What is a Healthcare Sanction?

A healthcare sanction is an administrative action taken against an individual’s license by a state professional licensure board. Such sanctions can be attributed to a restriction placed upon the license and can include a revocation of the license. These are also called disciplinary actions against the license. In order to locate a sanction or disciplinary action on a license, a search of the state professional licensing board minutes or actions must occur.

Sanction Screening Disciplinary Action OIG

What is the Difference Between Sanctions and Exclusions?

There is confusion in the marketplace because HHS OIG and SAM.gov federal data sets refer to exclusions as sanctions.  For purposes of this blog, we are using the term “sanction” to mean a disciplinary action taken against a person’s license by a state professional licensing board.

In its most extreme case, it can apply if there has been an action/inaction taken by the individual that resulted in harm to a patient. Licensing Boards will also take action and place a sanction on the license if the person has been convicted of a criminal offense involving fraud and abuse, patient abuse, substance abuse, or other related offenses.

Prior to a healthcare professional receiving a sanction, there has been a due process hearing at the license or disciplinary board and/or the excluding agency. Thus, the individual has an opportunity to present his/her case. Upon the issuance of a penalty, sanction, or disciplinary action, an individual’s license may be restricted, revoked, suspended, or other measures placed upon it. This process can take months and even years to progress. 


Why are Sanctions and Exclusions Issued by HHS Office of Inspector General (OIG)?

A sanction or exclusion can be imposed for many reasons. Here are a few examples:

  • An individual may be delinquent for a required fee or license renewal
  • An individual has not completed the required training
  • An individual may not have updated necessary documentation

What are the Consequences of a Healthcare Sanction?

A sanction from a healthcare disciplinary or licensing board can have significant consequences -including becoming excluded or sanctioned and placed on a list maintained by HHS OIG called the List of Excluded Individuals or Entities (LEIE). The consequences for sanctions vary depending on the severity of the incident.

Healthcare exclusions are a severe form of a sanction. If a provider is excluded, they will be prohibited from participating in federal healthcare programs and reimbursements from the Centers for Medicare and Medicaid Services (CMS). In addition, the provider can also lead to GSA/SAM.gov debarment and/or a state(s) exclusion, too.

Once an individual or entity is excluded in one state, he/she/it is considered excluded in all states (Section 6501 Affordable Care Act).  In other words, under the Affordable Care Act, an individual or entity/vendor excluded in one state is not permitted to participate in federal healthcare funds in all other states. A person or entity can be excluded by a federal agency (HHS OIG) or by a state Medicaid agency.

Did you know that 40% of the time excluded providers on the OIG List of Excluded Individuals and Entities, LEIE, are derived from their license being sanctioned or revoked?

How do Healthcare Sanctions Affect Your Organization?

If you, the employer, submit a claim for and/or receive federal healthcare reimbursements either directly or indirectly for that individual or entity, your organization is subject to civil fines and monetary penalties.

A healthcare organization cannot purchase goods or services from an entity or vendor that is excluded. The OIG mandates that healthcare organizations do not hire or do business with “excluded or sanctioned” individuals or entities/vendors.

How to Detect Sanctions with Provider Screening / Ongoing Monitoring

According to the OIG, CMS Guidelines, and State Medicaid Bulletins or Directives, it is the responsibility of the employer to conduct monthly exclusion monitoring. A sanction against an individual’s license can be an early indicator of an impending OIG or State exclusion depending on the type of infraction, the sanction imposed and/or the conviction of certain felonies.

There are 43 State exclusion or terminated provider lists and 2 federal exclusion lists that should be checked each month for your employees, contractors, and third-party entities, in addition to monthly OIG exclusion monitoring.

How We Can Help You With Sanction Screening

A manual sanction screening process can leave HR and Compliance teams left with what seems to be an insurmountable task of constant monitoring and updating their information. 

Here are just a few examples of what could happen within your healthcare data and employee population when a sanction occurs but would be hard to detect.

  • Delays or lags of time of many months between when an individual is sanctioned on the state level to when that offense is actually reported on the federal level. Thus, making it possible that one can have a sanction on the state level, but not show up on a federal list.
  • Similarly, there have been situations where sanction data reported to licensing boards have not been properly reported to the federal and state databases.
  • To avoid and conceal past records, individuals have altered names or used maiden names, changed addresses, and even gone as far as falsifying sensitive data such as social security numbers.

There are new technologies and sanction screening software that can alleviate the headache by aggregating all of these datasets, allowing you to avoid the pitfalls of delayed reporting and intentional provider identity concealment.  

Curious to learn more? Contact us today to get started.


ProviderTrust Healthcare License Monitoring Essential Guide

ProviderTrust Mike Rosen Cofounder

Written by Michael Rosen, Esq.

ProviderTrust Co-Founder, mrosen@providertrust.com

Michael brings over 20 years of experience founding and leading risk mitigation businesses, receiving numerous accolades such as Inc. Magazine’s Inc. 500 Award and Nashville Chamber of Commerce Small Business of the Year.

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