480 likes | 658 Views
2012 Ryan White Meeting. Strategies for Implementing an Effective Compliance Program. Adam J. Falcone, Esq. Disclosures.
E N D
2012 Ryan White Meeting Strategies for Implementing an Effective Compliance Program Adam J. Falcone, Esq.
Disclosures This continuing education activity is managed and accredited by Professional Education Services Group. The information presented in this activity represents the opinion of the authors. Neither PESG, nor any accrediting organization endorses any commercial products displayed or mentioned in conjunction with this activity. • Commercial support was not received for this activity. • Adam J. Falcone, Esq. has no financial interest or relationships to disclose.
Disclaimer • This presentation has been prepared by the attorneys of Feldesman Tucker Leifer Fidell LLP. The opinions expressed in these materials are solely their views. • The materials are being issued with the understanding that the authors are not engaged in rendering legal or other professional services. If legal advice or other expert assistance is required, the services of a competent professional should be sought.
Learning Objectives At the conclusion of this activity, the participants will be able to: • Learn the benefits of conducting a risk assessment. • Understand the reasons to create a compliance work plan. • Describe the structure and process of an internal investigation.
Reasons for conducting a risk assessment: To identify and prioritize areas of focus of compliance program Conserve resources (both financial and otherwise) Practice sound management Improve operational efficiency Why Conduct a Risk Assessment?
Conducting Internal Auditing and Monitoring • Risk Identification • The OIG considers risk assessment to be a key component of an effective Compliance Program. • According to the OIG, organizations should conduct a comprehensive risk analysis or obtain one from a consultant. • The OIG believes that a properly conducted risk assessment would • Identify and rank the various compliance and business risks that the organization may experience it its daily operations and • Serve as the basis for written policies the organizations develops to mitigate those risks • Risk assessments may also serve a basis for determining which activities to audit.
Risk Assessments • Three elements of a risk assessment: • Identify risk areas • Assess level of risk • Rank risk areas
Risk Assessments • Identifying risk areas • Internal sources • Past and current organizational activities • Planned organizational activities • Interviews with key departments • Review of key documents
Risk Assessments • Identifying risk areas • External sources • Read the news! • Government agency information • Professional sources
Risk Assessments • Assessing risks • Risk can be analyzed using a simple equation: Probability of occurrence x Consequences of occurrence • Example: • Probability that a patient will fall down the front stairs • Remote / Possible / Likely / Probable / Certain • Consequences of a patient fall • Lawsuit – payout • Additional care • Bad publicity
Risk Assessments • Assessing Risks severe SEVERITYOFCONSEQUENCES serious moderate remote possible probable LIKELIHOOD OF OCCURRENCE/ENFORCEMENT
Risk Assessments • Ranking highest risk areas • For example: • Billing and Coding • Contracts and Affiliations (i.e., kickbacks) • Federal Grants (i.e., time and effort, costs allocation, procurement) • HIPAA Security • Fair Labor Standards Act
Compliance Program Work Plans • Addressing risk areas – develop a work plan: • A work plan is a list of projects or actions that are conducted in response to a risk area • Potential work plan actions • Training and Education • Review and Development of P&Ps • Audits / Assessments • Monitoring
Developing Compliance Program Work Plans • A compliance program work plan should contain: • Specific actions to be taken • Party responsible for the action • Resources required to complete action • Date work is scheduled, conducted, and completed • If possible, goals to measure effectiveness
Sample Annual Compliance Program Work P lan Budget Person(s) Completion Risk Area Activities Expected Outcomes Request Responsible Date Compliance 1. Establish Staff [$ --- ] 1. Greater coordination and Compliance Officer Q2 Program Compliance Committee internal support 2. Update Standards of [$ --- ] 2. DRA Compliance Compliance Officer Q1 Conduct 3. Conduct Risk Assessment [$ --- ] 3. Identify Risk Areas Compliance Officer Q3 4. Compliance Training for [$ --- ] 4. Open Lines of Compliance Officer Mo nthly New Employees Communication Billing & Coding Conduct Billing Audit [$ --- ] Improved documentation Chief Financial Officer Q1 Compliance Work Plans
Developing Compliance Program Work Plans • Implement the work plan • Communicate the work plan to compliance committee, Board compliance committee, CEO, CFO, COO and staff • Begin to create the culture of compliance • Use gimmicks/prizes and publicity • Create environment of trust, not punishment
What is an Internal Investigation? • Factual/legal review of possible misconduct within the company/organization • Typically arises out of allegations or discovery – by the organization, an auditor, or a whistleblower – of circumstances that raise concern of possible liability (e.g., violations of the law, financial misconduct) • Conducted independently of government involvement or review, usually in conjunction with counsel • Critical component of any compliance program
What is the Purpose of an Internal Investigation? • Verify truth or falsity of allegations • Explore scope of legal problem(s) • Discover and review additional potential problem areas within the organization • Stop current violations (corrective actions) • Remedial action to prevent future violations • Disciplinary action • Self disclosure to the government?
