Healthcare Ethics and Compliance Program Requirements
The Affordable Care Act included a mandate that medical service providers and suppliers enact compliance programs as a condition of participating in federal health care programs. (The ACA also set a deadline of March 23, 2013, for skilled nursing facilities and nursing facilities to implement a compliance program).
The ACA requires HHS and the Office of the Inspector General (OIG) to establish core elements for mandatory compliance programs. Unfortunately, HHS has not issued final regulations for healthcare compliance programs. It is not an easy task since the guidelines have to take into account a variety of healthcare organizations concerning the entire landscape of medical service providers and suppliers.
HHS has a rich history from which to craft the core elements for the healthcare industry starting with the Federal Sentencing Guidelines, prior OIG compliance guidance and enforcement requirements contained in corporate integrity agreements (CIAs).
Based on these sources, many if not all medical service providers and suppliers already have established compliance programs. The quality of these compliance programs varies significantly across the industry. Eventually, when HHS finally gets its act together and issues the final rules, most healthcare organizations will have to modify or enhance their compliance programs. If a healthcare organization implemented only a “paper” program without any meaningful commitment to compliance, they will quickly learn that a “paper” program is not going to satisfy the HHS requirements.
We all know that compliance is not something that can be “faked” or masked through paper statements. It requires a legitimate commitment to promoting an ethical organization. Given the significant risks in the healthcare industry, from aggressive enforcement and a mature whistleblowing industry, it would be foolish for healthcare organizations to ignore the need for a robust ethics and compliance program.
The Federal Sentencing Guidelines are always a good place to start. Add to that OIGs numerous statements since the 1990s urging healthcare organizations to adopt compliance programs and providing specific guidance on the subject, and it is easy to see that healthcare organizations should have a good start in this area. Enforcement settlements, like FCPA settlements, provide another important source of guidance on healthcare compliance requirements.
Taking all of these sources together, it is fairly easy to identify the nine core requirements for an effective compliance program. These include:
1. Senior Management Commitment: The senior management of the organization has to establish and demonstrates its commitment to an effective compliance program
2. Written Compliance Standards and Procedures: Providers and suppliers should adopt written compliance standards and procedures to reduce criminal, civil and administrative violations. The standards and procedures should be tailored to a specific risk assessment conducted by the organization to identify the risk areas the organization faces in the healthcare marketplace.
3. Designation of Chief Compliance Officer: An organization should appoint a high-ranking individual responsible for the compliance program who has sufficient resources and authority to implement an effective compliance program. The individual or committee should have the authority and ability to report directly to the board of directors. The CCO has to be separate from the General Counsel and not part of the organization’s legal department.
4. Training and Communications: Providers and suppliers have to communicate standards and procedures to all personnel through mandatory compliance training, education and internal communications. As part of the training program, new employees should be required to completed training soon after joining the organization. Most organizations conduct mandatory training multiple times each year. The training programs have to be tailored to the audience to address the specific risks employees face in the organization.
5. Confidential Reporting: Providers and suppliers should create confidential reporting mechanisms for violations so that employees are able to report suspected compliance and legal violations without fear of retribution
6. Internal Monitoring and Auditing: An organization should conduct robust internal monitoring and auditing to detect violations, and identify weaknesses in a compliance program. Organizations should periodically review their policies and procedures and claim submissions. If an issue is identified in an internal audit or policy review, the organization should remediate the problem and implement changes to its compliance program to address the specific issue.
7. Enforcement and Discipline: Organizations should enforce its compliance program through appropriate disciplinary measures up to and including termination of employment and referral of matters to law enforcement and regulatory agencies, if warranted.
8. Due Diligence: Organizations should adopt due diligence procedures to ensure that its employees, agents and other business partners do not or have not in the past committed criminal, civil and administrative violations of healthcare laws and regulations (or any other laws and regulations).
9. Response to Potential Compliance Issues: Organization should develop appropriate systems and procedures for responding to identified or reported issues, including internal investigation systems to determine what actions, if any, are necessary to respond to complaints and other issues identified through the compliance program.