Ultimate Guide to Healthcare Compliance

What is healthcare compliance?

Healthcare compliance refers to the policies, procedures, laws, and regulatory guidelines that pertain to healthcare practices. Healthcare compliance ensures smooth operations of businesses, and that patient information is handled correctly, with minimal risk of jeopardization. Above all, it holds healthcare businesses accountable for their actions, and attributes responsibility to their business processes. 

There are a plethora of internal and external policies covered under compliance that ensure all medical and financial data is kept private, and is regulated properly. The healthcare industry deals with highly sensitive information, including evidence such as medical histories and personal details, and so healthcare compliance is an excellent way to outline the regulations that you should be following, as well as the consequences if you fail to do so. Most healthcare practices work tirelessly to maintain compliance and uphold regulations, with some having established committees and teams dedicated to resolving and working through compliance issues. Especially considering that healthcare compliance is quite fluid, and changes constantly, it’s of utmost importance that you keep up-to-date with compliance regulations.

When healthcare professionals and practitioners refer to healthcare compliance, they’re commonly referring to the backbone of compliance standards; HIPAA. 

HIPAA

Health compliance mainly incorporates HIPAA guidelines, which refer to the Health Insurance Portability and Accountability Act of 1996. This act serves as the foundation for how security is monitored and regulated within practices, and outlines the requirements that all businesses must adhere to in order to fulfill legal obligations. More specifically, HIPAA outlines the safety processes that should take place in regards to transferring, sharing, and receiving medical information, as well as the overall handling of healthcare information. HIPAA also supports businesses when it comes to health insurance coverage, which includes around 200 million Americans. It establishes industry-wide standards for medical billing and coding processes to ensure that the appropriate amount is reimbursed for businesses. It is an excellent way to elevate the quality of care within your practice, and abiding by HIPAA guarantees security when it comes to your legal position within healthcare. 

5 Main Guidelines

HIPAA guidelines refer to 5 main areas that you must consider when fulfilling legal obligations, and handing patient medical information. To support confidentiality and ensure that your patients are in the best hands, HIPAA privacy and compliance programs outline the steps to take to achieve the security requirements. You can effectively minimize risks of security breaches, as well as boost patient satisfaction by improving security systems and ensuring that your medical information is highly secure and private. 

1. Privacy - This outlines the various conditions that cannot be conducted without patient authorization, and the disclosures that must be submitted. When it comes to privacy, all patients should have full rights to control their private information, which means having appropriate access. Patients should be able to access medical history, medication forms, finances, and treatment plans, and have full confidence that only authorized users can view and assess their medical data. Upon request, clients should be able to correct their information as well as obtain a copy of their details if needed. 
2. Security - Security refers to the protocols and regulations that protect patient information, and ensure that only authorized users have access to the right data. When it comes to safeguarding your information, it is important that you implement the proper authentication and encryption standards so that patient information is of the highest protection. These also include various hardware and software evaluations, especially concerning management processes and risk assessments, to ensure that holes are quickly identified to prevent hacking or data leakages. 

1. Transaction - Inclusive of ICD-9, ICD-10, HCPCS, CPT-3, CPT-4, and NDC codes, you can improve billing and coding processes by using the correct HIPAA identification. Utilizing the right security codes allows you to improve and speed up business transactions, which can increase patient satisfaction and work towards better business processes. 
2. Identifiers - When it comes to HIPAA regulations, there are three main identifiers that healthcare businesses use, which include the National Provider Identifier (NPI), National Health Plan Identifier (NHI), and Center for Medicare and Medicaid Services (CMS). The NPI is a 10-digit number that covers the healthcare businesses across and within every HIPAA transaction, with NHIs used for a health plan and payer identification, and CMS correlating to their codes. 
3. Enforcement - This outlines the areas within healthcare that practices must adhere to and acknowledge, with its use derived from the ARRA HITECH ACT. It includes HIPAA security requirement applications, mandatory federal privacy formation and security breach requirements, marketing and sales restrictions, criminal and civil penalties, and non-compliant enforcement methods. By covering a variety of bases, enforcement is a central aspect when it comes to HIPAA, as it promotes healthcare businesses to inject more effort into upholding regulations and maintaining universal security protocol. This way, patients can have more confidence that they are in safe hands when it comes to protecting their data from potential breaches. 

