What is Healthcare Sanctions Background Check?

Hiring the wrong person in the healthcare industry can cost organizations up to $10,000 for every day a sanctioned individual remains on the job. That kind of risk isn’t just a financial headache; it’s a serious threat to patient safety, regulatory compliance, and your ability to receive federal funding. In a field where every decision impacts lives, healthcare sanctions background checks are not optional. They are essential.

These checks serve as your first line of defense, helping ensure your team is qualified, trustworthy, and fully compliant with laws designed to protect patients and preserve public trust.

What is a Healthcare Sanctions Background Check?

A healthcare sanctions background check is a comprehensive screening process that searches through multiple federal and state databases to identify individuals who have been prohibited from working in healthcare roles. These checks look for people who have been excluded from federal healthcare programs due to criminal convictions, professional misconduct, or other violations that could compromise patient safety.

The screening process searches several key databases, including:

• OIG Exclusion List – Maintained by the Office of Inspector General
• System for Award Management (SAM) – Federal contracting database
• Office of Foreign Asset Control (OFAC) – Treasury Department watchlist
• State exclusion lists – Individual state sanctions databases
• Professional licensing boards – Medical and nursing board disciplinary actions

Healthcare organizations that receive federal funding through Medicare, Medicaid, and other federally funded healthcare programs are legally required to conduct these screenings before hiring healthcare professionals.

Why Healthcare Sanctions Screenings Are Critical

Protecting Patient Safety

The primary reason healthcare sanctions checks are so important is patient safety. Sanctioned individuals may have been excluded for serious issues like:

• Patient abuse or patient neglect
• Theft of controlled substances
• Medicare fraud or medicaid fraud
• Healthcare-related fraud
• Felony convictions for financial misconduct
• Suspended or revoked licenses

By conducting thorough sanctions background checks, healthcare organizations can identify these red flags before they become serious problems.

Maintaining Federal Funding Eligibility

Healthcare organizations that participate in federally funded programs must comply with strict regulations about who they can employ. The Department of Health and Human Services has made it clear: if you hire excluded individuals, you’re putting your federal funding at risk.

Organizations can lose their ability to participate in federal healthcare programs entirely, which for many healthcare providers would mean financial ruin. This applies to hospitals, clinics, nursing homes, and any healthcare providers that bill federal programs.

Avoiding Heavy Financial Penalties

The financial risks are severe. Under federal regulations, healthcare organizations can face civil monetary penalties of up to $10,000 for each service provided by a sanctioned individual. These penalties can also be calculated on a per-day basis for each day the excluded individual worked for your organization.

Protecting Your Organization’s Reputation

When healthcare organizations employ sanctioned individuals, they face significant reputational damage. Patients lose trust, referring physicians become hesitant, and community confidence can be severely undermined.

What Shows Up on a Healthcare Sanctions Check?

A comprehensive healthcare sanctions check typically reveals:

OIG Exclusion List Results

• Whether the individual is excluded from federal programs
• The sanctioning agency (Office of Inspector General)
• Date of sanction and current status
• Reason for exclusion (if available)

System for Award Management (SAM) Results

• Federal contract debarments
• Exclusions from federal funding
• Restrictions on federal agency work

OFAC Screening Results

• Individuals on terrorism watchlists
• Drug trafficking sanctions
• Foreign asset control restrictions

State-Specific Information

• Medical board disciplinary actions
• Nursing board sanctions
• State medicaid exclusion lists
• Professional license suspensions

FACIS Database Results

The Fraud Abuse Control Information System (FACIS) offers three screening levels: Level 1 checks federal databases like OIG, DEA, FDA, Medicare, and Tricare; Level 2 adds state-specific data; and Level 3 provides the most comprehensive review, covering all state sanctioning boards.

When Should You Conduct Healthcare Sanctions Screening?

Before Hiring

Always conduct healthcare sanctions checks before making any hiring decisions. This is your first opportunity to identify potential risks, protect your organization from compliance violations, and avoid costly mistakes that could jeopardize patient safety or federal program eligibility.

Before Start Date

Since sanctions lists are updated regularly, run a second check before the employee’s actual start date. This helps catch any recent sanctions that may have occurred between the initial screening and onboarding, ensuring your organization stays compliant and minimizes legal or financial risks.

