Your next administrative headache: Complying with OIG compliance rules


Don’t wait until the last minute and scramble for results


If your practice doesn’t already have a formal program in the works to ensure that you comply with the regulations of federal health care programs, you should start to develop one now. The Office of the Inspector General (OIG) of the Department of Health and Human Services issued its "Draft Compliance Program for Individual and Small Group Physician Practices" in June.

Although the compliance program guidance is still in draft form, it is unlikely to change much when the final guidance is issued, says John Knapp, JD, a health care attorney with Cozen and O’Connor in Philadelphia. "What they have promoted as a draft is very consistent with the guidances for nursing homes, hospitals, and durable medical equipment companies," he adds.

The guidance calls for physician practices to establish a formal compliance program that includes internal controls and procedures to help prevent erroneous and fraudulent conduct by anyone in the practice and to ensure the accuracy of all claims submitted to federal health care programs.

"The OIG is serious. It has been giving notice of this for a long time, and it’s not going to go away despite the fact that physician practices are already complaining that they are overly burdened by administrative requirements," Knapp says.

The compliance program should be part of each physician practice’s efforts to make sure it complies with the law and to mitigate sanctions in the event that it doesn’t, Knapp says.

"Adopting a voluntary compliance program is a lot like practicing preventative medicine. It helps identify and treat small problems before they become big problems," Inspector General June Gibbs Brown said in a press release accompanying the draft compliance program guidance.

The OIG calls the compliance guidance "voluntary," but it’s advisable to look at it as mandatory, the experts say. "When the OIG provides recommended guidelines, they are not technically required, but it is always a good idea to move toward compliance. These guidelines obviously represent an area of concern, and the OIG will concentrate on those issue in the future," says Jay Williams, principal of Arista Associates, a health care strategy consulting firm in Northbrook, IL.

Although the law doesn’t say a practice must have a compliance program and there is no date for having it established, it’s still advisable to start one, Knapp points out.

"What [the OIG] is saying is that if you don’t have a compliance program and in the future you’re subject to prosecution for violating the law, you won’t have the defense of having a compliance program," he adds. (To learn what areas are most frequently the targets of investigations, see p. 132.)

Physician practices will have some time before the final guidelines come out, which will give them a chance to set priorities on the issues they need to tackle first, Williams says.

Although this is yet another administrative and bureaucratic burden on your practice, it can be blended into many things you are already doing, Knapp adds.

For instance, you probably already are training your staff in coding and producing documentation on how you keep records and how you code. You simply may have to expand the process to meet the federal guidance. (For tips on developing your compliance program, see related article, p. 131.)

The OIG regulations are just part of the changing nature of the practice of medicine that is making it increasingly difficulty for physicians to have small, independent practices, Knapp says. However, the same is true in many other professions, such as law, accounting, and architecture, he points out. "Look at any of the learned professions and you’ll find that the administrative requirements of running the profession as a successful business are forcing groups to join together to share expenses, reduce overhead, and comply with regulations. Medicine is among them. It’s not necessarily welcome news to medical practices, but it is reality."

The Medical Group Management Association (MGMA) in Englewood, CO, has recommended that the OIG amend the draft guidelines to improve the flexibility, clarity, and practicality of compliance programs for small group practices.

"These draft guidelines would be extremely difficult to implement for most small medical practices, or even many larger practices. Most of the medical practices affected by these guidelines are small and have scarce financial and human resources at their disposal," says William F. Jessee, MD, president and CEO of MGMA.


Relief from regulations


MGMA has asked the OIG to state more clearly that the draft guidance is voluntary and that medical practices are not required to include every one of the OIG’s seven recommended basic elements of compliance in their compliance programs. (See list of the seven recommended elements, above left.)

In addition, the MGMA suggests that the OIG and the Health Care Financing Administration should assist practices in developing policies and procedures.

The criticism is a fair one but one that the OIG attempts to address in its guidance by offering some suggestions for making the process easier, Knapp asserts. The OIG makes suggestions to reduce the burden on small practices, such as sharing resources among physician practices and keeping one copy of the compliance manual in a central location rather than distributing it to all employees, he says.

"Throughout the draft compliance guidelines, the OIG attempts to say Here is what we’d really like you to do, but if it’s too burdensome, here is another way,’" Knapp says.

In fact, the OIG cut physicians groups some slack in some areas, he says. For instance, in the guidances for other sectors of the health care industry, the OIG frowned upon using canned or standardized compliance programs, saying that each entity should develop its own unique program.

"With the physicians groups, the OIG seems to recognize that the cost and the amount of energy, time, and internal resources to develop customized compliance programs may not be consistent with the economic means of individual physician practices," Knapp says.

The physician guidance suggests that practices can use standardized compliance program developed by legal counsel, professional associations, or consultants, provided they make some effort to tailor the program to their particular practices, he says.