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How to Navigate Compliance with the CMS Preclusion List

May 24, 2019

It’s been nearly six months since the Centers for Medicare and Medicaid’s (CMS) Preclusion List was released. The list was released January 1, 2019 and action required with accompanying fines and penalties began April 1, 2019. The Preclusion List is a database of providers, prescribers and entities precluded from receiving payment for Medicare Advantage items and services, or Part D drugs for Medicare beneficiaries.

The 90 days between release and activation included a period of 30 days for the Medicare Advantage and Part D plans to review the List and give notice to patients by mail if they are receiving services, items or prescriptions from a provider on the Preclusion List; and 60 days for appeals, for beneficiaries to find an alternate prescriber or provider, and to implement payment denial.

As of April 1, 2019, if a Part D drug is prescribed by an individual on the Preclusion List, Part D sponsors are required to reject a pharmacy claim or deny a reimbursement request by a beneficiary. Medicare Advantage plans are required to deny payment to an individual or entity on the Preclusion List for a health care item or service provided to a beneficiary by the precluded individual or entity.

If payment is made by a plan to a precluded provider, CMS could impose sanctions, civil monetary penalties, and remove the plan from participation in Part D and Medicare Advantage programs.

CMS created the Preclusion List to enhance the Medicare Advantage prescriber enrollment requirements and add more teeth to its ideals of patient safety and quality of care, as well as reduce fraud in the health care system. With an eye on the opioid crisis, one of the features of the list is to identify and prevent suspicious prescribers from using federal funding to perpetuate questionable prescribing practices.

The final rule estimates 2019 savings totaling more than $34 million from not having Part D prescribers and Medicare Advantage providers enroll in Medicare, and some $19 million in savings of Medicare Trust Funds from reduction of opioid prescriptions.

The Preclusion List is designed to monitor and capture data on providers not enrolled in Medicare but prescribe for patients participating in Medicare Part D and provide items and services through a Medicare Advantage organization.

A provider or entity will appear on the List under two conditions according to CMS:

  • The provider or entity is currently revoked from Medicare, are under an active re-enrollment bar, or CMS has determined that the underlying conduct that led to the revocation is detrimental to the best interests of the Medicare program.
  • The provider or entity has engaged in behavior for which CMS could have revoked the individual or entity to the extent applicable if they had been enrolled in Medicare, and CMS determines that the underlying conduct that would have led to the revocation is detrimental to the best interests of the Medicare Program.

The Preclusion List is made available to Medicare Advantage plans and Part D sponsors. It is their responsibility to update their systems each month when the updated list is released to ensure the most current information. They must also subsequently notify those beneficiaries affected by a precluded provider.

Hospitals, health systems, pharmacies, providers, and physician practices do not have access to the Preclusion List so they are not required to screen and monitor against this list, however, understanding the criteria used to preclude is highly important to maintain a template of compliance that takes into consideration the spirit of preclusion. While the description of what constitutes preclusion is broad and subjective to CMS’s findings, a health care organization should create policies and procedures that align with best practices that incorporate laws, statutes and rulings which enforce patient safety and actively prevent and mitigate fraud, waste and abuse on the organizational, State and Federal levels.

Providers are notified by mail from the CMS, or a Medicare Administrative Contractor (MAC) if they are slated for the list. Regular review of contact information in the Provider Enrollment Chain and Ownership System (PECOS) and National Plan and Provider Enumeration System (NPPES) is recommended to ensure that email and postal addresses are current.

A provider will be precluded for the length of their re-enrollment bar if they are currently revoked or would have been revoked had they enrolled in the Medicare program. The re-enrollment bar is a minimum of 1 year, but not greater than 3 years depending on the severity of the basis for revocation. The Preclusion List timeframe will be specified in the notification letter.

The Health and Human Services (HHS) Office of Inspector General’s (OIG) List of Excluded Individuals and Entities (LEIE) is a completely different instrument than the Preclusion List. The LEIE is searchable by anyone and has specific criteria for mandatory exclusion and defined criteria for permissive exclusion.

Exclusion means being excluded from participation in all Federally funded entitlement programs at the State and Federal level. There is overlap where a provider can be both excluded and precluded.

Verisys is a Credentials Verification Organization (CVO) and helps health care organizations understand and comply with the ever-changing Federal and State rulings, laws and guidelines as well as those of most standard-setting organizations. Verisys has solutions for all health care organizations including those who are required to screen against the CMS Preclusion List.

As part of its data and technology offerings, Verisys verifies and name matches against 5,000+ primary sources in its data platform, CheckMedic®. Using both aggregated data and sophisticated algorithms alongside human expertise, Verisys achieves identity verification with 99.9% accuracy taking the guesswork out of properly identifying names on the Preclusion List.

It’s gold-standard health care database, FACIS® mirrors the criteria for the Preclusion List as well as the LEIE. If a name shows up with adverse action in the FACIS® set, that individual or entity is likely on either or both the Preclusion List and the LEIE.

Implementing Verisys’ enterprise-wide credentialing and compliance tool, CheckMedic® and issuing an individual MedPass® to all employees, partners and vendors brings transparency to your organization and exposes risk in real time. Using the turnkey CheckMedic® system creates the framework of a policies and procedures structure across all departments including Compliance, Medical Staff, Legal, and HR.

Juliette Willard Written by Susen Sawatzki
Healthcare Industry Expert
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