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Administrative “complification” ...continued from page 29 Publisher: Health Care Compliance Association, 888-580-8373 Executive Editor: Roy Snell, CEO, HCCA, roy.snell@hcca-info.org Contributing Editor: Odell Guyton, President, HCCA, 888-580-8373 Layout: Sarah Anondson, HCCA, 888-580-8373, sarah.anondson@hcca-info.org Story Editor: Margaret R. Dragon, HCCA, 781-593-4924, margaret.dragon@hcca-info.org Advertising: Margaret R. Dragon, HCCA, 888-580-8373, info@hcca-info.org HCCA Officers: Odell Guyton HCCA President Senior Corporate Attorney, Director of Compliance, U.S. Legal–Finance & Operations Microsoft Corporation Daniel Roach, Esq. HCCA 1st Vice President VP & Corporate Compliance Officer Catholic Healthcare West Steven Ortquist, CHC HCCA 2nd Vice President Senior Vice President, Ethics and Compliance/Chief Compliance Officer Tenet Healthcare Corporation Rory Jaffe, MD, MBA, CHC HCCA Treasurer Executive Director–Medical Services University of California Julene Brown, RN, BSN, CHC, CPC HCCA Secretary MeritCare Health System Al W. Josephs, CHC HCCA Immediate Past President Senior Director Policies and Training Tenet Healthcare Corporation Cynthia Boyd, MD, FACP, MBA Chief Compliance Officer Rush University Medical Center CEO/Executive Director: Roy Snell, CHC Health Care Compliance Association Board of Directors: Anne Doyle Director, Corporate Learning and Organizational Development Tufts Health Plan F. Lisa Murtha, Esq., CHC Managing Director Huron Consulting Group Frank Sheeder Partner Brown McCarroll, LLP John Steiner, Jr., JD Chief Compliance Officer The Cleveland Clinic Health System Debbie Troklus, CHC Assistant Vice President for Health Affairs/Compliance University of Louisville, School of Medicine Sheryl Vacca, CHC Director, National Health Care Regulatory Practice, Deloitte & Touche Cheryl Wagonhurst Outgoing, Chief Compliance Officer Tenet Healthcare Corporation Greg Warner, CHC Director for Compliance Mayo Foundation Counsel: Keith Halleland, Esq. Halleland Lewis Nilan Sipkins & Johnson Compliance Today (CT) (ISSN 1523-8466) is published by the Health Care Compliance Association (HCCA), 5780 Lincoln Drive, Suite 120, Minneapolis, MN 55436. Subscription rate is $357 a year for non-members. Periodicals postage-paid at Minneapolis, MN 55436. Postmaster: Send address changes to Compliance Today, 5780 Lincoln Drive, Suite 120, Minneapolis, MN 55436. Copyright 2004 the Health Care Compliance Association. All rights reserved. Printed in the USA. Except where specifically encouraged, no part of this publication may be reproduced, in any form or by any means without prior written consent of the HCCA. For subscription information and advertising rates, call Margaret Dragon at 781-593-4924. Send press releases to M. Dragon, PO Box 197, Nahant, MA 01908. Opinions expressed are not those of this publication or the HCCA. Mention of products and services does not constitute endorsement. Neither the HCCA nor CT is engaged in rendering legal or other professional services. If such assistance is needed, readers should consult professional counsel or other professional advisors for specific legal or ethical questions. For example, If the plan’s formulary specifies GSK amoxicillin, and the pharmacy dispenses the same drug manufactured by Teva, one of two things may happen: first, the pharmacy may submit a claim that includes the NDC number for GSK amoxicillin (which could later be characterized by a whistleblower or regulator as a false claim); or second, the pharmacy may submit a claim that includes the NDC number for Teva amoxicillin (which will not be paid). The MMA is also designed to encourage competition. Each of the competing plans is required to define its own formulary. A pharmacy that deals with several drug plans, in theory, will be required to dispense only the brand of generics each plan includes on its formulary; pills from other manufacturers are not covered Part D drugs. As another example, consider the plight of the long-term care pharmacy serving several nursing and assisted living facilities. Even if all residents of one facility choose the same plan (and formulary), it is unlikely all the other facilities the pharmacy serves will do the same. The generic drug on the formulary for one pharmacy may not be on the formulary for the other plan. If the automated dispensing machine is full of Teva amoxicillin, that is what all of the residents of all of the facilities are going to receive (which is both clinically appropriate and consistent with federal policy to promote the use of generics). Technically, however, some of the prescriptions dispensed that day will not be covered by Medicare. None of this is necessary in order for members of prescription drug plans to get access to generic drugs. Unfortunately, the “fix” is either