Why is healthcare compliance important?

Contributing to up to 60% of healthcare errors, it’s of utmost importance that you implement security protocol as a preventative measure to combat potential hacks and data leakages. If data is compromised, it can be much more difficult to gain control over, which can result in severe financial penalties and fines for your practice. A damaged reputation is difficult to recover, and so to avoid this, it’s best to incorporate effective compliance practices, allowing you to also provide better treatment for your patients. The reality of managing healthcare compliance can quickly become complicated without the right safeguards in place, and without proper care taken to adhere to the guidelines in place for your benefit. It is highly important to forestall security oversights, limit security dangers, guarantee innovation use, and ensure the classification of patient information. 

Compliance also ensures that patient data is connected within the right databases and to the right IDs, with information only accessible to particular users. This means that healthcare professionals across practices and organizations can easily receive the file transfers, and be able to treat patient conditions regardless of their location. With moral and lawful principles developing more intricately, more and more organizations are executing different HIPAA frameworks to continue providing a high-quality coordination and order of care, whilst ensuring clinical consistency. There must be an objective measurement that is applicable to all forms of healthcare, as it guarantees that all healthcare businesses are subjected to the same compliance standards; and this is why HIPAA works so well. You can protect against all forms of fraud and liability issues, and protect the longevity of your healthcare practice, as well as ensure that your patient medical information is locked tight. 

How does the public health system in the US work?

The public health system is consistently framed within the context of medical services and healthcare, and is often discussed together and considered connected. Public health is the core foundation of all medical service activities, and actively manages diseases, while also advancing health within general and state wellbeing offices. It is a widespread network, and can very easily become complicated with the number of regulations and standards in place. Especially considering that many of these bodies oversee their own frameworks differently, and in a way that works for them. They each have their own capacities concerning their level of power and construction within the health industry.

Inside the US, the general wellbeing framework comprises an assortment of public and private associations, which all serve as a component of a wider organization. These associations cooperate to advance and expand general wellbeing, and actively prevent diseases while ensuring businesses are held accountable for their actions. The government public health system itself is composed of 51 states, 2794 local governments, and 565 federally recognized agencies. 

How are health departments structured?

To better understand how departments are structured, you may need to know the following terms. 

• Centralized/state - Includes all local health departments, which are all units of state government.
• Local or decentralized - Local governments make the tax decisions and govern local health departments. 
• Mixed/hybrid system - The state government leads some local health departments, and the local government also leads some local health departments.
• Shared system - All local health departments are governed by state authorities and local authorities.
  

When it comes to healthcare, you often have to work with local health departments, so it can be useful to understand their role within the overall health structure. Their authority is derived from the state, within both country and municipality levels, and varies depending on the size of jurisdictions. For instance, smaller local health practices may have fewer services due to fewer developments, technology, and staff within the health departments. However, all practices and departments must practice compliance in accordance with laws and regulations in order to fulfill legal obligations, and ensure that patient information is protected. 

List of bodies and federal regulations that govern healthcare compliance

There are different overseeing bodies and government guidelines that guide medical care compliance arrangements, and investing in the opportunity to inspect these laws is immensely helpful for your training. Becoming familiar with these rules will enable you to better understand what is required from your healthcare practice, and therefore, provide a high level of privacy and protection when it comes to your medical data. 

