Of all the penalties issued this year by the OIG in response to healthcare organizations that employed excluded individuals, all but three were the result of self-disclosures.

Which kind of makes you wonder: Why?  Why would a healthcare organization go ahead and self-disclose, knowing that it will almost definitely be hit with a fine worth tens or even hundreds of thousands of dollars?

The answer is even simpler than the question.

Because not self-disclosing can be much, more worse.

According the OIG’s recently released Fiscal Year 2015 HHS OIG Work Plan Mid-Year Update, 4,017 individuals and entities were excluded from participation in Federal health care programs in 2014 alone.  That’s a lot of exclusions to keep track of; but there’s more.

The update goes on to describe its Provider Self-Disclosure protocol as follows:

The Provider Self-Disclosure Protocol gives providers an opportunity to minimize the potential costs and disruption that a full-scale OIG audit or investigation might entail if fraud is uncovered. The self-disclosure also HHS OIG Work Plan Mid-Year Update | FY 2015 CMS-Related Legal and Investigative Activities enables the provider to negotiate a fair monetary settlement and potentially avoid being excluded from participation in Federal health care programs. (emphasis added)

In other words, healthcare organizations that do not self-disclose can be hit with something a lot worse than fines — they can be excluded from participation in Federal health care programs altogether.

Oh.  So that’s why.