Graphical Version

Lab Compliance Plan


Compliance Plan for the Medical Laboratories of the University of Virginia Health Sciences Center

Owner: Tammy Audia, Laboratory Compliance Manager

Based on Department of Health and Human Services, Office of Inspector General - Compliance Program Guidance for Clinical Laboratories

(Federal Register, Vol. 63, No. 163; August 24, 1998)

Prepared by

Date Implemented

Supersedes Procedure #

Cheryl V. Lietch, MT (ASCP) SH

Marcia Parrish, BA

Jane L. Erwine, MT (ASCP)

February 15, 1999


Approved by:

Jay Marchwinski




Administrative Director, Laboratory

Review Date

Revision Date



Holley Thames Lutz, Vinson & Elkins Attorneys at Law


Patricia Van Hook, Director of Employee Relation Services, UVA Medical Center


Jay Marchwinski


Jay Marchwinski


Jay Marchwinski


Jay Marchwinski



Jay Marchwinski


Jay Marchwinski


Richard Ross


Richard Ross

Distributed to

Patti Dewey, Labaratory Qualilty Assurance Manager


Compliance Plan for University of Virginia Medical Laboratories

Table of Contents


•A.     Designation of Medical Laboratories Compliance Manager and Committee

•B.    Communication - Access to Medical Laboratories Lab Compliance Manager

•C.    Enforcing Standards

  • Discipline Policies & Actions
  • New Employee Policy
  • •D.    Auditing and Monitoring

    •E.     Written Procedures and Policies

A2K3 Quick Registrations  (deleted)                    MLCP 0001

Advance Beneficiary Notices                             MLCP 0002

Anatomic Pathology Credits                              MLCP 0003

Billing Edits                                                    MLCP 0004

Clinical Pathology Cancellations and Credits         MLCP 0005

Charge Capture                                              MLCP 0006

Charge Description Master Maintenance              MLCP 0007

Contractual Agreements                                  MLCP 0008

Custom Panels                                               MLCP 0009

Diagnosis Codes                                             MLCP 0010

Home Brews  (deleted)                                    MLCP 0011

Marketing                                                      MLCP 0012

Non-Retaliation                                              MLCP 0013

Retention of Specimens, Requisitions,

Reports, and Records                                    MLCP 0014

Physician Communication                                 MLCP 0015

Procedure Variance Requests (deleted)              MLCP 0016

Reflex Testing                                               MLCP 0017

Design of Forms to be Used to Request Services

by Medical Laboratories                                MLCP 0018

Skilled Nursing Facility Billing        (deleted)       MLCP 0019

Specimen Acceptance Criteria       (deleted)      MLCP 0020

Staff Compliance Training                               MLCP 0021

Standing Orders                                           MLCP 0022

System Configuration (deleted)                       MLCP 0023

Orders for Additional Testing                           MLCP 0024

Written Illegible Orders (deleted)                     MLCP 0025

Monitoring of Physician Test Ordering               MLCP 0026

Research Reports (deleted)                            MLCP 0027

Compliance with Applicable HHS OIG

Fraud Alerts                                              MLCP 0028

Responding to Detected Offences and

Corrective Action Initiatives                         MLCP 0029

Billing (deleted)                                            MLCP 0030

Outside Access to Medical Laboratory

Information Systems (deleted)                      MLCP 0031

Appendix I - Definition of Abbreviations

Appendix II - Resources

Appendix III - Annual Review


The Medical Laboratories of the University of Virginia have established a Corporate Compliance Program consistent with the recommended model guidelines of the Office of Inspector General (OIG), the Department of Health & Human Services (HHS), as well as the University of Virginia health System Corporate Compliance Program (Exhibit ). This plan has been established to set standards and guide and direct the Medical Laboratories in establishing:

