Summary: In general, a compliance program consists of a Medicare provider organization's internal policies, processes, and procedures that help it prevent and detect violations of Medicare law. According to recent surveys, most hospitals either had or planned to soon implement a compliance program, but no readily available data exist on program prevalence. Direct program costs appear to account for less than one percent of total patient revenues; indirect costs may be larger. Lacking compliance budgets, hospitals cannot always distinguish between compliance program and normal operations costs. Comprehensive baseline data with which to measure programs' effectiveness are lacking. The costs associated with gathering baseline data on the amount of improper payments made to providers--or comparison data for providers without compliance programs--have precluded the use of this effectiveness measure. Although hospital officials reported that program benefits outweigh costs, Medicare contractors reported receiving refunds of provider overpayments with more frequency, and formal provider self-disclosures have increased in recent years. This preliminary evidence, however, does not demonstrate that compliance programs have reduced improper Medicare payments. According to hospitals, the major intangible indicator of effectiveness is an increased corporate awareness of compliance as shown by frequent calls to compliance staff or hotlines for guidance. Some hospitals plan to measure improved employee knowledge of compliance issues, risk areas, and procedures in conjunction with compliance training.
