The Office of the Inspector General (OIG) has released the "Draft Compliance Guidance for Individual and Small Group Physician Practices." This document outlines the fundamental elements of physician practice Compliance Programs as well as the principles that each practice should consider when developing and implementing a Compliance Program.

Physicians are advised to pay close attention to this issue. Estimating a return of $10 in fines and penalties for every $1 spent in investigations, the Federal Government is dedicating substantial resources in its efforts to combat suspected fraud and abuse issues in the health care industry. A Compliance Program can significantly reduce the risk of an audit by Federal agencies and potential civil or criminal penalties.

A written plan based on an assessment of a practice’s high-risk areas is the first step in developing an effective Compliance Program. The plan outlines the central features of the program and refers to the OIG’s "seven core elements." The mere existence of a plan provides no protection, unless the action items stated in the plan have been successfully implemented. The combination of a plan and the implementation of its key features comprise the program.

The OIG believes that every effective Compliance Program should begin with a commitment by the physician practice to address all of the following applicable elements: (1) establish compliance standards through the development of a code of conduct and written policies and procedures; (2) assign compliance monitoring efforts to a designated compliance officer or contact; (3) conduct comprehensive training and education on practice ethics and policies and procedures; (4) conduct internal monitoring and auditing focusing on high-risk billing and coding issues through performance of periodic audits; (5) develop accessible lines of communication, such as discussions at staff meetings regarding fraudulent or erroneous conduct issues and community bulletin boards, to keep practice employees updated regarding compliance activities; (6) enforce disciplinary standards by making clear or ensuring employees are aware that compliance is treated seriously and that violations will be dealt with consistently and uniformly; (7) respond appropriately to detected violations through the investigation of allegations and the disclosure of incidents to appropriate Government entities.

The key features of a Compliance Program for a physician practice are as follows:

• Designate authority and responsibilities
• Target any high risk areas
• Provide a schedule for document review, as well as for the ongoing education of physician and staff
• Address the standards for recruitment and personnel conduct
• Put a system in place for reporting compliance concerns
• Include provisions for periodic audits, internal investigations and enforcement of issues
• Include a method of documenting violations and a schedule for the recurring assessment of the program

A truly effective Compliance Program is one in which both the plan design and the program’s operation are fully supported by detailed documentation that becomes an integral part of the management process of the practice. Once a Compliance Program is successfully implemented, the culture of a practice will shift to reflect the features covered in the plan.

For physician group practices already overburdened with the multitude of requirements imposed on them by various governmental agencies and insurance companies, the prospect of adding yet another chore may seem intimidating. The Amper Healthcare Consulting Group has the knowledge and expertise to ease the process of developing your Compliance Program.

The Amper approach to developing an effective and successful Compliance Program begins with an assessment of the practice’s high risk areas, as outlined by the OIG. It continues with assistance in developing the various elements of the compliance plan, including the mission statement, shareholders resolution, code of ethics and policies and procedures. The final step assists with the implementation of the action items outlined in your plan. These include services such as a coding and documentation review, physician and staff training, and an annual audit of your Compliance Program.

To discuss how the Healthcare Consulting Group at Amper can help your practice produce and implement the most effective possible Compliance Program, contact Michael McLafferty at 732.287.1000, ext. 337.

Michael J. McLafferty is a Manager with the Healthcare Consulting Practice at Amper, Politziner & Mattia. Michael has 15 years of experience in the healthcare field, most recently as a manager with an international consulting firm. He has particular expertise in providing business services to multi-hospital systems and physician practices, assisting them in making optimal financial and operational decisions. He has assisted numerous physician practices with network management and development, evaluation and improvement of practice operations, revenue enhancement, chart and coding evaluations, revenue enhancement strategies and implementation, contract negotiations, compensation reviews and benefits planning and regulatory and compliance issues.

In his previous positions, Michael developed the business plan for the faculty practice of a teaching hospital, provided interim management services for a major management services organization and performed an operational and financial assessment, budget redesign and benchmarking analysis for a major managed care payor. He has also held positions as a practice administrator and director of operations for medical practices.

Michael has extensive contacts in the healthcare field and is often requested as a speaker before professional organizations. He is active in numerous associations, including the Medical Group Management Association, American College of Healthcare Executives, the Healthcare Financial Management Association and the New Jersey Society of Certified Public Accountants.

A certified public accountant, Michael earned his MBA from Rutgers University. He has a fellowship designation (FACMPE) through the American College of Medical Practice Executives, the credentialing division of the Medical Group Management Association.