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Posts Tagged ‘Compliance Program’

US Attorney Manual Updated to Incorporate Yates Memorandum

Tuesday, November 1st, 2016

DOJ Directives Incorporating the Yates Principles

This is the third installment on our blog series covering the Yates memorandum and changes in Federal policy regarding prosecution of individuals for corporate wrongdoing.

In September of 2016, the DOJ issued revisions to its Manual used to provide guidance to U.S. Attorneys.  The revisions include the directives set forth in the Yates Memorandum together with subsequent clarification that was provided by the DOJ.  The revision to the Manual added a new section entitled “Focus on Individual Wrongdoers.”   The individual wrongdoer sections of the Manual cover the general principles that were set forth in the Yates Memorandum as well as revisions reflecting the new concepts regarding corporate cooperation credit, privilege assertion, and cooperation between criminal and civil enforcement authorities.

The Manual revisions should indicate the seriousness of this issue.  The Manuals are used as a primary reference by prosecutors across the country who are responsible for prosecuting corporate wrongdoing.  The revisions indicate that the DOJ is making the concepts included in the Yates memorandum into operational policy.  Agents will be judged and reviewed on their effectiveness complying with this policy.  This action is a clear indication that the Yates concepts are real.  We can expect a much higher degree of scrutiny on individual corporate wrongdoing.

As stressed in previous blog articles, companies must review their policies and procedures for investigating potential wrongdoing and implement changes that mitigate their risk in view of the new Federal policy.

Effective Compliance Programs Are Important Says DOJ to HCCA

Monday, July 9th, 2012

compliance programs now mandatory

Assistant Attorney General, DOJ, Speaks Out On Compliance Programs

In the May issue of Compliance Today, the magazine of the Healthcare Compliance Association, there was an article containing an interview with Assistant Attorney General, Criminal Division, US Department of Justice, Lanny A. Breuer.  In response to questioning concerning what value there is to an organization’s compliance program, Mr. Breuer stated as follows:

Strong compliance programs help prevent illegal activity from occurring within the organization, and they ensure that any misconduct that does occur is uncovered quickly and handled responsibly. In recent years, the Justice Department has increased enforcement in several areas of white collar crime, so having an effective compliance program has never been more important than it is today.

This is yet another expression by the individuals who are charged with enforcing health care fraud laws that effective compliance programs are crucial.  Now that the Supreme Court has upheld that Affordable Care Act, mandatory compliance programs have a clear path to move forward.  I believe we wil start seeing regulations released implementing mandatory compliance program requirements over upcoming months.


Corporate Compliance and Ethics Week 2012

Monday, May 7th, 2012

Corporate Compliance and Ethics Week 2012

Use Corporate Compliance Week To Increase Aweness of Your Compliance Program

This week (May 6-12, 2012) has been designated as Corporate Compliance and Ethics Week by the Society of Corporate Compliance and Ethics and the Health Care Compliance Association.  Corporate Compliance Week is a great time for you to reinforce the message of compliance throughout your organization.  At a minimum you should use this opportunity to publicize your program, hot-line and reporting system and anti-retaliation policy. 

Some ideas to help you leverage Corporate Compliance Week to increase the visibility if your compliance program include:

– Send E-mail to all employees announcing that it is Corporate Compliance week.

– Release a special compliance week newsletter or alert.

– Publish a quiz about information that all employees should know about the compliance program.

– Release a message on compliance from the CEO and/or Compliance Officer.

– Have a breakfast, lunch or “meet and great” with a brief message about the compliance program.

– Post signs in break and other visible areas announcing Corporate Compliance Week and your compliance program.

– Hold a raffle and have employees complete a brief questionnaire on the basics of the compliance program in order to enter.

With a little creativity, you can make the most of Corporate Compliance and Ethics Week.  Your focus should be to enforce compliance as a positive element of your corporate culture.  Reinforce the message that the organization encourages reporting of compliance concerns through its reporting system and takes information that it receives seriously.  You should also reinforce the organizations intolerance for retaliation or retribution against parties that provide compliance information.

Take this opportunity to have fun with your compliance program and put a positive face on your efforts.  Take the information that you learn through the interactions that you have with employees to make improvements to your compliance program.

