Every day healthcare providers must undertake the nerve-racking task of complying with an increasing number of healthcare regulations. According to one report, the healthcare industry spends nearly $39 billion every year on the administrative burdens of regulatory compliance.
Today healthcare organizations must comply with more than 600 regulatory requirements. The regulations that concern healthcare encompass numerous occupational sectors, ranging from pharmacies and insurance companies to cloud service providers.
This article serves as a resource to build the basic foundation of a regulatory compliance program.
What Does ‘Regulatory Compliance’ Mean?
Regulatory compliance is the set of processes and procedures that support an organization’s adherence to the regulations, laws, and other requirements that exist wherever the organization operates. This can include national or state laws, industry regulations, or even contractual obligations among private enterprises.
Regulations exist to protect society, and organizations need to follow the rules and respect the codes of practice relevant to their operations. Although many healthcare facilities may consider healthcare compliance requirements to be a hindrance to success, an effective program to comply with regulatory obligations can actually be a competitive advantage.
What Is Regulatory Compliance in Healthcare?
Compliance obligations specific to healthcare can include a broad spectrum of practices, but the majority of healthcare compliance issues relate to patient safety, the privacy of patient information, and government reimbursement for healthcare expenditures. In the largest sense, regulatory compliance in healthcare is about providing high-quality patient care.
Healthcare professionals routinely compile and access electronic health records. Therefore, maintaining patient privacy and results as those things are collected has become a vital component of the healthcare industry. Failure to protect all that data — that is, failure to meet compliance obligations — can result in costly monetary penalties from regulators.
For example, as of August 2021, the U.S. Department of Health & Human Services had imposed monetary penalties in more than 100 cases totalling $135.3 million. Given that financial threat, understanding your compliance obligations, and meeting those obligations, can save millions of dollars in penalties (on top of the value of patient trust).
Regulatory Requirements for Healthcare Organizations
Healthcare is more heavily regulated than almost any other industry. Below, we explain five major laws that govern healthcare compliance in the United States.
Health Insurance Portability and Accountability Act (HIPAA)
HIPAA compliance comprises the rules on privacy and security, breach notification, and enforcement for protecting healthcare system information.
The HIPAA Privacy Rule applies to all healthcare providers and entails all media: electronic, paper, and oral. It grants patients rights to see their own protected health information (PHI) and requires disclosure of how that information is used.
Healthcare facilities are also obliged to update security measures to continue safeguarding medical records in a changing environment. Under HIPAA, the Department of Health and Human Services (HHS) sets boundaries on the release of health records and establishes fines for violations.
Anti-Kickback Statute and Stark Law
The Anti-Kickback Statute and the Stark Law are designed to keep medical treatment decisions free from the influence of hidden financial arrangements between healthcare workers and hospitals. These laws are important because improper financial incentives can lead to improper medical decision-making and higher expenses for Medicare and Medicaid services.
Patient Safety and Quality Improvement Act (PSQIA)
The goal of this law is to stimulate safety culture by providing peer review assessments for the information reported on healthcare errors. The law established new patient safety organizations (PSOs) to prevent the information from being used in lawsuits against the PSO.
The PSO acts as the principal vehicle to gather data about adverse medical events and to assist providers in implementing practices to reduce adverse events and build cultures of safety, while increasing the quality of care.
The Health Information Technology for Economic and Clinical Health (HITECH) Act
Before the HITECH Act, only a small number of hospitals adopted electronic medical record systems, which led to a rise to inefficiencies in public health. HITECH was meant to encourage more use of electronic medical records, while preserving the privacy and security of that healthcare data.
Affordable Care Act (ACA)
As the name itself says, the goals of the ACA are to extend health and insurance coverage to more people and to encourage innovative medical care delivery methods developed to minimize the costs of healthcare.
The ACA created a Health Insurance Marketplace and stopped insurance organizations from refusing coverage because of pre-existing conditions.
Make Compliance Part of Your DNA With ZenGRC
At Reciprocity, we know that having a solid compliance program that adheres to HIPAA and other regulations is part of your commitment to quality patient care. For that reason, we built ZenGRC to help you stay on top of the compliance requirements.
If you are overwhelmed with managing health information and compliance in spreadsheets, ZenGRC is the solution you need for a more efficient compliance process. Schedule a demo now and we will show you how ZenGRC can simplify your processes, build more effective compliance, and drive your business forward.