While HIPAA is the main compliance regulation you need to be concerned with, it’s still important to recognize the others that continue to play a role when it comes to healthcare. These include the following:

• Health Information Technology for Economic and Clinical Health (HITECH) - Specific to health information technology, these regulations outline that healthcare businesses must conduct regular audits to assess compliance in regards to their privacy. It ensures that only authorized users have access to relevant information, and that patients are notified as to who has this specific access. Given the current Covid circumstances, it is especially important that online information is protected, and that medical records are contained to specific individuals. 
• Hospital Readmissions Reduction Program (HRRP) - This regulation requires Medicare and Medicaid services to reduce pay to facilities that have excessive readmission rates of patients. Patients can be treated in healthcare practices without fear of forking out additional hidden costs and finances, with it making treatment a more viable option for those in need. 
• Medicare Access and Children’s Health Insurance Program (MACRA) - This includes the use of electronic health records by medical practices and facilities, as well as doctor payments, Medicare costs, and treatment models that can be administered. 
• Healthcare Quality Improvement Act of 1986 (HCQIA) - This provides protection and immunity for healthcare professionals in the case of law, and supports an equal playing field when it comes to healthcare perspectives, treatments, and services. The act promotes audits and reviews, and also protects clinicians from lawsuits from fellow physicians. 
• Chain of Custody (CoC) - A chain of custody supports you in creating a paper trail of evidence concerning interactions with patients, and regulates record-keeping. It is an excellent way of holding you accountable for all your actions, especially when it comes to legal issues. 
• Affordable Care Act of 2010 - Healthcare professionals can play a larger role in the patient healthcare experience, as the affordable care act ensures that all relevant services are covered, so doctors can increase their quality of care. It specifically outlines specifications concerning the provision of healthcare coverage, and works to reduce care expenses, which increases the protection of patients.
• Patient Safety and Quality Improvement Act of 2005 (PSQIA) - Healthcare professionals can now report medical errors without fear of being exposed. Many mistakes go unnoticed and unreported due to fear of your job being at risk, and so this act works towards creating conditions where those in medical professions feel comfortable coming forward. 

There are also various other regulations that you should be aware of as additional resources that can influence the healthcare industry in the broader context. Anywhere from $50,000 to $1.5 million, violating these acts and regulations can result in severe financial losses for your practice, and thus, a damaged reputation. As a result, it’s important that you take note of the following standards that can protect you, in addition to the Department of Health and Human Services, and the Office of the Inspector General:

• Social Security Act - This act outlines the funding requirements for Medicare, Medicaid, as well as other reimbursement programs. 
• False Claims Act - Insurance is a central component of healthcare programs, and this act regulates insurance programs to ensure that patients and healthcare providers are reimbursed with the correct amount. It helps sort through claims to find genuity and authenticity.   
• Drug Enforcement Act - This works towards ensuring that drug distribution is even and fair, and is proportionate to what is needed. 

Regulation and governance impact on public health

When it comes to the impact of home rule within the ability of local governments to regulate and monitor public health, most refer to Dillon's Rule, which specifies that local governments can only exercise power through explicit state grants. However, local governments sometimes have more authority than the rule specifies depending on what states grant. This home system allows cities and countries to have a sense of governance, with law-making procedures needing to be transferred from the state legislature to local so they can make their own decisions. They have the authority, autonomy, and flexibility to implement standards and regulations that they see fit, and within reason. 

Health regulation regional links and resources

If health regulations seem daunting, there are a multitude of resources available to help you adhere to healthcare protocol and ensure that you keep patient information private. As a result, we have compiled some of the most useful resources and links to guide you in remaining compliant and making sure that patient information is regularly monitored, and stays confidential. 

• Guide to Privacy and Security of Electronic Health Information: This is a basic overview of HIPAA guidelines. The website has links to training games and risk assessment tools.
• State Attorneys General: A more comprehensive overview of what HIPAA and HITECH entail.
• CMS HIPAA Basics for Providers: Details of the role that providers play in adhering to HIPAA compliance, with additional information on how the breach notification rules and possible consequences of non-compliance. 
• World Health Organization: Catalog of resources to support health services delivery transformations.

The Role of Non-Compliance in Healthcare  

Risks of non-compliance 

In order to understand the full importance of healthcare, it’s important to know and understand the consequences so you know what to avoid, and how to elevate the quality and service of your practice. Failing to comply with healthcare regulations can result in heavy costs, financial or otherwise, so it is important to stay informed, educated, and up-to-date on healthcare standards.

