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Blog > Understanding Regulatory Compliance in Healthcare Industry

Understanding Regulatory Compliance in Healthcare Industry

VComply Editorial Team
June 8, 2024
7 minutes

Healthcare compliance laws play a big role for many reasons. Although it ensures the overall safety, privacy, and ethical standards within the industry, the first priority is patient safety by mandating high standards of treatment and care. Compliance with these laws will help prevent medical errors by setting high standards for care and treatment for patients.

What is Regulatory Compliance in Healthcare

Regulatory compliance in the healthcare industry is integral for keeping the patient information safe for a smooth delivery of high-quality healthcare services. It refers to the process and regulations all healthcare providers must follow to maintain legal and ethical standards, federal and state laws, guidelines, and regulations that are designed to protect patient safety, privacy, and overall health outcomes. 

The term Regulatory Compliance falls under the governance, risk and compliance (GRC) umbrella that covers all kinds of matters designed for companies to operate safely and legally. The main goal of compliance is to prevent fraud and secure patient data from breaches and unauthorized access, all the while making sure that healthcare providers maintain high standards of care.

What Happens When Compliance is Not Followed?

Failing to follow healthcare rules can pave the way to serious issues like fines, lawsuits, and harm to patients. Which is why it is super important to stay updated and follow the rules to avoid such problems.

Imagine a scenario where a healthcare organization struggles to keep pace with the rising volume, complexity, and ethical standards of regulatory compliance. This failure could have serious repercussions. 

For example, in May 2023, there were 75 data breaches of 500 or more healthcare records, 23 breaches of 10,000, and a whopping one million record data breach of 2.550,922 reported to the HHS Office of Civil Rights (OCR).

Majority of these breaches stemmed from ransomware attacks after a two-month period without any HIPAA enforcement actions. This surge in compliance failures led to “the imposition of two financial penalties by OCR for HIPAA violations, two enforcement actions by state attorneys general, and an FTC enforcement action against a non-HIPAA-regulated entity for the unpermitted disclosing of consumer health information.

Key Reasons for Healthcare Compliance Laws

Healthcare compliance laws play a big role for many reasons. Although it ensures the overall safety, privacy, and ethical standards within the industry, the first priority is patient safety by mandating high standards of treatment and care. Compliance with these laws will help prevent medical errors by setting high standards for care and treatment for patients. For example, the HIPAA law (Health Insurance Portability and Accountability Act) is designed to help with the secure handling of sensitive patient information for preventing data breaches and unauthorized access. 

Compliance also promotes ethical behavior among healthcare providers, maintaining public trust and ensuring the integrity of the healthcare system. They make sure that healthcare organizations function with integrity, steering clear of fraud and abuse. 

Sticking to compliance laws is key for healthcare providers to receive government funding and insurance reimbursements as they are critical for the financial stability of these institutions. Lastly, these laws help promote the growth and development of healthcare entities by conducting regular audits and assessments, benefiting both patients and providers.

That’s not all. Regulatory compliance helps healthcare providers adhere to established standards of care. This maintains high-quality healthcare services. Compliance with these standards ensures that patients receive consistent and effective treatment.

Let’s summarize! Healthcare compliance laws are formed for these key reasons:

  • Ensures patient safety by preventing medical errors
  • Protects patient privacy and secures sensitive information
  • Promotes ethical practices within healthcare organizations
  • Maintains public trust in the healthcare system
  • Ensures eligibility for government funding and insurance reimbursements
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What are Some of the Primary Healthcare Regulations?

  1. Health Insurance Portability and Accountability Act (HIPAA)

HIPAA is a foundational regulation for the privacy and security of health information. It sets standards for protecting sensitive patient data and ensures that healthcare providers and their associates implement appropriate safeguards.

  1. Health Information Technology for Economic and Clinical Health (HITECH) Act

Securing patient data against breaches and unauthorized access is a critical part of regulatory compliance. The HITECH Act ensures that electronic health records (EHRs) are protected, promoting secure data exchange. It improves HIPAA’s provisions by checking that healthcare providers use secure electronic systems for managing patient information. 

  1. Emergency Medical Treatment and Labor Act (EMTALA)

The EMTALA guarantees emergency medical care to individuals regardless of their ability to pay. It requires hospitals to provide necessary treatment to stabilize patients in emergency situations.

  1. Affordable Care Act

The Affordable Care Act (ACA), also known as Obamacare, brought sweeping reforms to the American healthcare system. It aims to improve access to healthcare, better quality, and reduce costs. Compliance with ACA regulations ensures proper administration of insurance plans and equitable provision of healthcare services.

