Seven Healthcare Compliance Escalation Scenarios

By John Tanner

What most CEOs lack more than anything else is time. Many wake up each morning feeling as if there are a thousand things to be done and simply not enough time or hands to adequately fulfill the broad expectations of directors, shareholders, customers, and employees. That is why the best CEOs hire top level managers (who in turn, hire mid-level managers and so on) whom they entrust to keep the train running through intelligent day-to-day decision making. The larger the company the more the CEO must trust team members and have confidence that they are performing in step with the organization’s business goals, priorities and ethical standards.

There is another thing these CEOs must trust as well – the judgment of their lieutenants to know when an issue needs to be elevated to a higher level, either for guidance or simply for informational purposes. Finding this balance of elevating or not elevating issues into the orbit of the CEO is often the scaffolding on which successful organizations are built.

The challenge in attaining this equilibrium falls not so much on the CEO as it does on others who must know when to trust their own judgment as opposed to what requires the attention of others. They must also realize that seeking the wisdom of another is not a weakness, but rather a strength of character.

One department within a health plan, hospital, health system or medical group that confronts this question more frequently than most others is Compliance whose very purpose is to ensure that a business adheres to external regulatory rules/guidance and internal controls. In carrying out this responsibility, it is the compliance department that protects against misdeeds (including criminal misconduct), helps to protect against fraud and abuse, watches out for potential liability issues and works to ensure that the organization exists within a culture of ethics.

The good news is that wrestling with what to elevate becomes easier over time. The more a CEO and department head work together, the greater the likelihood that a smooth rhythm will emerge where expectations are clear, trust is enhanced and a common understanding prevails. The bad news is that until that happens – and even after it does — there remains no reliable guide to govern behavior in this area as leadership preferences and risk tolerances differ. Still, there are more than a handful of clearly significant and consequential risks that should be on every compliance department’s radar and which, if found to exist, demand escalation to senior level management and perhaps even the governing body. Here are seven:

1. When the CEO, board member, or senior executive is named in an allegation.
2. Any issue that could potentially have a negative impact on a large number of members, patients, customers or employees.
3. Any issue that has the potential to materially impact the financial standing and ongoing stewardship of the organization.
4. The uncovering of meaningful misconduct or any illegal activity within the organization, whether singular in nature or systemic.
5. An issue that has the potential to cause significant reputational harm to an organization’s image, brand and public profile. This includes issues that might garner media coverage and, if so, would be damaging or embarrassing to the organization. No CEO or board member should be caught off guard by what they see on the evening news.
6. Repeated non-compliance for a specific high-risk function or activity. While individually each occurrence may not warrant elevation, the persistency in occurrence could be an indicator of that department’s management complacency or capability to effectively manage their area of responsibility.
7. An issue that is of personal and passionate interest to the CEO, such as one that touches on the company’s core values or is contrary to the corporate culture that the CEO has worked to build. This is especially true for founder CEOs who often feel a gravitational pull to step in and “fix everything.” But the real key, as the successful ones learn, is knowing when to be in the thick of things and when to keep their distance.

The challenge with all of these potential concerns has never been greater than it is in today’s COVID-19 environment. With so many employees working from home or other remote locations, now more than ever organizations need reliable reporting technology in place so compliance can feel that they have the best information possible to make timely decisions. With such information in hand, compliance can be more confident in deciding what warrants escalation. These tools need to include dashboards, analytics, automated monitoring, and ongoing tracking to know with certainty that issues uncovered, whether elevated or not, are properly handled and documented.

There is no better time than now to make sure that your organization has the systems and processes in place to track behavior in real-time and to have warning signs flash when danger is on the horizon. Only then can compliance feel truly confident that they have their finger on the pulse of the organization so that informed and appropriate decision making at the right level can quickly and appropriately take place.

John Tanner is chief compliance officer for Beacon Healthcare Systems, home to the healthcare industry’s leading compliance and risk management technologies.

 

Beacon Healthcare Systems is home to the healthcare industry’s leading compliance and risk management technologies, providing health plans of all sizes and sponsorships with customizable and scalable SaaS (Service as a Software) solutions that ensure accountability, accuracy and operational efficiency. With a focus on appeals, grievances, compliance and analytics, Beacon HCS is the first place health plans turn to when they are looking for a trusted, experienced partner who can help them reduce costs, grow revenue and achieve their strategic goals. Founded in 2011, Beacon HCS is a privately held California-based company with a technology center located in Austin, Texas. beaconhcs.com