Patient Administration Division
Tripler Army Medical Center is dedicated to full
What Is Compliance?
The American Hospital Association's (AHA's) definition is as follows, "Accurately following the Government's rules on Medicare billing system requirements and other regulations. A compliance program is a self monitoring system of checks and balances to ensure that an organization consistently complies with applicable laws relating to its business."
"Fundamentally, compliance efforts are designed to establish a culture within a hospital that promotes prevention, detection and resolution of instances of conduct that do not conform to Federal and State law, and Federal, State and private payor health care program requirements, as well as the hospital's ethical and business policies." (Federal Register/Vol 63, No. 35/ Monday, February 23, 1998/Notices)
Elements of the Office of Inspector General (OIG) Compliance Program
According to the OIG, comprehensive compliance programs should include, at a minimum, the following 7 elements:
1. The development and distribution of written policies and procedures that promote the MTF's commitment to compliance. These policies and procedures should include the following:
a. Standards of conduct
b. Risk Areas
c. Claims development and submission process
d. Medical necessity - Reasonable and necessary services
e. Anti-kickback and self-referral concerns
f. Bad Debt
g. Credit balances
h. Retention of Records
i. Compliance as an element of a performance plan
2. The designation of a Chief Compliance Officer and other appropriate bodies who report directly to the Commanding Officer.
3. The development and implementation of regular, effective education and training programs for all affected employees.
4. The maintenance of a process to receive complaints and maintain the anonymity of complainants.
5. The development of a system to respond to allegations of improper/illegal activities and the enforcement of appropriate disciplinary action against employees who have violated internal compliance policies, applicable statutes, regulations or Federal health care program requirements.
6. The use of audits and/or other evaluation techniques to monitor compliance and assist in the reduction of identified problem areas
7. The investigation and remediation of identified systemic problems and the development of policies addressing the non-employment or retention of sanctioned individuals.
Even though DoD may not include all 7 elements in its compliance plan, the OIG provides these elements as suggestions.
* Information obtained from Federal Register/Vol 63, No. 35/ Monday, February 23,1998/Notices.
What are the Benefits of a Compliance Program to the Military Treatment Facility (MTF)?
Primarily, it is fulfilling the MTF's legal duty to ensure that it is not submitting false or inaccurate claims to Government and private payers. A Compliance Program helps a MTF fulfill its fundamental care-giving mission to patients and the community. It assists the MTF to identify weaknesses and to improve upon internal systems and business office management. A Good Compliance Plan and Program will also:
- Concretely demonstrate to employees and the community at
large the MTF's strong commitment that it is honest in its corporate conduct;
- Provide a more accurate view of employee and contractor
behavior relating to fraud and abuse;
- Identify and prevent criminal behavior;
- Be tailored to a MTF's specific needs;
- Create a centralized source for distributing information
on health care statutes, regulations and other program directives related to
fraud and abuse and related issues;
- Develop a methodology that encourages employees to
report potential problems;
- Develop procedures that allow the prompt, thorough
investigation of alleged misconduct by Commanding Officers, managers,
employees, independent contractors, physicians, other health care
professionals, and consultants;
- Initiate immediate and appropriate corrective action;
and through early detection and reporting, minimize the loss to the Government
from false claims, and thereby reduce the MTFs exposure to civil damages and
penalties, criminal sanctions, and administrative remedies, such as program
Standards of Ethical Coding
The standards below were developed by American Health Information Management Association (AHIMA) Council on Coding and Classification to give medical coders ethical guideline for performing their tasks. They are intended to impart the responsibility and importance coders have as members of the healthcare team and to support them as dignified professionals.
In this era of payment based on diagnostic and procedural coding, the professional ethics of medical record coders continue to be challenged. The following standards for ethical coding developed by the AHIMA Council on Coding and Classification and approved by the AHIMA Board of Directors are offered to guide the coder in this process. **
- Diagnoses that are present on admission or diagnoses and
procedures that occur during the current encounter are to be abstracted after a
thorough review of the entire medical record. Those diagnoses not applicable to
the current encounter should not be abstracted.
- Selection of the principal diagnosis and principal
procedure, along with other diagnoses and procedures must meet the definitions
of the Uniform Hospital Discharge Data Set (UHDDS).
- Assessment must be made of the documentation in the
chart to ensure that it is adequate and appropriate to support the diagnoses
and procedures selected to be abstracted.
- Medical record coders should use their skills, their
knowledge of ICD-9-CM and CPT, and any available resources to select diagnostic
and procedural codes.
- Medical record coders should not change codes or
narratives of codes so that the meanings are misrepresented. Nor should
diagnoses or procedures be included or excluded because the payment will be
affected. Statistical clinical data is an important result of coding, and
maintaining a quality database should be a conscientious goal.
