OIG Compliance


The compliance plan described here should be considered an appendix to the [Practice's Policy and Procedures and Training Manual]. It is designed to make sure that we are following the rules, regulations and laws that affect our provision of high quality health care to our patients. Everyone involved with our practice must be aware of the compliance plan and commit themselves to implementing it.

Our plan will address the seven basic elements put forth by the Office of the Inspector General:

  • establish compliance standards through the development of a code of conduct and written policies and procedures;
  • assign compliance monitoring efforts to a designated compliance officer or contact;
  • conduct comprehensive training and education on practice ethics and policies and procedures;
  • conduct internal monitoring and auditing focusing on high-risk billing and coding issues through performance of periodic audits;
  • develop accessible lines of communication, such as discussions at staff meetings regarding fraudulent or erroneous conduct issues and community bulletin boards, to keep practice employees updated regarding compliance activities;
  • enforce disciplinary standards by making clear or ensuring employees are aware that compliance is treated seriously and that violations will be dealt with consistently and uniformly; and
  • respond appropriately to detected violations through the investigation of allegations and the disclosure of incidents to appropriate Governmental entities.

The compliance committee will include [designate a Compliance Committee] and meet [how often and where].

The Compliance Officer is [Name of Officer] and can be reached at [phone number].


    This policy has been adopted by [Owner(s) and Board of Directors] of this practice. It applies to all personnel. We will treat our patients and conduct our business in a manner that satisfies our medical and legal obligations as well as our own high standards of integrity and quality. We will bill only for those services actually provided which are medically necessary, properly documented, and by selecting the proper procedure and diagnostic codes.We will promptly notify the appropriate authority of any violations or potential violations of internal policies or policies set forth by law. It is the responsibility of each employee [or anyone under contract to this practice] to abide by this Billing and Compliance Manual.Nevertheless, all matters are confidential to [Name of Practice] and shall not be discussed with anyone who is not directly involved in the management of this practice.
    The purpose of this document is to ensure that we comply with both the letter and spirit of government contracting laws and regulations and with our own company policies and practices.

    1. Written Policies and Procedures 
      Our compliance program is made up of both formal written policies and procedures and less formal procedures that are a part of our every day work activity. If you identify a conflict between a written policy and a less formal operational procedure, it is important that you report it to the appropriate person. Everyone in our organization is responsible for making sure we maintain the highest standards, and all of us have an active responsibility to report potential problems immediately.
    2. Code of Conduct
      As described in our policy manual and training materials, all employees are expected to adhere to the highest standards of behavior. In addition to the general [Rules of Conduct and Miscellaneous Policies] described in the manual, please note the following:
      [enter specific practice rules here]

    In addition, this Compliance Plan has been developed to assure that matters effecting [Name of Practice] are reported and handled appropriately, and that all employees involved with any aspect of billing (including the definition of medical necessity, documentation of services provided, and collection) are aware of the requirements and understand how these matters are handled.


    1. The Compliance Officer will assure that all personnel subject to the Compliance Plan are trained and are aware of the issues. Training and attendance at meetings will be a condition of employment. All employees who are involved with any aspect of billing, as defined above, will sign for attendance and confirm that they have read and understand this Compliance Plan.
    2. Initial training will be completed within [ten days of employment. Additional mandatory training programs will be conducted periodically after the initial training.]
    3. Mandatory staff meetings will be held [frequency] to update staff, including physicians.
    4. Attendance at training meetings is a condition of employment.
    5. The Compliance Officer will maintain a file of all original documents, including employees' signed affidavits for a period of no less than six (6) fiscal years.
    6. Compliance training will include seminars on coding and billing changes for Medicare and Medicaid and other seminars that provide an understanding of the scope of these issues.

    Personnel subject to this program include anyone who participates with any billing, coding, documentation of medical services provided, or collection activity. No one previously convicted of Medicare fraud will be hired by this practice.

    [Although (Name of Practice) may base bonuses and promotions on contributions to the practice's profitability; continued employment depends on lawful and ethical conduct.] Failure to meet the requirements under this Compliance Plan will result in immediate dismissal for cause.

