Exclusion Screening

The Cost of OIG Corporate Integrity Agreement Violations


Emptech's founder, Jeff Aleixo


Jeffrey Aleixo

OIG CIA Violations Cost OIG Compliance

As the HHS Office of Inspector General’s goal is to investigate fraud and abuse committed against the Medicare and Medicaid programs, it has the authority to enter into settlement negotiations to avoid prosecuting health care providers for fraud and abuse violations. For healthcare providers involved in a healthcare fraud investigation, entering into a corporate integrity agreement (CIA) with the Office of Inspector General (OIG) is often a necessary condition for resolving the matter. Under the terms of the OIG Corporate Integrity Agreement, healthcare providers need to accept a number of detailed, compliance-related obligations. In exchange, they are given the opportunity to avoid exclusion from Medicare, Medicaid, or other federal healthcare programs, being a financially devastating outcome for any healthcare organization.

Although cumbersome and usually expensive to comply with, OIG Corporate Integrity Agreements guide organizations through the implementation of an effective healthcare compliance program that ultimately leads to proper billing practices. This includes the submission of accurate and complete claims for payment to federal healthcare programs, appropriate arrangements with physicians, and improved quality of care for program beneficiaries. Given that OIG Corporate Integrity Agreement is a contractual agreement between the OIG and a healthcare organization that commits the organization to undertake a defined set of compliance obligations, it is important to meet all of the terms and conditions. OIG Corporate Integrity Agreement violations and failing to meet the obligations under the agreement can result in severe penalties, including the possible exclusion of participation in federal healthcare programs.

Understanding OIG Corporate Integrity Agreements

While the focus of an OIG Corporate Integrity Agreement is the specific compliance failure at the subject healthcare organization or provider, all CIAs have common elements. A comprehensive CIA typically lasts five years and requires the organization to enhance its compliance program by developing, implementing, and monitoring various compliance areas. Furthermore, healthcare organizations are required to hire an Independent Review Organization (IRO) to conduct annual reviews and assessments.

The annual report is designed to keep the OIG informed of the provider’s compliance activities during the term of the Agreement. It includes the undertaken healthcare compliance activities and the results of the IRO review of the organization’s compliance with the terms of the OIG Corporate Integrity Agreement. Among other things, the annual report has to include a description of any reviews, audits, or analyses of the organization’s compliance program, the organization’s response to such reviews, audits, or analyses, and a summary report of any overpayments refunded during the period. Furthermore, an officer has to certify that the organization is meeting its obligations under the corporate integrity provisions of the OIG CIA.

Find out how to develop and maintain effective healthcare compliance with this comprehensive guide and ensure meeting healthcare industry standards as well as other necessary regulations.

OIG Corporate Integrity Agreement Enforcement

Corporate Integrity Agreements include breach and default provisions that are standard and allow the OIG some level of consistency in the application and enforcement of these provisions. The breach and default provisions address two general sets of OIG Corporate Integrity Agreement violations – stipulated penalties and material breaches.

Stipulated Penalties

Contractual monetary fines or stipulated penalties result from failure to comply with certain obligations of the OIG CIA. These penalties may vary slightly depending on the healthcare provider type and their amounts have changed over the years. However, they usually relate to the failure to maintain certain compliance program elements, such as a compliance officer, a code of conduct, written policies and procedures, training, auditing, and a disclosure program. Stipulated penalties include:

  1. Daily penalties for failure to:
  • Comply with terms and conditions related to the compliance program,
  • Engage and use an IRO,
  • Submit a complete implementation report, annual report, or any certifications on time, and
  • Submit any mandated claims review report.
  1. $50,000 per false certification in
  • Implementation reports,
  • Annual reports, and
  • Other OIG requested documentation.
  1. $1,000 per day for each compliance failure with any obligation of the CIA.

Material Breach

In addition to being subject to stipulated penalties, a provider may be subject to exclusion from participation from federal health care programs for a material breach of the OIG Corporate Integrity Agreement. In case of a material breach, a healthcare organization receives a notice and is typically given 30 days to cure the breach. Otherwise, the OIG may exclude the organization from participation in federal health care programs. Material breaches include:

  1. Not responding to an OIG demand letter,
  2. Not reporting a reportable event,
  3. Not taking corrective action of OIG Corporate Integrity Agreement violations,
  4. Not making appropriate refunds of overpayments,
  5. Not responding to demands for stipulated penalties payments, and
  6. Not engaging and using an IRO.

A healthcare organization can request a hearing before an HHS administrative law judge to dispute the OIG’s determination of noncompliance resulting in a stipulated penalty or exclusion. However, judging from numerous enforcement actions taken by the agency for violations of CIA terms and conditions, it is evident that the OIG is not reluctant to use its authority to enforce compliance with Corporate Integrity Agreements.

Ensuring OIG Corporate Integrity Agreement Success

Corporate Integrity Agreements are among the most important methods used by the OIG to promote healthcare compliance. While managing the requirements of a CIA is never an easy task and requires significant human and financial resources to successfully fulfill all its obligations, healthcare organizations should never overlook the implications of operating under a CIA. Even for organizations that are not involved in a Federal healthcare program investigation, understanding the elements and obligations of a CIA may help them better understand what the OIG expects their compliance programs to include.

Since CIAs are used as tools that promote model standards for ensuring compliance with healthcare laws, healthcare organizations should keep their requirements in place even after a typical five-year term of the CIA. The failure to comply with the terms of the OIG Corporate Integrity Agreement may lead to additional penalties, an extension of the terms of a CIA, or exclusion.

Improving healthcare compliance and creating fewer possibilities for a potential CIA can be simplified by integrating an automated solution and outsourcing exclusion screening. This allows healthcare organizations and providers to save valuable time, replace manual searches with automated ones, and reduce costs. Also, an automated solution enables healthcare organizations to carefully address OIG Corporate Integrity Agreement requirements, and maintain constant compliance.

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