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CMS' New Affiliate Screening Requirements Are Coming

Posted by Margaret Scavotto, JD, CHC on 10/23/19 7:58 AM

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On November 4, CMS' Program Integrity Enhancements to the Provider Enrollment Process final rule goes into effect. 

The "Affiliates" provision of this rule requires Medicare, Medicaid and CHIP providers to disclose to CMS any affiliations with organizations that have had a "disclosable event." Providers who fail to make these disclosures can be denied enrollment - or have their enrollment revoked. The purpose of this new process is to stop fraud and help CMS find parties that have committed fraud.

affiliates and disclosable events snip

What's an "affiliation"?

There are five ways a provider can have an "affiliation' with an organization:

  • a 5% or more direct or indirect ownership interest in another organization
  • a general or limited partnership interest (of any percentage) in another organization
  • an interest in which an individual or entity exercises "operational or managerial control over, or directly or indirectly conducts, the day-to-day operations of another organization," by contract of another arrangement. This includes sole proprietorships.
  • when an individual is acting as officer or director of a corporation
  • a reassignment or payment assignment relationship


What's a "disclosable event"?

Providers must disclose "affiliations" within the past five years to CMS if the affiliated organization has a "disclosable event:"

  • current uncollected debt owed to Medicare, Medicaid or CHIP
  • current or prior payment suspension
  • current or prior OIG exclusions
  • Medicare, Medicaid or CHIP enrollment denial, revocation or termination

When does this go into effect?

CMS has adopted a "phased-in" approach to implementing the affiliation disclosure requirements:

Phase One:

  • After the final rule's November 4, 2019 effective date, and after CMS updates Form CMS-855, CMS will begin requesting certain providers and suppliers to disclose all affiliations. CMS will make these requests only when it determines that a provider or supplier has at least one affiliation with a disclosable event.

Phase Two:

  • After public comment on "potential approaches for obtaining affiliation information... in terms of timing, mechanism, and priority," CMS will publish a new proposed rule outlining additional procedures for handling affiliation disclosures. After the final rule, the disclosure requirements will go into effect.

What do we do?

Start evaluating your screening processes and be prepared to identify affiliates and determine if they have disclosable events.

This is easier said than done - as  Michael Rosen from ProviderTrust adds: "Currently, there are no public databases of Medicare payment suspensions or revocations for healthcare providers to evaluate...."

Look for further guidance from CMS, which is asking for further comment on the best way to collect and report this information. Hopefully this guidance will clarify some of the challenges providers and suppliers face with complying with this new rule.

Work on developing or streamlining your processes to gather information about and screen your affiliates.

Finally, polish your excluded provider screening process and make sure that it includes affiliates.

MCS Signature November 2018

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Topics: Excluded Providers, compliance, vendor screening

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