5. Fraud and Abuse Laws

Several laws target fraud and abuse in the healthcare industry:

  • False Claims Act: Prevents fraudulent claims for payment to federal health programs.
  • Anti-Kickback Statute: Prohibits exchanging anything of value to induce referrals for services covered by federal healthcare programs.
  • Stark Law: Prevents physician self-referral for certain designated health services paid by Medicare or Medicaid.

List of the Major Regulatory Bodies and their Roles

  1. Department of Health and Human Services (HHS)

The HHS is the federal government’s primary body for overseeing healthcare regulations. It sets standards and guidelines for healthcare providers and ensures compliance with federal laws.

  1. The Office of Civil Rights (OCR)

The OCR enforces HIPAA regulations. It conducts investigations, ensures compliance, and penalizes entities that fail to protect patient health information.

  1. Accrediting Organizations and Professional Associations

Organizations like The Joint Commission and the National Committee for Quality Assurance (NCQA) set higher standards for healthcare quality and safety. Professional associations also play a role in establishing best practices and compliance standards.

  1. Occupational Safety and Health Administration (OSHA)

OSHA ensures the safety of healthcare workers by setting and enforcing standards that protect employees from workplace hazards. Compliance with OSHA regulations is crucial for maintaining a safe healthcare environment.

Regulatory Compliance in Healthcare: Challenges and Solutions

Healthcare regulations can feel like a tangled mess, and keeping up with them can be a real headache. Here are three big hurdles compliance officers face:

  • The Cybersecurity Challenge

Healthcare organizations are treasure troves of patient data, making them prime targets for cyberattacks. That’s why having top-notch security systems is crucial. Think of it like having a castle – any weak point in the walls can be exploited. Even the smallest breach can damage your reputation and trust. The best defense is a multi-layered approach, with security measures tailored to the size and seriousness of the threat. Regular training for your staff is also key – a well-informed team is a strong defense.

  • The Start of Telemedicine

The rise of telemedicine, where doctors connect with patients remotely, has been a game-changer. But for compliance officers, it’s a new frontier with murky regulations. Figuring out how to regulate telehealth while keeping cybersecurity at the forefront is a major challenge.

  • Ethical Hiring of the Right People

Hiring qualified staff is a constant battle for healthcare organizations. Ideally, you want people with a strong grasp of healthcare compliance, but finding the right talent can be tough. The key is to have a thorough screening process that’s both effective and ethical. By finding people with the right knowledge base, you can make sure your policies are in line with the changing regulations.

Let’s look at the solutions regulatory compliance can bring to the table for these challenges:

  • Constantly Changing Regulations and Updates

Healthcare regulations are continually evolving, which can make compliance challenging. Staying updated with federal and state regulations requires ongoing education and adaptation.

Solution: Implementing a robust compliance management system that includes regular updates and training can help organizations stay compliant.

  • Addressing Data Breaches and Secure Data Exchange

Data breaches pose a significant threat to healthcare compliance. Ensuring secure data exchange and protecting patient information are critical challenges.

Solution: Adopting advanced cybersecurity measures and encryption technologies can improve data security. Regular risk assessments and security audits are also key.

  • Implementing Effective Training Programs and Policies

Effective training programs and clear policies are crucial for ensuring that all staff members understand and comply with healthcare regulations.

Solution: Using healthcare-specific learning management systems (LMS) for regular training and policy updates ensures that employees are well-informed about compliance requirements.

  • Relying on Technology for Managing Healthcare Information

Technology can simplify compliance processes by automating tasks and providing real-time monitoring of compliance activities.

Solution: Executing healthcare-specific compliance software can smoothen the management of patient information and improve overall compliance efforts.

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How to Comply with Healthcare Regulatory Requirements

Keeping up with healthcare regulations can feel overwhelming, but it’s an essential part of providing excellent patient care. Here’s a 5-step plan to make compliance a breeze:

1. Stay Updated

Healthcare regulations are constantly exposed to changes, so staying informed about new developments in laws, regulations, and guidelines are key. Setting up a system to monitor updates from key regulatory bodies, reviewing industry publications, attending conferences, and continuing education are all key ingredients to keep up with compliance trends.

An agile-cloud GRC management platform like VComply can promote a compliance culture across the organization with minimal effort – helping teams stay on top of potential fines and data breaches. Staying ahead of the curve and preparing the staff with accessible tools can greatly smoothen workflows and ensure compliance with the changing regulations.

