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…the case for corporate compliance

As the long-term care industry moves further into the 21st century, skilled nursing facilities are becoming increasingly dependent upon government reimbursement – and virtually all providers accept it.  

Operational effectiveness is increasingly important.

Seniors have lots of choice. Nowhere is this phenomenon more telling than in assisted living. SNFs often have great difficulty competing with the ambience offered by many assisted living operations and are seeing consistent reductions in the numbers of their private pay residents. As a result, more and more SNFs are seeing their financial flexibility erode as they become more dependent on government reimbursement.

At a time when SNFs struggle to address the increasing acuity levels of our aging population, forecasted cuts in reimbursement rates promise to reduce facilities’ financial resources. Never before has government reimbursement been stretched so thin; government regulation so extensive; or government penalties so severe. Strategically, the options for SNFs are closing fast. Operational effectiveness is required in a difficult, highly-regulated business. For many providers, managing costs receives renewed emphasis – as it must.

It’s not getting any easier… Compliance programs will soon be mandatory.

Right now, SNFs are strongly encouraged by the OIG—but not required—to have compliance programs. The Affordable Care Act (a/k/a/ the Health Care Reform Law) mandates compliance programs in all SNFs by March 23, 2013. The Affordable Care Act also requires all providers to have compliance programs as a condition of enrollment in Medicare or Medicaid—meaning there will soon be a double impetus for nursing facilities to implement compliance programs. In addition, SNFs will be required to have quality assurance and performance improvement plans in place by no later than December 31, 2012.

Legal risk to providers of Medicare or Medicaid services that fail to comply:

SNFs already struggle to comply with HIPAA (and HITECH); the Anti-Kickback Statute; the Civil Monetary Penalties Law; the False Claims Act; the Stark (physician self-referral) Law; Medicare and Medicaid requirements; and many other laws and regulatory requirements. Regulation of healthcare providers is only increasing:

• The Deficit Reduction Act of 2005 requires certain facilities to have written policies for all employees, agents, and contractors, that provide detailed information about the False Claims Act. Penalties for noncompliance include forfeiture of Medicaid payments during the noncompliance period, and/or disqualification.
• The Fraud Enforcement and Recovery  Act of 2009 (FERA) expanded the scope of the False Claims Act (FCA); enhanced the attorney general’s authority to investigate false claims; removed the FCA’s intent requirement; increased liability for knowingly retaining Medicare or Medicaid overpayments; and extended whistleblower protections to contractors and agents.
• The Affordable Care Act makes it much easier for a health care provider or employee to inadvertently violate the Anti-Kickback Statute. A defendant will not need to have actual knowledge that the alleged activity violates the Statute—nor will a defendant need a specific intent to commit a violation. Anti-Kickback Statute violations will also constitute grounds for a False Claims Act action. The Affordable Care Act also created additional grounds for the government to impose civil monetary penalties, and increased funding for health care enforcement activities by $250,000,000 over 5 years.
• HITECH increased penalties for HIPAA violations to up to $50,000 per violation; and in June 2011, the Department of Health and Human Services appointed an audit contractor to conduct HIPAA Privacy and Security compliance audits.

Is your compliance program effective?

Keeping up with this flood of government requirements is a Herculean task. While many SNFs have compliance programs, many do not implement them effectively. Criminal sanctions may be mitigated by a compliance program, but only if that program is effective.  Having a written compliance program document in the filing cabinet is not enough. Most SNFs lack the policies and procedures, staff training, audit functions, and regulatory updates to implement and maintain their programs.

Benefits of MPA's Shared Compliance Program:

MPA’s Shared Compliance Program will all you to:

• Minimize financial loss with reduced sanctions and penalties. The OIG views the existence of an effective compliance program as a mitigating factor in fraud and abuse cases. Plus, under the Affordable Care Act, deficiencies that are self-reported and corrected may receive reduced civil monetary penalties.
• Reduce exposure to liability. Effective compliance programs can detect systemic failures of care that can result in liability for submitting false claims under the False Claims Act and the Civil Monetary Penalties Law.
• Enhance your reputation. Adherence to standards of quality of care and compliance enforcement increases resident satisfaction, market competitiveness and employee loyalty.
• Reduce compliance program costs via economies of scale. All MPA Shared Compliance Program services are included in your annual fee—saving you the expense of hiring an attorney at an hourly rate, or adding full-time staff and overhead to your facility.
• Improve best practices. You will actively participate in user groups with MPA’s other clients to benefit from multiple experiences, improve your compliance processes, and advance best practices
• Reduce whistleblowing. By using MPA’s reporting mechanism, which is both confidential and outside of your facility, employees will be more comfortable reporting incidents within the organization rather than to third party enforcers.

Shared services provided for a fixed annual fee:

• A preliminary audit to develop your baseline compliance status and identify improvement goals
• A state of the art compliance program complete with written policies and procedures that address risk areas identified by the government, such as: quality of care, residents’ rights; billing and cost reporting; employee screening; fraud and abuse; HIPAA privacy and security; and records management
• Corporate support for your Compliance Officer and employees
• Regular program updates to reflect regulatory changes and developments
• Recommended standards of organization conduct and ethics designed to create a culture of compliance, plus compliance training for management staff
• Prescribed formats for auditing clinical and financial submittals
• Billing integrity applications
• Strategic assistance with regular audits designed to measure and improve your facility’s adherence to the compliance program
• Procedures for reporting, detecting, and responding to non-compliance
• Staff education and training
• Recommended standards for integrating compliance into employee performance reviews and disciplinary guidelines 
• Legal representation for investigations and for individual compliance audits is available as a separate service.

Contact Us

For more information on MPA's Shared Compliance Programs, please contact Margaret Scavotto, General Counsel and Compliance Manager at Management Performance Associates, at mcs@healthcareperformance.com, or 314-434-4227 extension 16.