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Risk and Compliance in Healthcare Organizations: The Department of Justice’s 2020 Guidance on Corporate Compliance Programs

The Department of Justice has just issued updated Guidance on the evaluation of corporate compliance programs. This document is the latest in a series of Guidance documents (prior versions were issued in 2017 and 2019) issued by the DOJ to assist prosecutors who are investigating potential criminal acts in business organizations. What implications does this have for healthcare compliance?

When it comes to healthcare organizations, the DOJ will typically defer to the agencies with specific healthcare responsibility, such as the Centers for Medicare & Medicaid Services (CMS) and the Department of Health and Human Services (HHS). However, the DOJ guidelines are often relied upon as a “best practice” for developing a corporate compliance program, including a healthcare compliance program. The DOJ is also likely to incorporate healthcare-specific guidelines (such as the Seven Elements of an Effective Compliance Program) along with its own Guidance documents, rather than defer entirely to another agency.

DOJ Guidance Documents Explained

Generally speaking, the DOJ issues these guidance documents in an effort to show transparency to both organizations and attorneys. The intent is essentially prophylactic — that is, here’s what we’re going to be looking for, so make sure that you’re following this; and if you aren’t, you can’t be surprised that we’re asking.

This guidance document is slightly unusual in terms of its strength and scope. It provides all federal prosecutors with a strong mandate to assess and evaluate all aspects of a compliance program, regardless of the industry or nature of the putative misconduct. In other words, as part of a broader criminal investigation, the DOJ will review a compliance program, and use this document to guide their investigation into whether that program was at a sufficiently high standard — or not.

There are three overall questions on which this Guidance is built, along with a number of more specific inquiries to guide prosecutors in determining what, if any, consequences should be applied to the organization. These could include prosecution, monetary penalties, and additional compliance obligations (such as reporting).

Question 1: Is the compliance program well-designed?

The Guidance makes specific reference to a formal risk assessment and resource allocation process. This not only means that a compliance program must start with a risk assessment, but risk assessments must be reviewed and updated periodically, and updates must be made to policies, procedures and controls as necessary, throughout the organization.

The Guidance spins out a number of other specific requirements as well, such as training and communication, and reporting and internal investigations. The punchline, though, is that everything comes out of the risk assessment. Every process and procedure that makes up the compliance program must be aligned with the risks identified by the ongoing risk assessment process.

This means that, at a bare minimum, it is essential that a good compliance program have a strong risk assessment behind it. That assessment must be revisited at regular intervals, and changes in internal controls will need to be regularly made.

Question 2: Is the program effectively implemented?

The DOJ is distinguishing here between what we could call a “real” program, as compared to a “paper” program. In other words, are there appropriate resources to make the program function the way it was designed? Does senior management buy in to the program, and endorse it at a cultural level throughout the organization?

While a risk assessment is where a compliance program begins, the Guidance makes clear that it is in ongoing management and implementation that a compliance program comes to life. Without significant time and resources invested to build the compliance program into the way the organization functions, the program is not going to be sufficient, and the organization will vulnerable to potential penalties.

Question 3: Does the program actually work?

This backward-looking question is intended to assess whether the program was well-designed and well-implemented for the particular organization within which it operates. That is, if misconduct has occurred, was this because the program wasn’t the right program for this organization? Or was the program functioning well, and the misconduct resulted from something else? (DOJ acknowledges that no compliance program will ever prevent every incident of misconduct.)

What DOJ is ultimately looking for here is whether the program changes over time, in response to changes in the organization. If there is misconduct, is it investigated? Are opportunities identified for improving the compliance program to prevent the misconduct in future? Have these remediation efforts actually been implemented? And so on.

Best Practices

Overall, the DOJ has provided a set of clear guidelines that should be used to not only develop new compliance programs, but assess existing ones. Programs which do not live up to the DOJ’s requirements on risk assessments, program implementation, and continuous improvement are more likely to be found to be inadequate. And an inadequate compliance program leaves a healthcare organization at risk.

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Worker Fatigue and the Potential Negative Impact on Compliance

When workers get fatigued, what is the impact on compliance?

We all know that, during a normal workday, workers can get fatigued. Fatigue can come from a variety of sources, including personal and professional challenges or stressors. Mental fatigue specifically occurs when there is a need to process overwhelming amounts of new data or information.

The impact and stressors of working during a pandemic can make this worse. Mental fatigue is exacerbated because there is so much new information to cull through on a daily (sometimes more frequent) basis. Combine this information overload with rapidly changing pandemic recommendations and guidelines, and it’s no wonder that workers are becoming more fatigued.

Effects of Fatigue

Memory and performance both decline when a person is mentally fatigued, which can lead to non-compliant behaviors and actions. This happens because fatigue decreases the ability to make new, short-term memories. Lack of short-term memories prevents the formation of long-term memory knowledge. And a person simply cannot recall information which has not been transferred to long-term memory. In this way, fatigue decreases the ability to recall information – whether recently learned or already known.