    Third Parties subject to this plan include all subcontractors who will be held to the standards set forth in this Compliance Plan. We will endeavor to ensure that all subcontractors are actually performing the services they report and will assist them to understand these requirements.



    Education is an important part of the compliance program. [Name of Practice] recognizes both the complexity of the current healthcare environment and the changing nature of the rules and procedures we face every day. The training program has two major components. [Create an attachment to show: program, schedule, log of attendance, steps taken to ensure everyone was trained.]

    1. The first component provides initial training when a person is first employed. This combination orientation and training includes the following kinds of activities, (though it is usually customized for the particular job an employee has been hired to perform):
      1. general orientation to the policies and procedures of the office. The [Title of Person Responsible] is responsible for this aspect of the training, and usually combines it with benefit discussions and sign up.
      2. introduction to the [Name of Practice's] computer system - fundamentals. The [Title of Person Responsible] provides this introduction.
      3. training in job specific software, either the billing software, scheduling or other specific parts of the system will take place over a two to four week period. We will work together to ensure that all aspects of the job are clear to the new employee and that the process required by [Name of Practice] is understood. Most of our training occurs in the actual work site where the employee is expected to operate on a day to day basis.
      4. billing training includes medical terminology, co-pays, encounter form review, the patient collection process, reading and understanding the computer data displayed at the time of billing and collections, how to read insurance cards, the difference between participating and non- participating status, the difference between Point Of Service, (POS), Health Maintenance Organization (HMO), and Preferred Provider Organizations (PPO) insurance plans, and referral and authorization requirements.
    2. The second component provides ongoing information to either enhance employee skills or to keep employees aware of changing conditions. We do this in a number of ways: [tell how, when, what, where]
      1. [We issue "Billing Alerts" on special pink paper to all employees, including physicians, when there is a change in coding information, ICD or CPT numbers, or anything else which affects the billing process. These alerts are clearly identified and separate from all other communication we send to staff and physicians.]
      2. [We publish longer articles in our staff newsletter. We also publish brief news items about changes in insurance plans, coverage, and changes in the services we offer to our patients.]
      3. [We issue an updated list of plans we participate with as changes occur. This is critical as it affects a patient's out-of-pocket expense.]
      4. [We hold seminars and send key staff to outside seminars.]

      [Name of Practice] believes that the major responsibility for correctly coding an encounter and documenting the medical record belongs with the physician providing the service. To this end, we have emphasized physician training, and have provided a variety of aids to help physicians with the complicated requirements for correctly coding and documenting the medical services provided by our practice. Ongoing training for our providers is a major objective of our training program.

