Compliance program basics
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Compliance Program Basics. Presented By Sharlene Evans CPC, CPC-H, CHC. Disclaimer. Views expressed in this presentation are those of the speaker and do not necessarily reflect the views of Catholic Health Initiative (CHI) or any of CHI affiliations. Agenda. Getting to know me

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Compliance Program Basics

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Compliance Program Basics

Presented By

Sharlene Evans CPC, CPC-H, CHC


Views expressed in this presentation are those of the speaker and do not necessarily reflect the views of Catholic Health Initiative (CHI) or any of CHI affiliations.


Getting to know me

Getting to know you

Why is a Corporate Responsibility Program Important

8 Elements of an Effective Compliance Program

Not all Compliance Programs are Built the Same

A Coder’s Path to Compliance

Introduction – Getting to Know Me

My Journey to Compliance

Why Healthcare Compliance

Getting to Know You

  • How many are from Hospitals?

  • How many are from Physician Practices?

  • Other areas?

  • Who’s hospital/practice has a Compliance Program?

  • Who knows what a Compliance Department does?

    • Other Names used

      • Corporate Responsibility Office

      • Integrity Office

      • Compliance & Ethics Department

Why have an Effective Compliance Program?

Why have an Effective Compliance Program?

1. Regulatory requirements & guidance

  • Federal Sentencing Guidelines, OIG and Affordable Care Act

Federal Sentencing Guidelines

  • Federal Sentencing Guidelines – Chapter 8

    • An organization shall exercise due diligence to prevent and detect criminal conduct;

    • and otherwise promote an organizational culture that encourages ethical conduct and commitment to compliance with the law.

Affordable Care Act

  • Section 6401 of the Affordable Care Act

    • “A provider of medical or other items or services or supplier within a particular industry sector or category” shall establish a compliance program as a condition of enrollment in Medicare, Medicaid, or the Children’s Health Insurance Program (CHIP).”

  • An enforcement date for provider compliance plans as mandated in the Affordable Care Act not yet to been issued.

Office Of Inspector General (OIG)

The OIG has been advising providers to voluntarily adopt compliance plans, since the 1990’ds and has issued several compliance program guidance (CPG’s) for particular provider types, including hospitals, nursing homes, pharmaceutical manufactures, and physician group practices.

The CPG’s identify specific risk areas for the particular provider types and offer compliance tips.

OIG Website:

Why have an Effective Compliance Program?

2. Studies suggest that a strong ethical culture can reduce the risk of fraud, waist and abuse

3. Impact from unethical conduct

  • Loss of employee faith and commitment

  • Reputation risk

    4. Level of enforcement activities, already high, likely to grow

    5. Promote patient safety and ensure delivery of high quality patient care.

    *Effective Compliance Programs are an essential tool for identifying and mitigating audit risks

Elements of an Effective Compliance Program

OIG states - There is no single “best” compliance Program, given the diversity within the


8 Elements of an Effective Compliance Program

Written Policies, Procedures and Standards of Conduct

Compliance Program Oversight

Education and Training


Enforcement and Discipline

Monitoring and Auditing

Response to Detected Offenses and Prevention

Ongoing risk assessment – added in 2004*

*Federal Sentencing Guidelines, 1991, United states Sentencing Commission Revision, 2004

8 Elements of an Effective Compliance Program

  • Written Policies and Procedures

    • Code of conduct which addresses compliance expectations

      • State the organization's mission, goals and ethical requirements of compliance

      • Articulate the commitment to comply with all Federal and State Standards

      • Emphasis on preventing fraud waste and abuse

      • Employee’s should be required to acknowledge that they have read & understand the Code of Conduct

8 Elements of an Effective Compliance Program

  • Compliance-related policies for operational high risk areas

    • Accurate billing and coding

    • Payments and collections

    • Credentialing

    • Anti-Kickback & Stark

    • Record Retention

    • Cost Reports

  • Policies and Procedures should be:

    • written clearly,

    • be concise,

    • in non-technical language which is easily understood by all.

8 Elements of an Effective Compliance Program

2. Compliance Program Oversight

  • Designate a Compliance Officer who serves as the focal point for compliance

    • Responsibility may be the only duty they have or in smaller organizations this duty is added to other management responsibilities.

    • Has a leadership role that is recognized and promoted by senior management.

      • Access to the hospitals governing body and the CEO

  • Relationship to General Counsel/Legal and Chief Financial Officer

    • Conflict of interest for compliance officers to be under legal or finance

    • Most Corporate Integrity agreements prohibit the compliance officer be under legal or finance or have combined roles.

8 Elements of an Effective Compliance Program

  • Compliance Committee

    • The OIG recommends that a compliance committee be established to advise the compliance officer and assist in implementation of the compliance program.