Ongoing Periodic Screening

Implement regular screening schedules for existing employees. Many organizations conduct annual or semi-annual checks to ensure ongoing compliance. This helps identify any disciplinary action or sanctions that may have occurred after hire.

After Incidents

If any concerning incidents occur, conduct immediate screening to determine if there have been any recent sanctions or disciplinary actions. Prompt checks help you take swift, informed action to protect your patients, maintain compliance, and address potential risks before they escalate.

How Long Does a Healthcare Sanctions Background Check Take?

The time it takes to complete a healthcare sanctions background check depends on your approach. DIY screening can take days or even weeks, as it involves manually searching multiple federal and state databases. This process is time-consuming and prone to errors.

In contrast, working with a professional consumer reporting agency typically delivers results within hours. These agencies use advanced technology and have access to comprehensive databases, making the process faster, more accurate, and more efficient. For most healthcare organizations, partnering with a trusted consumer reporting agency is a reliable and effective way to streamline compliance.

Best Practices for Healthcare Sanctions Screening

Establish Clear Written Policies

Develop comprehensive policies that outline who must be screened, when screenings should occur (e.g., pre-employment, annually, or after incidents), how to handle positive results in a legally compliant and timely manner, and the documentation requirements for maintaining accurate records. Clear guidelines ensure consistency, support regulatory compliance, and protect your organization from liability.

Use Reliable Screening Partners

Partner with experienced background screening companies that specialize in healthcare sanctions checks. They offer access to comprehensive databases and understand the industry’s complex compliance requirements, helping you ensure accurate and reliable results.

Maintain Proper Documentation

Keep detailed records of all screening activities, including the dates of screening, databases searched, results obtained, and any actions taken. Thorough documentation supports compliance and protects your organization during audits or investigations.

Stay Current with Regulations

Healthcare regulations change frequently, and failing to keep up can put your organization at risk. Stay informed about federal and state updates to ensure your screening processes remain compliant, effective, and aligned with current legal and industry standards.

Train Your Staff

Ensure your hiring managers and HR staff understand the importance of healthcare sanctions screenings and know how to properly interpret results. Provide regular training so they can recognize red flags, follow established procedures, and make informed hiring decisions that protect both patients and the organization.

The Cost of Non-Compliance

Failing to conduct proper healthcare sanctions background checks can lead to civil penalties up to $10,000 per service or per day, loss of federal funding, exclusion from Medicare and Medicaid, reputational harm, legal liability, and serious patient safety risks. These consequences far outweigh the cost of a thorough screening program.

Making Informed Hiring Decisions

Healthcare sanctions background checks are just one part of a comprehensive background screening process. Combined with other background checks, reference verification, and credential validation, they help ensure you’re making informed hiring decisions that protect your patients and your organization.

Remember that the goal isn’t just compliance—it’s about building a healthcare team you can trust to provide safe, quality care to your patients while maintaining the integrity of your organization.

Conclusion

Healthcare sanctions background checks play a critical role in safeguarding patients, preserving your organization’s reputation, and ensuring compliance with federal and state regulations. From pre-employment screenings to ongoing checks, these efforts strengthen your hiring process, reduce risk, avoid financial penalties, and protect your ability to participate in Medicare, Medicaid, and other federally funded programs. In today’s complex healthcare environment, proactive screening is not just a best practice—it is a necessity.

Partner with Sapphire Check to streamline your healthcare sanctions background screening process. Our experts deliver fast, accurate results using industry-specific tools and databases to help you stay compliant and confident in every hiring decision. Do not leave your organization exposed. Contact us to strengthen your compliance strategy and protect what matters most.

FAQs

What does “sanctioned” mean in healthcare?

In healthcare, “sanctioned” means an individual or entity has been officially penalized, excluded, or barred from participating in federal healthcare programs like Medicare and Medicaid due to misconduct, fraud, or violations that could threaten patient safety.

What is a sanctions check?

A sanctions check is a screening process that searches government databases to determine if an individual or entity has been sanctioned, excluded, or debarred from participating in federal programs or conducting business with government agencies.

What is sanctions screening?

Sanctions screening refers to the systematic process of checking individuals and entities against various government watchlists and exclusion databases to ensure compliance with federal regulations and avoid hiring prohibited persons.

What is the purpose of sanctions?

The purpose of sanctions in healthcare is to protect patient safety, maintain the integrity of federal healthcare programs, and deter fraud and misconduct by excluding unqualified or dangerous individuals from the healthcare system.