[Federal Register Volume 69, Number 42 (Wednesday, March 3, 2004)]
[Rules and Regulations]
[Pages 9919-9924]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-4730]



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  Federal Register / Vol. 69, No. 42 / Wednesday, March 3, 2004 / Rules 
and Regulations  

[[Page 9919]]



OFFICE OF PERSONNEL MANAGEMENT

5 CFR Part 890

RIN 3206-AJ42


Eligibility of Suspended Health Care Providers To Receive Payment 
of Federal Employees Health Benefits Program Funds; Financial Sanctions 
of Health Care Providers Participating in the Federal Employees Health 
Benefits Program

AGENCY: Office of Personnel Management.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Office of Personnel Management (OPM) is amending its 
regulations regarding administrative sanctions of health care providers 
participating in the Federal Employees Health Benefits Program (FEHBP). 
This rule clarifies the circumstances under which payments may be made 
from FEHBP funds to suspended providers and implements the financial 
sanctions provisions of section 2 of the Federal Employees Health Care 
Protection Act of 1998 (Pub. L. 105-266), which authorize OPM to impose 
civil monetary penalties and financial assessments against health care 
providers who commit certain types of violations against the FEHBP. In 
concert with the final regulations on debarment and suspension that 
were issued on February 3, 2003 (68 FR 5470), the financial sanctions 
provisions afford OPM a full range of administrative remedies to deter 
and rectify provider misconduct within FEHBP. The regulatory framework 
established by this issuance contains appropriate procedural safeguards 
to assure that the amounts of financial sanctions are determined 
through a consistent and equitable process, that the Government's 
financial interests are fully protected, and that financial sanctions 
are imposed only after an opportunity for an administrative hearing on 
all facts material to the basis for the sanctions.

EFFECTIVE DATE: March 3, 2004.

FOR FURTHER INFORMATION CONTACT: David Cope, Debarring Official, Office 
of the Inspector General, Office of Personnel Management, by telephone 
at 202-606-2851, by fax at 202-606-2153, or by e-mail at [email protected].

SUPPLEMENTARY INFORMATION:

Background

    OPM's final regulations on debarment and suspension of health care 
providers were published in the Federal Register on February 3, 2003 
(68 FR 5470). Subsequently, during the public comment period for OPM's 
proposed regulations on financial sanctions of health care providers 
(see the following section of this preamble titled ``Financial 
Sanctions''), an FEHBP carrier commented to our office that the wording 
of several sections of the debarment and suspension regulations was 
ambiguous and potentially subject to misinterpretation in regard to the 
circumstances under which payments could be made to suspended 
providers.
    The carrier's comments focused on Sec. Sec.  890.1046 through 
890.1050 of the regulations, which speak to certain special situations 
where payments to debarred providers may be permissible. Section 
890.1048, regarding providers who are the sole source of health care 
services in their communities and section 890.1050, authorizing special 
exceptions to debarments for individual FEHBP enrollees, both contain 
specific language prohibiting payments to suspended providers in these 
circumstances. Sections 890.1046, 890.1047, and 890.1049, addressing 
services provided in emergency situations, institutional health care 
providers, and claims filed by enrollees who are unaware that their 
provider has been sanctioned, respectively, are silent regarding the 
permissibility of payments to suspended providers in those situations. 
By not specifically identifying the treatment of suspended providers in 
these three sections, we intended that they be governed by the overall 
policy stated in Sec.  890.1030(c), that the effect of a suspension is 
the same as the effect of a debarment. However, we agree with the 
carrier's observation that the presence of language in Sec. Sec.  
890.1048 and 890.1050 specifically excluding suspended providers from 
payment under some ``special'' circumstances may have inadvertently 
created confusion among both carriers and providers as to our actual 
intent in situations where the regulatory wording did not specify the 
rights of suspended providers. Therefore, to avoid possible 
misinterpretations, we are revising Sec. Sec.  890.1046, 890.1047, and 
890.1049 by adding appropriate language to indicate that suspended 
providers are eligible to receive FEHBP payments in the special 
situations addressed by those sections.

Financial Sanctions

    The proposed financial sanctions regulations were issued in a 
notice of proposed rulemaking in the February 10, 2003, Federal 
Register (68 FR 6649). During the 60-day public comment period, OPM 
received written comments from an industry association of health 
insurance plans and oral comments from an FEHBP carrier and from 
employees. This section of the regulatory preamble addresses all of the 
comments and explains OPM's rationale for incorporating certain of them 
in the final rule and declining to implement others.

