LSM 417 Week 4 Compliance Strategies for Long-Term Care Providers Example

Beyond Passing the Survey: Building a Compliance and Ethics Program for a Nursing Home Around the Inspector General's 2024 Risk Areas

[Student Name]

University of Phoenix

LSM/417: Regulations in Lifespan Management

Week 4 Assignment

[Instructor Name]

[Date]

The nursing home, its audits and its program design are composites written for a model paper; federal requirements and guidance come from the sources listed.

When a composite 120-bed nursing home hired its first full-time compliance officer, she found a binder of policies, a hotline number printed on a poster in the break room and no record of any audit in three years. The previous administrator had treated compliance as passing the annual survey. This paper describes how the home built a real compliance and ethics program.

The Federal Requirement

The 2016 revision of federal requirements for long-term care facilities added a requirement that nursing homes operate a compliance and ethics program with written standards and procedures, assigned high-level oversight, effective training, reporting mechanisms, monitoring and auditing, consistent discipline and response to violations, with additional elements for organizations operating five or more facilities (Centers for Medicare & Medicaid Services, 2016). The home's binder met none of these in practice, because no one owned the program, checked whether policies were followed or reported to the board.

Federal Guidance on Risk

In November 2024, the inspector general's office issued guidance specific to nursing facilities, its first update since 2008, identifying four groups of compliance risk: quality of care and quality of life; Medicare and Medicaid billing; the anti-kickback statute; and other areas including related-party transactions, physician self-referral, civil rights and privacy (Office of Inspector General, 2024). The compliance officer used these four groups to organize the program.

Risk Area One: Quality of Care and Quality of Life

Quality failures are compliance failures in nursing homes, because billing for care not provided or provided poorly can become a false claim. The program links to the quality committee: the compliance officer reviews survey citations, falls with injury, pressure injuries, antipsychotic use and staffing data each quarter. Staffing is checked against census and resident needs, since understaffing underlies many quality problems.

Risk Area Two: Billing and the Resident Assessment

Nursing home payment depends heavily on resident assessment data, which classify each resident's needs and conditions. The compliance officer commissioned an outside audit of 60 assessments. It found that 9 recorded diagnoses or conditions not supported by physician documentation, several of which raised payment. When the assessment says a resident has a condition the record does not support, the home is paid for care it cannot prove it gave.

Correcting the Billing Problem

The home stopped coding those items without documentation, retrained the assessment coordinators, added a second review of any newly coded condition that affects payment and, with counsel, quantified the resulting overpayments and returned them to the Medicare contractor. Earlier federal guidance had already warned nursing facilities about accurate resident assessments and billing (Office of Inspector General, 2008).

Risk Area Three: Kickbacks and Referral Relationships

The compliance officer reviewed arrangements with physicians, hospitals and vendors. The medical director's contract paid a fixed fee for documented duties, which was acceptable, but a hospice provider had been offering free staff time for admissions paperwork, a benefit that could be seen as inducing referrals. The home ended the arrangement and adopted a rule that any item or service of value from a referral source requires compliance review.

Risk Area Four: Privacy, Civil Rights and Related Parties

Privacy risk centered on staff sharing resident information on personal phones, addressed through policy, training and approved secure messaging. Civil rights obligations included language access and disability accommodations. The home, owned by a nonprofit that also owns a pharmacy, reviewed its pharmacy contract to confirm prices were at fair market value.

Screening and Exclusion Checks

Federal programs do not pay for services furnished by people excluded from them, so the home checks every employee, contractor and vendor against the federal exclusion list before hiring and monthly afterward, along with the state's list. The audit found that monthly checks had lapsed for contracted therapy staff. The home added the checks to its contract with the therapy company, which now certifies them monthly. Background checks and state registry checks for nursing assistants are verified before a start date is set.

The First Risk Assessment

Before choosing audits, the compliance officer ranked risks by likelihood and impact with the administrator, director of nursing, business office manager and medical director. Resident assessment accuracy and quality of care ranked highest; vendor relationships ranked lower but were reviewed because they had never been examined. The assessment will be repeated each year, and the board approves the resulting audit plan.

Reporting Channels

The hotline moved from a break room poster to a card in every employee's orientation packet and a monthly reminder in pay stubs, with an option to report anonymously online. The compliance officer answers every report within five business days. Reports rose from none in the prior year to 14 in the first year, two of which led to findings. One, from a night nurse, identified that a controlled substance count sheet was being signed without an actual count at shift change, a practice corrected within a week and audited monthly since.

Training

Training moved from a single annual video to role-specific sessions: assessment coordinators on documentation, admissions staff on referral rules, nursing staff on abuse reporting and privacy and managers on how to respond to reports without retaliation.

Governance

The compliance officer reports directly to the board's compliance committee each quarter, not only to the administrator. The committee reviews audit results, hotline reports, corrective actions and the next year's risk assessment.

Measuring the Program

The home measures the program by audit error rates over time, the number and resolution time of hotline reports, completion of corrective actions on schedule and staff survey results on whether employees would feel safe reporting a concern.

Conclusion

A compliance program that exists only in a binder protects no one. Guided by the 2016 federal requirement and the inspector general's 2024 risk areas, the home built a program that audits, invites reports, corrects problems and reports to the board. The assessment audit that found unsupported coding, and the repayment that followed, show a program doing what it is meant to do.

References

Centers for Medicare & Medicaid Services. (2016). Medicare and Medicaid programs; Reform of requirements for long-term care facilities. Federal Register, 81, 68688. https://www.federalregister.gov/d/2016-23503

Office of Inspector General. (2008). OIG supplemental compliance program guidance for nursing facilities. Federal Register, 73, 56832. https://www.federalregister.gov/d/E8-22796

Office of Inspector General. (2024). Nursing facility industry segment-specific compliance program guidance. U.S. Department of Health and Human Services. https://oig.hhs.gov/compliance/compliance-guidance/