 Ruder Ware has an active Corporate Compliance and Ethics practice.  We counsel clients in a variety of industries, including healthcare, transportation, banking and manufacturing on various aspects of their compliance and ethics programs.  We assist clients in assessing the effectiveness of programs and suggesting steps to take in order to increase program effectiveness.  Ruder Ware is actively involved in the Society of Corporate Compliance and Ethics and the Health Care Compliance Association.  Two of our attorneys recently attended the Midwest meeting of the SCCE.  One of our attorneys is Certified in Healthcare Compliance through the Health Care Compliance Association.

Compliance Programs Come Center Stage As Government Tools Expand

Friday, April 20th, 2012

Health Care Compliance and Our Compliance Practice

John Fisher, CHC

Health care attorneys health lawThe current health care regulatory environment presents a high degree of risk to even the most well-intentioned provider.  Recent legal changes have made it even easier for the government to pursue what they believe to be improper activities.  The government is taking a “return on investment” approach to pursuing health care fraud and is coming out on the winning end of this game.  Reports state that the government collects approximately $15 for every $1 that they invest policing health care fraud.  In addition, Whistleblowers continue to bring a steady flow of cases against health care providers.  Even though there is a dispute over certain aspects of health care reform, the area where all ranges of the political spectrum appear to agree is on pursuing health care fraud.  Therefore, we cannot expect this climate of enforcement against health care providers to go away anytime soon.

 While the government continues with its “pay and chase” approach to health care fraud and overpayments, it is also integrating even more drastic measures into its bag of tools.  The government is now authorized to discontinue making payments to a provider altogether upon receiving any “credible allegation” of misconduct.  The allegation does not need to be proven to be true and there is not even a formal procedure to permit the provider to make its case.  Yet, the financial consequences of suspending payment can be devastating.

 Chances are very good that an individual provider will eventually have dealings with the government over some overpayment or fraud and abuse issue.  If you have not had to deal with an investigation, you are very fortunate.  Even the best intentioned providers will more likely than not need to deal with government scrutiny.  When that occurs, it serves the provider well to have an appropriately scaled compliance program that is being actively worked to identify risk areas, billing mistakes, and other possible difficulties.  Having an effective compliance program in place is the best way to turn the problem into something that is manageable, and turn it away from an enforcement action that can have grave consequences on operations and financial viability.

 At Ruder Ware, we have assembled a multidisciplinary team of attorneys to assist providers in compliance matters.  Our compliance team is lead by John H. Fisher, III, who is a seasoned health care attorney and is certified in health care compliance.  Our compliance team can assist providers through the process of structuring an appropriately scaled compliance program, reviewing existing compliance program for effectiveness, and assisting with ongoing operational issues related to compliance programs.

 Our compliance team brings a depth of experience in the wide range of compliance issues that affect various types of providers, such as the Federal False Claims Act, the Stark Law, Anti-Kickback Statute, Civil Monetary Penalties laws, and various legal and billing issues that pertain to the specific practice or provider.  We can suggest practical approaches for identifying specific risk areas and crafting plans to minimize risks in those areas.

 We are able to work with compliance departments to fashion methods for handling issues that arise through their compliance reporting systems, including the creation of corrective action plans.  We advise providers regarding identification, repayment of overpayments, and where necessary, self-disclosure of legal violations to the appropriate governmental agencies using self-disclosure protocols.

When compliance problems are identified, it is critical that providers take appropriate actions to make repayment, appropriately investigate, and craft a proper resolution that avoids reoccurring or deeper difficulties.  We are able to assist with these matters under the attorney-client privilege to determine the nature and scope of any discovered compliance concern.  We can direct investigations and take necessary steps to remedy the problem, all while maintaining client confidentiality.

As with any other legal issue, prevention is the best medicine.  Although we are equipped to assist providers as difficulties arise, we prefer to assist providers to ensure that their compliance programs are effective and appropriately tailored to the size and nature of their particular business.  Ruder Ware’s compliance team has experience conducting compliance effectiveness review and “gap analysis.”  This process involves in-depth due diligence review of matters relative to your compliance program, an assessment of the program, and specific recommendations aimed at making the compliance program more effective.

