Board Members’ Roles in HHSC Compliance Program

  1. Bloomberg BNA—Health Care Program Compliance Guide Monthly Focus
    • New Federal Statutes make BOD oversight more important
        • 60 day repayment window for credit balances

      • False Claims Act changes make it easier for whistleblowers
      • “Intent Standard” for anti-kickback law amended to not require direct knowledge– “known or should have known” is new language
    • More aggressive anti-fraud cases–Less sympathy from prosecutors
    • Permissive exclusion Authority–
      • Directors excluded from Medicare if they”knew or should have known”
      • Even higher standard for BOD members—without any direct or indirect knowledge
      • BOD should trust management’s reports and input but question as they see fit and when things come up.
    • BOD should support management’s efforts to make compliance program “state of the art”
  2. HCCA—Compliance Officer’s Role in Board Oversight of Compliance Program
    • CO should report directly to the CEO and BOD
    • CO should be high in the management structure to reflect organization’s commitment to compliance
    • Education of BOD members should be provided regularly
    • There should be an active BOD or subcommittee scrutiny of issues, minutes, reports.
  3. Roach—Board of Directors’ Role in Compliance and Ethics
    • Federal “Organizational Sentencing Guidelines” revised and strengthened
      • BOD plays pivotal role in compliance
      • Should be knowledgeable about the content and organization of the compliance program
      • BOD should exercise reasonable oversight with respect to implementation and effectiveness of the compliance program.
    • BOD should request information about risk assessment process
    • Read the newspaper and ask questions about items they read/hear
    • Align incentives for expenditures, compensation, review with compliance goals
    • Encourage transparency in deliberations and compliance updates
    • Initiate relevant, regular, and substantive compliance reports to the BOD
  4. Governance Institute—Government Targets Healthcare Officers Directly
    • Individual liability is a looming and realistic possibility for hospital executives and leadership
    • BOD members held responsible regardless of direct involvement
  5. Governance Institute—Guide to BOD Oversight Duties
    • Compliance as part of fiduciary duty is “hot, hot, hot topic”
    • Expectations of BOD members increasing
    • Caremark decision has changed landscape for BOD members—more responsibility
    • BOD members must make “reasonable inquiry” when confronted with extraordinary facts or circumstances.
    • Recommended compliance structure of multi-hospital systems is what HHSC currently has. Regional Boards should also be active in compliance for their regions.
    • Recognize the dramatic regulatory focus on quality and patient care that is occurring
    • BOD members must be prepared to have “titanium spine”—be tough, consistent, follow through, and follow-up.

About Hawaii Health Systems Corporation

HHSC consists of five regional systems operating 9 facilities throughout the State of Hawaii: East Hawaii Regional system operates Hilo Medical Center, Ka’u Hospital, Hale Ho’ola Hamakua and Yukio Okutsu State Veterans Home; West Hawaii Regional system operates Kona Community Hospital and Kohala Hospital; Oahu Regional system operates Leahi Hospital and Maluhia; and Kauai Regional system operates: Kauai Veterans Memorial Hospital, and Samuel Mahelona Memorial Hospital. HHSC has three nonprofit affiliates: Kahuku Medical Center operating a critical access hospital and long-term care facility in rural Oahu; Ali'i Community Care Inc. doing business as (1) Roselani Place providing assisted living on Maui, and (2) Ali'i Health Center: a physician practice in Kona; and Hawaii Health Systems Foundation.

Established by the Legislature in 1996, HHSC is a public benefit corporation of the State of Hawaii. As such, HHSC provides essential safety-net hospital and long term care services throughout the State. Since 1996, HHSC has and continues to fulfill the State’s promise to provide high quality, healthcare to all regardless of whether an individual has health insurance or the ability to pay for the healthcare services they receive.

HHSC Media Contact:
Debbie Hirano, CEO Secretary/Board Secretary
808-733-4151, dhirano@hhsc.org