Timing key for internal audits, self-disclosure

There is an art to conducting internal compliance audits and determining when to begin a self-disclosure protocol—the ideal compliance program should promote prevention, detection, and resolution of any conduct that fails to comply with the requirements of state and federal health care programs. Knowing when to perform an internal investigation or audit to encourage a healthy program is key, according to Leia C. Olsen, shareholder, Hall Render, who was presenting at a Health Care Compliance Association (HCCA) webinar.

Olsen noted that many qui tam actions arise when employees do not feel as though their concerns are being heard and taken seriously. She stressed the importance of having a mechanism for reporting incidents, and timely monitoring identified issues and implementing remedial measures. However, she noted that qui tam suits can potentially be prevented not only by conducting an internal investigation, but also by self-disclosing, which can trigger the public disclosure bar. Self-disclosure of identified wrongdoing is encouraged by the Department of Justice and HHS, but, per the Yates memorandum, all relevant facts must be provided by a company before it can receive credit for cooperating and voluntary self-disclosure. Therefore, it is important to conduct a thorough investigation, collecting all available information and documentation, before self-disclosing.

The 60-day refund rule, promulgated under Sec. 6402 of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), together with the Fraud Enforcement and Recovery Act of 2009 (FERA) (P.L. 111-21), creates False Claims Act (FCA) liability for providers who fail to report and return identified overpayments within 60 days of identifying the overpayment. Therefore, Olsen said, the time to meet the reasonable diligence standard after learning of a potential overpayment is limited. Having a protocol in place to quickly decide whether to self-disclose is critical in securing the greatest amount of cooperation credit.

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