  5. RECORD RETENTION [Name of Practice] will retain records in keeping with the guidelines of the State of Maryland and other governing bodies. These records include documents relating to patient care, billing and other business activities. The Practice Administrator will keep an updated "Record of Compliance-Related Activities." Documents to be kept include: [If system is automated, maintain back-up tapes/disks instead - this info. is to the best of Mont. Co. Med. Soc. knowledge - you must check and update periodically]
Document Type Storage Period
Accident Reports
7 years
Accounts Payable & Receivable ledgers/schedules
7 years
Appointment Books
3 years
Bank Statements & Reconciliations
3 years
Capital Stock and related records
Cash and credit card receipts
3 years
Cash books
Charts of Accounts
Checks- cancelled
7 years
Checks ? cancelled for important payments
(e.g. I.R.S., property purchases, etc.)
Collection agency reports
7 years
Compliance Program violations and action
Computer backup tapes/diskettes
7 years
Contracts, mortgages, notes, etc.
7 years
Correspondence- general
2 years
Correspondence ? legal/important
Correspondence ? routine w/customers/vendors
2 years
Day sheets/daily journal
7 years
Deeds mortgages, etc.
Duplicate deposit slips
2 years
EOB?s (explanation of benefits)
7 years
Employment applications
3 years
Expense analyses
7 years
Financial statements
Insurance Policies ? expired
3 years
Insurance records ? current
Internal Audit Records
3 years
Internal reports- misc.
3 years
Inventories of products, supplies, etc.
7 years
Invoices from vendors
7 years
Medical Records (charts) - adult
5 years
Medical Records (charts) ? minor
majority + 5 years
Minutes of directors, stockholders meetings, etc.
Payroll records and summaries
7 years
Personnel files (terminated)
7 years
Petty cash vouchers
3 years
Property appraisals
Property records- general
Purchase Orders
1 year
Retail Receipts and Documentation (if applicable)
7 years
Retirement/Pension records
Subsidiary ledgers
7 years
Superbills (Encounter forms)
7 years
Tax returns, worksheets, etc.
Telephone message books
1 year
Time books/cards
7 years
Training Manuals
Withholding tax records
7 years
      1. Third-Party Billing Services [Include only if this practice uses such a service. Tell method used to check and who is responsible for checking]
        Physicians members of [Name of Practice] are responsible to Medicare for bills sent in their name or which contain their signature. [Title of responsible person(s)] needs to continuously check for accuracy of coding by conducting [quarterly] internal and [annual] external audits. Percentage billing by a billing service can result in intentional upcoding and other abusive billing practices. [Name of Practice] billing service cannot accept Medicare payments. Claims may not be billed under the name of the service or its tax identification number. Medicare payments must be sent directly to [Name of Practice] or its bank account. We will review third-party payments on a regular basis.
      2. Billing Practices [Include only if this practice has non-participating physicians]
        [Name of Practice] may not accept payment directly from the Medicare program if its physicians are non-participants. We will not knowingly and willfully collect charges that exceed Medicare limiting charges. If charges exceed the limit collectable by law, a refund will be made to the patient within 30 days notice of the violation. A refund will also be made if a Peer Review Organization or a Medicare carrier find that our services were not reasonable or necessary. We understand that failure to comply as a non-participating physician to any of these regulations can result in a fine of up to $10,000 per violation and exclusion from participation in Federal health care programs for up to 5 years.
      3. Professional Courtesy [GET ADVICE OF YOUR ATTORNEY ON THIS SECTION. You should determine your own rules with regard to professional courtesy.]
        [Name of Practice] will offer professional courtesy to the following group:

        1. employees of the practice and their family members;
        2. fellow physicians and their families;
        3. [add any group your practice wishes to include.]

    The group receiving the courtesy has been determined in a manner that does not take into account directly or indirectly any group member's ability to refer to, or otherwise generate Federal health care program business for[physician(s), practice]

    A professional waiver of co-payment will not be given to anyone who is a Federal health care program beneficiary who is not financially needy.

    No waiver of payment or co-payment will be extended to affect future referrals or kickbacks.

    1. Waiving fees and/or Co-pays
      We must also avoid offering inappropriate inducements directly to patients. Examples of such inducements include routinely waiving coinsurance or deductible amounts without a good faith determination that the patient is in financial need, or failing to make reasonable efforts to collect the cost-sharing amount. [Employees are required to indicate each day how many co-pays were collected at the time of the visit, and explain why a co-pay was not collected if that occurred.] It is our policy to collect co-pays at the time of the visit, and not bill for them. Please make sure that this occurs. Routine "Professional Courtesy" is not the policy of [Name of Practice].
    2. Advanced Beneficiary Notes (ABNs)
      [Name of Practice] and its physicians will provide ABNs before they provide services that they know or believe Medicare does not consider reasonable and necessary. This notification will acknowledge that coverage is uncertain or yet to be determined, and will stipulate that the patient promises to pay the bill if Medicare does not. We understand that patients have a right to sufficient information in order to make an informed decision. Those who are not notified before receiving services are not responsible for payment.Each ABN will be in writing and identify the service which may be denied and why, including the CPT/HCPC code. The patient will be required to sign the form, which acknowledges having read and understood the ABN, and acceptance of payment responsibility.We follow the Medical Carrier's Manual that states that an ABN will not be acceptable if the patient is asked to sign a blank form and the form is used routinely without regard to the specific study.

