Survey Shows Continued Growth in Compliance Program Budgets/Staffing

Although falling behind other businesses, the good news for health care compliance professionals is that there has been a 35 percent increase in budgets and staffing for compliance programs, according to a survey released on October 23, 2013, by the Society of Corporate Compliance and Ethics (SCCE) and the Health Care Compliance Association (HCCA). The survey, which was conducted between  July and August 2013, found that compliance and ethics programs’ budgets and staffing show steady increase that is expected to continue into 2014. Moreover, job security as well as management’s perception of the value of compliance are on the rise. SCCE and HCCA attributed the survey results to the improvements in the economy and the increased enforcement activity globally, which is leading to a signficant expansion in the need for compliance and ethics programs.

Survey Results

SCCE and HCCA began surveying the compliance community periodically on economic issues shortly after the recession began in 2009 to determine what has happened to compliance programs and staffing during the economic downturn and to project the direction budgets and staffing would go in the year ahead. The survey also looked at job security for compliance professionals as well as risk levels and management attitudes toward compliance and ethics programs. The key findings include:

  • Thirty-eight percent of respondents reported increased spending on compliance programs in 2013 with 50 percent reporting that their budgets remained the same, 29 percent reporting a somewhat increased budget, and  nine percent reporting a greatly increased budget. Only 12 percent of respondents reported a budget decrease. Specifically, although health care companies reported a 35 percent increase, non-health care companies had a 41 percent increase.
  • Over 46 percent of respondents predicted budgets to increase in 2014. The ratio of compliance professionals projecting their budgets increase in 2014 to those predicting their budget decrease in 2014 was more than four to one.
  • Thirty-four percent of respondents reported growth in staffing  levels. Again, respondents outside of the health care industry were higher at 39 percent versus health care respondents at 29 percent. 
  • The responses indicated that growing budgets reflected more positive feelings of regarding job security. Overall, 45 percent of respondents believed that their was less risk of losing their jobs.
  • Sixty percent of respondents believe that management sees compliance as a positive asset in helping the organization through the economic challenges. This is up from 56 percent in 2011 and 51 percent in 2009. Only 12 percent reported that management believed compliance was a hindrance.
  • Eighty seven percent of compliance professionals believe that there is an elevated sense of risk of failure due to the current economy. Thirty-one percent of the respondents believe that the current economy greatly increases the risk of compliance and ethics failures, while 56 percent believe it somewhat increases the risk.

Conclusion

SCCE and HCCA concluded that having an effective compliance and ethics program seems to be a part of the business community’s ongoing plans. Even during the worst years of the recession compliance budgets showed growth and respondents predicted continued growth. They concluded, however, that job growth is lagging behind budget increases and compliance and ethics professionals continue to believe that the current economy greatly increases the risk of failure. In a news release regarding the survey, Roy Snell, Chief Executive Officer of SCCE and HCCA noted that headlines in the business section of newspapers show the price of compliance failures but the survey results indicate that “more companies are getting it and realizing that compliance is a good investment. He added that the “Greater commitment to compliance and ethics programs means companies are seeing the value of compliance in mitigating their risks and avoiding the disastrous expense that comes from a compliance failure.”