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Overview: Compliance Plan Auditing by PMA
Under the Federal Sentencing Guidelines for Organizations, one of the criteria of an effective program is for an organization to take reasonable steps, “to evaluate periodically the effectiveness of the organization’s compliance and ethics program”. A regular program evaluation supplements the ongoing, day-to-day monitoring of compliance related activities. An internal audit provides one means for an in-depth analysis of the program, including its design, effectiveness, and possibly overall performance.
Auditing the Compliance Plan and Program should be viewed as part of an overall evaluation process that alone is likely not sufficient to demonstrate effectiveness unless it is approached in a comprehensive manner.
PMA reviews your Compliance Plan and Program in these domains:
Compliance Assessment Guidelines,
I. Auditing and Monitoring
a. Standards and Procedures
i. Current
ii. Complete
b. Claims submission audit
i. Bills are accurately coded and reflect the services provided
ii. Documentation is being completed correctly.
iii. Services are reasonable and necessary.
iv. Incentives for unnecessary services
II. Compliance standards and procedures
a. Identify specific risk areas
i. Coding and billing
1. Billing for services not rendered
2. Submitting services for claims not necessary
3. Double billing
4. Billing for non-covered services
5. Knowing misuse of provider ID numbers
6. Unbundling of services
7. Failure to use modifiers
8. Clustering
9. Upcoding
ii. Reasonable and necessary services
1. Agency/practice definition
iii. Documentation
1. Complete and legible
2. Must include, for each encounter:
a. Reason for the encounter
b. Relevant history
c. Physical exam findings
d. Prior Dx tests
e. Assessment, clinical impressions or Dx
f. Plan of care
g. Date and legible identity of the observer
3. CPT and ICD-9 codes used for claims submission are supported by documentation in the medical record
4. Any identified health risk factors
5. Pts’ progress, response to Tx, changes in Tx or revision in Dx.
iv. Improper inducements
1. Financial arrangements with outside entities to whom the practice may refer federal health care program business
2. Joint ventures with entities supplying goods or services to the agency/service or its patients
3. Consulting contracts or medical directorships
4. Soliciting, accepting or offering any gift or gratuity of more than nominal value to or from those who may benefit from an agency/practice’s referral of federal health care program business
5. Office and equipment leases with entities to which the physician refers.
b. Retention of records
i. The length of time that records are to be retained (Federal and state statutes should be consulted for specific time frames)
ii. Medical records need to be secured against loss, destruction, unauthorized access, unauthorized reproduction, corruption or damage
iii. Standards that stipulate to disposition of medical records.
III. Designation of Compliance Officer
a. Overseeing and monitoring the implementation of a compliance program
b. Establishing models, such as periodic audits, to improve the agency/practice’s efficiency and quality of services, and to reduce the agency/practice’s vulnerability to fraud and abuse
c. Periodically revising the compliance plan in light of changes in the needs of the organization and/or changes in the law
d. Developing, coordinating and participating in a training program that focuses on the components of the compliance program and seeks to ensure that training materials are appropriate
e. Ensuring that the HHS-OIG’s List of Excluded Individuals and Entities, and the General Services Administration’s List of Parties Debarred from Federal Programs have been checked with respect to all employees, medical staff and independent contractors, and
f. Investigating any report or allegation concerning possible unethical or improper business activities.
IV. Conducting Appropriate Staff Training
a. Determine who needs to be trained
b. Determine the types of training needed
i. Seminars
ii. In-service training
iii. Self-study
iv. Consultant training
c. Determine when and how often education is needed and how much each person should receive.
i. Compliance training
1. All employees
a. How to perform their jobs in compliance with the standards of the agency and any applicable regulations.
b. Understand that compliance is a condition of continued employment
ii. Coding and billing training
1. Coding requirements
2. Claim development and submission requirements
3. Signing a form for a physician without the physician’s authorization
4. Proper billing standards and procedures and submission of accurate bills for services rendered to federal and state health care program beneficiaries.
5. The legal sanctions for submitting deliberately false or reckless billings.
iii. Format of the training
iv. Continuing Education on Compliance Issues
V. Responding to Detected Offenses and Developing Corrective Action Initiatives.
a. Develop monitors and warning indicators
b. Follow up
c. Corrective action
d. Change compliance plan, as needed, to prevent recurrence.
VI. Develop open lines of Communication
a. Require that employees report conduct that a reasonable person would, in good faith, believe to be erroneous or fraudulent conduct.
b. Create a user-friendly process for effectively reporting erroneous or fraudulent conduct.
c. Establish a provision in the standards that state a failure to report erroneous or fraudulent conduct is a violation of the compliance program.
d. The development of a simple and accessible procedure to process reports of erroneous or fraudulent conduct.
e. The utilization of a process that maintains the anonymity of the persons involved in the reported possible conduct and the person reporting the concern.
f. Provision that there will be no retribution for reporting conduct that a reasonable person acting in good faith would have believed to be erroneous or fraudulent.
VII. Enforce Discipline Through Well-Publicized Guidelines
a. Does the organization have policies and procedures addressing enforcement of compliance standards and discipline of individuals who violate them?
b. Does the organization screen employees and business partners before initiating a relationship and periodically thereafter to assure that they have not been excluded by the OIG or GSA?
c. Are enforcement and disciplinary standards communicated throughout the organization?
d. Is compliance an element of performance reviews and incentive compensation decisions?
Contact us at 425-454-7688 or write to contact@pmallp.org to schedule an audit or get more information.
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