    • Leaders who should be on the Committee

      • Compliance Officer

      • President/CEO

      • Chief Operations Officer (CEO)

      • Chief Financial Officer (CFO)

      • Human Resources

      • Department Management

    • Names for the Committee

      • Audit & Compliance Committee

8 Elements of an Effective Compliance Program

3. Education and Training

  • Training should highlight

    • The compliance program,

    • Fraud and abuse laws,

    • Coding requirements

    • Claim development & submission process

    • marketing practices

    • 1-2 hours general compliance training

      • Include all employee’s, board members, executives, volunteers

8 Elements of an Effective Compliance Program

  • Various methods for training

    • Web-based interactive

    • New employee orientation

    • Staff meetings

  • Be effective – testing, knowledge

  • Separate Specialized high risk area training

    • Example: Billing, Coding, Cardiology –ICD’s

  • Attendance and participation in training programs

    • should be a condition of continued employment.

    • Failure to comply with requirements could result in disciplinary action, including possible termination.

8 Elements of an Effective Compliance Program

4. Reporting/Communication

  • Access to the Compliance Officer

    • Open lines of communication to the Compliance Officer should be established. “Open Door” policy

    • Several options should be available for employees to report compliance issues

      • In-person – Supervisor, Manager, Compliance Officer

      • Electronically – e-mail

      • Anonymously

        • Hotline – number should be posted for employees

        • Locked drop boxes

    • Written confidentiality and non-retaliation policies should be developed and distributed to all employees.

8 Elements of an Effective Compliance Program

5. Enforcement and Discipline

  • Disciplinary policies outline disciplinary actions that may be imposed.

    • Failing to report a potential compliance issue

    • Participation in non-compliant behavior

  • Level of discipline is consistent regardless of status

  • Compliance Officer does not carry out discipline, they only recommend.

  • New Employee’s

    • Background investigations

    • Disclose criminal convictions or exclusions

      • List of Excluded Individuals & Entities – LEIE


8 Elements of an Effective Compliance Program

6. Monitoring and Auditing

Difference between Monitoring & Auditing

  • Monitoring - includes regular reviews performed as part of normal operations to confirm ongoing compliance.

  • Occurs on a regular basis (daily, weekly, monthly) during normal day to day operations

  • Are performed by staff

  • Checks to see if procedures are working

  • Follow-up on recommendations and corrective action plans to ensure they are being implemented

8 Elements of an Effective Compliance Program

  • Auditing – includes formal reviews of compliance with a particular set of standards as base measures.

    • Ensures compliance with a range of statutory and CMS requirements in critical operational areas

    • Includes regular, periodic evaluations of the compliance program to determine the programs overall effectiveness

    • Is performed at least annually, or ore frequently as appropriate

    • May include a variety of audit methods (desk, onsite, internal, or external)

    • Includes written reports containing findings, recommendations and proposed corrective actions

8 Elements of an Effective Compliance Program

  • Audits can be performed by internal or external auditors

  • Auditors should:

    • Be independent of and not employed in the department being audited

    • Be competent to identify potential issues within the critical review areas

  • Audits should be designed to address compliance with:

    • Kickback arrangements

    • Stark – Physician self-referrals

    • CPT/HCPS/Diagnosis Coding

    • Claim development and submission

    • Reimbursement

    • Cost Reporting

    • Marketing

8 Elements of an Effective Compliance Program

  • Other references you can use for audit plans:

    • OIG Work Plan -

    • Medicare Administrative Contractor –MAC

      • LCD’s,

      • CERT

    • Recovery Audit Contractors – RAC


    • List of Excluded Individuals & Entities – LEIE


8 Elements of an Effective Compliance Program

  • Compliance Program Effectiveness

    • At least annually, include the basic elements

    • Measurement of various outcomes

      • Billing and Coding error rates

      • Identified overpayments

      • Audit results

      • Training/Education

    • Reported out to the Audit and Compliance Committee and Board

8 Elements of an Effective Compliance Program

7. Response to detected offenses and prevention

  • Detected but uncorrected misconduct can seriously endanger the mission, reputation and an entities legal status

  • Steps to investigate the conduct in question is necessary to determine whether a violation has occurred

  • If a violation has occurred steps to correct the violation must be taken. These could included:

    • Referral to criminal and/or civil law enforcement

    • Corrective Action Plan

    • Reporting & Repayments of Overpayments – 60 days

8 Elements of an Effective Compliance Program

8. Ongoing risk assessment

  • Conducted annually

  • Focus is on identifying risk areas

  • Identified by high, medium and low

  • Includes face-to-face interviews with senior leaders

    • Revenue cycle

    • Risk management

    • Lab

    • Pharmacy

  • Results of the risk assessment are used to develop compliance work plans and annual audit reviews.