the development of a new code set to describe generic drugs or federal legislation. Completion of either process is not likely by the end of this year. Under the current design of the Prescription Drug Benefit, providers who dispense drugs are thus faced with a difficult choice. Those who obligate themselves to submit electronic claims with eleven-digit numbers take on an impossible task. Those who insist on manual claims—which identify the generic but not the manufacturer and bottle size—may be rebuffed or, at a minimum, encounter delays in payment. Providers need to publicize this issue with prescription drug plans and regulators alike, or whistleblowers may turn out to be one of the prime beneficiaries of the new prescription drug benefit. ■ January 2006 30 Health Care Compliance Association • 888-580-8373 • www.hcca-info.org
By José A. Tabuena JOSÉ A. TABUENA Editor’s note: José A. Tabuena is with the Forensic & Dispute Services practice of Deloitte Financial Advisory Services and assists organizations in the development and assessment of corporate compliance and anti-fraud programs. He is currently an Assistant Editor with Compliance & Ethics for The Society of Corporate Compliance and Ethics (SCCE). This article was originally published in Compliance & Ethics (Vol. 1, No. 2), page 10, November 2004. HCCA members interested in learning more about Compliance & Ethics can visit the SCCE Web site at: www.corporatecompliance.org or e-mail José at jtabuena@deloitte.com How did “internal control” become such a catch phrase in the current business climate For the experienced auditor, the terminology and underlying concepts, though frequently used, are deceptively simple and often ill-defined or applied in an assumptive manner. Just what are internal controls and what can happen to a company’s performance (and stock) if the controls aren’t very good Often it is not well understood that a compliance and/or antifraud program itself serves as a broad form of internal control. Certainly the features of such programs can comprise the fundamentals of a company’s internal control system. In certain highly regulated industries (including health care, defense contractors, financial institutions), an ethics-based compliance or integrity program headed by a compliance officer with senior management responsibility, have produced an established track record for the processes called for in the corporate governance reforms. Yet the recent legislation and resulting standards, though touting useful principles, still fail to recognize or emphasize a compliance program as an essential element for enhancing corporate governance. 1 The changing legal and regulatory environment is encouraging companies to do what compliance officers and internal auditors have been striving to accomplish for some time— namely to consider compliance and fraud prevention programs as a significant part of an organization’s internal controls. To a growing extent, regulators and investors are demanding proactive compliance and fraud control programs characterized by an emphasis on the timely detection of fraud or other misconduct. The changing mindset places greater emphasis on internal controls, and particularly in the United States, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) internal control framework. This fundamental shift presents an opportunity for ethics and compliance officers to become more actively involved in corporate governance matters and to demonstrate tangible value to an organization. For the compliance function, which may have been chafing under ambiguous accountabilities and perhaps perceptions that compliance programs only contribute burdensome processes, the environment is encouraging greater expectations to support efforts to combat corporate fraud and misconduct. Although there are some studies indicating that compliance and antifraud programs can pay for themselves 2 it has been a challenge for a compliance program to show value beyond the prevention of uncertain regulatory fines and penalties. Sarbanes-Oxley (SOX) and corresponding regulatory changes have raised the stakes for senior management and the board of directors. What follows is a discussion on how a compliance function can contribute to meeting the new requirements to assess the effectiveness of internal controls over financial reporting, while simultaneously laying the groundwork for documenting and demonstrating the effectiveness of the compliance program. This is unquestionably an opportune time to embrace the new financial governance standards as a bridge to overall compliance excellence. Continued on page 40 Health Care Compliance Association • 888-580-8373 • www.hcca-info.org January 2006 31
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MD - Health Care Compliance Association

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