Continued Questions About GSA Debarment Screening

Federal agencies can exclude (suspend or debar) businesses or individuals from receiving government contracts or assistance for various reasons.  The General Services Administration (GSA) maintains these exclusions through the System for Award Management (SAM).  The SAM is not user-friendly for health care providers and often causes many false hits that take time and effort to resolve.  However, this is not entirely the GSA’s fault since they designed the system for use by federal government agencies for procurement purposes.  There are two types of debarments identified by the GSA on their website:

• Administrative Debarments. According to the GSA, this category of debarments is not punitive.  The debarments generally last less than three years and can be waived by federal agency heads.  Administrative debarments are within the discretion of agency contracting officials.  Suspensions are temporary administrative debarments lasting only as long as any agency investigation of contractor misconduct or ensuing legal proceeding.

• Mandatory Statutory Debarments. Federal contracting officers have little discretion in permitting the use of this type of debarment. Further, these debarments provide limited opportunities for agencies to waive them.  Statutory suspensions otherwise resemble statutory debarments but last only until a designated agency official finds that the contractor has ceased the conduct violating the statute.

Problems With The SAM

There are a number of problems with the GSA SAM.  Firstly, the system is intended for use by federal government agencies only and informs or warn agencies about companies or individuals who demonstrate a lack of present responsibility.  It is not intended for any other purposes.  The GSA debarment list does not apply to health care providers and plans.  Debarments prohibit or inhibit parties from contracting with the federal government.  In short, the GSA debarment list was not created for non-governmental entities in any sector, including health care.  There are very few providers of health care services and products that meet the definition of a federal agency.  Among the exceptions are the Veterans Administration, Indian Health Service, National Institutes of Health, Department of Defense healthcare facilities, and other similar bodies of government providing health care.  The only federal agency that has been pushing for the ability of health care entities to screen against the GSA debarment list is the Centers for Medicare & Medicaid Services (CMS).  I believe that CMS has been misguided in this effort.

By contrast, screening against the Department of Health and Human Services (HHS) Office of Inspector General (OIG) List of Excluded Individuals and Entities (LEIE) is mandatory.  It has been designed to be user friendly for health care organizations and assists them in resolving potential hits of individuals and entities who are not eligible to receive money from federal government health care financing programs.  The OIG makes clear that sanction screening against the LEIE is not optional for health care providers while they only notes the availability of the GSA SAM.

Factors To Consider About The SAM

1. The government debarment and suspension procedures are intended for government agencies contracting with commercial entities, not for non-governmental entities.
2. Many of the government contractors on the SAM are large multi-billion dollar organizations with many subsidiaries. When a debarment arises from one of those subsidiaries, it is difficult to determine how relevant the debarment is to another.
3. The HHS OIG provides the LEIE to the SAM. Therefore, any hits on the LEIE may also show up on the GSA database.  It is a double hit for the same action which doesn’t always prove useful.
4. There is no accounting between the OIG and GSA. Due to this, no one is certain that the SAM is up to date with current LEIE data. There is considerable evidence suggesting that the GSA is not timely in removing those exclusions removed from the LEIE from the SAM.
5. On May 8, 2013, the OIG issued a “Special Advisory Bulletin on the Effect of Exclusion from Participation in Federal Health Care Programs.” In the bulletin, the OIG noted that they only take action against those on the LEIE lists and stated categorically that they have no authority to take action on a GSA debarred party.
6. It is advisable to review options for reducing the burdens of sanction screening against the SAM.

As part of ongoing monitoring and auditing, organizations should keep track of the time and effort devoted to sanction screening and resolving potential “hits.”  Knowing how much time, effort, and costs involved in the process may provide useful information for determining whether it is less costly and more efficient to outsource the entire screening process to experts or invest in a sanctions screening software tool. In addition, having a report on every screening result can be used to evidence how an organization meets its compliance obligations.