Georgia Medical Practices: Not Having a Compliance Program is AT YOUR FINANCIAL PERIL

law-education-series-3-68918-mSome critical details of The Affordable Care Act (ACA) are often omitted from the political rhetoric and other noise during public debate about whether the ACA is a “good” or “bad” thing. One such detail – and a huge one – is the ACA’s significant expansion of compliance risks for medical practices and other health care entities.

Our Georgia business and health care law firm follows compliance and other developing regulatory issues that impact the business of providing health care. The ACA mandates that health care providers, suppliers and nursing facilities who participate in Medicare or other federal programs establish effective compliance and ethics programs. See ACA § 6401. The United States Department of Health and Human Services, Office of the Inspector General (OIG) made the creation of guidelines for compliance programs a “major initiative” in its efforts to stem health care fraud. See Federal Register, Vol. 65, No. 1994. Copies of the OIG’s compliance program guidelines are on the government’s OIG website.

The OIG has formulated seven basic components that may serve as the core of a proper compliance program:

  • Internal monitoring and audits;
  • Implementation of compliance and practice standards;
  • Selecting a compliance officer or contact;
  • Appropriate training and education;
  • Appropriate responsive measures to detect offense and develop corrective action
  • Developing open lines of communication; and
  • Enforcing disciplinary standards through well-publicized guidelines.

However, these elements are guidance and not necessarily mandatory components for an adequate compliance program for all doctor practices. In fact, the OIG acknowledges that all seven elements may not be feasible for all medical practices. There is not a one-size-fits-all program. Rather, the OIG seeks a “step by step approach to follow in developing and implementing a voluntary compliance program.” See Federal Register, Vol. 65, No. 1994.

The OIG’s discussion of this subject suggests that in evaluating the adequacy of a particular medical practice’s compliance program, it takes into account the size and resources of the medical practice: “Smaller physician practices may incorporate each of the components in a manner that best suits the practice. By contrast, larger physician practices will often have the means to incorporate the components in a more systematic manner.” See id at p. 59436. The OIG encourages a collaborative approach by physician practices to enable one physician practice to utilize the compliance program of another, relevant physician practice to serve as a template for its own version of compliance.

Generally speaking, the OIG’s website is the best source of information concerning compliance program guidance. It provides specific guidance on compliance plan design for the various categories of health care businesses or industry segments (e.g., nursing facilities, hospitals, ambulance companies), including individual and small group physician practices.

OIG emphasizes that “all health care providers have a duty to ensure that the claims submitted to Federal health care programs are true and accurate” and believes that development and implementation of compliance programs will advance that objective. See id. Historically, CMS has targeted those who fail to have a compliance program in place in its enforcement and audit activities. The financial consequences of not having a compliance program can be very severe, ranging from liability for repayment of erroneous or improperly submitted claims to defense of federal investigations under the False Claims Act or other types of alleged fraud. The proactive steps of creating, implementing and monitoring a good compliance plan is a small investment relative to the potential adverse financial consequences of failing to do so. Your attorney or qualified consultant can show you how to set up a proper compliance plan.

If you have questions about this post, contact us today for additional information.

Disclaimer: Thoughts shared here do not constitute legal advice. Please consult with an attorney to discuss your legal issue.

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