Not all Compliance Programs are Built the Same

Lets Take a Closer look at a few of the Elements

Element #1 – Written Policies and Procedures


Physician Group/Office

Code of Conduct

  • Complex, lengthy covering multiple risk areas

  • Professional production, printed and/or distributed to all employees

  • Posted on the Intranet

  • Made available or distributed to:

    • Board and Board committees

    • Medical Staff members

    • Volunteers, Students, Vendors, others

Code of Conduct

Simple & Short

Create a Word document and print a few copies to have at the front desk and nursing station

Hold a meeting to implement to all employees

Element #1 – Written Policies and Procedures


Physician Group/Office

Policies and Standards

  • High, medium and even lower risk areas

  • Areas requiring special guidance

  • Address consistent approach

Policy and Standards

Minimal written policies

Very operations focused

Risk Areas Addressed in Policies Include:


Physician Group/Office

Billing for items or services not provided

Up-coding/Under-coding (Medical Necessity

DRG Creep

Cost Reporting

Revenue Cycle Areas

Excluded Provider/Background Checking

Billing for items or services not provided


Medical Necessity


Misuse of provider identification numbers


Double-billing resulting in duplicate payment

Element #2 – Compliance Program Oversight


Physician Group/Office

  • Where does this person report? What is the line to the Board?

  • What other hats does the Compliance Officer wear?

    • None

    • Full time with additional staff

  • What is the committee structure and what is their charter?

    • Board Audit and Compliance committee

    • Senior Leader Compliance committee

Practice Manager will most likely oversee the compliance efforts and report to the ownership.

It is highly unlikely a compliance committee will exist.

Benefits – react to change quickly and low cost

Challenges – Lack of independence and will staff actually raise issues – due to fear of retaliation.

Element #3 – Education and Training


Physician Group/Office

Use of on-line based learning

Annual Education

Role based education as needed

Physician education program

Newsletters and Bulletins

Education at the time of employment

Education on the Code of conduct is enough

Conversations at staff meetings surrounding specific topics

Element #4 – Auditing and Monitoring


Physician Group/Office

  • Formal Audit work plan

  • Includes focus reviews on high risk areas:

    • Revenue Cycle

    • Lab

    • Pharmacy

    • Physician Contracts

  • Regular reporting to Board, Audit and Compliance committee and senior leadership

Uses third-party billing company to perform periodic reviews of documentation and coding

Element #5 – Reporting/Communication


Physician Group/Office

Anonymous reporting

External hotline

Focus on non-retaliation

Poster in break rooms or by time clocks

Lock box which can only be accessed by compliance officer

Physician(s) should help support a focus of non-retaliation during staff meetings.

Implementation of a Compliance Program

Send a message that your organization operates in an ethical manner and is committed to quality customer and patient care.

Be there to Protect and Serve, not be there to police and intimidate

Coding Career Path to Compliance

What Experience does a coder Need to enter the Compliance Field?

Coding Career Path to Compliance

  • Compliance Specialist/Analyst

    • Coding experience & Auditing Experience

      • Certified (CCS, CPC, CPC-H) and or RHIT is normally preferred

      • 3 – 5 years in healthcare compliance, internal audit, coding, billing, finance

    • Data analytics

      • Run reports and pick samples

    • Certified in Healthcare Compliance (CHC or equivalent) - normally don’t have to have it when hired, but within a certain time frame.

  • Ability to multi – task

    • Multiple projects

    • Putting out multiple “Fires” – start the day with a plan, this may change

  • Communication

    • Be able to deliver a concise message. Able to speak to an audience, at their level.

Coding Career Path to Compliance

  • Do you like to read the Federal Register and/or State and Federal Laws?

  • Are you able to interpret the regulations?


      • Manuals

      • Physician Fee Schedule

      • Conditions of Participation – CoPs

      • Conditions of Coverage - CfCs

    • – Proposed and Final Rules

      • Inpatient Perspective Payment System - IPPS

      • Outpatient Perspective Payment System -OPPS

Coder Career Path to Compliance

  • Revised Code of Washington – RCW


  • Washington Administrative Code - WAC


  • Washington Healthcare Association


  • Noridian Healthcare Solutions, LLC – A & B


Coder Career Path to Compliance

  • American Academy of Professional Coders – AAPC

    • Certified Professional Compliance Officer –CPCO


  • Health Care Compliance Association – HCCA

    • CHC – Certified in Healthcare Compliance

    • CHRC – Certified in Healthcare Research Compliance

    • CHPC – Certified in Healthcare Privacy Compliance

    • CCEP – Certified Compliance and Ethics Professional


  • University of Washington

    • Certificate in Healthcare Regulatory Compliance – Continuing Education



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