Will I Be Excluded From Medicare and Medi-Cal or Other State Health Provider Programs Due to a Conviction?

This is a highly important question we receive often and it is one which can have a very dramatic impact on your income and a provider’s ability to continue to bill Medicare/Medi-Cal and receive payment for services rendered.

42 USC 1320(a)(7) governs exclusion from Medicare and state health care programs which are funded by the Social Security Act, including 42 USC Chapter 7.  Regulations regarding the authority of the Office of Inspector General (“OIG”) to exclude providers are codified at 42 CFR Sec. 1001.101 et seq.  California State Medicaid agencies, such as the Department of Healthcare Services (“DHCS”), are required to suspend a provider from the state program during the period of a Medicare exclusion (42 USC 1320(a)(7)(d)(3)(A).

It is crucial to know, though, that there are both permissive and mandatory exclusions.  Exclusion from Medicare is mandatory for felony convictions and permissive for misdemeanor convictions which are “relating to the unlawful manufacture, distribution, perscription or dispensing of a controlled substance” (42 USC Sec. 1320(a)(7)(a)(4) and (b)(3)).  The Social Security Act defines a conviction to include cases dismissed pursuant to a “first offender, deferred adjudication or other arrangement or program where judgment of conviction has been withheld” (42 USC Sec. 1320(a)(7)(i)(4).

Permissive exclusion is allowed based on state medical license suspension or revocation (42 USC Sec. 1320(a)(7)(b)(4)) or exclusion from a state healthcare program, such as Medi-Cal in California (42 USC Sec. 1320(a-7)(b)(5).

Many clients ask what the minimum period of exclusion is, which is five years pursuant to 42 USC 1320(a-7)(c)(3)(B).  Permissive exclusion for a misdemeanor conviction is lower, at three years subject to a reduction for mitigation or an increase for aggravation (42 USC Sec. 1320(a-7)(c)(3)(D).
Exclusion resulting from license suspension or revocation shall be at least the length of time the license is suspended or revoked (42 USC Sec. 1320 (a-7)(c)(3)(E).

CMS/Centers for Medicare and Medicaid Services revocation of billing privileges

The authority of CMS to revoke Medicare billing privileges of a provider based on a felony conviction is broader than the OIG’s authority to do so.  CMS may revoke billing privileges of a provider based on any felony conviction that “CMS determines is detrimental to the best interests of the Medicare program and its beneficiaries” (42 CFR Sec. 424.535(a)(3)(i).  Felonies in this category include violent crimes, financial crimes such as insurance fraud and other “white collar crime,” and crimes that would result in mandatory exclusion under 42 USC 1320(a-7).  Revocations based upon felony convictions must run at least 10 years from the date of conviction (42 CFR Sec. 424.535 (a)(3)(iii).

CMS may also revoke Medicare billing privileges as a result of termination by a state Medicaid agency or revocation of prescribing authority by the DEA (42 CFR Sec. 424.535(a)(12) and (13).

As these are very complex matters which require aggressive and immediate responses within specific time frames, providers in the above situation(s) should have the highly experienced attorneys at Brown & Brown on their side to protect their livelihoods and ability to continue to bill Medicare/Medi-Cal and other state agencies.  

We can also work with criminal defense counsel to attempt to explain to the prosecutor how important a reduction in the offense level of conviction can be to a provider faced with this situation.  We have done so on many occasions and prosecutors are often very receptive to this additional information which will affect the accused not only in the criminal case, but with regard to his or her license and ability to bill Medicaid and Medicare/Medi-Cal for services provided.

If you are facing this challenging situation, do not handle it on your own.  Call us today at 310-792-1315 for a free consultation and let us protect you and everything you’ve worked so hard for.