F. Auditing and Monitoring

The OIG believes that an effective program should incorporate thorough monitoring of its implementation and an ongoing evaluation process. The compliance officer should document this ongoing monitoring, including reports of suspected noncompliance, and share these assessments with the nursing facility’s senior management and the compliance committee. The extent and frequency of the compliance audits may vary depending on variables such as the nursing facility’s available resources, prior history of noncompliance, and the risk factors particular to the facility.¹⁰¹

Although many assessment techniques are available, one effective tool is the performance of regular, periodic compliance audits by internal or external evaluators who have expertise in Federal and State health care statutes, regulations, and program requirements, as well as private payor rules. These assessments should focus both on the nursing facility’s day-to-day operations, as well as its adherence to the rules governing claims development, billing and cost reports, and relationships with third parties. The reviews also should address the nursing facility’s compliance with Medicare requirements and the specific rules and policies that have been the focus of particular attention by the Medicare fiscal intermediaries or carriers, survey agencies, and law enforcement.¹⁰²

Monitoring techniques may include sampling protocols that permit the compliance officer to identify and review variations from an established performance baseline.¹⁰³ This performance baseline should include measurable patient outcomes, such as resident weight maintenance and pressure ulcers, established by the facility’s Quality Assessment and Assurance Committee. Significant variations from the baseline should trigger an inquiry to determine the cause of the deviation. If the inquiry determines that the deviation occurred for legitimate reasons, the compliance officer and nursing facility management may want to take no action. If it is determined that the deviation was caused by a departure from or misunderstanding of the facility’s policies, the nursing facility should take prompt steps to correct the problem. Any overpayments discovered as a result of such deviations should be returned promptly to the affected payor,¹⁰⁴ with appropriate documentation and a sufficiently detailed explanation of the reason for the refund.¹⁰⁵

In addition to evaluating the facility’s conformance with program rules, an effective compliance program also should incorporate periodic (at least annual) reviews of whether the program’s compliance elements have been satisfied, e.g., whether there has been appropriate dissemination of the program’s standards, ongoing educational programs, and internal investigations of alleged non-compliance. This process will assess actual conformance by all departments with the compliance program and may identify areas for improvements in the program, as well as the nursing facility’s general operations.

The OIG requires a provider operating under a CIA to conduct an annual assessment of its compliance with the elements of the CIA. A compliance officer may want to review several CIAs in designing the facility’s self-audit protocol.¹⁰⁶

As part of the review process, the compliance officer or reviewers should consider techniques such as:

The reviewers should:

The extent and scope of a nursing facility’s compliance self-audits will depend on the facility’s identified risk areas, past history of deficiencies and enforcement actions, and resources. If the facility comes under Government scrutiny in the future, the Government will assess whether the facility developed a reasonable audit plan based upon identified risk areas and resources. If the Government determines that the nursing facility failed to develop an adequate audit program, the Government will be less likely to afford the nursing facility favorable treatment under the Federal Sentencing Guidelines.

Summary
Background