A Reminder About Compliance

The FDA believes corporate compliance programs are important to ensure that the medical products a company sells or distributes are safe and effective for their intended use. The FDA looks for proof in the quality of a company's compliance program that the consumer will consistently receive acceptable products.

The following overview, excerpted from a Model Compliance Plan for Clinical Laboratories developed by the Office of the Inspector General of the Department of Health and Human Services, lists the basic steps companies should take in establishing a compliance plan.

INTRODUCTION

The Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) and other Federal agencies charged with responsibility for enforcement of Federal law have emphasized the importance of voluntarily developed and implemented compliance plans. In recent years, the OIG has been asked to supply guidance as to the elements of a model compliance plan.

The creation of model compliance plans has become a major initiative of the Office of Inspector General (OIG) in its effort to engage the private health care community in the fight to combat fraud and abuse. Many providers and provider organizations have expressed an interest in better protecting their operations from fraud through the adoption of corporate plans which promote compliance with applicable laws and an ethical corporate culture. In developing these compliance plans, the OIG works closely with the Health Care Financing Administration and various sectors of the health care industry.

STEPS OF MODEL COMPLIANCE PLAN

1. An organization must establish compliance standards, procedures and policies to be followed by its employees and other agents that are reasonably capable of reducing the prospect of violations of Federal or State law or company policy.

2. An organization must assign specific individuals, high in the corporate structure, to have overall responsibility to oversee compliance with such standards, procedures and policies as well as to use due care not to delegate substantial discretionary authority to individuals whom the organization knew, or should have known through the exercise of due diligence, had a propensity to engage in illegal activities.

3. An organization must take steps to communicate effectively its standards and procedures to all employees and other agents through participation in training and educational programs or by disseminating publications that explain in a practical manner what is required.

4. An organization must take steps to achieve compliance by utilizing monitoring and auditing systems reasonably designed to detect illegal or unethical conduct by its employees and other agents.

5. An organization must develop lines of communication between employees and the compliance officer to permit the reporting of potential violations or to clarify company policy.

6. An organization must consistently enforce its standards or policies through appropriate, well-publicized disciplinary mechanisms. Appropriate discipline of individuals responsible for an offense is a necessary component of compliance.

7. An organization, after an offense has been detected, must take all reasonable steps to respond appropriately to the offense and to prevent further similar offenses including any necessary modifications to its systems or company policies.

Note: Full text of the Model Compliance Plan for Clinical Laboratories, developed 3/97 and revised in 1998, as well as other current information on HHS compliance issues, can be found on the internet at www.hhs.gov/progorg/oig/modcomp/modcomp.html

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