A new final rule and a proposed rule published September 2, 1998, by the HHS Office of Inspector General (OIG) outline regulations that implement enforcement provisions of the Health Insurance Portability and Accountability Act of 1996 and the Balanced Budget Act of 1997, respectively. The rules give the OIG discretionary authority to exclude organizations from participation in state or Federal healthcare programs or exact civil monetary penalties for certain types of infractions. Healthcare organizations, therefore, need to understand these rules and incorporate corresponding changes and processes into their compliance programs to avoid violations that could lead to penalties or exclusions.