(as defined by the Secretary in regulations), occurring during the five-year
period ending on the date of such request, between the entity and any wholly
owned supplier or between the entity and any subcontractor.
(A) To the Secretary, or to the agency used by the Secretary, for the purpose
specified in the first sentence of section 1395aa(a) of this title (relating
to compliance with conditions of participation or payment).
(B) To the Secretary or the State agency, to perform the reviews and surveys
required under State plans under paragraphs (26), (31), and (33) of section
1396a(a) of this title and under section 1396b(g) of this title.
(C) To the Inspector General of the Department of Health and Human Services,
for the purpose of reviewing records, documents, and other data necessary to
the performance of the statutory functions of the Inspector General.
(D) To a State medicaid fraud control unit (as defined in section 1396b(q) of
this title), for the purpose of conducting activities described in that section.
(i) who has a direct or indirect ownership or control interest in a sanctioned
entity and who knows or should know (as defined in section 1320a- 7a(i)(6) [FN1]
of this title) of the action constituting the basis for the conviction or exclusion
described in subparagraph (B); or
(ii) who is an officer or managing employee (as defined in section 1320a- 5(b)
of this title) of such an entity.
(B) For purposes of subparagraph (A), the term "sanctioned entity"
means an entity--
(i) that has been convicted of any offense described in subsection (a) of this
section or in paragraph (1), (2), or (3) of this subsection; or
(ii) that has been excluded from participation under a program under subchapter
XVIII of this chapter or under a State health care program.
(2)(A) Except as provided in subparagraph (B), such an exclusion shall be effective
with respect to services furnished to an individual on or after the effective
date of the exclusion.
(B) Unless the Secretary determines that the health and safety of individuals
receiving services warrants the exclusion taking effect earlier, an exclusion
shall not apply to payments made under subchapter XVIII of this chapter or under
a State health care program for--
(i) inpatient institutional services furnished to an individual who was admitted
to such institution before the date of the exclusion, or
(ii) home health services and hospice care furnished to an individual under
a plan of care established before the date of the exclusion,
(3)(A) The Secretary shall specify, in the notice of exclusion under paragraph
(1) and the written notice under section 1320a-7a of this title, the minimum
period (or, in the case of an exclusion of an individual under subsection (b)(12)
of this section or in the case described in subparagraph (G), the period) of
the exclusion.
(B) Subject to subparagraph (G), in the case of an exclusion under subsection
(a) of this section, the minimum period of exclusion shall be not less than
five years, except that, upon the request of a State, the Secretary may waive
the exclusion under subsection (a)(1) of this section in the case of an individual
or entity that is the sole community physician or sole source of essential specialized
services in a community. The Secretary's decision whether to waive the exclusion
shall not be reviewable.
(C) In the case of an exclusion of an individual under subsection (b)(12) of
this section, the period of the exclusion shall be equal to the sum of--
(i) the length of the period in which the individual failed to grant the immediate
access described in that subsection, and
(ii) an additional period, not to exceed 90 days, set by the Secretary.
(D) Subject to subparagraph (G), in the case of an exclusion of an individual
or entity under paragraph (1), (2), or (3) of subsection (b) of this section,
the period of the exclusion shall be 3 years, unless the Secretary determines
in accordance with published regulations that a shorter period is appropriate
because of mitigating circumstances or that a longer period is appropriate because
of aggravating circumstances.
(E) In the case of an exclusion of an individual or entity under subsection
(b)(4) or (b)(5) of this section, the period of the exclusion shall not be less
than the period during which the individual's or entity's license to provide
health care is revoked, suspended, or surrendered, or the individual or the
entity is excluded or suspended from a Federal or State health care program.
(F) In the case of an exclusion of an individual or entity under subsection
(b)(6)(B) of this section, the period of the exclusion shall be not less than
1 year.
(G) In the case of an exclusion of an individual under subsection (a) of this
section based on a conviction occurring on or after August 5, 1997, if the individual
has (before, on, or after August 5, 1997) been convicted--
(i) on one previous occasion of one or more offenses for which an exclusion
may be effected under such subsection, the period of the exclusion shall be
not less than 10 years, or
(ii) on 2 or more previous occasions of one or more offenses for which an exclusion
may be effected under such subsection, the period of the exclusion shall be
permanent.