Compliance Program Effectiveness – About Our Compliance Practice

Friday, March 9th, 2012

Compliance Program Development and Effectiveness Review

John Fisher, JD, CHC

A significant part of our health law practice involves the creation, implementation, and review of compliance programs for health care providers.  Some of our compliance practice is devoted to institutional provides such as hospitals, health systems and nursing homes.  We are increasingly advising our smaller health care clients, such as physician groups, home health agencies and other providers on establishing appropriate compliance programs.  The entire health care industry is trending toward the adoption of compliance programs spurred on by a true desire to reduce risk as well as recent legal changes that mandate the adoption of compliance programs for most health care providers.

We have made a major firm committment to our compliance practice.  Health care attorney John Fisher recently obtained national certification in health care compliance through the Health Care Compliance Association.  We have assembled a team attorneys with various legal backgrounds, including health law, employment law, non-profit tax law and other areas to complement Mr. Fisher’s focus on compliance issues faced by health care providers.

We provide compliance program development and review services to hospitals, individual physicians and group practices, dental groups, chiropractic groups, home health agencies, skilled nursing facilities, durable medical equipment suppliers, ambulance providers, therapy clinics, ambulatory surgery centers, and behavioral health care providers.  We assist providers in conducting internal audits, internal investigations, compliance program gap analysis and effectiveness reviews. We have also assisted providers who are the subject of reviews by institutions where they may be employed or have staff privileges.

Examples of some of our compliance program related involvement in the health care area include:

  • Conducting effectiveness reviews and making suggestions for enhancements to existing compliance programs.
  • Working with governing bodies to develop initial compliance programs.
  • Advising compliance officers and governance with respect to ongoing monitoring and auditing.
  • Assisting providers to conduct internal audits and assessments.
  • Assisting providers to focus on specific risk areas that may affect their practices.
  • Assisting providers in the reacting to compliance reports including investigations and corrective action plan development.
  • Conducting detailed compliance related research in the course of acquisitions of other providers.
  • Creating programs that leverage existing resources and expertise into an enterprise management system addressed at compliance issues.
  • Compliance Programs Are An Essential Element of Health Care Operations

Effective compliance programs have become an essential element of an effective regulatory risk reduction program.  The importance of compliance programs have been repeatedly emphasised by government officials over the past decade.  Recently, Marilyn Tavenner, Acting Administrator of the Centers for Medicare & Medicaid Services (CMS) released a brief article on the CMS Blog emphasizing the use of “predictive modeling” technologies to identify specific providers that warrant further investigation.  The Acting Administrator touts that predictive modeling has already identified 2,500 leads for further investigation, 600 preliminary law enforcement cases, and 400 direct interviews with providers that have taken place due to the use of predictive modeling.

The 2012 Office of Inspector General Annual Work Plan also referred to new methods and programs to detect potential billing anomolies.  The OIG states that it will be using data matching programs to identify not only providers who are at a high risk of having incorrect billings, but also providers who have low risk.  The OIG claims that it will be examining both types of providers to determine the impact that compliance program operations have on the accuracy of billings.  This is alarming because it means that the OIG will be eamining the operations of compliance programs who show low risk of billing anomolies.

The Coming of Mandatory Compliance Programs

The PPACA created the concept of mandatory compliance programs for most providers.  Nursing homes are first on the list and must certify that they have an effective compliance program by 2013.  We are expecting additional regulations on what constitutes and effecive compliance progam as well as specific timelines defining when other provider types will be required to adopt compliance programs as a condition of participation in the Medicare and Medicaid programs.

Compliance Programs – One Size Does Not Fit All

The OIG Guidance on Compliance Programs as well as the Federal Sentencing Guidelines make it clear that one size does not fit all when it comes to compliance program development.  An effective compliance program needs to be strategically developed based on identification of the risk factors that are specific to the size and nature of the organization.  It is not prudent to simply copy the policies of another organization and adopt them as your own.  You should create a structure as well as topical policies that reflect the nature of your particular organization; sometimes right down to the personalities that are involved in the various aspects of your operations.

There are certain core principals that will be common to all compliance programs.  However, your program should be appropriately scaled to the size and resources of your organization.  I am not suggesting that you fail to allocate sufficient resources to compliance.  Decisions regarding allocation of resources are difficult but must be addressed.  At the same time, you do not want to develop policies that you will never have the resources to appropriately follow.  This carries the risk of creating a “Roadmap” that demonstrators to investigators the things that you are NOT doing.  Policies that you do not follows are argueably worse than having no policies at all; at least in some areas.