Rewording of Redundant or Ambiguous Passages

    Most commenters observed that some of the wording in the proposed 
rule was ambiguous or redundant in addressing (1) the factors used to 
determine the amounts of penalties and assessments and (2) the 
procedures for contesting or settling proposed financial sanctions. 
Upon review, we agree that several sections could be reworded to 
clarify the intended meaning.
    In particular, the proposed Sec.  890.1064(b) appeared to be 
largely duplicated by Sec.  890.1064(c) and (d), and this redundancy 
might have fostered some uncertainty as to the relationship between the 
purposes of financial sanctions and the specific factors that may 
determine the amount of a sanction against a given provider. In fact, 
the purposes of financial sanctions are to (1) make OPM whole for any 
monetary losses and damages associated with a provider's violations and 
(2) deter future violations by the sanctioned provider and other 
providers. The procedure for determining amounts in specific cases is 
intended to effectuate those purposes. Therefore, we have consolidated

[[Page 9920]]

paragraphs (b), (c), and (d) of Sec.  890.1064 as they appeared in the 
proposed rule into paragraph (b) as it appears in the final rule, thus 
eliminating the redundancy and emphasizing the seamless connection 
between overall regulatory purpose and the amounts of penalties in 
individual cases. As the result of this consolidation, the proposed 
paragraph (e) has been redesignated as Sec.  890.1064(c) in the final 
rule.
    Similarly, we have reworded the proposed Sec.  890.1067(c) to 
clarify that (1) the debarring official may settle or compromise 
proposed financial sanctions at any stage of the sanctions process 
prior to issuance of a final decision and (2) such settlements or 
compromises do not have to be predicated on a provider's filing a 
contest of the proposed sanctions or making a formal settlement offer.
    Several commenters noted that the phrase ``intention to contest'' 
in Sec.  890.1068(a) was ambiguous as to the nature of the contact from 
a provider that would be sufficient to initiate OPM contest procedures. 
We have rewritten this section in the final rule to make it clear that, 
in filing a contest, the provider must adhere to the instructions given 
by the notice of proposed sanctions issued by OPM. If a provider does 
not file a contest within the timeframe stated in the notice, in a 
manner that complies with the procedures specified by the notice, OPM 
may implement the proposed sanctions immediately and without further 
procedures. However, OPM does not intend to use this provision to deny 
the opportunity to contest on the grounds of minor ``technical'' 
deviations from the instructions in the notice of proposed sanctions. 
Providers will receive the benefit of any reasonable doubt regarding 
their adherence to the requirements for filing a contest.
    Some commenters also observed that the proposed Sec. Sec.  890.1070 
and 890.1071 were partially redundant and unclear regarding OPM's 
procedures for conducting and deciding contests. Upon review, we agree 
that a revision of these sections is warranted. Accordingly, we have 
consolidated the proposed Sec. Sec.  890.1070 and 890.1071 into a 
single Sec.  890.1070 in the final rule. This section sets forth in 
sequential order the process that the debarring official must apply to 
deciding contests of proposed financial sanctions and identifies the 
critical decision points at each stage of this process. To account for 
the consolidation, we have renumbered proposed Sec. Sec.  890.1072 and 
890.1073 as Sec. Sec.  890.1071 and 890.1072, respectively, in the 
final rule.

Impact of Financial Sanctions on FEHBP Carriers

    The association of insurance carriers suggested that the scope of 
the proposed rule be expanded to provide a mechanism for crediting 
collected amounts of financial sanctions, deposited in the Employees 
Health Benefits Fund, to reimburse FEHBP plans for any losses and costs 
they incur as a result of the provider misconduct on which the 
financial sanctions are based. In support of this suggestion, the 
association noted that FEHBP plans may expend substantial amounts when 
investigating provider violations, and that there is no formula for 
``compensating plans for [such] losses.'' However, FEHBP carriers are 
reimbursed from the Employees Health Benefits Fund for allowable costs 
incurred in administering their responsibilities under their FEHBP 
contracts. The nature and extent of such reimbursement is addressed 
within the regulatory framework of the Federal Employees Health 
Benefits Acquisition Regulations, and is subject to annual negotiation 
between OPM and the carrier. In contrast, the FEHBP sanctions statute 
is designed solely as an enforcement measure aimed at untrustworthy 
health care providers, and offers no basis or authority for regulating 
costs and/or reimbursement policies. Therefore, we have not accepted 
the carrier association's suggestions.