      In order to assure that [Name of Practice] is in compliance with OIG regulations for ABNs for diagnostic tests and services, we will endeavor to determine which tests are not covered under national coverage rules, local coverage rules such as Local Medical Review Policies (LMRP) and determine which tests are only covered for certain diagnoses.

    3. Billing for Non-Covered Services as if Covered
      It is occasionally necessary for [Name of Practice] to submit claims for services in order to receive a denial from the carrier, thereby enabling the patient to submit the denied claim to a secondary payer. These claims will note that this is the reason for submission to the first carrier. If the carrier pays the claim, even though the service is non-covered, [Name of Practice] will refund the amount paid and indicate that the service was not covered.


    1. Coding and Billing
      The coding and billing manual for [Name of Practice] is located [place(s).]We will continuously monitor our coding and billing practices [establish a schedule, e.g. monthly, quarterly, etc and name responsible party]. We recognize that an ongoing review and update of codes will lower the risk of errors. We will:

      1. Check for billing of items or services not provided by our physician(s) to the patient;
      2. Check for claims submitted for equipment, medical supplies, and services not considered "reasonable and necessary;"
      3. Check for double billing;
      4. Check that non-covered services are billed;
      5. Check for accurate provider identification numbers and use them correctly;
      6. Bill only for "bundled" services;
      7. Use coding modifiers correctly; and
      8. Check the coding level of the service(s) provided.

      Our billing and coding practices adhere to applicable statues, regulations, and Federal, State, or private payer health care program requirements and are based on medical record documentation. Claims rejected for causes pertaining to diagnosis and procedure codes will be investigated promptly by [the practice billing office] and appropriate corrective action will be taken.

    2. Reasonable and Necessary Services 
      [Name of Practice]
       will only submit claims for services considered "reasonable and necessary." We understand that although the OIG recognizes that physicians should be able to order any tests, including screening tests they believe are appropriate for treatment of their patients, we are fully aware that Medicare will only pay for services that meet the Medicare definition of "reasonable and necessary." Medicare (and many insurance plans) may deny payment for a service that the physician believes is clinically appropriate, but which is not "reasonable and necessary." Upon request, the staff of [Practice Name] will provide documentation, such as a patient's medical records and physician's orders, to support the appropriateness of a service that the physician provided.
    3. Documentation
      Timely, accurate, and complete documentation is critical to nearly every aspect of this practice. Therefore, it is crucial that [Practice Name]remains compliant by keeping appropriate, up-to-date documentation of each patient's diagnosis and treatment. This documentation is necessary to determine appropriate medical treatment for the patient, and is the basis for coding and billing determinations. Failure to do so by all office personnel will compromise good patient care. Thorough and accurate documentation helps to ensure accurate recording and timely transmission of information.

      1. Medical Record Documentation
        It is the goal of [Practice Name] to provide high quality care for its patients. Careful and complete medical record documentation is important because it verifies and documents precisely what services were actually provided. Our records validate the site of the service(s) rendered; the appropriateness of the services provided; and the accuracy of the billing. We endeavor to have records that:

        • are complete and legible;
        • include the reason for the encounter, relevant history, physician examination findings, prior diagnosis test results, assessment, clinical impression, or diagnosis; plan of care, and the date and legible identity of the observer;
        • make clear the rationale for ordering diagnostic and other ancillary services. Past and present diagnoses are accessible to the consulting physician(s); and
        • include appropriate health risk factors as well as the patient's progress, his/her response to any changes in treatment, and diagnosis revisions.

        We will make sure that appropriate office personnel include the CPT and ICD-9 CM codes on all health insurance claim forms. HCFA and local carriers will be able to determine who provided the services.

