Beyond Policies: Building a Compliance Culture to Catch Unwitting Fraud in Healthcare

The healthcare sector's exponential growth continues and the latest projections from the Centers for Medicare and Medicaid Services Office of the Actuary are that expenditures will reach a $7.7 trillion by 2032. This presents a double-edged sword for providers. While opportunities abound, the potential for fraud and abuse intensifies alongside the rising expenditures. We saw this in fiscal year 2023, when the DOJ settled more than $1.8 billion in False Claims Act matters related to managed care providers, hospitals, pharmacies, laboratories, long-term acute care facilities, and physicians.

While providers know how to prevent the most common fraud schemes, the real challenge lies in preventing unintentional misconduct by employees. Here's how to craft a compliance program that addresses this silent threat:

• Education is the Antidote: Don't just distribute compliance manuals – make learning interactive. Conduct engaging training sessions that explain complex regulations like the Stark Law and Anti-Kickback Statute in clear, relatable terms. Focus on real-world scenarios employees might encounter.
• Empower, Don't Intimidate: Foster a culture of open communication. Employees should feel comfortable asking questions and reporting potential issues without fear of reprisal. Develop a confidential reporting hotline and anonymous reporting mechanisms.
• Focus on Intent (Not Just Action): Compliance programs shouldn't solely punish mistakes. Implement clear disciplinary procedures that differentiate between intentional wrongdoing and honest errors. Prioritize corrective action and education over draconian penalties.
• Continuous Improvement is Key: Don't become complacent. Regularly review and update your compliance program to reflect changes in regulations and industry best practices. Solicit employee feedback to identify areas for improvement.

By building a compliance culture that prioritizes education, open communication, and a focus on intent, you can significantly reduce the risk of unwitting fraud within your organization.