In today’s frenzy of merger and acquisitions (M&A), it is critical that providers review their current compliance program with future business strategies in mind. How do you know if you’re on the right path when it comes to analyzing the effectiveness of your compliance program and its ability to adjust with future changes?
Consider these three key questions:
1. Have I updated my compliance program?
Is your current compliance program updated frequently enough based on the current marketplace and risk profile? Do you have a standard process for updating your compliance program, and if so, what does that process look like and who is implementing it?
2. Does my current compliance program framework allow me to achieve my business strategy and future goals for expansion, merger, or acquisition?
If needed, will your compliance program be flexible enough or have the ability to adapt properly? Do you need to make changes to add flexibility now? In other words, will your current compliance program be sufficient in light of your future business state, or should you be adapting your compliance program now to achieve your goals? By performing ongoing compliance program updates, you will be properly positioned for a successful business transaction should you ever decide to sell your healthcare business.
3. Have you had a third party independent review of your compliance program?
It is important to have a regular review of your compliance program performed by an expert third party from time to time. Doing so will ensure you have the most current perspectives and have incorporated any significant regulatory changes into your compliance program.
From our experience representing an array of healthcare providers ─from physician practices to major hospitals and healthcare systems─ we’ve discovered many provider compliance programs are static and not updated enough or even on a regular basis. Many provider compliance programs do not address the issue of expansion into other business lines or include a process for adding providers or conducting compliance due diligence. Often times, there is a major communication gap and disconnect between the provider’s compliance and strategy/operation executives. Such compliance program silence and communication gaps can lead to poor planning, greater regulatory risk, unprofitable outcomes and even internal operational and personnel issues. The inability of a current compliance program to adapt and be flexible enough for a provider’s planned future state can lead to major deficiencies, including regulatory and financial risk.
A proactive healthcare provider can mitigate such risks by asking the right questions, ensuring internal communication lines with compliance leaders are open and updating their compliance program to meet the company’s future state needs.
Looking for additional guidance? Check out our recent podcast “What to Expect in a Due Diligence Process.”
For more information, contact Rob Senska, Director at 609-249-3819 or email RSenska@LW-Consult.com for ways in which LW Consulting, Inc. can help.