Nursing Facility Compliance and Ethics Program – The Deadline is Near

AHCA’s VP of Legal Affairs, Dianne De La Mare, issues a memo on January 31 regarding the upcoming March 23rd deadline for nursing facilities to have in place an effective compliance and ethics program as required by the Affordable Care Act (ACA).  In short, while the ACA requires CMS to promulgate rules upon which nursing facilities would rely in development of the compliance programs that have not yet been published, it is recommended that nursing facilities strive to meet the March 23rd deadline for implementing a compliance program.  It is expected that the compliance program regulations will be based off of the HHS Office of Inspector General guidance from 2000 and 2008, and facilities should look to those OIG materials when developing their programs.  Please see Dianne’s memo below:

According to the statutory language in section 6102 of the Affordable Care Act (ACA), which added Section 1128I of the Social Security Act, all skilled nursing facilities (SNFs) and nursing facilities (NFs) must have in operation an effective compliance and ethics program by March 23, 2013.  As reported previously, under the ACA, the HHS Secretary working with the Office of Inspector General (OIG) is required to promulgate regulations for designing and implementing a compliance and ethics program by March 23, 2012; but this deadline has passed with no regulations. In 2012, AHCA contacted OIG about the regulation and was told that CMS was drafting the compliance and ethics rule.  Subsequently, AHCA staff contacted CMS and we were told that the agency is in the process of drafting the rule and could not share information or timelines.  As a result, many nursing facility providers are confused about how they should proceed in the design and implementation of a compliance and ethics program, and when they must meet the deadline for implementing a program.
 
The ACA statutory language discussing the compliance and ethics program says that “on or after the date that is 36 months after the date of the enactment of this section,” a facility must “have in operation a compliance and ethics program…consistent with the regulations developed…”  As a matter of statutory construction this language is unclear, and the federal government could choose to interpret the compliance date using the March 23, 2013, deadline.   In some ACA provisions, there is specific language stating that the policy is effective notwithstanding failure to issue regulations.  In other ACA provisions, there is specific language stating that a policy change requires the issuance of a regulation before it can be effective.  The ACA compliance and ethics requirement language, however, provides no explanation of whether or not the statutory deadline is dependent on the release of a final rule or if it can stand independently.

Therefore, AHCA strongly encourages SNF/NF providers to strive to meet the statutory deadline (March 23, 2013) for designing and implementing a compliance program whether or not CMS has released a final rule.  We recommend, as we have for many years, that providers (if they haven’t already) begin the process of designing and implementing a compliance and ethics program by reviewing the information on AHCA’s website at http://www.ahcancal.org/facility_operations/integrity/Pages/Compliance-Programs.aspx; the OIG guidance for SNFs/NFs released in 2000 at https://oig.hhs.gov/authorities/docs/cpgnf.pdf; and the OIG supplemental guidance released in 2008 at https://oig.hhs.gov/compliance/compliance-guidance/docs/complianceguidance/nhg_fr.pdf. 

The ACA also specifically mentions the 8 components that must be incorporated into a compliance and ethics program, which are all discussed in the aforementioned links:
• The organization must have established compliance standards and procedures that reduce criminal, civil and administrative violations;
• Specific high-level personnel within the organization much have overall responsibility;
• The organization must use due diligence to ensure that employees have not been excluded from working in the Medicare or Medicaid program;
• The organization must effectively communicate and train employees on the standards and procedures outlined in the compliance and ethics program;
• The organization must have effective auditing and monitoring systems in place to detect criminal, civil or administrative violations;
• The standards and procedures must be consistently enforced;
• After a violation is detected, the organization must take reasonable steps to respond to any violations; and the organization must periodically evaluate the compliance and ethics program