  • 1.       Medical Laboratories Compliance Officer and Compliance Committee;
  • 2.      Policies and process in concert with Health System compliance Program to assure that we do not knowingly employ or contract with any individual or entity excluded, debarred, suspended or sanctioned ineligible to participate in federal programs particularly as listed excluded from OIG or GSA (General Services Administration) federal procurement and non-procurement programs;
  • 3.      Auditing and monitoring system in concert with Health System corporate compliance Office as well as the UVA Office of Internal Audit to assure on at least an annual basis that its pertinent policies and procedures, including billing policies and procedures and practices regarding Medicare and Medicaid claims submission are in compliance with the federal program mandates.  This annual audit shall include review of all coding and billing and documentation for outpatient laboratory.  The program will also include ongoing monitoring to assure compliance with key billing and coding issues.  It is understood that any violation of Medicare and Medicaid regulations will be reported to the HHS-OIG Office of Counsel to the Inspector General in writing after reasonable investigation.  The system of remedy will be implemented consistent with settlement agreement in collaboration with the UVA Health System Compliance Program;
  • 4.      Appropriate standards and guidelines for policy as directed by a settlement agreement between the University of Virginia and the United States Attorney's office of the Eastern District of Virginia in conjunction with HSS-OIG, effective August 1, 1999, directing compliance plan development and reporting procedures.
  • 5.      The lab will also report suspected violations of regulations internally through a 24-hour confidential Help Line administered through an outside, third party agency and managed by the Health System Corporate Compliance Office. These calls can be made anonymously and will be logged and investigated according to Health System policy without retribution but consistent with Health System disciplinary policies;
  • 6.      Education and communications program for all technical and clerical employees as well as independent contractors involved in ordering Medical Laboratories tests and/or preparing or submitting claims for reimbursement for outpatient Medical Laboratories services to Medicare and Medicaid programs.  At a minimum it is the intention of this plan to include all Medical Laboratories employees in education of both the general Health System Compliance Program as well as specific laboratory compliance issues requiring education pursuant to settlement agreement;

It is understood that the Medical Laboratories and the University of Virginia will make an annual report in writing to the OIG-OCIG on the first, second, and third anniversaries of the execution of this agreement regarding the status and findings of compliance efforts.  These reports will be initiated by the Lab Corporate Compliance and submitted by the Health System Corporate Compliance Officer.

A. Designation of Medical Laboratories Compliance Manager and Committee

Purpose:A Medical Laboratories Lab Compliance Officer will serve as the focal point for Medical Laboratories compliance activities related to FR Vol. 63, No. 163, August 24, 1998.