      2. Kickbacks, Inducements and Self-Referrals 
        [This practice]
         is committed to ensuring that there are no kickbacks from any organization with whom we do business. In general the anti-kickback statute prohibits knowingly and willfully giving or receiving anything of value to induce referrals of Federal health care program business. All business arrangements where physician practices refer business to an outside entity should be on a "fair market value" basis. Please report any offers of inappropriate payments to [the administrator of your office site or] the compliance officer.
      3. HCFA 1500 forms
        We will closely monitor [tell how and who is responsible] documentation of the HCFA 1500 form to ensure that:

        • the diagnosis code is linked with the steps taken to perform an examination and the record of personal history obtained;
        • the single most appropriate diagnosis is linked with the corresponding procedure code;
        • modifiers are used appropriately; and
        • Medicare is provided with all information about a patient's other insurance coverage.
    Abuse occurs when a provider does not knowingly and intentionally misrepresent services provided, but -- either directly or indirectly-- causes Medicare to render improper payment for the services.False Billing
    Billing for services not provided, or not documented in the medical record; failure to provide necessary medical services; physician kickbacks, patient abuse; professional licensure issues, physician certification and alteration/destruction of documents.

    A sum imposed as punishment for an offence; a forfeiture or penalty paid to an injured party in a civil suit. Fines include refund of any overpayment made, plus interest, plus a charge for committing the fraud or abuse.

    Fraud occurs when a provider knowingly and intentionally deceives Medicare, or any other payor of medical services, by representing services provided in order to receive unauthorized benefits.

    Fraudulent Claims / Erroneous Claims
    There appear to be significant misunderstandings among physicians regarding the critical differences between fraudulent (intentionally or recklessly false) health care claims on the one hand and innocent "erroneous" claims on the other. Some physicians feel that Federal law enforcement agencies have maligned medical professionals and are focused on innocent billing errors. These physicians are under the impression that innocent billing errors can subject them to civil penalties, or even jail. These feelings and impressions are mistaken.Under the law, physicians are not subject to civil or criminal penalties for innocent errors, or even negligence. The Attorney General of the United States has stated, "[i]t is not the [Justice Department's] policy to punish honest billing mistakes . . . [or] mere negligence. . . . These are not cases where we are seeking to punish someone for honest billing mistakes."

    The Health Insurance Portability and Accountability Act of 1996, otherwise known as the Kennedy-Kassebaum Health Care Reform Act, took effect on January1, 1997. Unlike the Medicare/Medicaid statute, which deals exclusively with crimes against those programs, the following offenses created under HIPAA apply to any health care benefit program: Fraud; Theft or embezzlement from Health Care Benefit Program; False statements in Health Care Benefit Programs; Obstruction of criminal investigations; Money laundering; Investigative demands; Injunctive relief. [Reference: MedChi Supplement - Fraud & Abuse Prevention: What physicians need to know -pp. 48-49.]

    Joint Ventures
    An agreement, undertaking or relationship that links the economic welfare of two or more parties. This may take the legal form of a contract, a separate partnership, or separate corporation. This agreement requires the parties to make an investment in a common enterprise, such as: capital services, technology, or some other asset. The degree of control that is shared between the joint ventures will vary with the type of business and legal form selected.

    A joint venture may take a variety of forms: it may be a contractual agreement between two or more parties to cooperate in providing services, or it may involve the creation of a new legal entity by the parties, such as limited partnership or closely held corporation, to provide such services.

    The criminally liable act of knowingly or willingly paying, receiving, offering, or soliciting (whether directly or indirectly) any remuneration in return for, or to induce the referral to Medicare and Medicaid business. To return a part of a sum received often because of confidential agreement or coercion, such as bribes and rebates. Subject to a fine of up to $25,000 and/or up to five years imprisonment.

    OIG - Office of Inspector General
    The Office of Inspector General was established at the Department of Health and Human Services by Congress in 1976 to identify and eliminate fraud or abuse. The OIG is actively investigating health care providers, practitioners and suppliers of health care items and services.

    The suffering in person, rights, or property that is annexed by law or judicial decision to the commission of a crime or public offence. The suffering or the sum to be forfeited to which a person subjects himself by agreement in case of nonfulfillment of stipulation.


