Background

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The creation of compliance program guidances is a major initiative of the OIG in its effort to engage the private health care community in combating fraud and abuse. In the last several years, the OIG has developed and issued compliance program guidances directed at the following segments of the health care industry: the hospital industry; home health agencies; clinical laboratories; third-party medical billing companies; the durable medical equipment, prosthetics, orthotics and supply industry; hospices; and Medicare+Choice organizations offering coordinated care plans. The development of these types of compliance program guidances is based on our belief that a health care provider can use internal controls to more efficiently monitor adherence to applicable statutes, regulations and program requirements.

Copies of these compliance program guidances can be found on the OIG web site at http://www.hhs.gov/oig.

Developing Compliance Program Guidance for Nursing Facilities

On December 18, 1998, the OIG published a solicitation notice seeking information and recommendations for developing formal guidance for nursing facilities (63 FR 70137). In response to that solicitation notice, the OIG received 16 comments from various outside sources. We carefully considered those comments, as well as previous OIG publications, such as other compliance program guidances and Special Fraud Alerts, in developing a compliance program guidance for nursing facilities. In addition, we have taken into account past and recent fraud investigations conducted by the OIG’s Office of Investigations and the Department of Justice, and have consulted with the Health Care Financing Administration. In an effort to ensure that all parties had a reasonable opportunity to provide input into a final product, the draft guidance for nursing facilities was published in the Federal Register on October 29, 1999 (64 FR 58419) for further comments and recommendations.

Elements for an Effective Compliance Program

This compliance guidance for nursing facilities contains seven elements that the OIG has determined to be fundamental to an effective compliance program:

  • implementing written policies, procedures and standards of conduct;
  • designating a compliance officer and compliance committee;
  • conducting effective training and education;
  • developing effective lines of communication;
  • enforcing standards through well-publicized disciplinary guidelines;
  • conducting internal monitoring and auditing; and
  • responding promptly to detected offenses and developing corrective action.

These elements are contained in previous guidances issued by the OIG. As with previously-issued guidances, this compliance program guidance represents the OIG’s suggestions on how nursing facilities can best establish internal controls and prevent fraudulent activities. The contents of this guidance should not be viewed as mandatory or as an exclusive discussion of the advisable elements of a compliance program; the document is intended to present voluntary guidance to the industry and not represent binding standards for nursing facilities.

Summary
Background
I. Introduction
II. Compliance Program Elements
A. The Seven Basic Compliance Elements
B. Written Policies and Procedures
C. Designation of a Compliance Officer and a Compliance Committee
D. Conducting Effective Training and Education
E. Developing Effective Lines of Communication
F. Auditing and Monitoring
G. Enforcing Standards Through Well-Publicized Disciplinary Guidelines
H. Responding to Detected Offenses and Developing Corrective Action Initiatives
III. Assessing the Effectiveness of a Compliance Program
IV. Conclusion
Appendix