Observation Deck

The Time for Compliance Is Now

Requirements represent hidden opportunity.

What do you think of when you hear the word “compliance?” Never before has this word been more important. If you haven’t figured it out quite yet, it’s a different time in the HME industry, and if youwant to stay in business, compliance is the key.

It all started a few years ago with Medicare’s accreditation and surety bonds requirements. Then came competitive bidding as well as the implementation of new and aggressive audit contractors called RACs and ZPICs. CMS has made its position known. It wants to reduce the number of companies that provide durable medical equipment to Medicare beneficiaries and it is spending hundreds of millions of dollars to implement the programs that are accomplishing that goal.

And while doing this; CMS realizes and understands that the number of beneficiaries that will require this benefit is rising. What CMS is saying is that if you want to accept money from the government, you have to play by its rules and it only wants to do business with the most compliant of organizations.

Hidden Opportunity

From a business perspective, this environment actually represents an amazing opportunity for anyone willing and motivated to seize it. The companies that do not take the necessary steps to become a compliant organization but rather stay in the “business as usual” frame of mind will eventually succumb to that old way of thinking.

I see it over and over again in our practice, where companies call us after undergoing a Medicare audit with drastic results that have a significant impact on their ability to remain in business. While we can and will help them appeal and often with positive results, the cost of doing so is significant and the process normally takes up to or over a year to navigate through. So many companies are operating in the same manner with this constant fear that it will happen to them.

Why not make the investment of the front end to better prepare your organization, implement effective internal controls, improve the efficiency of your staff, and provide better quality of service to your patients? That is what an effective and comprehensive compliance program does. Furthermore, you will be able to sleep better at night knowing that when that audit letter is received, you are prepared and can weather the storms that plague this industry.

So, that’s the practical reason why to implement compliance controls. The reality is that the Affordable Care Act has made it mandatory for all healthcare providers, at some point, to implement a comprehensive compliance program that meets or exceeds government expectations.

There is no deadline for DME providers specifically yet, but based on past experience, I am confident they will be among the first to be forced to comply with this mandate. The government has been recommending that DME suppliers implement a comprehensive compliance program since 1999 and at this point, the general feel is that providers who don’t are considered negligent. It’s also important to note that the compliance piece of your accreditation is usually not comprehensive enough for what they OIG has said an effective compliance program should be, although it may be a strong foundation on which to start.

I understand that trying to implement additional controls when reimbursement is down isn’t the easiest action to take but consider it an investment in your company’s future. Once you have made that decision, getting the program set up is easier than you may think.

Starting a Compliance Program

The first step in the process is identifying someone you trust, without question, as your company’s Compliance Officer. That person does not have to be solely dedicated to compliance but he or she should certainly have clearly delineated tasks without contradictions with any other role he or she might play in your organization.

The individual selected as Compliance Officer will be responsible for implementing the program and even more importantly, making sure it becomes a “living program” and not just another manual on the shelf gathering dust. One challenge is that, much like accreditation is making sure the program gets integrated successfully within the daily operations of your organization. If it doesn’t, it’s as useless as never having one at all.

The Compliance Officer and senior management will also play a very integral part in conveying a top-down commitment to compliance on a regular ongoing basis to your staff. Once this message gets across, your employees will share in that commitment and you will immediately begin seeing improved efficiency and quality of care.

The other pieces of a program include a sound audit plan and an education and training program that feed off of each other. The audit plan should include regularly scheduled claim audits. The challenge most providers have is not conducting the audits, but rather conducting them in accordance with the strict adherence to Medicare policies.

The purpose of internal audits is to determine if you have issues that would be identified in a government audit, resolve them and avoid them in the future, thereby reducing your own liability and risk. You then use the results of these audits to determine where you need additional job-specific training that will incorporate into your regularly scheduled compliance training program that you develop. So, all new and current employees will have compliance training on a regular basis and more job specific training from a variety of sources (conferences, webinars, Medicare, etc.) to keep them up to date on the changes made as well as the issues identified internally.

Other areas to work on for compliance include disciplinary guidelines for those who do not follow the policies and procedures, internal communication, reporting mechanisms, and developing a process in which the Compliance Officer can respond promptly to detected offenses. Implementing these elements into your daily operations will help protect your business and better secure its future as a successful Medicare supplier.

This article originally appeared in the May 2012 issue of HME Business.

About the Author

Wayne H. van Halem, CFE, AHFI is President of The van Halem Group LLC (Atlanta, Ga.), a business unit of VGM Group that helps providers navigate complex issues related to Medicare and Medicaid audits, appeals and compliance.

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