For example, if the organization has not previously billed for telehealth visits, a fatigued coder may not remember the education that was provided regarding telehealth documentation requirements or the codes applied to these visits. Moreover, the coder may have difficulty recalling in-person visit codes or coding modifiers. When these effects of fatigue happen, coding compliance will decrease.

Mental and physical fatigue can affect worker performance in other ways. Think about the last time you did not get a good night’s sleep. At work the next day, all you can think about is drinking more coffee or taking a nap or going to bed early that night.

Signs of this kind of fatigue include decreased awareness or a general decrease in interest with respect to work or job tasks. Other signs of fatigue include changes in judgment or decision-making. Take, for example, an employee who is usually very engaged on the job, but unexpectedly shows up late for a scheduled meeting. During the meeting, the employee is unusually quiet and provides limited feedback. If that employee’s knowledge and feedback are necessary to make a critical compliance-related decision there would be not only a negative effect on compliance, but potentially a negative effect on the entire organization.

Compliance Fatigue

There is also a form of specific compliance fatigue – where people are overwhelmed and wearied by the numerous adherence requirements in healthcare policies and procedures and rules and regulations. This combines with mental fatigue, which inhibits the ability to remember and follow these policies and procedures, which is the cornerstone of good compliance.

Employees may know and understand policies and procedures addressing HIPAA. For example, they must use encryption when emailing protected health information (PHI) or personally identifiable information (PII) or payment card information (PCI). Similarly, in the course of their work, they must exercise heightened caution before clicking on links embedded in emails. If they are experiencing fatigue, the possibility of compliance failures increases.

As physical, mental and compliance fatigue increase the potential for job related mistakes, they conversely decrease worker compliance. The overall impact of worker fatigue can have very real and negative impact on compliance ranging from simple mistakes or lapses in judgment to catastrophic errors related to breach of PHI/PII or PCI.

Practice Tips

Encourage supervisors to regularly meet with their staff to evaluate the level of information fatigue or physical fatigue. If possible, conduct education and feedback sessions to help the team talk through fatigue challenges.

Utilize resources, such as youCompli, to assist the team in staying current with healthcare compliance related changes to guidelines, regulations and laws, and managing compliance-related workflows automatically.

Denise Atwood, RN, JD, CPHRM
District Medical Group (DMG), Inc., Chief Risk Officer and owner of Denise Atwood, PLLC
Disclaimer: The opinions expressed in this article or blog are the author’s and do not represent the opinions of DMG.

Denise Atwood, RN, JD, CPHRM has over 30 years of healthcare experience in compliance, risk management, quality, and clinical areas. She is also a published author and educator on risk, compliance, medical-legal and ethics issues. She is currently the Chief Risk Officer and Associate General Counsel at a nonprofit, multispecialty provider group in Phoenix, Arizona and Vice President of the company’s self-insurance captive.

Legal Challenges and the Benefit of a Comprehensive Compliance Program

The list of compliance and legal challenges facing providers, hospitals and healthcare systems over the next year is long:

Physician arrangements and fair market value;
Mergers and acquisitions;
Quality metrics and risk sharing;
Fraud, waste, and abuse;
Coding and billing transactions;
Reimbursement;
Medical staff issues and burnout;
Labor and employment issues;
HIPAA and HITECH; and
Technology and integrated medical devices.

A list like this can seem daunting. However, a comprehensive compliance program with appropriate resources can help avoid disastrous results related to healthcare compliance and legal challenges.

Labor and Employment Law

The Atlantic reported in January 2018, “Health Care Just Became the U.S.’s Largest Employer In the American labor market.” The growth of the healthcare sector brings increased labor and employment challenges. Although the terms are often used synonymously, labor law focuses on groups of workers (think unions and collective bargaining) while employment law focuses on individual workers, (think discrimination of an individual in a protected class).

A comprehensive compliance program will decrease labor and employment law challenges, by ensuring human resource policies and procedures comply with federal and state laws. Moreover, personnel file audits will demonstrate compliance with those laws.

Transactional Law

Mergers, acquisitions, partnerships, joint ventures and U.S. antitrust law

The Agency for Healthcare Research and Quality (AHRQ) reported in its 2018 National Healthcare Quality & Disparities Report that almost 70% of U.S. hospitals and 43% of primary care physicians are part of consolidated health care systems. Consolidations require an astute compliance and legal team to ensure compliance with antitrust law. These transactions continue to draw scrutiny from the Federal Trade Commission due to monopoly concerns.

The challenge for healthcare organizations is even greater when business crosses state lines. The organization must then comply with multiple state laws simultaneously. As part of a comprehensive compliance program, a compliance professional should work closely with in-house or outside counsel to ensure the business transactions and consolidations include a compliance due diligence perspective, for example reports to the board of directors.

