Elements of an Effective Compliance Program

Building Your Compliance Program - The Elements of an Effective Compliance Program

So, where do we start? We first need a checklist of all the elements of an effective compliance program before we start building, so we’ll know what the “house” needs to look like once it’s completed. The OIG says that an effective compliance program must at a minimum address each of the following elements:

• Designation of a Compliance Officer and Compliance Committee. Just as a household needs someone in charge to manage operations, an effective compliance program must have a compliance officer and often a compliance committee who are responsible for developing, operating and monitoring the compliance program. They must report directly to the facility’s owner, its governing body, and CEO, periodically and on an as-needed basis. The compliance officer must oversee the program, including making revisions as the facility’s needs change, coordinating and participating in training and education for employees, independently investigating compliance matters and ensuring that any necessary corrective action is taken.
• Developing Effective Lines of Communication. It’s not enough to appoint a compliance officer and committee, even if they are diligent. As with any head of a household, the compliance officer must create and maintain effective lines of communication with all employees. This should include a process, such as a hotline or other reporting system, to encourage questions and complaints and procedures to protect the confidentiality or reports and anonymity of the complainants and to protect employees against retaliation.
• Creation and Retention of Records. This essential part of a compliance program goes hand in hand with quality medical care and proper billing – developing and implementing a records system that ensures complete and accurate medical record documentation, including policies and procedures addressing documentation of services records, retention and destruction of records and privacy concerns. If problems arise, the facility must be able to demonstrate the integrity of the facility’s compliance process, its effectiveness, and the facility’s efforts to comply with all applicable statutes and regulations. This can only be accomplished by documenting every element of the program.
• Conducting Effective Training and Education. If we want our kids to obey the rules of the house, we don’t merely write them a note -- we must educate them in ways consistent with their particular ages and learning styles. Similarly, a necessary component of an effective compliance program, according to the OIG, is the proper and periodic education and training of all managers, physicians and facility personnel at all levels. The facility should use a variety of teaching methods which take into account the skills and experience of the individual trainees. The content may vary according to the specific group being trained, but all must at a minimum understand the facility’s standards of conduct, compliance with Medicare requirements, proper documentation in clinical and financial records, and the prohibition on payment for referrals, residents’ rights, and the duty to report misconduct.
• Compliance as an Element of Employee Performance. The program should require an employee to promote and adhere to the elements of the compliance program as a factor in evaluating the performance of all employees. Managers should be required to discuss with all supervised employees and contractors, as needed, the compliance policies and legal requirements related to their respective functions, inform personnel that strict compliance with the same is a condition of employment and warn them that the facility will take disciplinary action in the event of any violations.
• Enforcing Standards through Well-Publicized Disciplinary Guidelines. Whether or not spanking is in your disciplinary repertoire at home, there must be some sort of consequences to enforce discipline. An effective compliance program should set out the consequences for employees or contractors who violate the facility’s standards of conduct, policies and procedures, and Federal and State laws. It should describe the procedures for handling such disciplinary problems. Intentional violations should result in significant sanctions, and negligent violations in some instances may also result in disciplinary action.
• Internal Auditing and Monitoring. Being able to spot and catch problems before they multiply is important in both a household and a facility. To demonstrate a compliance program’s effectiveness, the facility must thoroughly monitor its implementation of the compliance program through a process of ongoing evaluation, including regular, periodic compliance audits by internal or external evaluators with the necessary expertise in Federal and State requirements and private payor rules. Auditing should be designed to identify problem areas and resolve them. The facility also needs to review at least annually whether all the departments of the facility have satisfied each of the compliance program’s elements.
• Responding to Detected Offenses and Developing Corrective Action Initiatives. A homeowner who ignores a leaking roof will end up with a much bigger and more expensive problem than if he had acted promptly. Similarly, if the compliance officer receives reports or reasonable indications of suspected noncompliance, there must be an immediate investigation to determine whether there has been a violation of law or other requirements and, if so, decisive steps to correct the problem. Corrective action may include developing a plan of action, returning overpayments, or referral to criminal or civil law authorities, among others.
• Assessing Effectiveness of a Compliance Program. The compliance program must be evaluated periodically to assess its effectiveness as a whole, including how it performs in practice to monitor the facility’s operations on a day-to-day basis. If the same problems recur time and time again, something needs to be addressed. Comprehensive policies, standards and practices are only effective if they have the commitment of the facility’s management, are clearly written and communicated to staff, and are interpreted by a compliance officer with the requisite skills and experience. In the event of a regulatory investigation, thorough documentation of all aspects of the facility’s compliance program is necessary to demonstrate the facility’s good faith and the program’s effectiveness.
• Policies and Procedures, Including a Statement of Corporate Philosophy and Codes of Conduct. Finally, the program should develop and distribute written compliance standards, procedures and practices to guide the facility and its employees on a day-to-day basis. These should include a code of conduct detailing the fundamental principles, values and framework for action within the organization; general corporate policies and procedures; a synthesis of key Federal and State laws and specific provisions for various clinical, financial and administrative functions within the facility. These should be easily understood by, and posted and distributed to, all affected employees, as well as physicians, suppliers, agents and contractors.

We’ll explore each of these compliance program components in detail later on in this web-based guidance.