A Provider’s Guide to Alabama Medicaid Exclusion Screening

Alabama at a glance

Official list name	Alabama Medicaid Suspended Providers List
Format	Online searchable list
Screening cadence	Monthly (CMS SMDL #08-003 and #09-001)
Official source	View Alabama’s official list →

Recent cases from across the country

Each settlement below started with one missed exclusion check. All were preventable. Don’t let your organization become the next example.

Alabama hasn’t had a publicly reported settlement of this kind between 2020 and 2025, so the cases below are drawn from the most recent enforcement actions nationally.

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Alabama’s Medicaid Program will not pay for any item or service furnished by, or at the medical direction of, an excluded party. To enforce this payment prohibition, it imposes exclusion and sanction screening requirements on providers, and those that fail to fulfill their screening obligations, risk the imposition of overpayments and civil money penalties. This short question and answer summary will help providers understand and comply Alabama’s exclusion and sanction screening rules and regulations.

What are the Basic Alabama Medicaid Exclusion Screening Requirements?

Prior to hiring and monthly thereafter, providers in Alabama are required to screen all employees, vendors, and contractors that contribute to the submission of any Medicaid claims with the Alabama Medicaid Exclusion List, the Office of Inspector General’s List of Excluded Individuals and Entities (LEIE), and the General Services Administration, System for Award Management’s debarment list (GSA/SAM).

What is the effect of an exclusion from participation in Alabama Medicaid?

Since Alabama will not pay for any item or service furnished either directly or indirectly by an excluded party, excluded parties are essentially banned from all participation in its Medicaid program. The payment prohibition extends to support services that are not directly billable such as nursing care and the preparation of surgical trays; to indirect services such as inputting prescription information; and to administrative and management duties. The ban also applies if the excluded party provided the item or service indirectly, and it extends to all methods of reimbursement (whether bundled, fee-for-service, or other).

(Alabama Administrative Code, Rule No. 560-X-4-.04; Alabama Medicaid Provider Manual, 7.3.1; Section 1903(i)(2) of the Social Security Act; and 42 CFR sections 1001.1901(b)) and 1002.211)

What are the Risks for Hiring or Contracting with Excluded Parties in Alabama?

As a result of the payment prohibition, any and all payments for services provided directly or indirectly by an excluded entity are overpayments which should be repaid. In addition, civil monetary penalties may be imposed against Medicaid providers and managed care entities (MCEs) who employ or enter into contracts with excluded individuals or entities to provide items or services to Medicaid recipients.

(See, 1128A (a)(6) of the SSA, 42 CFR 1003.102(a)(2)), and Alabama Medicaid Provider Manual. Section 7.3.1).

Are there any added screening requirements arising from provider enrollment?

Yes, providers must identify all owners, officers, shareholders of greater than 5%, agents, directors and managing employees and, for each, disclose whether they have ever been excluded, debarred, or sanctioned from any state or federal program.

(Alabama Provider Disclosure Form, amended July 2018.)

Who Typically Gets Excluded? Do I Only have to worry about doctors?

You have to worry about all your employees and contractors because the payment prohibition extends to everyone that contributes either directly or indirectly to the submission of a claim!  And as the chart below shows, as of December, 2023 physicians and their medical clinics accounted for only slightly more than 20% of all exclusions whereas nurses and other non-billing employees accounted for almost 70% of all exclusions. 

Final Thoughts

In almost all instances, exclusions result from fraud, patient abuse or neglect, and/or drug related offenses, so employing or contracting with excluded parities pose direct risks to your practice or organization in addition to the potential legal consequences that can result from governmental oversight. Thus, in addition to avoiding overpayment and civil money penalty liability, effective Exclusion Screening provides an additional, cost-effective layer of risk reduction. For more information on Alabama Medicaid, visit their official website. For more information on State Medicaid, visit our article Current States With a Separate Medicaid Exclusion List.