The move by many in the health care industry to develop corporate compliance programs came after passage of the Health Insurance Portability and Accountability Act of 1996. This Act gives the Department of Health and Human Services’ Office of Inspector General and the U. S. Department of Justice more investigational funding and authority to increase penalties for health care fraud and abuse.
To protect their institutions from liability, health care providers are implementing corporate compliance programs using the seven elements outlined in the U. S. Sentencing Guidelines for Organizations and appointing corporate compliance officers to develop, implement, and manage them.
While law does not require an organization to meet the Guidelines seven elements of a compliance program, these elements provide the backbone of a well-designed compliance program. An organization that is found guilty of violating federal criminal laws and has a compliance program in accord with the Guidelines, may reduce assessed penalties by up to 70% against the fines that the law requires.