Regulatory Flexibility Act

    I certify that this proposed regulation will not have a significant 
economic impact on a substantial number of small entities, because the 
financial sanctions are limited to the portion of health care 
providers' activities involving transactions with the Federal Employees 
Health Benefits Program.

Executive Order 12866, Regulatory Review

    This rule has been reviewed by the Office of Management and Budget 
in accordance with Executive Order 12866.

List of Subjects in 5 CFR Part 890

    Administrative practice and procedure, Government employees, Health 
facilities, Health insurance, Health professions.

Office of Personnel Management.
Kay Coles James,
Director.

0
Accordingly, OPM is amending part 890 of title 5, Code of Federal 
Regulations as follows:

PART 890--FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM

0
1. The authority citation for part 890 continues to read as follows:

    Authority: 5 U.S.C. 8913; Sec.  890.803 also issued under 50 
U.S.C. 403(p), 22 U.S.C. 4069c and 4069c-1; subpart L also issued 
under sec. 599c of Pub. L. 101-513, 104 Stat. 2064, as amended; 
Sec.  890.102 also issued under sections 11202(f), 11232(e), 
11246(b) and (c) of Pub. L. 105-33, 111 Stat 251; and section 721 of 
Pub. L. 105-261, 112 Stat. 2061.


0
2. In subpart J, Sec.  890.1046 is revised to read as follows:


Sec.  890.1046  Effect of debarment or suspension on payments for 
services furnished in emergency situations.

    A debarred or suspended health care provider may receive FEHBP 
funds paid for items or services furnished on an emergency basis if the 
FEHBP carrier serving the covered individual determines that:
    (a) The provider's treatment was essential to the health and safety 
of the covered individual; and
    (b) No other source of equivalent treatment was reasonably 
available.

0
3. In subpart J, Sec.  890.1047 is revised to read as follows:


Sec.  890.1047  Special rules for institutional providers.

    (a) Covered individual admitted before debarment or suspension. If 
a covered person is admitted as an inpatient before the effective date 
of an institutional provider's debarment or suspension, that provider 
may continue to receive payment of FEHBP funds for inpatient 
institutional services until the covered person is released or 
transferred, unless the debarring or suspending official terminates 
payments under paragraph (b) of this section.
    (b) Health and safety of covered individuals. If the debarring or 
suspending official determines that the health and safety of covered 
persons would be at risk if they remain in a debarred or suspended 
institution, OPM may terminate FEHBP payments at any time.
    (c) Notice of payment limitations. If OPM limits any payment under 
paragraph (b) of this section, it must immediately send written notice 
of its action to the institutional provider.
    (d) Finality of debarring or suspending official's decision. The 
debarring or suspending official's decision to limit or deny payments 
under paragraph (b) of this section is not subject to administrative 
review or reconsideration.

0
4. In subpart J, Sec.  890.1049 is revised to read as follows:

[[Page 9921]]

Sec.  890.1049  Claims for non-emergency items or services furnished by 
a debarred or suspended provider.

    (a) Covered individual unaware of debarment or suspension. FEHBP 
funds may be paid for items or services furnished by a debarred or 
suspended provider if, at the time the items or services were 
furnished, the covered individual did not know, and could not 
reasonably be expected to have known, that the provider was debarred or 
suspended. This provision is intended solely to protect the interests 
of FEHBP-covered persons who obtain services from a debarred or 
suspended provider in good faith and without knowledge that the 
provider has been sanctioned. It does not authorize debarred or 
suspended providers to submit claims for payment to FEHBP carriers.
    (b) Notice sent by carrier. When paying a claim under the authority 
of paragraph (a) of this section, an FEHBP carrier must send a written 
notice to the covered individual, stating:
    (1) That the provider is debarred or suspended and is prohibited 
from receiving payment of FEHBP funds for items or services furnished 
after the effective date of the debarment or suspension;
    (2) That claims may not be paid for items or services furnished by 
the debarred or suspended provider after the covered individual is 
informed of the debarment or suspension;
    (3) That the current claim is being paid as a legally-authorized 
exception to the effect of the debarment or suspension in order to 
protect covered individuals who obtain items or services without 
knowledge of their provider's debarment or suspension;
    (4) That FEHBP carriers are required to deny payment of any claim 
for items or services rendered by a debarred or suspended provider 15 
days or longer after the date of the notice described in paragraph (b) 
of this section, unless the covered individual had no knowledge of the 
provider's debarment or suspension when the items or services were 
rendered;
    (5) The minimum period remaining in the provider's debarment or 
suspension; and
    (6) That FEHBP funds cannot otherwise be paid to the provider until 
OPM terminates the debarment or suspension.

