[Code of Federal Regulations]

[Title 42, Volume 4]

[Revised as of October 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 42CFR1001.801]



[Page 1130-1131]

 

                         TITLE 42--PUBLIC HEALTH

 

      GENERAL--HEALTH CARE, DEPARTMENT OF HEALTH AND HUMAN SERVICES

 

PART 1001_PROGRAM INTEGRITY_MEDICARE AND STATE HEALTH CARE PROGRAMS--

 

                     Subpart C_Permissive Exclusions

 

Sec.  1001.801  Failure of HMOs and CMPs to furnish medically necessary



items and services.



    (a) Circumstances for exclusion. The OIG may exclude an entity--

    (1) That is a--

    (i) Health maintenance organization (HMO), as defined in section 

1903(m) of the Act, providing items or services under a State Medicaid 

Plan;

    (ii) Primary care case management system providing services, in 

accordance with a waiver approved under section 1915(b)(1) of the Act; 

or

    (iii) HMO or competitive medical plan providing items or services in 

accordance with a risk-sharing contract under section 1876 of the Act;



[[Page 1131]]



    (2) That has failed substantially to provide medically necessary 

items and services that are required under a plan, waiver or contract 

described in paragraph (a)(1) of this section to be provided to 

individuals covered by such plan, waiver or contract; and

    (3) Where such failure has adversely affected or has a substantial 

likelihood of adversely affecting covered individuals.

    (b) The OIG's determination under paragraph (a)(2) of this section--

that the medically necessary items and services required under law or 

contract were not provided--will be made on the basis of information, 

including sanction reports, from the following sources:

    (1) The QIO or other quality assurance organization under contract 

with a State Medicaid plan for the area served by the HMO or competitive 

medical plan;

    (2) State or local licensing or certification authorities;

    (3) Fiscal agents or contractors, or private insurance companies;

    (4) State or local professional societies;

    (5) CMS's HMO compliance office; or

    (6) Any other sources deemed appropriate by the OIG.

    (c) Length of exclusion. (1) An exclusion imposed in accordance with 

this section will be for a period of 3 years, unless aggravating or 

mitigating factors set forth in paragraphs (c)(2) and (c)(3) of this 

section form a basis for lengthening or shortening the period.

    (2) Any of the following factors may be considered aggravating and a 

basis for lengthening the period of exclusion--

    (i) The entity failed to provide a large number or a variety of 

items or services;

    (ii) The failures occurred over a lengthy period of time;

    (iii) The entity's failure to provide a necessary item or service 

that had or could have had a serious adverse effect;

    (iv) Whether the individual or entity has a documented history of 

criminal, civil or administrative wrongdoing; or

    (v) The individual or entity has been the subject of any other 

adverse action by any Federal, State or local government agency or 

board, if the adverse action is based on the same set of circumstances 

that serves as the basis for the imposition of the exclusion.

    (3) Only the following factors may be considered as mitigating and a 

basis for reducing the period of exclusion--

    (i) There were few violations and they occurred over a short period 

of time; or

    (ii) Alternative sources of the type of health care items or 

services furnished by the entity are not available.

    (iii) The entity took corrective action upon learning of 

impermissible activities by an employee or contractor.



[57 FR 3330, Jan. 29, 1992, as amended at 63 FR 46688, Sept. 2, 1998]