Excluded Party Screening – Compliance Program Key Element

Tuesday, February 14th, 2012

Screening For Excluded Providers
Key Elements Of Your Compliance Program

Most hospitals and larger healthcare organizations have gone through the process of developing compliance programs and are aware of the prohibitions against entering relationships with parties who have been excluded from a federal health care program.  Smaller organizations may not be aware of their responsibilities to screen all employees, vendors and contracting parties for exclusion.

Providers, such hospitals, medical groups, ambulatory surgery centers and home health agencies are subject to civil monetary penalties for submitting claims for healthcare items or services that are provided by excluded individuals or companies.  Fines can reach as high as $10,000 per item or service.  The fines can be astronomical if goods or services are regularly provided by the excluded party.

For this reason, compliance programs will generally include policies and procedures that require screening prior to contracting or employment.  Regular periodic screening is also highly recommended.  Smaller organizations and physician practices are at the most risk of violating these provisions.  These organizations have generally not yet faced the creation of formal compliance programs; although compliance programs will be mandatory in upcoming years.

 All health care providers must establish policies and procedures to be certain that they do not contract with excluded parties.

Physician Compliance Programs – Specific Steps Necessary

Monday, December 19th, 2011

compliance attorney physician compliance issuesSpecific Steps Needed to Establish a Compliance Program for a Physician Practice

 The Compliance Guidance for Physician Practices and the Federal Sentencing Guidelines provide useful information concerning the process that is required to develop appropriate compliance programs.  A health care compliance attorney, preferably with demonstrated knowledge of the compliance process through appropriate certification in health care compliance, can also be a terrific asset to help you design a program.  I may be repeating myself, but it is extremely important that you do not simply adopt a “canned” program and expect it to reduce your risks or be effective in the event that the government comes calling.  It is extremely important that you follow a systematic process for assessing risk and tailor your compliance program to address precise risk areas that are identified through the process.  It is imperative that you document in detail the steps that you take to develop your program.  When developing your program, and later while operating your program, you should at all times assume that someday you will be called upon to defend the program and demonstrate that it indicates a meaningful organizational commitment to the specific compliance risks that you face in your unique practice environment.

 Initial Needs Assessment

 As mentioned above, a compliance program should be developed with consideration for the actual risks that are present in the specific practice.  This requires the practice to perform a formal analysis that is aimed at identifying specific risk areas.  The extent of the needs analysis will depend on the size and complexity of the practice.  Methods of performing the analysis will range from a full blown “gap” analysis with scoring of various risk areas down to a more simple employee questionnaire that asks for input concerning risk from the perspective of individual employees.  In smaller, less complicated practices, such as a simple primary care practice, the needs assessment will be relatively simple.  More complex specialty practices will touch on a much broad array of risk areas.  Each item identified through your needs assessment will need to be prioritized and appropriately addressed in the compliance program.

 Establish Line of Responsibility for Compliance Matters

 The Federal Sentencing Guidelines require the appointment of a single individual with responsibility for compliance in the organization.  The individual should be a “high ranking” individual with direct access to the Board of Directors or other governing authority.  Smaller physician practices will generally designate one of the physicians as compliance officers.   A member of administration may be named compliance officer in larger clinics. 

 Ideally, the compliance officer should not be in-house counsel because of potential conflicts between the differing roles of advocate and compliance officer.  An attorney has ethical obligations to zealously defend the organization.  This will sometimes mean that the best course of action from a legal standpoint may be to “deny and defend.”  This will never be an appropriate course of action from the standpoint of a compliance officer whose primary job is to prevent compliance problems.  The compliance officer will work to bring problems to the surface and disclose them when they are uncovered.  This will often conflict with the role of general counsel.

 Certainly general counsel plays an important role in compliance, but not as compliance officer.  Most general counsel are already busy providing legal services to the organization.  Placing compliance under general counsel makes compliance a secondary function of the general counsel and fails to demonstrate adequate commitment to organizational compliance.  The “dual role” compliance officer will appear to work until a problem arises.  Several cases involving “dual role” compliance officers have been investigated by the Federal government.  Once an investigation commences, the organization generally quickly abandons the dual role compliance structure and appoints a dedicated compliance officer.  In the most visible cases, the general counsel was actually forced to resign and the organization settled the case by entering a Corporate Integrity Agreement that required the division of general counsel and compliance function.