0
5. In subpart J, Sec. Sec.  890.1060 through 890.1072 are added to read 
as follows:

Subpart J--Administrative Sanctions Imposed Against Health Care 
Providers Civil Monetary Penalties and Financial Assessments

Sec.
890.1060 Purpose and scope of civil monetary penalties and 
assessments.
890.1061 Bases for penalties and assessments.
890.1062 Deciding whether to impose penalties and assessments.
890.1063 Maximum amounts of penalties and assessments.
890.1064 Determining the amounts of penalties and assessments to be 
imposed on a provider.
890.1065 Deciding whether to suspend or debar a provider in a case 
that also involves penalties and assessments.
890.1066 Notice of proposed penalties and assessments.
890.1067 Provider contests of proposed penalties and assessments.
890.1068 Effect of not contesting proposed penalties and 
assessments.
890.1069 Information the debarring official must consider in 
deciding a provider's contest of proposed penalties and assessments.
890.1070 Deciding contests of proposed penalties and assessments.
890.1071 Further appeal rights after final decision to impose 
penalties and assessments.
890.1072 Collecting penalties and assessments.

Civil Monetary Penalties and Financial Assessments


Sec.  890.1060  Purpose and scope of civil monetary penalties and 
assessments.

    (a) Civil monetary penalty. A civil monetary penalty is an amount 
that OPM may impose on a health care provider who commits one of the 
violations listed in Sec.  890.1061. Penalties are intended to protect 
the integrity of FEHBP by deterring repeat violations by the same 
provider and by reducing the likelihood of future violations by other 
providers.
    (b) Assessment. An assessment is an amount that OPM may impose on a 
provider, calculated by reference to the claims involved in the 
underlying violations. Assessments are intended to recognize monetary 
losses, costs, and damages sustained by OPM as the result of a 
provider's violations.
    (c) Definitions. In Sec. Sec.  890.1060 through 890.1072:
    Penalty means civil monetary penalty; and
    Penalties and assessments may connote the singular or plural forms 
of either of those terms, and may represent either the conjunctive or 
disjunctive sense.
    (d) Relationship to debarment and suspension. In addition to 
imposing penalties and assessments, OPM may concurrently debar or 
suspend a provider from participating in the FEHBP on the basis of the 
same violations.
    (e) Relationship to other penalties provided by law. The penalties, 
assessments, debarment, and suspension imposed by OPM are in addition 
to any other penalties that may be prescribed by law or regulation 
administered by an agency of the Federal Government or any State.


Sec.  890.1061  Bases for penalties and assessments.

    (a) Improper claims. OPM may impose penalties and assessments on a 
provider if a claim presented by that provider for payment from FEHBP 
funds meets the criteria set forth in 5 U.S.C. 8902a(d)(1).
    (b) False or misleading statements. OPM may impose penalties and 
assessments on a provider who makes a false statement or 
misrepresentation as set forth in 5 U.S.C. 8902a(d)(2).
    (c) Failing to provide claims-related information. OPM may impose 
penalties and assessments on a provider who knowingly fails to provide 
claims-related information as otherwise required by law.


Sec.  890.1062  Deciding whether to impose penalties and assessments.