    1. Imprisonment and/or fines.
    2. Mandatory exclusion from Medicare/Medicaid programs.


    1. Fines
    2. Exclusion.
      1. No Medicare or Medicaid payment can be made to anyone (including a patient) for services rendered ordered or supervised by the excluded physician.
      2. Pre-exclusion hearing generally not required.

    Referral Source
    One that sends a patient to another practitioner or another program to initiate the request for treatment, aid, or information. A physician with an ownership interest in, or a compensation agreement with, an entity is prohibited from making referrals to that entity for the furnishing of designated health services for which Medicare payment would otherwise be made.

    The act of paying an equivalent for services, losses, or expenses. To return in kind, payment for services rendered or products purchased. Payment for referrals.

    Routine Waiver (write off)
    A waiver is the act of intentionally relinquishing or abandoning a known right, claim or privilege. Routine waivers of deductibles and copayments by charge-based providers, practitioners, or suppliers is unlawful because it results in (1) false claims, (2) violations of the anti-kickback statute, and (3) excessive utilization of items and services paid for by Medicare. A provider, practitioner, or supplier who routinely waives Medicare copayments or deductibles is misstating its actual charge.

    It is important to understand the specific issues covered by this Compliance Plan for [Name of Practice.]Alteration/destruction of documents

    Any change in medical records or billing documents must be noted (with date and signature) without removal or change of original documents.
    Certification and licensure 
    For those employees requiring licensure or provider certification, it will be the responsibility of the employee to ensure that action is taken prior to the expiration date. This will be confirmed at each employee's annual performance review.
    Conflict of interest
    Referral to any facility providing certain diagnostic services where the referring provider has ownership is prohibited by OBRA Act 1989 (Stark I) and OBRA Act 1993 (Stark II). This currently does not include non-Medicare and non-Medicaid patients. Attempts jointly by several physicians/providers to lock in fees for special consideration or favorable contract is considered a criminal offense under the Sherman Antitrust Act. To the extent that any employer finds that undo pressure or a conflict of interest arises that diminishes his or her ability to conform to the Compliance Plan, it must be reported to the Compliance Officer immediately.
    Failure to provide necessary medical services
    Although certain managed care programs do not pay for testing, all care must be given to meet the normal standards of care.
    False billings
    Any service and diagnosis used for billing must agree to the medical records in all items. (See Appendix B) Incomplete documentation/medical necessity 
    Completion of medical records must be done timely and to the standard of this Practice and HCFA. Medical necessity must be clearly indicated for services provided. (See Appendix C)
    Misapplication of payments/lack of refunds
    Payments must be applied for the specific date and services. Credit balances must be returned based on the established criteria to determine who is due the refund. (Credit balances cannot be "offset" unless requested, in writing, by the patient.)
    Patient Abuse
    Verbal and physical abuse of any patient will not be tolerated.

    The OIG has determined that an effective compliance program includes procedures for enforcing and disciplining individuals who violate the practice's compliance standards. The [Name of Practice] standards of conduct and a complete description of the disciplinary process are spelled out in the "Policy and Procedure Manual," and include: warnings (oral); reprimands (written); probation; temporary suspension; discharge of employment; restitution of damages; and referral for criminal prosecution. Individuals who hold positions responsible for supervising others, and fail to detect or report violations of the compliance program may also be subject to discipline.An open line of communication is essential to properly implement an effective compliance program. [Name of Practice] has implemented an "open door" policy between the physician(s) and staff member(s). A bulletin board is located in [area] for the posting of notices that up-date compliance information. [We have also provided an anonymous drop box in the (place) where employees can report any conduct that they would consider fraudulent or erroneous. To report a suspected violation, complete a written report and place it in a sealed envelope in the drop box.] Maintain copies or detailed information for review by the Compliance Officer.

