DOJ Guidance on Evaluating Compliance Effectiveness

The Department of Justice (DOJ) has issued an update to their Evaluation of Corporate Compliance Programs (ECCP) guidance document.  They have also announced a new “Pilot Program Regarding Compensation Incentives and Clawbacks” which requires compensation be tied to corporate compliance, effective March 15, 2023. 

The latest updates signal the government’s expectations that providers establish financial incentives to reward compliant behavior while also establishing financial disincentives for non-compliant behavior.  The ECCP outlines the types of factors prosecutors will be considering when evaluating the financial incentives related to compliance:

  • Has the company considered the financial impact of its financial rewards and other incentives on compliance?
  • What role does the compliance function have in designing and awarding financial incentives at senior levels of the organization?
  • How does the company incentivize compliant behavior?
  • Are the terms of bonus and deferred compensation subject to cancellation or recoupment in the event non-compliant behavior is discovered?
  • Does the company have a policy for recouping compensation that has been paid where there has been misconduct?
  • Have there been specific actions taken (incentives or disincentives) based on compliance and ethics considerations?

In addition to the ECCP updates, the DOJ has launched a 3-year pilot program which will require organizations entering into criminal settlement agreements to implement compliance criteria into compensation and bonus structures.  The pilot program will also allow prosecutors the discretion to reduce fines when companies seek to recoup compensation from employees as well as individuals who had supervisory authority over the employee(s) or business area engaged in the misconduct and who knew of or were willfully blind to the misconduct. A company who makes a good faith attempt to recoup the compensation may potentially be eligible up to a 25% reduction in fines.

The DOJ continues to emphasize the need for effective compliance program essentials such as:

  • Education and training
  • Policy and procedures
  • Qualified and sufficient staffing
  • Open lines of communication and reporting 

It is clear it is time to start putting your money where your mouth is when it comes to compliance.  Having an effective compliance program is one of the greatest investments an organization can make.  We recommend reviewing your current compliance program efforts against the March ECCP update and making improvements where necessary.

The DOJ Evaluation of Corporate Compliance Programs Guidance can be accessed here:

The DOJ Pilot Program Announcement can be accessed here:

We are here to help.  The HBE team is available to assist you with all of your compliance program needs.  We routinely provide compliance partner services to large health systems as well as physician practices. Our services include:

  • Risk Assessments
  • Clinical documentation improvement reviews
  • Coding accuracy reviews
  • Policy and procedure development
  • Customized education and training for clinical and administrative staff

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