Stop the Ongoing Misconduct • If you discover irrefutable evidence of on-going wrongdoing or law violations in the midst of the fact-gathering phase (or at any point before the conclusion of the investigation), take steps to cease the conduct immediately; prevent on-going errors and violations – don’t wait until the end of the investigation!
Involvement of Counsel in Internal Investigations • When and how should legal counsel be consulted? • Allegations of violations of law • Allegations of intentional fraud or misrepresentation • Audit results over a certain threshold of errors • Audit results impacted by ambiguity or contradictions in rules
Are Internal Investigations Protected by Legal Privilege? • Typically, there is no privilege for routine compliance investigations and related materials • In general: The investigational process and findings may be protected from disclosure to third parties pursuant to attorney-client privilege where the investigation is directed by counsel in anticipation of potential litigation, or counsel is consulted and involved for the purpose of providing legal advice on the subject being investigated
Attorney-Client Privilege Protections in Internal Investigations • Protects communications between attorney and client for purpose of obtaining legal advice • Current employees, former employees, management • Protects direct communications with in-house or outside legal counsel for legal (not business) advice • Attorney can retain agents (accountants, experts, etc.) to assist • Communications between agents and client, or between agent and attorney, can be covered by privilege, but must be at the direction of counsel for the ultimate purpose of providing legal advice
Attorney-Client Privilege (cont’d) • Attorney-directed investigations or audits • Can be privileged • But again, fact gathering or audit results should be for purpose of providing legal advice • Investigative steps should be undertaken at the request of counsel to preserve the privilege • Interviews by non-lawyers • Requests should be documented • The “figurehead attorney” may not be sufficient to preserve a privilege
Attorney-Client Privilege: Common Errors • Avoid concepts such as “contacting the attorney and placing an issue under privilege” • Attorneys’ presence on a call or e-mail message may not always be enough to preserve a privilege – must involve advice or counsel • Assuming the privilege applies to all communications with consultants merely because an attorney hired them • Failing to keep the attorneys’ advice and communications confidential
Attorney-Client Privilege: Common Errors (cont’d) • Insufficient “dress” • Documentation of attorney-client relationship • Send memo at start of investigation establishing attorney-client relationship • Request from attorney for information or investigative steps • Evidence that legal advice was delivered • Identification of privileged documents • Attorney-client privileged markings • Mystery documents • Not addressed to anyone • Nothing to allow the organization’s attorneys to determine that a privilege applies
Overview: Four Steps of an Internal Investigation • Evaluate and plan • Gather facts • Review, assess, and report findings • Remedial and corrective actions (if necessary)
Step 1: Evaluate and Plan • Evaluate. Considerations in deciding whether to initiate an internal investigation: • Is an investigation necessary, warranted or appropriate? • Nature of the issue • Seriousness of the allegations • Credibility of alleger(s) • Specificity of allegations • Sufficient information to investigate • Ability to investigate • Consequences of not investigating
Evaluate and Plan (cont’d) • Evaluate the allegations/potential problem; are there potential law violations? E.g.→ • False Statements • False claims • Intentional fraud • Medicare/Medicaid (improper billing, over payments, etc.) • Anti-kickback (improper inducements) • Other Federal and State laws
Evaluate and Plan (cont’d) • Assess: Who knows about the potential problem? (damage control) • Management or Board of Directors, if appropriate, should be consulted at this stage • Planning: Management should agree upon the goals, strategy, and implementation
Who should direct the investigation? Counsel Inside or outside Compliance HR Other Who should “conduct” the investigative steps? Counsel Auditors Compliance staff HR staff Managers Evaluate and Plan (cont’d)
Evaluate and Plan (cont’d) • Manage outside counsel and consultants • Define client and client contact in written engagement letter • Written budget – aspirational at best • Frequent reports (oral? written?) • Retain consultants through counsel to ensure privilege
Evaluate and Plan (cont’d) • Establish reporting protocol for investigators • Establish involvement and oversight at the appropriate corporate level • Mid-management • Division Head • CEO • Special Committee of the Board • Board of Directors
Evaluate and Plan (cont’d) • Preservation of documents/document hold • Availability of documents for review • Prevent potential obstruction of justice issues should the government later audit, investigate or otherwise be involved • Avoid creation of evidence tending to establish criminal intent or consciousness of guilt • Review/suspend document retention policy • Cease destruction of documents in normal course of document retention policy • Put document hold in writing
Evaluate and Plan (cont’d) • What will be your investigative steps and methodology? • Usually gather documents first, then conduct interviews • Who will conduct interviews and where? • Rumor mill problems • Can reveal identity of complainant and create risk of retaliation allegations • May not be justified if issue is minor, credibility of complainant is suspect, or all pertinent information can be gleaned from documents • Interim and final reports: oral v. written
Step 2: Gather the Facts • Document gathering and review: Documents drive many government and internal investigations • Preservation memorandum to all employees in possible possession of relevant documents • Use of IT specialists for electronic retention and gathering of electronic documents • Use of outside accountants or forensic accountants for complex financial investigations
Gather the Facts (cont’d) • Organize the collection of information • “War room” • Bates labeling • Witness folders • Create an initial fact chronology with cross references to documents; constantly update this throughout the investigation
Gather the Facts (cont’d) • Interview Goals: • Gather information • Assess interviewee’s credibility • Demeanor • Logic and consistency of witness’ statement in the context of other information • Corroboration/contradiction • Limit unnecessary disclosures • Maintain credibility of your investigation
Gather the Facts (cont’d) • General Interview Guidelines: • Individual in-person interviews, not groups • Third person should always be present (note taker or “prover”) • Take notes, do not tape • In general, don’t discuss one person’s interview with another person • Furnish employee with relevant documents in advance?
