Week 7 SOP

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Week 7

Corporate Compliance, Fraud, and Abuse

Fraud and abuse are a threat not only to individual healthcare organizations, but also to

the national healthcare system as a whole. In fiscal year 2016, the U.S. Department of

Justice (DOJ) recovered about $4.7 billion in settlements and judgments from civil cases

involving fraud and false claims. Over half of that amount, $2.5 billion, was from cases

related to the healthcare industry (DOJ, 2016). Throughout the last decade, the media has

often reported on major healthcare scandals. For example, in 2009, 60 Minutes had an

episode that described how Medicare was fraudulently billed $60 billion for services or

products that were never provided or delivered. The Centers for Medicare and Medicaid

are required to pay claims within a short time period, either 15 or 30 days. The payment

turnaround made it difficult to investigate false claims. However, the DOJ, the FBI, and

several state’s attorneys general have taken on investigating these claims. Medicare has

taken steps to make enrollment more stringent so that phony companies are less likely to

be able to commit fraud in the future (CBS News, 2009). Such cases of fraud cause great

harm to the taxpayers, whose dollars go into a public trust to administer two of the largest

direct health services programs in the world. However, it’s the smaller cases of fraud that

go almost unnoticed and not reported by the media that result in a similar degree of harm

to the U.S. healthcare system.

Abuse, providing unnecessary services, and overbilling for services are also detrimental to

the system of healthcare. As stated in Week 3, cases of fraud and abuse result in both

criminal and civil charges. In the face of such large-scale corruption in 1991, the U.S.

Sentencing Commission (USSC) adopted guidelines that provided rules and principles for

the sentencing of organizations that commit fraud and abuse. Moreover, the Thompson

Memorandum, otherwise known as Principles of Federal Prosecution of Business

Organizations, established guidelines that U.S. attorneys can use in determining whether

to bring an enforcement action against an organization (U.S. Sentencing Commission,

2015). These guidelines and principles have been updated in keeping with the changes in

the corporate climate, with the latest proposed changes announced in late 2018 (U.S.

Department of Justice, 2018). In response, leaders of healthcare organizations began to

establish corporate compliance programs to prevent and mitigate the effects of fraud and

abuse. The U.S. Department of Health and Human Services’ Office of the Inspector

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Books and Resources for this Week

Mayer, C. M. (1995). Preventing fraud and

abuse fallout. Healthcare Financial

Management, 49(4), 40, 42, 44. Link

General (OIG), is responsible for disseminating compliance guidance to

healthcare organizations.

As was discussed in Weeks 1 and 3, the environment of an organization can determine

whether ethical behavior is encouraged or discouraged, and the leadership of the

organization directly impacts the environment. Executives must go beyond fostering the

right environment and establish policies and procedures to ensure that their organizations

do not commit acts of fraud and abuse.

Be sure to review this week's resources carefully. You are expected to apply the

information from these resources when you prepare your assignments.

References:

CBS News. (2009). Medicare fraud: A $60 billion crime.

https://www.cbsnews.com/news/medicare-fraud-a-60-billion-crime-23-10-2009/

U.S. Department of Justice. (2015). U.S. States Attorney’s Office, District of New Jersey:

Compounding pharmacist sentenced to 20 months in prison for paying kickbacks for

referrals, health care fraud.

U.S. Department of Justice. (2016). Justice Department recovers over $4.7 billion from

False Claims Act cases in Fiscal Year 2016. U.S. Department of Justice. (2018). Principles of

Federal Prosecution of Business Organizations.

U.S. Sentencing Commission. (2015). Chapter eight: Sentencing of organizations. In 2015

guidelines manual. Washington, DC: Author.

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McGreal, P. E. (2018). Corporate compliance

survey. Business Lawyer, 73(3), 817–842. Link

Osowski, B. (2012). Health care industry

codes of conduct: A must have? Journal of

Health Care Compliance, 14(5), 61-64. Link

U.S. Department of Justice, Criminal Division,

Fraud Section. (n.d.). Evaluation of corporate

compliance program. Link

Week 7 - Assignment: Assess Your Organization's Readiness

for Corporate Compliance Assignment

Due August 4 at 11:59 PM

You will create a standard operating procedure (SOP) and checklist (as an appendix to the

SOP) to assess an organization’s readiness to adopt and implement corporate compliance.

The organization you select can be your present healthcare organization, one you have

worked for in the past, or a fictitious one. Review this week’s resources for guidance on

what should be included in the SOP and accompanying checklist. Approval would be given

by the compliance officer in your organization (or the individual whose job responsibilities

include compliance and enforcement).

Table 3. Sample SOP

(Company Name)

STANDARD OPERATING PROCEDURE

(name of this standard operating procedure)

Standard Operating Procedure No.

Revision No:

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1: Health Law, Ethics, and Policy (2609876349) - DHA-7006 v1: Health Law, Ethics, and Policy (2609876349)

Original Date of Issue:

Revision Date:

Revised by:

Approved by:

Background: (What requirements will this standard operating procedure meet?)

Purpose: To provide instruction on …

Related Standards and Procedures:

List any related standards, good operating practices or other standard operating

procedures.

Procedure:

List the tasks step by step to provide instruction on how to perform this procedure.

Related Forms and documentation:

List the forms pertaining to this procedure.

Records:

List the records that will be kept as a result of this procedure.

Length: a minimum of 5 pages, including checklist as an appendix (not including title page

and reference page).

References: Include a minimum of 3 scholarly resources to support the creation of the

SOP and checklist.

Your presentation should demonstrate thoughtful consideration of the ideas and concepts

presented in the course and provide new thoughts and insights relating directly to this

topic. Your response should reflect scholarly writing and current APA standards.

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