Completing the Compliance Annual Assessment: Avoiding Fraud, Waste, and Abuse

Jeannine LeCompte, Publishing and Research Coordinator

The final component of an annual compliance assessment, required by long-term care facilities (LTCs) receiving Medicare or Medicaid funding, is proving that all reasonable steps have been taken to avoid fraud, waste, and abuse.

As was the case with company directors, the facility’s duty to avoid fraud, waste, and abuse is subject to the “good faith” test. This is an acknowledgement on the part of the state that it might be impossible to prevent malicious instances of fraud, waste, and abuse. In order to avoid liability, the LTC should show that all possible attempts were made to avoid such instances.

However, this defense will only work if the LTC can show—as detailed in its annual compliance report—that it has:

Written compliance and ethics standards, policies, and procedures capable of reducing the prospect of fraud, waste, and abuse

High-level personnel with substantial control over the operating organization who oversee the compliance rules

The designation of an appropriate compliance and ethics program contact to whom individuals may report suspected violations, as well as an alternate method of reporting suspected violations anonymously without fear of retribution

Suitable disciplinary and enforcement procedures and policies which are designed to avoid instances of fraud, waste, and abuse

A suitable and ongoing training program designed to teach all personnel, including contractors and subcontractors, the principles of the company’s compliance and ethics program standards

A regular review and revision program designed to ensure that the compliance and ethics program reflects all changes in laws or regulations

A detailed record retention policy

That periodic organizational risk assessments are carried out, including the provision of human resources and management with training to recognize compliance risk associated with employee misconduct