    (a) Authority of debarring official. The debarring official has 
discretionary authority to impose penalties and assessments in 
accordance with 5 U.S.C. 8902a and this subpart.
    (b) Factors to be considered. In deciding whether to impose 
penalties and assessments against a provider that has committed one of 
the violations identified in Sec.  890.1061, OPM must consider:
    (1) The number and frequency of the provider's violations;
    (2) The period of time over which the violations were committed;
    (3) The provider's culpability for the specific conduct underlying 
theviolations;
    (4) The nature of any claims involved in the violations and the 
circumstances under which the claims were presented to FEHBP carriers;
    (5) The provider's history of prior offenses or improper conduct, 
including any actions that could have constituted a basis for a 
suspension, debarment, penalty, or assessment by any Federal or State 
agency, whether or not any sanction was actually imposed;
    (6) The monetary amount of any damages, losses, and costs, as 
described in Sec.  890.1064(c), attributable to the provider's 
violations; and
    (7) Such other factors as justice may require.
    (c) Additional factors when penalty or assessment is based on 
provisions of

[[Page 9922]]

Sec.  890.1061(b) or (c). In the case of violations involving false or 
misleading statements or the failure to provide claims-related 
information, OPM must also consider:
    (1) The nature and circumstances of the provider's failure to 
properly report information; and
    (2) The materiality and significance of the false statements or 
misrepresentations the provider made or caused to be made, or the 
information that the provider knowingly did not report.


Sec.  890.1063  Maximum amounts of penalties and assessments.

    OPM may impose penalties and assessments in amounts not to exceed 
those set forth in U.S.C. 8902a(d).


Sec.  890.1064  Determining the amounts of penalties and assessments to 
be imposed on a provider.

    (a) Authority of debarring official. The debarring official has 
discretionary authority to set the amounts of penalties and assessments 
in accordance with law and this subpart.
    (b) Factors considered in determining amounts of penalties and 
assessments. In determining the amounts of penalties and assessments to 
impose on a provider, the debarring official must consider:
    (1) The Government's interests in being fully compensated for all 
damages, losses, and costs associated with the provider's violations, 
including:
    (i) Amounts wrongfully paid from FEHBP funds as the result of the 
provider's violations and interest on those amounts, at rates 
determined by the Department of the Treasury;
    (ii) All costs incurred by OPM in investigating a provider's 
sanctionable misconduct; and
    (iii) All costs incurred in OPM's administrative review of the 
case, including every phase of the administrative sanctions processes 
described by this subpart;
    (2) The Government's interests in deterring future misconduct by 
health care providers;
    (3) The provider's personal financial situation, or, in the case of 
an entity, the entity's financial situation;
    (4) All of the factors set forth in Sec.  890.1062(b) and (c); and
    (5) The presence of aggravating or less serious circumstances, as 
described in paragraphs (c)(1) through (c)(7) of this section.
    (c) Aggravated and less serious circumstances. The presence of 
aggravating circumstances may cause OPM to impose penalties and 
assessments at a higher level within the authorized range, while less 
serious violations may warrant sanctions of relatively lower amounts. 
Paragraphs (c)(1) through (c)(7) of this section provide examples of 
aggravated and less serious violations. These examples are illustrative 
only, and are not intended to represent an exhaustive list of all 
possible types of violations.
    (1) The existence of many separate violations, or of violations 
committed over an extended period of time, constitutes an aggravating 
circumstance. OPM may consider conduct involving a small number of 
violations, committed either infrequently or within a brief period of 
time, to be less serious.
    (2) Violations for which a provider had direct knowledge of the 
material facts (for example, submitting claims that the provider knew 
to contain false, inaccurate, or misleading information), or for which 
the provider did not cooperate with OPM's or an FEHBP carrier's 
investigations, constitute aggravating circumstances. OPM may consider 
violations where the provider did not have direct knowledge of the 
material facts, or in which the provider cooperated with post-violation 
investigative efforts, to be less serious.
    (3) Violations resulting in substantial damages, losses, and costs 
to OPM, the FEHBP, or FEHBP-covered persons constitute aggravating 
circumstances. Violations producing a small or negligible overall 
financial impact may be considered to be less serious.
    (4) A pattern of conduct reflecting numerous improper claims, high-
dollar false claims, or improper claims involving several types of 
items or services constitutes aggravating circumstances. OPM may 
consider a small number of improper claims for relatively low dollar 
amounts to be less serious.
    (5) Every violation involving any harm, or the risk of harm, to the 
health and safety of an FEHBP enrollee, must be considered an 
aggravating circumstance.
    (6) Any prior violation described in Sec.  890.1062(b)(5) 
constitutes an aggravating circumstance. OPM may consider repeated or 
multiple prior violations to represent an especially serious form of 
aggravating circumstances.
    (7) OPM may consider other circumstances or actions to be 
aggravating or less serious within the context of an individual case, 
as the interests of justice require.


