5 Essential Elements of Corporate Compliance

May 26, 2016

Federal and state regulators are aggressively taking action to rein in costs and investigate fraud in the healthcare industry. Initiatives to identify non-compliance are more intense than ever, and officials are increasingly focusing on the specialty of radiology.

Imaging has consistently been one of the fastest growing Medicare costs, rising from $6.5 billion in 2000 to $11.7 billion in 2009. According to a 2010 study published in the Journal of the American College of Radiology, 26 percent of the 459 CT and MRI exams studied were deemed inappropriate. As policymakers and payors strive to contain costs and reduce waste, radiology groups will increasingly need to prove medical necessity and demonstrate their value to the health systems and communities they serve.

In 2010, the Centers for Medicare and Medicaid (CMS) developed an advanced analytics system called the Fraud Prevention System (FPS). In its first three years of use, the agency identified and/or prevented $820 million in inappropriate payments, according to a statement released by CMS.

The passage of the Affordable Care Act of 2010 required a broad range of providers, suppliers and physicians to adopt a compliance and ethics program. This legislation no doubt impacted smaller physician groups and suppliers most significantly, given that many larger health care providers already had some form of compliance program in place.

A corporate compliance program is a “code of conduct” consisting of written guidelines, policies and procedures for acceptable business practices designed to prevent and detect violation of laws. A failure to implement certain compliance program elements will invite regulatory and law enforcement scrutiny, as well as potential False Claims Act liability for failure to prevent or identify improper federal healthcare program claims and payments. When paired with the stronger sanctions and expanded application of the federal False Claims Act, Civil Monetary Penalties Law and Anti-Kickback Law, the existence, or lack of, robust provider compliance program controls will dictate to what degree enhanced focus in fraud and abuse inquiries and prosecutions by the Office of Inspector General are likely.
A well-crafted, consistently administered and comprehensive compliance program is not an option to consider – it is mandatory. In some states, enrollment and participation in Medicaid programs requires attestation of having a compliance officer and compliance program in place as a condition of participation and payment for services.

The following is a list of five essential elements to be included in most radiology groups’ compliance program:

1. Compliance Manual: A copy of the organization’s compliance manual should be found at each of its locations, and should consist of the following components:

  • Overview of the compliance program – Fraud and Abuse, Anti-Trust, Anti-Kickback
  • Introduction to the compliance officer and compliance committee
  • Employee training and education policies
  • Policies regarding auditing, disclosure/reporting, record retention, discipline and enforcement/prevention
  • Employee performance evaluations
  • Goals of the program
  • Hotline Reporting contact information (federal and state)
  • Areas of potential risk for healthcare entities
  • Procedures in the event of an investigation/search by a federal or state government agency

2. Compliance Officer’s Manual: The compliance officer’s manual should aggregate a variety of forms, policies and reports regarding ongoing compliance initiatives and goals, including:

  • Signature list of compliance program review
  • Training/education documentation of individual employees
  • Zero tolerance policy
  • Simple error log form
  • Employee auditing form
  • Confidential incident report form
  • Quarterly/annual report to board of directors

3. Code of Conduct: The code of conduct should be adopted by the owners and management team and must be signed by each radiologist and staff member to be filed and maintained by the compliance officer.

4. Compliance Training Program: The training program should consist of an initial course for new hires as well as ongoing training modules for employees and radiologists to review new policies and identify risk areas within the organization.

5. Continuous Monitoring and Compliance Audits: Audits should be performed on a regular basis to ensure strict adherence to compliance regulation and to identify any risk areas or issues within the group. Remember, the government does not prosecute people for simple mistakes – it does go after negligent entities and “bad actors.”

Keep this in mind — a well-crafted and administered compliance program should not only minimize errors and enable the practice to compliantly navigate regulatory requirements and laws applicable to the profession; it has the potential to enhance revenue through improved billing and documentation processes. It also facilitates the best response to possible regulatory investigations, audits or inquiries in the future.

By placing compliance initiatives at the core of their organization, radiology providers can create an environment that encourages accountability, open lines of communication and transparent activity among employees, radiologists and billing providers while protecting the assets of the owners.

To learn more about how to easily develop a comprehensive compliance program for your radiology group, please contact us at ContactIRP@IntegratedRP.com.