2. Do a Gap Analysis 

Before you tackle compliance, figure out where your organization stands. Do a compliance gap analysis to identify areas that need improvement in the organization – such as current compliance practices, spotting non-compliance areas, and evaluating associated potential risks and consequences. The analysis will help you prioritize and build a strong compliance plan.

3. Make a Plan

Your compliance plan should be a roadmap to success. This compliance plan is made from the insights and data from the compliance gap analysis. It should set clear goals, outline policies and procedures, and include staff training programs. Don’t forget to allocate resources – you can’t achieve compliance without the right tools!

4. Protect Patient Privacy

This is a big one. Protecting patient privacy and data security is crucial. Invest in secure storage systems, access controls, and encryption. Have an incident response plan in place for data breaches – a quick response can reduce damage and protect your organization’s reputation.

5. Keep Good Records

Accurate documentation is your best friend. Maintain accurate billing and coding practices, conduct regular audits, and have a system to catch fraud. Form mechanisms to prevent and detect frauds and abuse. Also, the documentation has to be securely stored, with proper access controls and retention policies. Remember, good records are proof of your compliance efforts. So, regularly review and maintain documentation for an outlined period to make sure to go in tune with the healthcare regulatory standards.

Bonus Tip: Compliance is Everyone’s Job!

Grow a culture of compliance by rewarding ethical behavior and open communication. Regular training and resources will empower your staff to make smart choices and uphold the highest standards.

To have a healthy culture of compliance in clinical trials, sponsors and CROs should maintain:

  1. Keep up with changes in global regulations by developing and maintaining a strong compliance code of conduct.
  2. This code should aim for a culture of compliance in the workplace and include the following elements:
  • Purpose and Scope: Define the compliance policy’s purpose and outline the regulations it covers.
  • Applicability: Specify who must follow the regulations, noting any exceptions or limitations.
  • Regulation List: Give a detailed list of regulations and outline the steps and procedures for compliance.
  • Violation Protocols: Set communication protocols for reporting violations, including the authorities to notify.
  1. Monitoring and Review: Set up procedures for ongoing monitoring and schedule periodic reviews of compliance efforts.
  2. Clearly document the compliance processes, detailing the roles and responsibilities of all staff involved in compliance management. This documentation is essential for regulatory compliance audits, whether conducted internally or by an external party.
  3. Regularly review the regulatory compliance policy to identify and correct weaknesses and ensure it remains current with the latest regulatory changes. 
  4. Set up a process for responding to complaints, violations, or information breaches, including appropriate disciplinary actions for employees who fail to meet conduct standards.
  5. Provide regular training for employees on regulatory compliance via workshops and training sessions, and periodically assess their analysis of compliance requirements. Make sure they can dig out phishing attempts and other cybersecurity threats with thorough and ongoing security awareness training.

Technology in Healthcare Compliance

Adopting technology can significantly improve healthcare compliance efforts. Here’s how:

  • Compliance Management Software: Platforms like VComply can streamline compliance activities, automate monitoring, and facilitate reporting.
  • Electronic Health Records (EHRs): Secure and comprehensive EHR systems help maintain accurate and accessible patient records, crucial for compliance.
  • Data Encryption Tools: Applying advanced encryption techniques makes sure patient data is protected during storage and transmission.
  • Automated Auditing Tools: These tools can regularly check for compliance issues, reducing the risk of human error and ensuring consistent adherence to regulations.
  • Incident Response Systems: Quick and effective incident response systems for data breaches can reduce damage and show compliance with data protection regulations.

With technology, healthcare organizations can create more efficient, effective, advanced, and secure compliance processes, ultimately improving patient care and organizational integrity.

Read: Beyond Tracking: How VComply’s Compliance Monitor Elevates Oversight

Experience Better Healthcare Compliance with VComply

Keeping up with healthcare regulations can feel like chasing a moving target. The good news is, you don’t have to do it alone. Regular assessments and staying informed on the latest trends are key, but adapting your strategies is just as important. By being proactive and responsive, your organization can stay compliant in this dynamic field of healthcare. 

An advanced compliance software like VComply can be a game-changer, automating tasks and streamlining your efforts. With features like automated workflows, pre-built framework library, common control mapping, real-time alerts, and evidence management, VComply scales healthcare organizations to actively address compliance issues and requirements and easily tackle risks to boost overall agility and efficiency.