Sec.  890.1065  Deciding whether to suspend or debar a provider in a 
case that also involves penalties and assessments.

    In a case where both penalties and assessments and debarment are 
proposed concurrently,OPM must decide the proposed debarment under the 
same criteria and procedures as if it had been proposed separately from 
penalties and assessments.


Sec.  890.1066  Notice of proposed penalties and assessments.

    (a) Written notice. OPM must inform a provider of proposed 
penalties and assessments by written notice, sent via certified mail 
with return receipt requested, to the provider's last known street or 
post office address. OPM may, at its discretion, use an express service 
that furnishes a verification of delivery instead of postal mail.
    (b) Statutory limitations period. OPM must send the notice to the 
provider within 6 years of the date on which the claim underlying the 
proposed penalties and assessments was presented to an FEHBP carrier. 
If the proposed penalties and assessments do not involve a claim 
presented for payment, OPM must send the notice within 6 years of the 
date of the actions on which the proposed penalties and assessments are 
based.
    (c) Contents of the notice. OPM's notice must contain, at a 
minimum:
    (1) The statement that OPM proposes to impose penalties and/or 
assessments against the provider;
    (2) Identification of the actions, conduct, and claims that 
comprise the basis for the proposed penalties and assessments;
    (3) The amount of the proposed penalties and assessments, and an 
explanation of how OPM determined those amounts;
    (4) The statutory and regulatory bases for the proposed penalties 
and assessments; and
    (5) Instructions for responding to the notice, including specific 
explanations regarding:
    (i) The provider's right to contest the imposition and/or amounts 
of penalties and assessments before they are formally imposed; and
    (ii) OPM's right, if the provider does not contest the proposed 
penalties and assessments within 30 days of the date he receives the 
notice, to implement them immediately without further administrative 
appeal or recourse.
    (d) Proposing debarment in the same notice. OPM may propose a 
provider's debarment in the same notice that also proposes penalties 
and assessments. In this case, the notice must also provide the 
elements of information required to appear in a notice of proposed 
debarment under Sec.  890.1006(b).

[[Page 9923]]

    (e) Procedures if the notice cannot be delivered. OPM must apply 
the provisions of Sec.  890.1006(f) if the notice of proposed penalties 
and assessments cannot be delivered as originally addressed.
    (f) Sending notice by electronic means.[Reserved]


Sec.  890.1067  Provider contests of proposed penalties and 
assessments.

    (a) Contesting proposed sanctions. A provider may formally contest 
the proposed penalties and assessments by sending a written notice to 
the debarring official within 30 days after receiving the notice 
described in Sec.  890.1066. The debarring official must apply the 
administrative procedures set forth in Sec. Sec.  890.1069 and 890.1070 
to decide the contest.
    (b) Contesting debarments and financial sanctions concurrently. If 
OPM proposes debarment and penalties and assessments in the same 
notice, the provider may contest both the debarment and the financial 
sanctions in the same proceeding. If the provider pursues a combined 
contest, the requirements set forth in Sec. Sec.  890.1022 through 
890.1024, as well as this section, apply.
    (c) Settling or compromising proposed sanctions. The debarring 
official may settle or compromise proposed sanctions at any time before 
issuing a final decision under Sec.  890.1070.


Sec.  890.1068  Effect of not contesting proposed penalties and 
assessments.

    (a) Proposed sanctions may be implemented immediately. In the 
absence of a timely response by a provider as required in the notice 
described in Sec.  890.1066, the debarring official may issue a final 
decision implementing the proposed financial sanctions immediately, 
without further procedures.
    (b) Debarring official sends notice after implementing sanctions. 
Immediately upon issuing a final decision under paragraph (a), the 
debarring official must send the provider written notice, via certified 
return receipt mail or express delivery service, stating:
    (1) The amount of penalties and assessments imposed;
    (2) The date on which they were imposed; and
    (3) The means by which the provider may pay the penalties and 
assessments.
    (c) No appeal rights. A provider may not pursue a further 
administrative or judicial appeal of the debarring official's final 
decision implementing any sanctions if a timely contest was not filed 
in response to OPM's notice under Sec.  890.1066.


Sec.  890.1069  Information the debarring official must consider in 
deciding a provider's contest of proposed penalties and assessments.