 A practice may wish to consider creating a compliance committee in addition to appointing a compliance officer.  Establishing a committee can be very helpful to the organization gaining physician buy-in and demonstrating that the organization is serious about compliance issues.  As a practical matter, the compliance committee involves more individuals in the compliance process and can make the task of the compliance officer much easier.  In larger organizations, establishing a compliance or ethics committee is strongly recommended.  Smaller organizations should consider fulfilling this task at the Board level through regularly scheduled discussions of compliance issues.

 Adopt Standards of Conduct

 An integral part of the compliance program is the standards of conduct.  The standards of conduct should include simply stated standards, in terms that can be understood by all levels of employees and others that deal with the practice that provide information concerning the commitment of the practice to compliance matters.  The Standards of Conduct are not the place to get into legalistic discussions of the various laws that could apply to operations or present compliance challenges.  The Code of Conduct should be a summary that everyone can understand and should reflect the general tone of the practice’s commitment to honesty, integrity and legal compliance.

 Oftentimes the Standards of Conduct will include a personal introduction or letter from the highest ranking individual in the clinic which briefly explains the purposes of the Standards of Conduct and the practice’s commitment to legal compliance.  This helps to set the tone within the practice that compliance and ethical behavior are a core value and principal of the practice.

 Creating Your Compliance Plan

The compliance plan itself will provide detail in the seven areas of an effective compliance program as set forth in the Federal Sentencing Guidelines.  The Compliance Plan will normally cover each of the seven areas.  Additionally, there may be a more detailed discussion of some of the laws that may apply to the specific practice.

 Setting Up Your Internal Reporting Mechanism

 One of the primary elements in a Compliance Program is the creation of a system that permits employees and others to provide information regarding potential compliance issues without fear of retaliation.  In larger organizations, multiple pathways permitting employees to make anonymous complaints should be maintained.  Oftentimes providers use 24 hour compliance “hotlines.”  Online reporting systems or “drop boxes” are also commonly used.  Whatever system is used, it is crucial that employee understand that they are encouraged to provide information and that there is a clear prohibition against others in the organization retaliating against them for providing information.  It should also be made clear to employees that wherever possible the identity of the person providing the information will be kept confidential.

 The establishment of the compliance reporting process and communication to employees that retaliation will not be tolerated is a central element to an effective compliance program.  Such a system will help the practice obtain valuable information, hopefully early on, before the issue becomes a big problem.  Additionally, the openness of the program will send a strong signal to the outside world, such as government regulators, that the organization takes compliance seriously. 

 If information is obtained through the hotline system it must be taken seriously.  Certainly not every piece of information will be reflective of a serious compliance problem, and an employee could potentially have other motives for making a compliant.  Regardless, it is crucial that the information be acted upon and that the action be documented.  If the compliance officer concludes that there were alternative motivations for the complaint, that fact should be substantiated and documented.  If an objective investigation indicates that there could be a compliance issue, the matter needs to be pursued through an appropriate outcome.  Depending on the circumstances and the result of a thorough investigation, the outcome could range anywhere from additional training through a self disclosure to the government.

 Internal Compliance Policies and Procedures – Enforcement

 One of the elements required by the Federal Sentencing Guidelines and described in all of the OIG industry specific Compliance Guidelines is that the Compliance Program include a mechanism to deal with compliance problems as they are discovered.  In some cases the appropriate action may be a change in policies and further education.  In more extreme cases of compliance violations should lead to employment discipline of various degrees depending on the nature and extent of the violation.  Other cases will require full disclosure to the Federal government and repayment of overpayments and possible penalties.

 It is important that your compliance program fit seamlessly with your employment policies.  Part of developing a compliance program is adopting suitable employment standards that let employees know what to expect from an employment standpoint if they are found to be engaged in compliance infractions.  These policies need to be communicated to employees as part of their training, both so they know the potential employment implications of compliance infractions, and so employees understand how seriously compliance issues will be taken by the organization.