• Fines, penalties, and other fees - If you fail to comply with regulatory standards, you may face expensive fines and penalties. These can vary greatly depending on the offense, and according to the General Data Protection Regulation (GDBR), low-tier fines can go up to $11.03 million for large businesses, or two percent of the company’s annual revenue, which can cause vast financial losses. If no action is taken, this could further escalate to confiscation of healthcare resources and equipment, which can have immense flow-on effects. Maintaining compliance early can significantly reduce the chances of running into problems that are potentially irreversible. 
• Business disruption - Patients need to be sure that you’re able to handle private information, and that their data remains confidential. If you cannot fulfill this need, clients are far less likely to trust your organization, which can prove difficult when retaining clients. Your patients may look at competing businesses, and you will have to spend double the amount of time to attract clients back! Privacy should be the highest concern when it comes to your business, so you can continue with smooth operations and prioritizing patient care.  
• Loss in revenue - If you fail to comply with healthcare security standards, you may have to cease operations in part, or entirely. Temporarily disabling business processes can restrict income, and thus increase overhead costs. For practices facing significant data violations and breaches, the large incurred costs make it difficult for businesses to recover, with fewer finances to be able to invest in medical services and equipment. This means the quality of service can also decrease, which can have devastating effects on your patients.   
• Loss in productivity - Productivity can also decrease if you breach particular security guidelines and compliance standards, as you may need to halt production, or disable areas of operations. Restricting output, labor, and working capacity mean you can’t treat as many patients as your resources allow.  
• Reputation damage - Above all, failing to comply with regulations can cause distrust amongst your patients, and can damage your reputation, which can be incredibly difficult to fix. Depending on the size and impact of your violation, this could be permanent, where your ability for patients to trust you is irreparable. This restoration process could take a long time, so it is important that you consider your impact on clients at all steps in the business process.

HIPAA violation tier

To reinforce the consequences that can occur when failing to comply with HIPAA standards, it is important to acknowledge the four tiers of penalties. These four tiers outline the financial repercussions that any security offense may incur, and taking note of these will ensure that you are aware of the penalties concerning violations. 

Tier 1

As the lowest level, this tier usually starts around $100, depending on the number of patients involved, and is the smallest penalty you can incur. At this tier, the individual cannot have been aware of the violation they committed.

Tier 2

While this also depends on the number of patients involved, this tier recognizes that individuals do acknowledge a degree of awareness when it comes to HIPAA regulations and standards. However, because they do not act with gross negligence, these costs start at around $1000, and don’t reach higher than $10,000. 

Tier 3

Employees knowingly commit a HIPAA violation, but also make a correction within 30 days. This must be made promptly to minimize penalties, as, at this level, violations start at around $10,000.

Tier 4

Beginning at $50,000 per violation, and with the potential to reach up into the millions, this is the most costly tier. The employee charged is acting with purposeful negligence, and does not correct their violation, which can cause immense damage for your practice; both financially, and concerning your reputation. 

‍Creating a culture of compliance within healthcare

To prevent extensive HIPAA violations and penalties, it's important that you create a culture of compliance within the workplace, so all employees are aware and up-to-date on security standards. This way, you can ensure that your employees follow and adhere to regulations to ensure that patient privacy is prioritized, and that you fulfill legal obligations concerning federal and state laws. Doing so will significantly reduce the risk of fraud, hacking, and other security breaches that can massively disrupt the operations and success of your practice. To avoid negligence, your staff need to be aware of how to recognize and report suspicious activity, as well as create a culture where employees feel safe to reach out and communicate if needed. Investing in healthcare compliance software is a good way to encourage a culture of compliance.

