Rules and regulations are part of daily life for medical laboratories. That includes laboratory outreach programs. It’s rare that someone intentionally engages in fraudulent, wasteful, or abusive practices. Therefore, it is essential that compliance programs prevent any opportunity to even accidentally engage in these activities. An effective compliance plan ensures all outreach practices are compliant with legal guidelines.

The importance of compliance plans

In 1997, the Office of Inspector General (OIG) published a model voluntary compliance plan for clinical laboratories to ensure claims sent to a federally funded healthcare program are deemed medically necessary. While healthcare providers assign diagnosis codes to support medical necessity, the OIG expects the laboratory to ensure this step is performed correctly.

Although published as voluntary, most laboratory outreach programs consider the OIG compliance plan mandatory and create compliance plans to support their business needs and fulfill the mission of providing quality services.

The OIG’s plan provides many guidelines for what a laboratory compliance program should do but little advice as to how to accomplish or implement it. This lack of direction can be frustrating but is intended to provide the flexibility to implement a plan compatible with the unique confines and practices of each laboratory.

Review current guidelines to prepare for 2025 updates

The OIG is set to publish a new laboratory compliance program in 2025. Becoming familiar with the current compliance plan will prepare laboratories to adopt the new standards as needed.

The OIG model compliance plan suggests the following foundational tenets:

• Physicians can order any test they deem appropriate, but Medicare will only pay for tests that are covered, reasonable, and necessary.
• Other individuals, such as advanced practice providers, may be allowed to order laboratory tests in some states.
• Additional information, such as diagnosis code information, may be obtained from an authorized individual, not just the physician.
• Physicians are required to submit diagnostic information to the laboratory when ordering laboratory tests.
• Standing orders are permitted, but only when necessary.
• Laboratories should not establish pricing strategies for non-federal health program testing to induce the physician into sending federal healthcare business.

The OIG model compliance plan suggests maintaining compliance by:

• Supporting employees with a designated compliance officer who provides oversight, written standards of conduct, and ongoing education and training programs.
• Developing written policies that promote the laboratory’s commitment to compliance, with a focus on areas where fraud or abuse can occur, such as billing, sales, and marketing.
• Completing routine audits to monitor compliance and develop evaluation techniques to ensure compliance across all affected areas of the laboratory.
• Managing personnel concerns with a formal tracking process and plan for managing consistent personnel problems when issues are identified. This includes having compliance competency in every job description, ensuring that all supervisory or management staff are fully trained in compliance, and having an appropriate course of action for staff who fail to support laboratory compliance.
• Creating a recordkeeping system to comply with recordkeeping and document retention requirements.
• Providing an anonymous compliance reporting line to allow employees to share any concerns without fear of retaliation.

Familiarizing yourself with these expectations and guidance will help you prepare to evaluate and update your compliance plan when OIG shares its 2025 update. More importantly, it gives you an opportunity to reflect on your current compliance plan to determine if there are opportunities to strengthen or improve it to better support your business objectives and mission.

The enclosed information is not intended to provide accounting or legal advice. Consultation with financial experts and legal counsel within your organization is recommended.