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Five steps to limit your risk as a compliance officer
As compliance officers assume a higher-profile role in hospitals, their personal liability also is increasing. However, specific techniques and strategies can minimize that liability, not necessarily at the expense of their employer.
Christopher Ideker, a partner with Ernst & Young in Atlanta, says that while compliance officers can never completely eliminate the conflict of interest or personal liability inherent in their position, they can manage that risk using a range of strategies.
Among the measures he recommends are the following:
I. Investigate the position before you accept the job. Ideker says compliance officers should become familiar with the company’s past history and their response to investigations before accepting a new position. "You have to know the reputation of the company and the community," he warns. Two questions to ask: Are they committed to doing the right thing? Is compliance part of their orientation when hiring new employees?
Recent or anticipated mergers and acquisitions also can be a key factor, he adds. "When you buy a company, you buy their problems," says Ideker. "I had a Department of Justice attorney once tell me that she didn’t need whistle-blowers; all she needed was to read The Wall Street Journal and find out who was buying who."
II. Understand the role of management. According to Ideker, it is important to understand the organizational structure and the role management plays in compliance. He says compliance officers should speak directly with the CEO to gauge their level of commitment to integrating compliance into the company’s mission. That includes what type of infrastructure will be established as well as compensation.
"I believe that measurements in compensation drive behavior," he says. While compliance officers typically will not receive a commitment on precisely what will be spent on compliance, they should get a commitment that their views will be considered strongly.
III. Set ground rules with your employer. Ideker says compliance officers should examine the scope of their duties. Depending on the job description, they may be responsible for compliance, or compliance and internal audit, or compliance and quality control. All of these schemes can work, he maintains, but compliance officers must understand which arrangement it will be.
IV. Ensure proper budgeting. Ideker says the biggest problem he often finds is underfunded plans." He says one way to secure adequate funding is to point out areas where the organization can make additional money through effective compliance. "Point out areas where correcting documentation shortfalls would have led to more reimbursement," he says. "Those are good stories to tell, and it helps make you part of that team. It shows them your value and ensures proper funding."
V. Assess reporting requirements. According to Ideker, compliance officers should be wary of the knee-jerk tendency to report to the CEO. Rather, he says compliance officers should always report parallel to the people who are expected to comply.
Regardless of the arrangement, however, Ideker says compliance officers must have direct access to the governing body and the CEO. That should be documented, he adds. "In any corporate governance litigation you might have downstream, this is your ultimate hammer, but use it sparingly," he advises.
"I think being tightly integrated with operations is the key to compliance," concludes Ideker. "The more you make it a staff function instead of an integrated operational strategy, the less chance of success you will have."