Gather the Facts (cont’d) • Beginning the Interview: • Tell the interviewee the general reason for the interview, giving limited information (only disclose what is necessary) • Communicate ground rules, especially that the employee should not discuss the interview with anyone • “Upjohn” or “Corporate Miranda” warnings • Pursuade the reluctant employee to cooperate through reason • You can remind employee that refusal to cooperate in an internal investigation may lead to discipline • You can say you will try to keep confidential, but cannot guarantee, and there are no secrets from management
Gather the Facts (cont’d) • Conducting the Interview • Be calm and non-intimidating; put the employee at ease • Be conversational and professional; don’t be opinionated • Be firm, but fair • Let employee tell his/her story • Focus on listening, not talking • Be open-minded; don’t be too wedded to your theory • Don’t put words in the employee’s mouth • May be useful at times to summarize
Gather the Facts (cont’d) • Conducting the interview (cont’d) • You may want to start with small talk to put the interviewee at ease if he/she seems nervous • When getting into the important subject matter, start with open-ended questions (What happened?) • And then follow up with specific questions (Who said what? In what order? When? Did you learn anything else?) • In follow-up, focus on how the interviewee knows what he/she is telling you (Did you hear or see it directly or did someone tell you? What made you reach that conclusion? Is that what you think happened or do you know for sure? Etc.) • Do not limit interviewee to giving you information he/she only heard or saw directly – sometimes rumors, hunches, and hearsay can be valuable (but you must assess and know that is what you are getting)
Gather the Facts (cont’d) • Special considerations when interviewing the accused or an employee suspected of wrongdoing: • Timing: usually at the beginning and/or end of the investigation • Give the person an opportunity to respond to each accusation, and to provide any relevant information they want • Protect identity of accuser where possible • Accused must believe you are not pre-disposed in any way • What to do when an employee asks to have a lawyer present at an interview • Prepare in advance for this question
Gather the Facts (cont’d) • If time and resources permit, type up interview notes from each interview (but do not create a verbatim transcript) • If you showed the interviewee any documents during the interview, make a copy of the documents and attach them to your interview notes • Insert interview notes, and attached documents, into witness folder for interviewee (separate witness folders for each interviewee) • Update fact chronologies with cross references to information learned during interviews
Step 3: Reach and Report Findings • Consider whether to begin with an oral report • Written documentation: • Summary of activity and investigative conclusions • Basis for factual conclusions, evidence (documentary, testimonial), credibility of witnesses, and whether there is corroboration • Keep in mind that report may some day be disclosed to government or other third parties during the course of litigation (if privilege does not shield its disclosure) • Consider whether to report the findings, or some of the findings, to the complainant and accused
Step 4: Corrective Action • Consider need for discipline • Reprimand, transfer, demotion • Compensation and/or bonus adjustment • Suspension, termination • If corrective action is warranted, make recommendations or lay out options • Refer to appropriate person(s) for approval, and then for implementation • Assign responsibility to fix the problem going forward • Document corrective steps taken • Monitor and regularly review corrective action
Step 4: Corrective Action (cont’d) • Consult with counsel as to whether the matter is appropriate for self-disclosure to the government • Good corporate citizenship • “Assisted suicide” • Avoidance of death sentence
Questions? Questions? Adam J. Falcone, Esq. 1129 20th St. NW 4th Floor Washington, DC 20036 202.466.8960 AFalcone@ftlf.com www.ftlf.com
Obtaining CME/CE Credit • If you would like to receive continuing education credit for this activity, please visit: • http://www.pesgce.com/RyanWhite2012