- Physicians should be consulted for clarification when
they enter conflicting or ambiguous documentation in the chart.
- The medical record coder is a member of the healthcare
team and, as such, should assist physicians who are unfamiliar with ICD-9-CM,
CPT or DRG methodology by suggesting resequencing or inclusion of diagnoses or
procedures when needed to more accurately reflect the occurrence of events
during the encounter.
- The medical record coder is expected to strive for the
optimal payment to which the facility is legally entitled, but it is unethical
and illegal to maximize payment by means that contradicts regulatory
** The Official Coding Guidelines, published by the Cooperating Parties (American Hospital Association, American Health Information Management Association, Health Care Financing Administration and National Center for Health Statistics), should be followed in all facilities regardless of payment source in conjunction with DoD guidelines.
Office of Inspector General (OIG) Focus
The Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) is continuing its efforts to promote voluntarily developed and implemented compliance programs for the health care industry. This effort is aimed at reducing the amount of fraud, waste and abuse in Federal, State, and private health plans. According to Centers for Medicare and Medicaid Services (CMS) financial statements, there were $20.3 billion in incorrect Medicare payments (perceived as fraud) in 1997. Since the 1980's, the Federal government has waged an ever-increasing campaign to fight health care fraud and abuse. New legislation has provided millions of dollars to identify and investigate this problem. This legislation has identified new crimes, increased penalties, expanded exclusions from Medicare, and enhanced incentives for whistle blowing among beneficiaries as well as providers.
Some of the special areas of concern include:
- Billing for items or services not actually rendered.
- Providing medically unnecessary services.
- Upcoding - practice of using a billing code that
provides a higher payment rate than the billing code that actually reflects the
- DRG creep - the practice of billing using a DRG code
that provides a higher payment rate than the DRG code that accurately reflects
the service furnished.
- Outpatient services rendered in connection with
- Teaching physician and resident requirements for
- Duplicate billing.
- False cost reports.
- Unbundling - the practice of submitting bills piecemeal
or in fragmented fashion to maximize reimbursement.
- Billing for discharge in lieu of transfer.
- Patients' freedom of choice.
- Credit balances - failure to refund.
- Hospital incentives that violate the anti-kickback
statute or other similar Federal or State statute or regulation.
- Joint ventures.
- Financial arrangement between hospitals and
- Stark physician self-referral law.
- Knowing failure to provide covered services or necessary
care to members of a Health Maintenance Organization (HMO).
- Patient dumping.
Some of the Arsenal of Weapons of the U.S. Government to Fight Fraud, Waste, and Abuse
1. Health Insurance Portability and Accountability Act
- Health Care Fraud 18 USC 1347- felony - up to life in
- Elements - knowingly and willfully, execute or attempt
to execute a scheme or artifice, to defraud any health care benefit program.
- 18 USC 669 - theft or embezzlement in connection with
- 18 USC 1035 - false statements relating to health care.
- 18 USC 1518 - obstructing criminal investigations in
- 18 USC 1956(c)(7) - money laundering related to a Federal health care offense.
2. Anti-Kickback Statute - 42 UCS 1320a-7b(b) - Applies to health care programs funded wholly or in part with federal funds. Criminal punishment - maximum prison sentence of five years and fines up to $25,000 per violation.
- Elements - to solicit, offer, or receive any
remuneration in return for referring an individual or to purchase lease, order
or arrange for any item or service for which payment may be made in whole or in
part by Medicare or Medicaid.
- Intent - knowingly and willfully
3. Federal Self-Referral Statute ("Stark Law") - 42 USC 1395nn
Civil penalties of up to $100,000
- Elements - prohibits remuneration by persons or entities
to specific entities in which the referring provider has a financial interest.
- Intent - Does not require an illegal intent. Good faith is not an exception.
4. Civil Monetary Penalties Law 42 USC 1320a-7a - Is specific to Health Care Abuse. Civil penalties of up to $50,000 for each act plus triple the damages sustained by the government
- Knowingly present or cause to be presented to the government a claim for an item or service that the claimant knows or should know:
- Was provided by a person or entity excluded from participation
- Was false or fraudulent
- Was not provided as claimed
- Was provided by an ineligible physician
- Was for an item or service which was not medically necessary
- Knowingly pay a physician to reduce or limit servicesIntent - knowingly
5. False Claims Act 31 USC 3729-33
Civil penalties of up to $10,000 per false claim plus triple damages sustained by the Government.
- Knowingly file a false or fraudulent claim to the U.S. Government for payment
- Knowingly use false statements to obtain payments on such claims
- Commit certain reverse false claims
- Conspire to defraud the U.S. Government through false claims
- Intent - knowingly
6. Balanced Budget Act Exclusions/Suspensions - Ten year to mandatory lifetime exclusions for repeated convictions for defrauding the Medicare/Medicaid program.