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[Blog Series] 7 Elements of an Effective Compliance Program: Week 6

October 24, 2018
Compliance By Rodney Farley, Director

In this week of our blog series on the 7 elements of an effective compliance program, we will review how to avoid submitting incorrect claims to health care programs by developing effective auditing and monitoring systems. Per the Federal Register Vol. 65, No. 52, a compliance program should “incorporate thorough monitoring of its implementation and ongoing evaluation process.”


Documentation and monitoring is the responsibility of the compliance officer. This also includes reports of suspected non-compliance. The reports are to be shared with senior management at the nursing facility, as well as the compliance committee.

There are many documentation, monitoring, and assessment techniques, some of which include:

  • Periodic compliance audits by internal or external experts with knowledge of Federal and State health care statutes.
  • Sampling  protocols that permit the compliance officer to identify and review variations from an established performance baseline.
  • At a minimum, annual reviews to determine whether the program's compliance elements have been satisfied (such as the dissemination of program standards, implementation of ongoing education, and internal investigations of non-compliance).

So, let's review these techniques in more detail.

Standard 5: Developing Effective Auditing and Monitoring Systems

As mentioned previously, effective auditing and monitoring is important to avoid submitting incorrect claims. Audit plans should include an in depth assessment of a nursing home's billing systems to better identify billing errors. Entities should identify error rates in annual audits. Additionally, when appointing an auditor, the role should be clearly defined, and personnel should be qualified with the appropriate certifications to perform the job accordingly. And don't disregard audit plans. These should be reevaluated on an annual basis and address the proper areas, such as areas of concerns from previous year audits.

Why is Developing Effective Auditing and Monitoring Systems Important?

Auditing and monitoring help detect and prevent any areas that require improvement, at the same time making sure that any existing systems are free from issues or concerns. Together, auditing and monitoring are a powerful team—feeding off on one another. A thorough evaluation of your compliance practices may indicate areas needing audit. Whereas your audit findings may indicate key areas that should be subjected to ongoing monitoring.

Auditing also improves areas of weaknesses in processes and controls. This is where risk assessments come in handy. Risk assessments are usually created for the purpose of conducting internal controls and help identify issues that may cause breaches or violations of the compliance program.

One final note…auditors cannot be biased when performing their duties. Auditor findings must be reported regularly with remedial actions. On-going review of systems must take place to maintain compliance, and the approach to auditing must be organized and well-structured. And don't forget, auditors must be competent—having the relevant skill-set and training needed to perform their duties.

Looking for more information? Watch our video on the seven elements of an effective compliance program and join us weekly in this series as we will discuss each of the seven elements in greater detail, along with implementation recommendations.

Don't forget, HHS-OIG encourages providers to seek help and support as needed from outside experts in billing and coding, legal counsel knowledgeable in fraud and abuse laws, and the comprehensive resources available on HHS-OIG’s website.


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