What You Need to Know About Compliance Plans

Compliance plans are a new and challenging part of the Medicaid program. Some are mandated (all are encouraged) to have compliance plans in place and they offer significant benefits. Failure to adopt a compliance plan (if mandated) could lead to serious sanctions or penalties. Over the last few months we have shared so much information with you regarding Medicaid compliance plans, it seemed like a good idea to place it all in one easy to find location. We hope that you find the following information helpful in your efforts.

  1. What is a Medicaid compliance plan? It is a written document that outlines what steps you will be taking to prevent and detect (Medicaid) fraud, waste and abuse.
  1. Why am I required to have a compliance plan? In 2009 President Obama signed the Patient Care and Affordable Care Act (PPACA) into law. While the law contains 2500 pages of text and contains much uncertainly sections 6401 and 6402 deal with compliance program requirements for healthcare providers and provider integrity measures for State Medicaid programs. The compliance requirements of section 6401 references section 1822 of the Social Security Act, which, in turn, references Office of the Inspector General (OIG) Compliance Guidances, which were established in the late 1990’s and early 2000’s as voluntary measures for healthcare providers for establishing compliance programs to minimize payments errors and protect their integrity.

For New Yorkers the answer hits a bit close to home in that the State of New York was ‘busted’ for Medicaid failures. In 2002 the Federal government audited the Medicaid-in-Education program in New York State. The audit was settled in July of 2009 and New York State paid $540 million to settle allegations that for the period from 1990 to 2001 the state failed to provide proper guidance to the districts and counties outlining the requirements for a service to be covered by the Medicaid program. The compliance plan is a tool to help prevent this type of outcome from happening again. Since this event New York has lead the country with efforts to enhance provider education and minimize the financial impact of fraud, waste and abuse involving government funds.

  1. Who needs to have a Medicaid compliance plan? If you provide, bill or claim any amount in Medicaid services in a 12-month period you are mandated to have a compliance plan.
  1. Should we create a compliance plan even if we are not mandated to? The Office of the Inspector General (OIG) has said on numerous occasions that it is a good idea for everyone to have a compliance plan. So, if you do not provide dental services for your state Medicaid program you are not required to establish a compliance program, but consider the idea that compliance program requirements will eventually effect all providers who provide, bill or claim services to ANY and ALL government-funded programs; sooner or later all healthcare (and dental) programs will be government funded (at least in part) by states and/or the federal government.
  1. Is there a deadline to create a compliance plan? If you are mandated to have a plan it should have been in place by October 1, 2009. If you are not mandated to have a plan but chose to implement one you are under no deadline.

Need Help with Your Compliance Plan?

  1. What should be in our compliance plan? The federal OIG has identified 7 key elements of a compliance plan (there are 8 elements for New Yorkers).
  • Written Policies and Procedures.
  • Compliance Officer and Compliance Committee
  • Training and Education.
  • Open Lines of Communication.
  • Disciplinary Policies
  • Identification of Compliance Risk Areas.
  • Responding to Compliance Issues.
  • Whistleblower/ non-retaliation protections (for New Yorkers)

You can read more about these elements on the OIG website (http://oig.hhs.gov/compliance/) or (https://www.omig.ny.gov/compliance for New Yorkers).

  1. What would happen if we did not have a compliance plan? The OIG is authorized to impose sanctions or penalties, including, but not limited to, the revocation of the provider’s agreement to participate in the Medicaid program against providers who fail to develop, adopt and implement an effective compliance program.

The Affordable Care Act (ACA) mandated compliance programs for Medicare and Medicaid providers nationwide. Every State Medicaid program requires providers to attest that they have such a program as part of the credentialing process (see fine print of your provider enrollment agreement). Additionally, many Managed Care Organizations (MCOs) have similar language on their provider enrollment agreements to limit their liability concerning you and your dental practice.

Here’s an illustration:

“By signing this application, Provider certifies that in accordance with requirement section 6401 of the Patient Protection and Affordable Care Act (herein PPACA), Provider has a compliance program containing the core elements as established by the Secretary of Health and Human Services referenced in §1866(j)(8) of the Social Security Act (42 U.S.C. §1395cc(j)(8)), as applicable. I attest that I have a compliance plan. o Yes o No”

“I attest that an internal review was conducted to confirm that neither the applicant or the re-enrolling provider nor any of its employees, owners, managing partners, or contractors have been excluded from participation in a program under the Title XVIII, XIX, or XXI of the Social Security Act.” o Yes o No”

“The Provider further certifies that the Provider will comply with all amendments, regulations, and guidance relating to those laws, to the extent applicable.”


“By signing below, Provider acknowledges and certifies to all of the following:

  1. Provider has carefully read and understands the requirements of this agreement, and will comply.
  2. Provider has carefully reviewed all of the information submitted in connection with its application to participate in the Medicaid program, including the provider information forms and principal information form, and provider certifies that this information is current, complete, and correct.
  3. Provider understands that falsifying entries, concealment of a material fact, or pertinent omissions may constitute fraud and may be prosecuted under applicable federal and state law. Fraud is a felony, which can result in fines or imprisonment.
  4. Provider understands and agrees that any falsification, omission, or misrepresentation in connection with the application for enrollment or with claims filed may result in all paid services declared as an overpayment and subject to recoupment, and may also result in other administrative sanctions that include payment hold, exclusion, debarment, contract cancellation, and monetary penalties. (g) Provider agrees to abide by all Medicaid regulations, program instructions, and Title XIX of the Social Security Act. The Medicaid laws, regulations, and program instructions are available through the Medicaid contractor. Provider understands that payment of a claim by Medicaid is conditioned upon the claim and the underlying transaction complying with such laws, regulations, and program instructions (including, but not limited to, the Federal anti-kickback statute and the Stark law), and on the provider’s compliance with all applicable conditions of participation in Medicaid.”

Now that you have read this, double check your signed agreements and verify your obligations. If you find that you don’t understand much of this information or realize you don’t have systems in place to address all or some of these requirements don’t worry – my team and I can help!

Some states, such as New York, have accessed fines up to $40,000 for providing false testimony on a government application for attesting they have a healthcare compliance program, but really do not, so it behooves you to explore what you need to implement to satisfy ACA compliance program requirements. It is actually a crime to provide false information on a government document. In these types of cases criminal intent is surprisingly easy to prove, as all the elements needed for a criminal conviction are worded in the attestation itself. To this point (fortunately) issues related to this matter have only been pursued administratively/ civilly, but the potential is there for the government to one day make a criminal case out of this false testimony.

  1. What are the benefits of having a compliance plan? The plan can help you detect and prevent fraud, abuse, or errors. This in turn can help to lead to more desirable outcomes when audited. An effective compliance and risk assessment program is also your best defense against whistleblower claims. Additionally, compliance programs aid providers in ensuring the accuracy of their billing and collections processes. This helps minimize overpayments, but also helps to minimize underpayments by ensuring accuracy of provider billing and payment processing.

Need help sorting through it all? Schedule a Complimentary Compliance Consultation with Duane Tinker. Click here to Schedule.

A former Law Enforcement Officer/ Dental Board investigator Mr. Duane Tinker is the CEO of Dental Compliance Specialists. Mr. Tinker and his compliance specialists provide compliance consulting, auditing and training services for dentists and Dental Service Organizations nationwide on compliance risks including OSHA, HIPAA, Dental Board rules/ regulations, state radiology rules, DEA and state drug regulations, and Medicaid. He often speaks for dental societies and study clubs. Mr. Tinker can be reached at (817) 755-0035 or click here to email.