COMPLIANCE PROGRAMS One Size Does Not Fit All

BY JULIE JANEWAY, MSA, JD; Associate principal, Foley, Baron, Metzger and Juip, PLLC

Does your organization have a written compliance document as required by federal law? If so, was it purchased from a vendor who sent you a pre-packaged product that basically just inserted your pharmacy’s name and address? Was it purchased from a company outside of Michigan with no lawyer on staff? Whether you have one of these documents, or you don’t have one at all, you are guaranteed to be out of compliance with the law to at least some degree, and that means you are facing significant legal risks and potential financial penalties and sanctions.

What is a compliance program?

A compliance program is an organization-specific document that declares compliance or intent to comply with legal and accreditation requirements, and is a multifaceted infrastructure of rules, policies, training, penalties, internal controls, and prevention and response protocols that will reduce the incidence of noncompliance, detect it faster when it happens and attempt to prevent its recurrence. The purpose of a compliance program is to bring the organization into compliance with the law by deterring, preventing and correcting fraud, waste, abuse and other forms of noncompliance, and to set forth the framework and internal controls for an operational and ongoing employee system of compliance. It also serves as an important legal defense document if the organization is found to be in alleged violation of the law or violation of other requirements to which the organization is subject or has agreed by contract. Numerous federal and state laws require significant and tedious compliance efforts, and it can be daunting to keep track of all of them. Having a thoughtful and well-crafted compliance document is a start, but the document itself does not get the job done. Here are just a few of the reasons why compliance programs are not one-size-fits-all: • It requires a document and fully functioning program created specifically for the needs, risks and legal issues of the pharmacy – something pre-packaged compliance documents purport to provide but don’t fully achieve. • No two pharmacies are the same: size, operational features, location, restrictions, limitations and other aspects differ. • Each pharmacy often has very complex legal risks, issues and requirements, and pre-packaged documents often miss critical legal provisions and protections. • The document must address federal law, but also state-specific laws and regulations. These are often missed or improperly addressed by non-lawyer providers of pre-packaged documents.

• Adding a pharmacy name or a few employee names does not tailor the document to the needs of the specific pharmacy and is often evidence that the pharmacy does not have a functional compliance program. • Pharmacies within a chain of stores may not all have the same needs either, so each, or at least some, should have their own documents that coordinate with the compliance program established at the corporate level. • Generic documents try to cover too many different types of circumstances to be effective and make the document unreadable and unusable by employees at the pharmacy. • “Kitchen-sink” documents tend to undermine the legitimacy and compliance nature of the document and its use as a legal defense document. Legal precision, accuracy, a tailored approach, and a daily, operational compliance program is what gets the job done. In the unlikely event that your pharmacy is found to be out of compliance, and there are sanctions ranging from mildly aggravating to potentially catastrophic, your “compliance program” vendor is not going to help you. By using a compliance attorney, an attorneyclient relationship is already established. As a result of having drafted your compliance document/program, your attorney is fully aware of your organization’s legal environment, the contents of the compliance document and the relevant law. So instead of having a panic attack, all you have to do is call your attorney. Your defense is ready to hit the ground running. There are many non-attorney vendors who can provide services that are very helpful to your organization for a low cost. But using a non-attorney vendor to address your legal compliance program is not the place to save money, because it will cost you exponentially in the end. It’s just a matter of time. In the next issue – just in time for Halloween – we will explore the variety of annoying, chilling or down-right horrifying consequences that can result from having no compliance program, having a poorly-crafted one and failing to keep your compliance in check.