Exclusions

i-prescriptiondrugThe sanction/penalty which is of most concern to many health care practitioners and providers is exclusion from billing Medicare and Medicaid for services or items furnished by the practitioner/provider.

A health care provider who is excluded cannot bill Medicare, Medicaid or any other Federal health care program, either directly or indirectly, for services or items furnished by the provider.

The effect of an exclusion is that no Medicare,  Medicaid or other federal health care program payment may be made for any items or services furnished

(1) by an excluded person

(2) at the medical direction or on the prescription of an excluded person

(3) by a business entity which employs an excluded person or in which the excluded person plays a managerial or other executive role or

(4) by a business entity in which the excluded person (or specified  or household member) has an ownership interest of 5% or more in the entity

Thus, services or items furnished by an excluded person cannot be billed directly, using the provider number of the excluded person, or indirectly, using the provider number of the non-excluded person or entity which employs or contracts with the excluded person. This payment prohibition applies to all methods of Federal health care program payment, including itemized claims or bundled payments.

There are two types of program exclusions: mandatory and permissive. The list of mandatory and permissive exclusions can be found at 42 U.S.C. § 1320a-7.