(2) The Secretary shall promptly notify each appropriate State agency administering
or supervising the administration of each State health care program (and, in
the case of an exclusion effected pursuant to subsection (a) of this section
and to which section 824(a)(5) of Title 21 may apply, the Attorney General)--
(A) of the fact and circumstances of each exclusion effected against an individual
or entity under this section or section 1320a-7a of this title, and
(B) of the period (described in paragraph (3)) for which the State agency is
directed to exclude the individual or entity from participation in the State
health care program.
(3)(A) Except as provided in subparagraph (B), the period of the exclusion under
a State health care program under paragraph (2) shall be the same as any period
of exclusion under subchapter XVIII of this chapter.
(B)(i) The Secretary may waive an individual's or entity's exclusion under a
State health care program under paragraph (2) if the Secretary receives and
approves a request for the waiver with respect to the individual or entity from
the State agency administering or supervising the administration of the program.
(ii) A State health care program may provide for a period of exclusion which
is longer than the period of exclusion under subchapter XVIII of this chapter.
(1) promptly notify the appropriate State or local agency or authority having
responsibility for the licensing or certification of an individual or entity
excluded (or directed to be excluded) from participation under this section
or section 1320a-7a of this title, of the fact and circumstances of the exclusion,
(2) request that appropriate investigations be made and sanctions invoked in
accordance with applicable State law and policy, and
(3) request that the State or local agency or authority keep the Secretary and
the Inspector General of the Department of Health and Human Services fully and
currently informed with respect to any actions taken in response to the request.
(2) Unless the Secretary determines that the health or safety of individuals
receiving services warrants the exclusion taking effect earlier, any individual
or entity that is the subject of an adverse determination under subsection (b)(7)
of this section shall be entitled to a hearing by an administrative law judge
(as provided under section 405(b) of this title) on the determination under
subsection (b)(7) of this section before any exclusion based upon the determination
takes effect.
(3) The provisions of section 405(h) of this title shall apply with respect
to this section and sections 1320a-7a, 1320a-8, and 1320c-5 of this title to
the same extent as it is applicable with respect to subchapter II of this chapter,
except that, in so applying such section and section 405(l) of this title, any
reference therein to the Commissioner of Social Security shall be considered
a reference to the Secretary.
(2) The Secretary may terminate the exclusion if the Secretary determines, on
the basis of the conduct of the applicant which occurred after the date of the
notice of exclusion or which was unknown to the Secretary at the time of the
exclusion, that--
(A) there is no basis under subsection (a) or (b) of this section or section
1320a-7a(a) of this title for a continuation of the exclusion, and
(B) there are reasonable assurances that the types of actions which formed the
basis for the original exclusion have not recurred and will not recur.
(3) The Secretary shall promptly notify each appropriate State agency administering
or supervising the administration of each State health care program (and, in
the case of an exclusion effected pursuant to subsection (a) of this section
and to which section 824(a)(5) of Title 21 may apply, the Attorney General)
of the fact and circumstances of each termination of exclusion made under this
subsection.
(1) a State plan approved under subchapter XIX of this chapter,
(2) any program receiving funds under subchapter V of this chapter or from an
allotment to a State under such subchapter,
(3) any program receiving funds under subchapter XX of this chapter or from
an allotment to a State under such subchapter, or
(4) a State child health plan approved under subchapter XXI of this chapter.
(1) when a judgment of conviction has been entered against the individual or
entity by a Federal, State, or local court, regardless of whether there is an
appeal pending or whether the judgment of conviction or other record relating
to criminal conduct has been expunged;
(2) when there has been a finding of guilt against the individual or entity
by a Federal, State, or local court;
(3) when a plea of guilty or nolo contendere by the individual or entity has
been accepted by a Federal, State, or local court; or
(4) when the individual or entity has entered into participation in a first
offender, deferred adjudication, or other arrangement or program where judgment
of conviction has been withheld.
(1) The term "immediate family member" means, with respect to a person--
(A) the husband or wife of the person;
(B) the natural or adoptive parent, child, or sibling of the person;
(C) the stepparent, stepchild, stepbrother, or stepsister of the person;
(D) the father-, mother-, daughter-, son-, brother-, or sister-in-law of the
person;
(E) the grandparent or grandchild of the person; and
(F) the spouse of a grandparent or grandchild of the person.
(2) The term "member of the household" means, with respect to any
person, any individual sharing a common abode as part of a single family unit
with the person, including domestic employees and others who live together as
a family unit, but not including a roomer or boarder.