Life Science Compliance Update

July 19, 2017

Effectiveness, The Holy Grail of Compliance - Both the DOJ & OIG Weigh In

  Regulations

Measuring the effectiveness of compliance programs is no easy task since governing agencies have not published a template that will work in all cases; compliance measurements are unique to each company’s size, operations, resources and risks factors. Although there is no “one size fits all” program, both the DOJ and the OIG (in conjunction with the Health Care Compliance Association (“HCCA”)) recently issued guidelines and recommendations for healthcare organizations to design, implement, evaluate and improve their compliance programs. Unfortunately, this may have been done in a vacuum as neither agency appeared to have consulted with one another. There are similarities, differences, and ambiguities between the two agencies’ point of views. This article serves to compare and contrast the compliance guidelines as set forth by the DOJ and OIG within weeks of each other.

More than 25 years have passed since U.S. Sentencing Commission put forth the now infamous seven elements of an effective compliance program. Since then, Compliance Officers continue to chase the “holy grail” of effectiveness. Unfortunately, determining whether a compliance program is effective and how to measure for effectiveness has proven both elusive and difficult. Compounding the challenge is that in the historical period, compliance program guidance has been limited and infrequent. But in the first quarter of 2017, in an unprecedented move, both the United States Department of Justice (“DOJ”) and Department of Health and Human Services (“HHS”) Office of Inspector General (“OIG”) issued guidance on compliance programs.

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May 26, 2017

A Port in Any Storm – Adding New Safe Harbors to the Anti-Kickback Statute

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On December 7, 2016, the HHS Office of the Inspector General ("OIG") approved new safe harbors to the federal anti-kickback statute (“AKS”) and amendments to the civil monetary penalty ("CMP") rules, including recognizing new statutory exceptions, seeking to alleviate blanket prohibitions, and regulatory measures to promote access to care. In doing so, the OIG is ushering in a new era for compliance and providing life science companies some refuge from the regulatory storm.

Dating back to 1972, the Anti-Kickback Statute (“AKS”) is a legal requirement whose “main purpose is to protect patients and the federal health care programs from fraud and abuse by curtailing the corrupting influence of money on health care decisions.” At the time the AKS was implemented, various “concerns arose among health care providers that some relatively innocuous, and in some cases even beneficial, commercial arrangements are prohibited by the anti-kickback law.” This was a result of the fact that in an effort to combat all types of fraud and abuse, the AKS’s reach is incredibly broad.

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April 19, 2017

Project Exclusion: The OIG’s Latest Attempt to Make Its Exclusion Authority Real

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On January 11, 2017, the Office of Inspector General (OIG) at the U.S. Department of Health and Human Services (HHS), issued a new robust set of policy and rule-making guidelines, significantly clarifying and reaffirming regulatory efforts to place both individuals and corporations that engage in fraudulent Medicare and Medicaid programs on the Agency’s exclusionary list. Although such regulatory enhancements strengthen the Agency’s overall approach to combating fraudulent activity, it also seeks to impart a level of “objective fairness” in such process.

For years, the OIG and compliance professionals have understood the Government’s “nuclear threat”; the threat being that if a life science company is convicted of a federal healthcare violation, the company can no longer sell its products to the federal government: no Medicare, Medicaid, CHIP, or VA dollars (e.g., exclusion). Since Medicare and Medicaid account for 37% of the major sources healthcare funding in the U.S., exclusion effectively would wipe a company off the playing field.

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