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Employing an Excluded Worker: OIG Penalties, With Recent Cases

Short answer: if a home care agency, hospice or nursing home employs or contracts with someone it knows or should know is excluded from federal health care programs, OIG can seek a civil money penalty for each item or service that person provided, plus an assessment of up to 3 times the amount, and can exclude the provider too (42 U.S.C. 1320a-7a(a)(6)). Recent OIG settlements with care providers for this have run from about $20,000 to more than $600,000.

Updated October 15, 2026 · Checked against the official sources listed at the end

What the law says

The Civil Monetary Penalties Law, 42 U.S.C. 1320a-7a(a)(6), covers any person that arranges or contracts, by employment or otherwise, with someone it knows or should know is excluded, to provide items or services that a federal health care program may pay for. OIG's rule repeats this at 42 CFR 1003.200(b)(4).

"Should know" means acting in deliberate ignorance or reckless disregard of the truth. OIG doesn't have to prove you meant to defraud anyone (42 CFR 1003.110). Not checking the list is the kind of gap that matters here.

Penalty: up to $20,000 for each item or service the excluded person provided, for conduct after February 9, 2018 (42 CFR 1003.210(a)(4)). HHS adjusts it for inflation each year; its 2025 table lists $25,595 (45 CFR 102.3).
The penalty applies to each item or service, whether or not it is billed separately. Aide visits and nursing care inside a daily rate still count.
Assessment: up to 3 times the amount claimed for separately billed services. For services not billed separately, up to 3 times the total cost of employing the person, including salary, benefits and taxes (42 CFR 1003.210(b)(2)).
Exclusion: OIG may exclude the provider from federal health care programs in the same proceeding.

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What OIG's 2013 Special Advisory Bulletin says

No federal program payment may be made for items or services an excluded person furnishes. That holds for every payment method, including cost reports, per diem rates, bundled payments and capitated payments.
It goes beyond hands-on care. OIG names nursing homes and home health agencies, and says the ban also covers administrative and management work, such as billing, staff training and human resources, unless wholly unrelated to federal programs.
Volunteers count. A provider can be liable even if the excluded person isn't paid.
Agency staff count. If a contracted staffing agency sends an excluded nurse, the facility faces overpayment liability and possible CMP liability. OIG says the facility may reduce or remove CMP liability if it reasonably relied on the agency to check the list, for example under a contract, and made sure the agency was doing it.
Hiring a vendor to screen doesn't move the risk. OIG says the provider keeps the potential CMP liability.
No statute or regulation requires checking the list, but OIG says screening employees and contractors each month best minimizes overpayment and CMP liability, since it updates the list monthly.
OIG has no authority to impose CMPs for employing someone who is only debarred on SAM.gov. The LEIE is OIG's own list.

Recent OIG settlements with care providers

These are public cases from OIG's enforcement pages. Each settlement resolves OIG's allegations, and each is linked in the sources below.

July 20, 2026, Colorado: Advanced Health Care of Colorado Springs paid $500,019.53. OIG alleged an excluded person worked as an RN/LPN medication and treatment nurse.
September 29, 2025, Arizona: AccuCare Home Health Services of Mesa paid $20,000. OIG alleged the excluded person worked as a home health aide.
June 10, 2025, Illinois: CareLink Home Health of Schaumburg paid $35,597.37. OIG alleged the excluded person worked as a nurse and case manager.
June 10, 2025, Illinois: Citadel Care Center – Sterling agreed to pay $639,283.03 after it self-disclosed to OIG that it employed someone it knew or should have known was excluded.
January 23, 2025, Ohio: Walnut Creek Nursing Center of Dayton paid $243,000.90. OIG said the excluded person was a licensed practical nurse.
October 8, 2024, Tennessee: BrightStar Care of Chattanooga paid $20,374.43. OIG said the excluded person was a caregiver.

Orders are taken now and start when Pact's Checkr account opens; Checkr then emails the person.

What these cases show

The jobs were everyday ones: a caregiver, a home health aide, practical nurses, a nurse case manager. In each case except Citadel, OIG said the person's services were billed to federal health care programs. One excluded worker on staff was enough.

Citadel found the problem itself and disclosed it. Self-disclosure did not make the cost small, which is why catching an exclusion before hire, or within a month of it happening, matters most.

If you find an excluded person on staff

OIG's 2013 bulletin points providers to its Health Care Fraud Self-Disclosure Protocol. Under that protocol, before you disclose, you must screen all current employees and contractors against the LEIE and disclose every excluded person you find in one submission. Talk to a health care attorney before you act.

The disclosure covers the person's identity, job duties and dates of work, the background checks you ran, your screening process and where it broke down, how you found the problem, and what you changed.
For aides, nurses and office staff whose work isn't billed separately, OIG estimates damages from your total cost of employing the person during the exclusion, times your federal payor mix.
OIG's general practice is a minimum multiplier of 1.5 times those damages, and a minimum $20,000 settlement for matters like this.

How to lower the risk

Check the LEIE before you hire or contract with anyone, then every month after. OIG says anyone who hires a person on the LEIE may face civil monetary penalties.
Check former names and each part of a hyphenated last name, and verify any possible match with the Social Security number in OIG's online search.
Save a dated printout of every search. OIG says to keep documentation of the name search and of any follow-up searches.
For agency or contract staff, check them yourself or get the agency's screening records in writing.
Use one log for every check. Pact's monthly exclusion check log guide lists the columns, and Pact's free name check at portal.pactcompliance.com/exclusion-check searches OIG's list.

How Pact helps (and what it doesn't do)

Pact checks every active staff member against OIG's exclusion list each month, plus the state Medicaid exclusion lists Pact can download, and keeps a dated record of each check next to the person's licenses, training and background check. The downloaded files have no Social Security numbers, so any possible match comes to you to verify. Pact doesn't check SAM.gov. $10 per active staff member a month, $250 minimum, first month free.

Screening lowers the risk; it doesn't remove it. OIG says the provider stays responsible for who it employs, even when someone else runs the checks. This page is general information, not legal advice.

Common questions

What is the penalty for employing an excluded individual?

Up to $20,000 per item or service the person provided, for conduct after February 9, 2018 (42 CFR 1003.210(a)(4)), adjusted for inflation to $25,595 in HHS's 2025 table, plus an assessment of up to 3 times the amount claimed or the cost of employing the person, and possible exclusion.

Is checking the OIG exclusion list required by law?

OIG's 2013 bulletin says no statute or regulation requires providers to check the LEIE. It says monthly screening best minimizes overpayment and CMP liability, and the CMP law applies if you knew or should have known.

If a staffing agency sends us an excluded nurse, are we liable?

You may be. OIG says the facility faces overpayment liability and may face CMP liability, but may reduce or eliminate CMP liability if it reasonably relied on the agency to screen, such as under a contract, and checked that the agency did it.

Does OIG penalize hiring someone who is only on SAM.gov?

OIG's 2013 bulletin says it has no authority to impose CMPs for employing or contracting with a person who is only debarred. Your state, broker or contracts may still require a SAM check.

What should we do if we already employ someone who is excluded?

Talk to a health care attorney. OIG points providers to its Self-Disclosure Protocol, which requires screening all current employees and contractors first and disclosing every excluded person in one submission.

Sources

Related guides

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