Changes To New York’s Compliance Program Requirements

September 14, 2020


New York’s Social Services Law (“SSL”) § 363-d sets out the elements that are required in order to have an effective compliance program under New York law. Amendments to SSL § 363-d went into effect April 1, 2020. As these changes took effect during the height of the COVID-19 pandemic in New York, providers may not have focused on them at the time.

Below, we summarize some of the key changes to the law. Providers should consider reviewing their current compliance program documentation and practices in advance of December’s annual compliance program certification requirement to ensure they are continuing to meet all of the required elements for having an effective compliance program.

Some of the key changes to SSL § 363-d include:

  • Specifying that meeting the requirements found in SSL § 363-d is a condition of receiving payment from the Medicaid program;
  • Adding monetary penalties for the failure to implement a compliance program that satisfies the law’s requirements. Specifically, the law now allows for penalties of $5,000 per calendar month (for a maximum of 12 calendar months) against a provider that is required to, but does not, satisfy SSL § 363-d’s requirements. For repeat offenders that had a penalty imposed within the prior 5 years, the penalty escalates to up to $10,000 per calendar month (again, for a maximum of 12 months);
  • Adding that compliance programs include measures to prevent, detect and correct non-compliance with Medicaid requirements (in addition to ensuring that there are measures to prevent, detect and correct fraud, waste and abuse);
  • Requiring that a compliance program have written policies, procedures and standards that articulate a commitment to comply with all applicable federal and state standards, and that meet all requirements of the federal Deficit Reduction Act;
  • Requiring the designation of a compliance committee;
  • Extending the training and education requirement to include the compliance officer, and to include the orientation for a newly appointed chief executive or manager;
  • Mandating that “effective” lines of communication exist that ensure confidentiality between the compliance officer, members of the compliance committee, the organization’s employees, managers and governing body, and the organizations first tier, downstream, and related entities;
  • Requiring that disciplinary standards, through the implementation of procedures that encourage good faith participation in the compliance program by all affected individuals, be “well-publicized;”
  • Having in place procedures and a system for “promptly” responding to compliance issues as they are raised and ensuring ongoing compliance with Medicaid program requirements;
  • Codifying in SSL § 363-d the requirement to report, return and explain in writing to the Office of the Medicaid Inspector General (“OMIG”) Medicaid overpayments, including setting out the time frame for so doing, specifying when the time period may be tolled, and allowing for the imposition of monetary penalties for retaining any overpayment after the deadline for reporting and returning it. As a corollary, SSL § 145-b was also amended to provide for monetary penalties of up to $10,000 for each item or service determined to involve a case where the provider knew or should have known that an overpayment has been identified, but does not report, return and explain it as required by SSL § 363-d. The potential penalty increases to up to $30,000 for each item or service where a penalty has been imposed within the previous 5 years; and
  • Codifying in SSL § 363-d the OMIG’s self-disclosure program, including specifying who is eligible to participate in the program and the time period for repayment (i.e., within 15 days of the OMIG’s notification of the amount due, unless an installment payment arrangement is permitted by the OMIG).

Garfunkel Wild is available to review your current compliance program and to assist in making any revisions that may be necessary. We are also available to help create and implement compliance programs for those who do not currently have one.

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