    The employees of [Name of Practice] are required to report any behavior by any person whom they believe to be fraudulent or erroneous to the Compliance Officer. Failure to report such behavior is in violation of this Compliance Program. While we will endeavor to maintain the confidentiality of person(s) involved, there may be a point at which the individual's identity may become known or may have to be revealed in certain circumstances. Employees will face no recrimination from making a report. In addition, anyone found to be guilty of retribution can be fired.

    All investigations will be handled by the Compliance Officer; all reports of non-compliance will go to the attorney immediately upon receipt by the Compliance Officer.Our attorney is [_____________________]

    Phone number [_____________________]

    1. Internal investigations
      Our attorney will lead any internal investigations, giving us the protection of attorney-client privilege. Our attorney will arrange for assistance of any other party [other attorneys, accountants, or consultants] to extend the attorney-client privilege to them.
    2. Investigations by government or outside agencies
      If any third party comes to review our records (billing or medical records), the following steps must be taken:

      1. Obtain identification.
      2. Call immediate supervisor, or if not available, the Compliance Officer directly.
      3. The supervisor should stay with the investigator until the Compliance Officer arrives. DO NOT SPEAK OR TALK ABOUT ANYTHING.
      4. Have the investigator wait in a separate room or waiting area until the Compliance Officer takes over.
      5. The Compliance Officer will determine the needs of the third party investigation and if it is not a "routine" and/or pre-arranged examination, the ATTORNEY SHOULD BE CONTACTED IMMEDIATELY.
  7. MONITORING SYSTEM Fraudulent or erroneous conduct that has been detected, but not corrected, can seriously endanger the reputation and legal status of [Name of Practice]. Consequently, upon receipt of reports or reasonable indications of suspected noncompliance, it is important that the compliance officer or other practice employee investigate the allegations within [time frame] to determine whether a violation of applicable law or the requirements of the compliance program has occurred.There are several key warning signs of when a compliance program is not working well. Examples of this include high rates of rejected and/or suspended claims and the placement of a practice on pre-payment review by the carrier. These warning signs should be followed up on immediately to prevent the problem from recurring. The individuals involved in the violation will either be retrained, or, if appropriate, terminated. We will also conduct a review of all confirmed violations, and, if appropriate, report the violations to the applicable authority.

    [Name of the Practice] will engage an outside consultant to review our billing/coding records [annually]. Any problem detected will be reported to the Compliance Officer for follow-up. It is your responsibility to cooperate and provide any requested information to the consultant.

    Just as immunizations are given to patients to prevent them from becoming ill, [Name of Practice] views the implementation of an effective compliance program as comparable to a form of preventive medicine to protect against fraudulent or erroneous conduct. By implementing an effective compliance program, we can help prevent and reduce fraudulent or erroneous conduct in our practice, as well as furthering our mission to provide quality care to our patients.
    The Compliance Plan for [Name of Practice] was give to me on [Date] ______by [Name of Supervisor]. I was employed on [Date] _______. I have read and understand the information provided and my role in staying in compliance. I also understand that from time to time the Plan may change and I will maintain an active awareness of these changes.Signed: ________________________________

    Name Printed:__________________Date: _____



Specific Personnel subject to this Compliance Program are listed below. 

Physicians and Providers:
[Names & Qualifications]

Medical Records Personnel: 
[Names & Qualifications]

Billing, coders, collectors and front desk personnel: 
[Names & Qualifications] 



  1. Billing for procedures that were not performed
  2. Falsifying dates on claims;
  3. Changing the reported medical procedure to one that is covered by the patient's policy;
  4. Allowing another person to use a subscriber's card;
  5. Changing the dollar amounts on receipts;
  6. Billing Medicare patients for more than the limiting charge;
  7. Charging Medicare patients more than you paid for purchased diagnostic services;
  8. Billing Medicare for non-covered surgical services without informing patients that Medicare may not cover the services;
  9. Billing patients for laboratory tests;
  10. Billing patients for mandatory assignment services (Medicaid, PA services, CRNA Services);
  11. For Medicare, billing for laboratory services performed outside the facility;
  12. Failing to provide ICD-9 codes for each procedure;
  13. Billing Medicare patients more than other patients,
  14. Routinely forgiving co-payments and deductibles;
  15. Failing to refund payments for services found to be medically unnecessary;
  16. Billing patients for a level of service that was not documented in the patient medical record and/or was at a level which was disproportionate to the patient's condition;
  17. Submitting duplicate or additional billings for multiple procedures that are considered component parts of a surgical procedure performed at one anatomical location; and
  18. Submittal of bills to Medicare instead of third-party payors which are primary insurers for Medicare beneficiaries.

