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Compliance is mandatory

Health care providers have historically been encouraged by the OIG—but not required—to have compliance programs.

The Affordable Care Act (a/k/a/ the Health Care Reform Law) made these recommended compliance programs mandatory on March 23, 2013.

Section 6102 of the Affordable Care Act requires all nursing facilities to have compliance and ethics programs in place. CMS issued a final regulation implementing this requirement on October 4, 2016, and plans to begin enforcing the requirement on November 28, 2019.

The CMS regulation requires nursing homes to have a compliance and ethics program with the following elements:

  • Written policies and procedures that prevent violations of the law and promote quality. Policies include: compliance officer designation; method of reporting non-compliance; non-retaliation; and disciplinary standards.
  • Assigning compliance oversight to high-level personnel (such as the CEO or Board).
  • Sufficient resources and authority for those overseeing the program.
  • Due care not to delegate substantial authority to individuals with a propensity to violate the law.
  • Communication of policies to staff, contractors, and volunteers. This includes mandatory training or distribution of information.
  • Auditing and monitoring.
  • Enforcement of policies with disciplinary action.
  • Corrective action in response to non-compliance.
  • Annual review and revision of the compliance program.

Nursing home organizations with 5+ facilities must also include the following in their compliance programs:

  • Mandatory annual compliance training.
  • A designated compliance officer who reports directly to the Board, and is not subordinate to the CFO, COO or general counsel.
  • Designated compliance liaisons at each facility.

Even if the compliance program mandate didn’t exist, a compliance program is still essential to avoid penalties under the heavily enforced health care laws. The government may mitigate penalties if you have an effective compliance program in place, and you are much more likely to prevent violations of health care laws if you have a robust compliance program.

Condition of enrollment

The Affordable Care Act also requires all providers to have compliance programs as a condition of enrollment in Medicare or Medicaid.