Importance of Regulatory Compliance in Healthcare

No other industry in the U.S. economy is subject to more regulation than healthcare. Hospitals and private practices aren’t the only enterprises with compliance obligations within this sector. Insurance carriers, cloud service providers, pharmacies, medical equipment manufacturers, and other organizations in this industry must comply with various health and safety regulations.

Regulatory compliance in healthcare ensures quality care for patients. It also reduces waste, fraud, and abuse that threaten the efficiency of healthcare delivery and services. In this blog, we’ll outline the fundamentals and importance of regulatory compliance in healthcare in the U.S.

What Does Regulatory Compliance in Healthcare Involve?

Complying with healthcare regulations and standards means following rules and guidelines that protect patient and worker safety, prevent waste and abuse of federal funds, and uphold privacy surrounding personal health information (PHI). Regulatory compliance also involves preserving the highest standards in ethical practices and quality of patient care. You can break down regulatory compliance into the following issues:

  • Patient safety: Providers and all staff who care for or interact with patients must take all the necessary measures to control infection, prevent medical errors, and protect patient and employee safety.
  • Coding and billing: All physicians and healthcare providers must maintain accuracy and avoid misconduct in all billing activities. Also, all insurance and Medicare or Medicaid claims must only include charges for services and treatments ordered and deemed necessary.
  • Patient privacy and data security: Healthcare organizations and medical facilities must safeguard PHI and any personally identifiable patient data (e.g., name, phone number). They must also prevent unauthorized access to such information.

Key Healthcare Regulations

Within the realm of healthcare, the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (HHS) enforces laws relevant to patient care, healthcare delivery and billing, and workplace safety in the U.S. All healthcare organizations must be aware of and comply with the following laws and standards.

HIPAA

The Health Insurance Portability and Privacy Act (HIPAA) applies to anyone who interacts with patients or handles PHI. Applicable PHI includes medical records, insurance information, and details regarding payment. HIPAA includes several rules addressing data security and privacy that protect all patient-related data within U.S. healthcare. Under HIPAA, organizations and providers are required to

  • Allow patients to view their PHI
  • Fully disclose to patients how they use PHI
  • Regularly update their data security measures to adapt to technological advancements and other changes in the digital landscape

ACA

Also called Obamacare, the Patient Protection and Affordable Care Act (ACA) enables access to the Health Insurance Marketplace to expand healthcare coverage to more Americans and help patients reduce their healthcare costs. One of the ACA’s most significant features is prohibiting health insurance companies from using patients’ pre-existing conditions to justify denying or limiting coverage.

Anti-Kickback Statute and Stark Law

Providers who stand to gain financially from medical decisions potentially undermine quality patient care and ethical practices. To address this problem, the Anti-Kickback Statute and the Stark Law prevent unseen or clandestine financial arrangements between healthcare staff and hospitals from influencing decisions like ordering certain medical procedures or the prescription of drugs.

The Anti-Kickback Statute applies to all providers who make service referrals. By comparison, the Stark Law pertains only to physicians.

HITECH Act

The Health Information Technology for Economic and Clinical Health (HITECH) Act promotes using electronic medical records (EMRs) in various medical settings. It also supports HIPAA enforcement by requiring healthcare organizations to take proper data security actions. The HITECH Act is a response to organizations’ increased reliance on EMRs to document, use, share, and transfer patient data.

OSHA

The Occupational Safety and Health Administration (OSHA) is the federal agency that mandates employee safety and upholds working conditions. OSHA regulations are implemented to reduce the risk of injuries, illnesses, and accidents. To this end, healthcare and medical facilities must:

  • Regularly assess workplace hazards and risks in the environment
  • Provide annual training to employees on workplace safety and well-being
  • Provide personal protective equipment (PPE) to all employees who need or request it. Regulations also mandate the proper use, storage, and disposal of PPE.

Patient Safety and Quality Improvement Act (PSQIA)

The Patient Safety and Quality Improvement Act (PSQIA) of 2005 spurred the development of a system to encourage healthcare staff to report medical errors voluntarily. The PSQIA also led to the creation of Patient Safety Organizations (PSOs), which collect data about adverse health outcomes resulting from mistakes and negligence. The intent of the PSQIA is to advance efficiency, prevent error, improve quality care, and encourage safety cultures within hospitals and other healthcare facilities.

Staying abreast of all the necessary healthcare regulations can seem overwhelming without the right resources and support. At Compliancy Group, we can help familiarize you with and help you navigate essential healthcare laws. We also specialize in tools and strategies that streamline your processes to help you stay compliant. Contact us today to learn about how our compliance software can meet your business needs.

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