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Many compliance officers find it difficult to establish a positive working relationship with legal counsel. There are certain areas where the compliance officer should operate without the direct involvement of legal counsel, and others where legal counsel should be involved, if not in charge. The challenge is finding the right balance in the authorities. In an effort to shed light on this subject, a group of experts have weighed in.
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Steve Forman, CPA, has over 30 years of healthcare compliance experience, including serving as an executive in the Department of Health and Human Services (HHS) Office of Inspector General (OIG), Chief Compliance Officer for one of the nation’s largest healthcare systems, and as a compliance consultant. Steve found that relations between compliance and legal counsel frequently have serious problems. The worst situation occurs when the compliance officer allows the natural tension between the functions to devolve into a “turf war.” What follows most often is dysfunction, with the compliance officer often coming out on the losing side. Steve advises compliance officers to not challenge legal counsel’s authority. Instead, compliance officers should focus on establishing a policy that clarifies and delineates the roles and responsibilities of each function and explains how they can coordinate efforts effectively. It is imperative that this is done before a major contentious issue arises. It is almost like entering into a treaty between the functions that require some diplomacy and compromise. The compliance officer must have the independent authority to interview employees and managers, as well as review all documents and information that relate to compliance laws and regulations. However, legal counsel should be consulted regarding legal advice or a second opinion on a matter.
When there are indications of a potential violation of law or regulation, legal counsel should be consulted on what further investigative steps would be appropriate, including whether the investigation should be conducted at the direction of legal counsel. Further, legal counsel should take the lead when a matter involves a regulatory or enforcement agency or legal issues with another party. This delineation allows for the easy assignment of tasks when an issue comes up. Legal counsel is primarily in charge of contract drafting, negotiation, and review; compliance handles violations of the Code of Conduct, policies and procedures, or other wrongdoing by those employed or engaged by the organization.
Carrie Kusserow has over 15 years of healthcare compliance experience as a compliance officer and consultant, and underscores the importance of addressing the relationship between the two functions before conflict arises. She states there are philosophical differences between the compliance officer and legal counsel. The latter focuses on providing legal advice and does not act as the decision authority, whereas the compliance officer is a program official that must make decisions and not just offer advice. Compliance officers are most likely to receive complaints warranting investigation through the hotline or provided directly to their office. They should be able to independently investigate and act on matters related to compliance. They should also ensure appropriate remedial actions are taken when weaknesses are identified through investigations. When potential violations of the Code, policies, standards, regulations, or applicable laws are alleged, the compliance officer should conduct an initial inquiry. This inquiry is used to determine either that the allegation is baseless or that there is sufficient information to warrant further investigation. There may be situations where employees or other covered persons may have participated in serious misconduct or committed other malfeasance related to their employment or engagement on the organization’s behalf. In such situations, the compliance officer should work closely with legal counsel, who can provide guidance regarding such issues. Upon reasonable indication of suspected noncompliance with any criminal, civil, or administrative law, investigations should be conducted by legal counsel, or by the compliance officer under the direction of legal counsel. Furthermore, in light of timely reporting requirements, credible issues related to billing and reimbursement should be turned over to legal counsel as expeditiously as possible.
Suzanne Castaldo, JD, served as an attorney for seven years before becoming a healthcare compliance consultant. Suzanne points out that in cases where legal counsel takes over an investigation, it will be their responsibility to notify senior management of investigation results. Additionally, legal counsel is also responsible for providing the compliance officer with sufficient details of its investigation to show that it is properly addressing the issue. If the investigation does evidence a potential violation of law, legal must immediately notify appropriate enforcement authorities. When legal counsel takes over an investigation, a memorandum should be prepared stating they have done so in anticipation of possible litigation. Thereafter, all documents produced during the investigation under direction of legal counsel must include the statement: “Privileged and Confidential Document; Subject to Attorney-Client Privilege; Attorney Directed Work Product.” Senior management should be notified of the results of the investigation and provide the compliance officer with sufficient details of the investigation to show that the issues raised were properly addressed.
- During formal briefings of the executive/management and Board compliance committees, educate them on the expected roles, responsibilities, and empowerment of the compliance officer, citing relevant sections from the OIG compliance guidance documents, public statements, whitepapers, and Corporate Integrity Agreements.
- Work with legal counsel to develop protocols in the form of a policy with procedures that delineate respective duties and responsibilities of the compliance program, particularly where it comes to investigating potential wrongdoing.
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