Types of Civil Monetary Penalties and Affirmative Exclusions

The Office of Inspector General (OIG) has the authority to seek civil monetary penalties (CMPs), assessments, and exclusion against an individual or entity based on a wide variety of prohibited conduct. In each CMP case resolved through a settlement agreement, the settling party has contested the OIG's allegations and denied any liability. No CMP judgment or finding of liability has been made against the settling party. A list of OIG's CMP authorities can be found on the CMP Authorities page and a list of OIG's exclusion authorities can be found on the Exclusion Authorities page. Below are examples of some of OIG's commonly used CMP authorities.

Drug Price Reporting

The Medicaid Drug Rebate Program requires drug manufacturers to submit pricing information to HHS and to pay a rebate to the state Medicaid programs for each unit of the covered drug that the state Medicaid programs reimburse. Manufacturers with Medicaid Drug Rebate agreements are also required to report price information that is used to set Average Sales Price, the reimbursement metric for drugs covered by the Medicare Part B program. Given the importance of timely and accurate submission of pricing information, OIG may seek a CMP against drug manufacturers that fail to properly report the required information.

False and Fraudulent Claims

The OIG may seek a CMP or exclusion against individuals or entities that present claims to Federal health care programs that the individual or entity knows or should know are for an item or service that was not provided as claimed or is false or fraudulent. For example, the OIG may seek a CMP or exclusion against an individual or entity who makes claims for a service that is not actually provided, is provided but is already covered under another claim, is not properly coded, or is not supported by the medical record.

Grants, Contracts, and Other Agreements

The OIG may impose CMPs, assessments, and exclusions against individuals and entities that engage in fraud and other improper conduct related to HHS grants, contracts, and other agreements. The OIG may impose sanctions for, among other things, knowingly presenting a specified claim under a grant, contract, or other agreement that is false or fraudulent, or knowingly making or using any false statement, omission, or misrepresentation of a material fact in any application, proposal, bid, progress report, or other document submitted to HHS in order to receive funds under an HHS grant, contract, or other agreement.

Kickback

The Anti-Kickback Statute prohibits individuals or entities from asking for or receiving any remuneration in exchange for referrals of Federal health care program business. The OIG may seek a CMP or exclusion against individuals or entities who knowingly and willfully: (1) offer or pay remuneration, directly or indirectly, to induce referrals of Federal health care program business; or (2) solicit or receive remuneration, directly or indirectly, in return for referrals of Federal health care program business.

Misuse of Departmental Words and Emblems

The Social Security Act prohibits an individual or entity's unauthorized use of words or emblems belonging to the Department of Health and Human Services (HHS). The OIG may seek a CMP against individuals or entities who without authorization use words or emblems belonging to the Department of Health and Human Services (HHS), or its programs, operating divisions or agencies, in connection with any communication in a manner which such individual or entity knows or should know would convey, or could be interpreted or construed as conveying, the false impression that the item is approved, endorsed, or authorized by HHS or that the individual or entity has some connection with HHS.

The Emergency Medical Treatment and Labor Act (EMTALA)

The Emergency Medical Treatment and Labor Act (EMTALA), also known as the patient dumping statute, is a federal law that requires anyone coming to an emergency department, with an emergency medical condition, to be stabilized and treated, regardless of their insurance status or ability to pay. If the hospital does not have the specialized capabilities required to stabilize the patient, the hospital must arrange for an appropriate transfer. The OIG may seek a CMP against any hospital that has negligently violated its obligations under EMTALA.

Learn more: EMTALA Featured Topic

Physician Self-Referral

The Physician Self-Referral Statute, or Stark law as it is sometimes called, prohibits individuals or entities from referring Medicare or Medicaid patients for designated health services to entities with which individuals or entities have a direct or indirect financial relationship, unless an exception applies. The OIG may seek a CMP or exclusion against individuals or entities that present or cause to be presented a claim that the individual or entity knows or should know is for a service for which payment may not be made under the Stark law.

Select Agents and Toxins

The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 requires that entities and individuals who possess, use, or transfer select agents follow specific regulatory requirements. The OIG may seek a CMP against those who do not follow those regulatory requirements.