Are You Ready If the Government Knocks on Your Door?

May 16, 2019

By Kate Hickner and Andrew Wilber

healthcareIt’s no secret that the health care industry is heavily regulated and that compliance with applicable law is imperative. This is especially true in today’s current enforcement environment – warranting a quick compliance reminder and overview of a new piece of guidance that may be useful to your organization.

Don’t sacrifice long-term success for the short-term satisfaction of procrastination.

Every physician practice, hospital and other business in the health care industry needs a regulatory compliance program. And it can’t just be a binder sitting on a shelf—it needs to be robust, active and tailored to your business.

Although most organizations understand the importance of health care compliance, not all of them actually take the steps necessary to meet such standards. This is understandable—it’s rarely enjoyable for an organization to think about these issues or to allocate a portion of its annual budget to address them. But action needs to be taken. Having a strong regulatory compliance program prevents non-compliance from occurring and, therefore, mitigates certain legal, financial and reputational risk facing your organization.

Strong corporate compliance programs also place health care businesses in a better position to defend themselves in the event of a governmental audit or investigation. The adequacy and effectiveness of a regulatory compliance program is one factor that federal prosecutors consider when conducting an investigation, determining whether to bring charges and negotiating pleas. The existence of an effective compliance program is also taken into consideration for purposes of calculating criminal fines.

Developing an effective compliance program is stiff medicine for organizations, but organizations cannot sacrifice long-term success for the short-term satisfaction provided by procrastinating their regulatory duties.

New guidance: ask the important questions.

In April, the Department of Justice Criminal Division announced the release of updated guidance for white-collar prosecutors evaluating corporate compliance programs: The Evaluation of Corporate Compliance Programs. Although the document is designed to assist prosecutors in determining whether a compliance program is effective, it also provides valuable guidance to organizations in the process of bolstering their compliance programs.

The guidance is organized around three basic questions:

  • Is the organization’s compliance program well designed?
  • Is the organization’s compliance program being implemented effectively?
  • Does the organization’s compliance program work in practice?

Federal prosecutors are instructed to answer each of these fundamental questions as they evaluate an organization’s corporate compliance program.

Each of the three fundamental questions is explored by identifying various sub-topics and other related questions. The discussion covers risk assessments, policies and procedures, training and communications, confidential reporting structures, commitment by senior and middle management, disciplinary measures, periodic testing, investigations, remediation of misconduct and several other topics. Some of the questions raised include the following:

  • What methodology has the organization used to identify, analyze and address the particular risks that it faces?
  • Has the organization updated its policies and procedures in light of lessons learned?
  • Do compliance and control personnel have the appropriate experience and qualifications for their roles and responsibilities?
  • How often and how does the organization measure its culture of compliance?
  • What disciplinary actions did the organization take in response to the misconduct and were they timely?

Now is a great time for our health care clients to review their compliance programs and strengthen them based upon the April 30th release and other recent guidance. The KJK Healthcare Group provides health care compliance guidance to its clients on a daily basis. We are available to answer any related questions that you have.

For more information, feel free to reach out to Kate Hickner at 216.736.7279 or keh@kjk.com, Andrew Wilber at 216.736.7298 or ajw@kjk.com, or contact any of our Healthcare professionals.


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