The False Claims Act: Physicians and other health care providers who miscode their bills are also exposed to severe civil penalties under federal law. Miscoded bills are false claims and, as such, are prohibited by the Federal False Claims Act. The False Claims Act requires only that a violator knowingly present a false claim to the federal government. Under the Act, violators are liable for civil penalties of between $5,000 and $10,000 per false claim, plus damages of three times the amount of each overcharge. Under the Civil Monetary Penalties Act, the penalty is $2,000 per claim but damages can be twice the total charges involved in the false claim. [This information must be monitored for change.] 


MEDICAL RECORD REQUIREMENTS - INCOMPLETE DOCUMENTATION/MEDICAL NECESSITY: Documentation is the recording of pertinent facts and observations about the individual's health history, including past and present illnesses, tests, treatments, and outcomes. The medical record chronologically documents the care of the patient in order to:

  1. enable the physician and other healthcare professionals to plan and evaluate the patient's treatment;
  2. enhance communications and promote continuity of care among physicians and other healthcare professionals involved in the patient's care;
  3. facilitate claims review and payment;
  4. assist in utilization review and quality of care evaluations;
  5. reduce hassles related to medical review;
  6. serve as a medicolegal document which protects both the patient and the provider of care;
  7. serve as an educational instrument through which research and medical advancement are possible;
  8. justify as to why Medicare noncovered services were required by the Medicare patient, such as preventive services;
  9. justify "why" several services were needed in that period of time;
  10. justify level of care reported;
  11. serve to substantiate the medical necessity of services provided and offer proof of actual care and treatment given to anyone reimbursing the provider or patient for that care.

A good record bespeaks good care, a sloppy, incomplete record suggests a sloppy physician who provides incomplete care -- a presumption that is difficult to refute.

Covered services are those services that are payable in accordance with the terms of the Medicare contract. These services must be documented and medically necessary in order for payment to be made.

"Medically Necessary" services are deemed to be reasonable and necessary for the treatment of the listed diagnosis for a particular case, or for certain specified conditions, or for the treatment of any kind of illness, injury, or condition.

Medicare does not cover items and/or services, which are not reasonable and necessary for the diagnosis or treatment of an illness, injury or to improve the function of a malformed body member.

Poor medical documentation is the most common problem uncovered in the investigation of quality assurance and utilization issues. Poor record keeping can profoundly impact third-party reimbursement or create legal difficulties. A complete, accurate and objective medical record offers a solid foundation for defending healthcare providers against allegations of negligence, improper treatment or omissions in care. Physicians have to document on patient charts why tests were or were not ordered, the results, and the physician's conclusions.

Medicare has a rule: if it is not written down, it did not happen. Also, if the physician's notes cannot be read, it will be as if the procedure was not performed or if it is abbreviated and it is not clear what the abbreviation means, it is not done.


Alterations can be construed as obstruction of justice. Never erase a handwritten entry. An erasure makes your chart as legally worthless as an altered check.

If you notice that you have left out a bit of information or transposed notes onto the wrong chart or made any transcription errors, make the corrections in an approved manner by doing the following:

  1. Draw a pencil line through the error, leaving the mistaken entry clearly readable.
  2. Write or type the correct information in ink immediately after the error. If there is no room right below the mistaken entry, make a pen-and-ink- notation showing where the correct data can be found.
  3. Initial the correction in ink and show the date and time the correction was made; if the error and correction are at different places in your notes, initial and date both places.
  4. Correct innocent errors any time you notice them except after a malpractice case has been filed.