Considering that the healthcare workspace deals with highly sensitive medical information, it is highly important that you implement security measures within all business processes. Insurance providers often require the medical information you store, so with high transferability and verification levels of information, it is of utmost importance that you uphold compliance values. This means that only authorized users should have access to relevant medical records and history, and that encryption services are incorporated at each step along the way. All businesses, regardless of their size, must implement compliant processes as part of the healthcare governance, risk management, and compliance (GRC) act. No business is exempt, and your patient data should be regularly monitored and stored whenever possible.

In order to create a compliance culture that can properly handle security procedures, it’s important that you consider the following factors. Incorporating these can drive your business to success, as well as meet your patient needs. 

• Educate - The most important step to establishing a solid foundation when it comes to compliance, is making sure that your employees are aware of security procedures, as well as what happens in the case that they are violated. This can be accomplished through a variety of different methods, including providing the relevant resources to reduce the likelihood of negligence charges. Through a committed team dedicated to healthcare compliance, compulsory programs to ensure that your staff are qualified, or simply having physical resources that staff can use; it’s important that you incorporate a way to clearly convey the significance of compliance. 
• Quiz your employees! - Sometimes it’s good to use surveys to evaluate your staff’s knowledge of compliance, and to establish a baseline of what the current state of affairs is when it comes to security in the workplace. You can assess how comfortable employees are when reporting information, whether they know the right procedures to use, and how they typically go about security measures. This is a great, non-invasive way to gauge your employees’ knowledge and, as well as shedding light on areas that can be improved going forward.
• Campaign - Don’t shy away from clarifying compliance policies within your workplace through common marketing strategies. Sometimes, sending posters and emails is all that’s needed when it comes to reminding staff about their security requirements. 
  

‍Basic compliance reporting steps

When it comes to healthcare compliance, it can be tricky to understand what is considered an offense, and when dealing with highly confidential patient information, you definitely don’t want to overstep. As a result, we have compiled a few simple tips to help simplify the reporting process, and to help you recognize and work through the complexities of compliance. 

• Stop! - If you have a suspicion that you’re participating in the harmful activity, or that it is a violation of compliance in any regard, it’s important that you stop immediately. This is to ensure that you don’t complicate matters further, and can potentially save your practice from thousands of dollars in penalties and financial losses. 
• Speak up - If you’re uncertain, it’s best to speak to a supervisor or manager who is in charge to ensure that you’re not violating any security standards. It’s always good to double-check, and if you’re ever unsure, asking someone is the best way to make sure your concerns and queries are directly addressed. If speaking to a compliance officer specifically, your questions can’t be exposed, as your privacy is secured through legal binding. 
• Get external help - Sometimes internal help doesn’t work, and compliance officers, fellow practitioners, and other employees aren’t enough, which is okay! You may need to resort to external organizations such as the Department of Health and Human Services, the Officer of Inspector General for Medicare and Medicare issues, or an ombudsman. 

Keeping up-to-date with regulations

Healthcare compliance guidelines are widely known for their complexity, due to their ever-changing nature. New technology is continuously being developed, and the healthcare landscape is forever evolving as it adapts to new forces. You want to ensure that you stay on top of healthcare regulations to avoid dealing with security breaches that can jeopardize private information, and put your practice at financial risk from HIPAA penalties and fines. One violation is difficult to contain, let alone dealing with multiple, and so to protect yourself, you must make an effort to be knowledgeable about relevant legal laws and standards. 

• Have experience - Having experience in either the public or private policy sector is always a benefit, as it ensures that you are more equipped to handle various security breaches. If you have experience within the loss prevention and strategic management sector, this is even more beneficial as it can make dealing with compliance much easier. 
• Equip the right skills - You should have the ability to employ the right agile workstyle tools, including healthcare compliance software, and be able to easily pick up practices and apply them in a correct context. The rightly developed skill set should enable you to identify suspicious activity more quickly, and honing in on these skills encourages greater detection. It allows for an innovative and intuitive perspective when it comes to healthcare compliance.
• Have the right credentials - Sometimes employing relevant backgrounds and qualifications is the best way to fulfill legal obligations and standards, as it ensures that you have a theoretical understanding of security, and can approach situations with a critical lens.