 Governing Board Approval of Compliance Plan and Policies

 When it comes to compliance matters, the “buck stops” with the board of directors or other governing body of the organization.  The governing body should be involved in the creation and adoption of all policies and procedures.  The governing body and top management should take all actions necessary to make compliance a top priority within the organization.  The board should issue an initial resolution regarding compliance at the inception of the process of creating a plan.  The resolution should indicate the commitment of the governing body to compliance.  It should also allocated sufficient funding to the establishment and operation of the compliance program.  All of these actions indicate the organization’s commitment to compliance.

 During the development stage, the governing body should be kept in the loop.  Frequent reports should be provided to the governing body and input into the process should be provided by the governing body.  The governing body should approve the steps that are taken in writing.  If further direction comes from the governing body, it is recommended that the direction be placed in writing.  This will indicate the ongoing input from the governing body and further solidify the organization’s commitment to compliance.

 The governing body should also assist with other professionals in the organization “buying in” to the compliance efforts.  It is very helpful for the governing body to be proactive in compliance issues and set the tone for the “compliance spirit” within the entire organization.

 Internal Documentation and Systematic Approach 

 It is extremely important for the organization to take a systematic approach to both developing and operating a compliance program.  Each step of the formation process, from the initial planning stage through final implementation, should be documented with a great deal of detail.  The information should be presented to the governing body for review periodically through the implementation stage and the governing body should approve and adopt the information and provide additional suggestions and directives to the compliance officer.

 When establishing and operating your compliance program, keep in mind that it is very possible, if not highly likely, that someday you will be called upon to defend the actions that you took to establish and operate the program.  This is a very useful mindset to have while you are performing compliance functions.  We often advise organizations to act as if the organization is actually under a Corporate Integrity Agreement and to document each steps as if they are providing the information directly to the government.

 Educating and Training Your Staff

 Another key element of an effective compliance program is to have an ongoing education and training program for employees.  Training should occur at the inception of the program and upon commencement of employment by any new employees.  Additionally, the organization should adopt an ongoing training program to provide period refreshers of basic issues and the requirements of the program.  Additionally, topic-specific training should occur based on compliance risks or problems that are identified through the operation of the compliance program.

 Ongoing Monitoring, Auditing and Assessment

 It is important that the compliance program be seen as a continual process within the organization.  Adopting a compliance program and then leaving it sit on the shelf will be of little if any effect.  In fact, failing to adopt compliance as a process rather than a static “form” can present the organization with more risk than failing to adopt a compliance program at all because the compliance program that is not actively “worked” sets expectation and requirements that will not be met.

 The organization should adopt an effective ongoing process to monitor and audit the organization for compliance difficulties.  Risks areas that are identified by the monitoring process need to be reinforced with amendments to the compliance program, action by the governing body, potential internal discipline, additional training, and in extreme cases, self reporting to the federal government.

 In The End

 The process of developing an effective compliance program will not be without some pain, internal resistance, and resources.  The payoff will often not be as apparent as the effort that it takes to develop and operate an effective program.  The risks you are avoiding can be very difficult to see or quantify.  However, the failure to confront and mitigate those risks can be devastating to your organization.  Repayment obligations for false claims are generally three times the amount of the claims plus $15,000 per claim.  It is shocking how fast the penalties add up.  Extreme cases of fraud can also lead to criminal investigation and prosecution.  Recently enacted health care reform legislation makes it easier in a number of ways for the government to bring criminal prosecutions in the health care area.

 Now that compliance programs are becoming mandatory for most providers, including physician practices, it is necessary for providers to confront these issues.  Do not make the mistake of taking this task on in a half-hearted manner.  The result will not provide you with any of the benefits of an effective compliance program and can actually hurt you if a problem ever arises.  Even though the date for adopting mandatory compliance plans for physicians is not yet upon us, you should start now to assure that your program is effective and that you have time to develop the appropriate “buy-in” by professionals in your practice.  The proper process as identified above cannot be accomplished by taking “canned” compliance policies and adopting them.  You must go through the steps necessary to develop a meaningful program.

John H. Fisher

Health Care Counsel
Ruder Ware, L.L.S.C.
500 First Street, Suite 8000
P.O. Box 8050
Wausau, WI 54402-8050

Tel 715.845.4336
Fax 715.845.2718

Ruder Ware is a member of Meritas Law Firms Worldwide

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