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Medicaid Compliance Plans: What You Need to Know


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Compliance plans are a new and challenging part of the Medicaid program. Some are mandated (all are encouraged) to have compliance plans in place and they offer significant benefits. Failure to adopt a compliance plan (if mandated) could lead to serious sanctions or penalties. Over the last few months we have shared so much information with you regarding Medicaid compliance plans, it seemed like a good idea to place it all in one easy to find location. We hope that you find the following information helpful in your efforts.

  • What is a Medicaid compliance plan? It is a detailed description of your efforts to ensure compliance with federal and state regulations, particularly regarding clinical documentation and billing to government-funded healthcare programs.
  • Why am I required to have a compliance plan? Anyone who submits claims for reimbursement by or receives payments from a federally-funded healthcare program is required by the ACA to develop and implement a compliance program, which starts with a compliance plan.
  • Who needs to have a Medicaid compliance plan? If your practice (or dental organization) participates with (or receives payment from) a federally-funded healthcare program (Medicare, Medicaid, CHIP, Tricare, Indian Health Services, and etc.) you are required to develop and implement a compliance plan (and subsequently, a compliance program).
  • Should we create a compliance plan even if we are not mandated to? The federal Office of the Inspector General for the U.S. Department of Health and Human Services recommend that all  healthcare providers (dentists too) implement healthcare compliance programs as voluntary measures to ensure patient safety and minimize documentation and billing issues that can manifest as fraud investigations, lawsuits, or complaints to regulatory agencies (dental board, OSHA, Office for Civil Rights, and etc.).

The Affordable Care Act seems to be facing death row. However, I expect that compliance program requirements will be included in whatever new healthcare system is passed by the federal government. Compliance programs help providers prevent, even discover costly mistakes. The government has, for many years, followed the pay and chase modality (historical focus) for prosecuting fraud. In the next generation of healthcare there will be a larger emphasis on quality of care, minimizing medical errors, and prevention of sentinel events, fraud, and other concerns that can close the doors to any practice (future focus).

  • What should be in our compliance plan? The federal OIG has identified 7 key elements essential to demonstrate an effective compliance program
  1. Establish written policies and procedures that address compliance and liability risks
  2. Compliance Officer and (based on the size of your practice/ organization) a Compliance Committee
  3. Training and Education appropriate for every owner, employee, independent contractor and vendor based on each person’s role/ position (i.e. Infection Control for clinical staff, clinical documentation clinical and billing staff, coding and billing for billing staff, HIPAA for all staff, Fraud/Waste/Abuse training for everyone).
  4. Open Lines of Communication. Provide for an internal reporting system for patients and employees to express concerns about compliance issues. Provide a system for anonymous report. Include written whistleblower protections in your compliance plan or written policies and procedures. Encourage internal report of violations of rules, regulations or internal policies.
  5. Disciplinary Policies. Establish that policies, procedures, your code of conduct will be enforced then actually follow through with disciplinary action for those who do not comply.
  6. Identification of Compliance Risk Areas. Compliance risks can change over time. Dental offices need to keep up with the risks and establish periodic internal checks be in periodic chart auditing, office inspections and etc.
  7. Responding to Compliance Issues. When issues are reported/discovered ensure they are properly followed up. Corrective action can include change of behavior, documentation changes, use of a new form, termination of an employee, staff training, or returning money to a payor.
  • What would happen if we did not have a compliance plan? The OIG is authorized to impose sanctions or penalties, including, but not limited to, the revocation of the provider’s agreement to participate in the Medicaid program against providers who fail to develop, adopt and implement an effective compliance program.

The Affordable Care Act (ACA) mandated compliance programs for Medicare and Medicaid providers nationwide. Every State Medicaid program requires providers to attest that they have such a program as part of the credentialing process (see fine print of your provider enrollment agreement).

Some states, such as New York, have audited providers and accessed fines up to $40,000 for providing false testimony on a government application for attesting they have a healthcare compliance program when they really did not. It behooves you to explore what you must implement to satisfy ACA compliance program requirements. It is actually a crime to provide false information on a government document. In these types of cases criminal intent is surprisingly easy to prove, as all the elements needed for a criminal conviction are worded in the attestation itself. To this point, fortunately, issues related to this matter have only been pursued administratively/ civilly, but the potential is there for the government to one day make a criminal case out of this false testimony.

  • What are the benefits of having a compliance plan/program? A compliance plan, or more specifically a compliance program, can help you detect and prevent fraud, abuse, or errors. This in turn can help to lead to more desirable outcomes when audited (minimal or no monetary recoupments). An effective compliance and risk assessment program can be your best defense against whistleblower claims by disgruntled employees. Additionally, compliance programs aid providers in ensuring the accuracy of their billing and collections processes. This helps minimize overpayments, but also helps to minimize underpayments by ensuring accuracy of provider billing and payment processing (do you monitor your billing to ensure claims are submitted for each procedure provided and walked out)?

You don’t have to hire an attorney or consultant to write your compliance plan, but it can be helpful to have an expert walk you through the process. If you need help establishing your compliance program it’s what we do and we’re glad to help. If your practice/ organization has a compliance program we can provide a comprehensive evaluation of your compliance program and audit processes. If you’re looking to bolster your compliance program we can help! We love working with solo practitioner and small-to-medium sized dental organizations as well as large group practices. We serve dental clients from rural Alaska to urban areas of Houston, TX (and everything in between).