Compliance programs, which help medical practices avoid fraud through prevention and detection, are now mandatory. Under the Affordable Care Act, any provider who bills Medicare or Medicaid must now have a compliance program, with training, policies and protocol in place for identifying and reporting financial misconduct, according to Physicians Practice. Practices that are already quite busy may have difficulty creating a compliance plan, but it is a necessary step to take.

The Centers for Medicare and Medicaid Services has not yet released exact guidance on how to create a compliance program, but there are recommendations from the Office of Inspector General for solo practitioners and small group practices that date to 2000. There are seven components of the program outlined in that guidance, which are: internal audits and monitoring, designating a compliance monitor, establishing standards and procedures, conducting training, responding to offenses with appropriate corrective actions, maintaining open lines of communication and having clear guidelines for disciplinary actions.

All about billing fraud
Health care fraud represents between 3 percent and 10 percent of annual government healthcare spending, which ends up costing taxpayers between $80 billion and $200 billion a year, according to the National Healthcare Anti-Fraud Association. It's rare that providers commit deliberate fraud, but the new regulations expose all practitioners to some risk.

For example, those who accidentally find themselves on the wrong side of anti-kickback statutes or who return overpayments late can be subject to civil and criminal penalties. These issues can arise from a swamped administrative department rather than any type of malice, but the consequences are the same no matter what the intentions.

"If you do get caught with a billing issue, a good compliance program can help deflect some of the additional charges you might otherwise be required to pay," Russell Still, executive vice president of Medical Management Associates, told Physicians Practice. "If you have an operational plan in place, you can potentially deflect some of that." The government has the right to ask for overpayments back, of course, but can also triple that amount in penalties. Billing issues can be very costly for a practice.

Creating a strong compliance program
For this reason, practices must make the most effort possible to create a compliance plan. Bringing every employee at the practice on board with this goal is vital. A review of the possible consequences involved in noncompliance or not having a plan is likely to be enough to drum up the necessary support. Past that point, practices may find it useful to form a special compliance committee. This will ensure those working on the issue are heavily invested in it, and will also be an ideal way to find and appoint a compliance monitor.

Other steps a practice can take toward an effective compliance program also exist. This can include working with a revenue cycle management company to ensure medical billing is done by a specialist third party, which can reduce any errors. It also removes the need to retain an in-house medical billing and coding staff, which means fewer people to train on the complexities of compliance. This can be a useful step for many practices, particularly those that are very busy or understaffed.