From the Contributor’s Corner: Predicating An Internal Investigation

Every organization finds that it is confronted with a problem that must be resolved by some sort of fact gathering. The larger the organization, the more this will happen. Most cases predicated for investigation arise from allegations or complaints that someone has committed a wrongdoing. When this occurs, someone needs to be tasked with conducting an investigation to establish the facts related to that allegation. Often, the predicating evidence for an investigation suggests violations of policies, procedures, rules, standards, etc. On relatively rare occasions, it may suggest potential violation of law, or potential civil liability.

An investigation can be predicated in a variety of ways, including an anonymous letter, a hotline complaint, a finding from an audit, a management encounter, or contact from an outside government agency. Examples of common complaints and allegations include:

  • Violations of employee or patient privacy
  • Questionable claims processing
  • Theft of assets
  • Misuse of property or proprietary information
  • Improper disclosure of protected health information
  • Regulatory or legal transgressions
  • Unlawful harassment
  • Hostile behavior
  • Operational irregularities
  • Workplace injuries

Complaints often contain more than one allegation or are not clearly defined. It is up to the employer to investigate the issues and gather evidence through document examination and interviews to arrive at a clear picture of the true situation. In many cases, the Compliance Officer will assume a primary role with responsibility for managing the investigation. This typically occurs where the allegations involve a compliance-related issue that may implicate either regulatory or legal prohibitions. In many instances, the Compliance Officer may be serving in a supporting role. Most often this may be to inside or outside counsel. However, the list above suggests that the responsibility for conducting an investigation may involve a number of other offices, including Human Resources, Risk Management, Security, Legal Counsel, etc. The first hurdle to dealing with allegations or information suggesting potential wrongdoing is whether the information is sufficient or sufficiently credible to warrant initiation of an inquiry or investigation, and who would be responsible for the investigation.

One of the most important factors in deciding whether to conduct an investigation is the circumstances that give rise to the allegations, including the source of the information. In most cases, predication of an investigation will come from inside the organization. In these circumstances, evaluating the source information to decide upon appropriate courses of action is a very important decision. This decision will rest in large measure upon potential liability, should it be determined that the allegation is true. In many, if not most cases, the decision may be that something less than a formal inquiry or investigation will suffice.

It is not possible to identify firm rules as to when something should be or should not be formally investigated. This will always become a case-by-case determination. Knowledge of the facts will enable management to examine options and respond effectively, and enable a proper decision as to whether it is necessary to investigate allegations or not. An investigation can be costly in time and resources, both in actual expenditures and in loss in management and employee time. However, the organization must be prepared to deal with the consequences of its decision to investigate or not investigate. In most cases where there are credible allegations, there are more advantages to investigating and resolving issues raised than to not doing so.

Even with small or apparently innocuous matters, it is important to act quickly and decisively. That decision may be to not investigate based upon inadequate predicating information; lack of lead information; and/or absence of evidence of a violation of policies, procedures, law, regulation, or the Code. It is also important to remember that not acting upon allegations of wrongdoing is a decision, and failing to act may be the worst decision. Delaying an investigation is almost as bad. It may result in the allegations being filed with someone else, like the media, a government agency, a tort lawyer, etc. The potential liability grows almost exponentially with lapsing of time from notice of a problem.

Richard Kusserow, served as the DHHS Inspector General for 11 years with prior services in the FBI. He is the author of Conducting Internal Investigations in Health Care Organizations, AIS, 2011, (ISBN 979-1-936230-60-8). He currently is CEO of Strategic Management Services.

Connect with Richard Kusserow on Google+ or LinkedIn.

Copyright © 2013 Strategic Management Services, LLC.  Published with permission.