    (a) Documentary material and written arguments. As part of a 
provider's contest, the provider must furnish a written statement of 
reasons why the proposed penalties and assessments should not be 
imposed and/or why the amounts proposed are excessive.
    (b) Mandatory disclosures. In addition to any other information 
submitted during the contest, the provider must inform the debarring 
official in writing of:
    (1) Any existing, proposed, or prior exclusion, debarment, penalty, 
assessment, or other sanction that was imposed by a Federal, State, or 
local government agency, including any administrative agreement that 
purports to affect only a single agency; and
    (2) Any current or prior criminal or civil legal proceeding that 
was based on the same facts as the penalties and assessments proposed 
by OPM.
    (c) In-person appearance. A provider may request a personal 
appearance (in person, by telephone conference, or through a 
representative) to provide testimony and oral arguments to the 
debarring official.


Sec.  890.1070  Deciding contests of proposed penalties and 
assessments.

    (a) Debarring official reviews entire administrative record. After 
the provider submits the information and evidence authorized or 
required by Sec.  890.1069, the debarring official shall review the 
entire official record to determine if the contest can be decided 
without additional administrative proceedings, or if an evidentiary 
hearing is required to resolve disputed material facts.
    (b) Previously determined facts. Any facts relating to the basis 
for the proposed penalties and assessments that were determined in 
prior due process proceedings are binding on the debarring official in 
deciding the contest. ``Prior due process proceedings'' are those set 
forth in Sec.  890.1025(a)(1) through (4).
    (c) Deciding the contest without further proceedings. To decide the 
contest without further administrative proceedings, the debarring 
official must determine that:
    (1) The preponderance of the evidence in the administrative record 
as a whole demonstrates that the provider committed a sanctionable 
violation described in Sec.  890.1061; and
    (2) The evidentiary record contains no bona fide dispute of any 
fact material to the proposed financial sanction. A ``material fact'' 
is a fact essential to determining whether a provider committed a 
sanctionable violation for which penalties and assessments may be 
imposed.
    (d) Final decision without further proceedings. If the debarring 
official determines that paragraphs (c)(1) and (c)(2) of this section 
both apply, a final decision may be issued, imposing financial 
sanctions in amounts not exceeding those proposed in the notice to the 
provider described in Sec.  890.1066.
    (e) Insufficient evidence. If the debarring official determines 
that a preponderance of the evidence does not demonstrate that the 
provider committed a sanctionable violation described in Sec.  
890.1061, the notice of proposed sanctions described in Sec.  890.1066 
must be withdrawn.
    (f) Disputed material facts. If the debarring official determines 
that the administrative record contains a bona fide dispute about any 
fact material to the proposed sanction, he must refer the case for a 
fact-finding hearing to resolve the disputed fact or facts. The 
provisions of Sec.  890.1027(b) and (c), 890.1028, and 890.1029(a) and 
(b) will govern such a hearing.
    (g) Final decision after fact-finding hearing. After receiving the 
report of the fact-finding hearing, the debarring official must apply 
the provisions of paragraphs (c), (d), and (e) of this section to reach 
a final decision on the provider's contest.


Sec.  890.1071  Further appeal rights after final decision to impose 
penalties and assessments.

    If the debarring official's final decision imposes any penalties 
and assessments, the affected provider may appeal it to the appropriate 
United States district court under the provisions of 5 U.S.C. 
8902a(h)(2).


Sec.  890.1072  Collecting penalties and assessments.

    (a) Agreed-upon payment schedule. At the time OPM imposes penalties 
and assessments, or the amounts are settled or compromised, the 
provider must be afforded the opportunity to arrange an agreed-upon 
payment schedule.
    (b) No agreed-upon payment schedule. In the absence of an agreed-
upon payment schedule, OPM must collect penalties and assessments under 
its regular procedures for resolving debts owed to the Employees Health 
Benefits Fund.
    (c) Offsets. As part of its debt collection efforts, OPM may 
request other Federal agencies to offset the penalties and assessments 
against amounts that the agencies may owe to

[[Page 9924]]

the provider, including Federal income tax refunds.
    (d) Civil lawsuit. If necessary to obtain payment of penalties and 
assessments, the United States may file a civil lawsuit as set forth in 
5 U.S.C. 8902(i).
    (e) Crediting payments. OPM must deposit payments of penalties and 
assessments into the Employees Health Benefits Fund.

[FR Doc. 04-4730 Filed 3-2-04; 8:45 am]
BILLING CODE 6325-52-P