Security Law

HIPAA

Compliance is mandatory; failure to comply is an opportunity to ruin an organization both financially and reputationally. Ransomware attacks on healthcare providers through their computers and medical devices are on the rise. While most IT departments focus on HIPAA security for computers, few address security issues with interconnected medical devices.

A comprehensive compliance program will include recommendations to address the management of cybersecurity for medical devices like those outlined by the U.S. Food and Drug Administration (FDA).

Practice Tips

Use of reports to support legal defense of employment or labor law violations, if needed.
Use of notification and management system to prevent legal challenges by providing up-to-date guidance to support compliance activities.
Conduct an evaluation of medical devices in accordance with the FDA FAQ. Disable the voice recognition feature of smart devices while conducting confidential discussions in a room with a smart TV or speaker.

A system such as youCompli is a strong addition to a comprehensive compliance program, providing up to date notifications of regulatory change, as well as full insight and audit of the compliance process.

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Privacy vs. Transparency: You’re in the Middle

Since 1996, HIPAA has required hospitals and other providers to strictly maintain the privacy and security of patient and clinical records.

In 2010, the Affordable Care Act (Obamacare) required them to digitize those records for greater transparency.

Today, some 96% of hospitals and 78% of doctors’ offices use electronic health records.

As a result, patients can instantly access the notes from their doctor visits, review their prescriptions, see their lab results, and email questions to the doctor(s) they’ve been seeing. And doctors, whether primary care providers or specialists, can have a patient’s personal information and medical history right at their fingertips.

Unfortunately, so can others.

In 2018, a total of 18 million patient records were hacked and phished. In just the first half of 2019, almost twice as many – 32 million – were.

Clearly, there’s a tug of war between privacy and transparency, and hospitals are the rope.

In 2018, the last year for which complete figures are available, hospitals paid out an average of more than $2.5 million in settlements and civil monetary penalties. That year, the HHS Office of Civil Rights conducted a total of 25,520 complaint and compliance review investigations. And even if the vast majority don’t lead to cash penalties, even the mildest OCR action – resolution after intake and review – can still cost you staff hours and money.

That’s one reason it pays to keep on top of all the latest HIPAA and ePHI changes.

Another is on the horizon for this year. Throughout 2019, OCR has been considering HIPAA regulation changes, and at least some of those should become final this year. Some of those could include easing “aspects of HIPAA Rules that are proving unnecessarily burdensome for HIPAA covered entities and provide little benefit to patients and health plan members.”

Others involve making it easier for hospitals and doctors to coordinate, and requiring instead of just allowing hospitals to share ePHI data with other providers.

That’s why alerts to changes practically as they occur, determining how they apply to you, then implementing and documenting compliance with no wasted time or money makes for good self-defense.

In the battle between privacy and transparency, see how we can keep you out of the crossfire.

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Cybersecurity: The Nightmare That Keeps Me Up At Night

You are preparing for board meeting, but you can’t get into your reporting application. You log off the computer and then log back in – no good. You call the helpdesk and hear what you never want to: “The application is offline due to a potential cyber attack.”

Keeping organization data safe from hackers is a real concern for compliance professionals. When asked what keeps them up at night, most would say it is the fear of finding one of the IT systems or applications was hacked. The nightmare may be recurring for compliance professionals who work in health care where personal, protected health information (PHI) data is stored in electronic health record applications.

To optimize cyber protection and minimize cyber events, it is recommended that compliance departments partner with their organization’s information technology (IT) and risk management departments. A good place to start collaborating is to write and implement an organization-wide cybersecurity plan (CSP) based on each discipline’s input, this way input is included from each discipline leading to a more robust plan

As required under HIPAA and HITECH, Compliance and IT professionals generally focus on how to prevent both privacy and security breaches respectively, so the CSP should include prevention steps from both of those aspects. While risk management includes prevention, risk also focuses on loss mitigation and minimizing impact to the organization’s reputation after a cyber event has occurred.

And the CSP must include ongoing staff education. While there are many commercially available tools or applications which provide cyber protection against email hackers, phishers, malware, spyware, and viruses, these tools are only as good as the end users working on the organization’s computers. Of course, the CSP should include appropriate fire walls and penetration testing by an outside vendor to assess the organizations privacy and security vulnerabilities; however, the best prevention is education for staff so they can identify emails which may contain malware, spyware or viruses.

Ongoing education should occur with staff at all levels of the organization. Education should include internal IT generated phishing emails with remediation for those who “take the bait” and click on the bad links. It should also include cross-departmental table-top exercises where cybersecurity related scenarios are presented and discussed to ensure familiarity with the CSP and to identify and improve upon weaknesses in the plan, staff education, or the applications used.

PRACTICE TIPS:

Schedule a one-hour call with your insurance broker to review your cyber liability insurance policy and reporting requirements in the event of a privacy or security breach.
Ensure you are current with not only federal, but state security and privacy laws.

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