  • ­ The Medical Laboratories will designate a Medical Laboratories Lab Compliance Manager. Primary responsibilities will include:
    • a) Overseeing and monitoring the implementation of the Medical Laboratories Compliance program;
    • b) Reporting on a regular basis to the Medical Laboratory's Administration and Compliance Committee on the progress of implementation, and assisting these components in establishing methods to improve the Medical Laboratory's efficiency and quality of services, and to reduce the Medical Laboratory's vulnerability to fraud, abuse and waste;
    • c) Reporting on a regular basis to the Hospital Corporate Compliance Officer on audits related to assessing the Medical Laboratory's operations as they relate to compliance with the Medical Laboratories Compliance Plan, Medical Laboratories Compliance policies and procedures and all applicable Federal and State Laws. Communicates appropriate information to lab staff;
    • d) Developing and distributing to all affected employees all written compliance policies and procedures;
    • e) Periodically revising the program in light of changes in the needs of the organization, and in the law, policies and procedures of Government and private payor health plans;
    • f) Developing, coordinating and participating in a multifaceted educational and training program that focuses on the elements of the compliance program, and seeks to ensure that all appropriate employees and management are knowledgeable of, and comply with, pertinent Federal, State and private payor standards;
    • g) Ensuring that physicians who order services from the Medical Laboratories are informed of the Medical Laboratory's compliance program standards with respect to coding, billing, and marketing;
    • h) Assisting the Medical Laboratory's financial management in coordinating internal compliance review and monitoring activities, including periodic reviews of policies. Ensures appropriate actions are taken regarding issues, findings, or recommendations identified in compliance audits;
    • i) To conduct investigations collaboratively with the Health System Corporate Compliance Office and acting on matters related to compliance, including the flexibility to design and coordinate internal investigations. Reports all material incidents on non-compliance to the Hospital Corporate Compliance Officer;
    • j) Developing policies and programs that encourage managers and employees to report suspected compliance violations and fraud or other improprieties without fear of retaliation to their manager, Corporate Compliance Liaison, Health System Corporate Compliance Officer, or 24 hour, confidential compliance Help Line at 1-800-835-8700.
    • k) Serves as primary contact for all compliance questions for all lab areas. Co-ordinates response with Hospital Corporate Compliance Officer.
    • l) Other duties as assigned by the Hospital Corporate Compliance Officer in co-ordination with the Administrator of Medical Laboratories.
  • The Medical Laboratories will establish a Compliance Committee to advise the Medical Laboratories Lab Compliance Manager and assist in implementation of the Medical Laboratories Compliance Program. Committee functions will include:
    • a) Analyzing the organization's regulatory environment, the legal requirements with which it must comply, and specific risk areas;
    • b) Assessing existing policies and procedures that address these areas for possible incorporation into the compliance program;
    • c) Working within the Medical Laboratories to develop standards of conduct and policies and procedures to promote compliance;
    • d) Recommending and monitoring the development of internal systems and controls to implement the Medical Laboratory's standards, policies and procedures as part of its daily operations;
    • e) Determining the appropriate strategy/approach to promote compliance with the program and detection of any potential violations, through various fraud reporting mechanisms;
    • f) Developing a system to solicit, evaluate and respond to complaints and problems;
    • g) Work in concert with Health System Corporate Compliance Office to develop lab compliance education program;
    • h) The Committee will review all investigations and reports of suspected violation to assure appropriate responses including communication with the employee bringing forward the information to assure that it has been adequately solved in their view.

B. Communication - Access to Medical Laboratories Compliance Manager and Committee

Standard:An open line of communication between the Compliance Officer and the Medical Laboratories Lab Compliance Manager and the Medical Laboratories staff is critical to the successful implementation and operation of the Medical Laboratories Compliance Program.  Employees who seek to ask questions about compliance issues or report instances of possible non-compliance should be encouraged to do so.


  • ­ Employees will be educated and encouraged to communicate directly with the Compliance Officer and/or Medical Laboratories Manager with questions and/or complaints.
  • ­ Employees will have access to the Medical Laboratories Compliance Manager through the following means:
    • a) E-mail
    • b) Medical Laboratories Information System
    • c) Written Memoranda
    • d) Telephone
  • ­ The Medical Laboratories Compliance Manager will review communiqués and determine the appropriate course of action for problems by either internal resolution or through reporting the problem to the Hospital Compliance Officer. The Medical Laboratories Compliance Manager will act in accordance with his or her role as set forth in Section 2.2 of the University Compliance Principles and the applicable University Standards and Procedures.
  • ­ All communications or inquiries to the Laboratory Compliance Manager will be logged and appropriately investigated.

C. Enforcing Standards

  • ­ Discipline Policies & Actions
  • ­ New Employee Policy

Discipline Policies and Actions

Employment Policy

Standard:The Medical Laboratories will provide guidance regarding disciplinary action for corporate officers, managers, and other employees who fail to comply with the Medical Laboratory's Compliance policies and procedures, or Federal and State laws, or for those who have otherwise engaged in wrongdoing which have the potential to impair the Medical Laboratory's status as a reliable, honest and trustworthy health care provider.


  • Discipline Policies and Actions
    • a) Medical Center Human Resource policies will be adhered to regarding disciplinary actions that may be imposed for failure to comply with Medical Laboratories Compliance policies and procedures, or applicable Federal and State statutes and regulations.
    • b) Corporate officers, managers and other employees will be held accountable for the foreseeable failure of their subordinates to adhere to the Medical Laboratory's Compliance policies and procedures, or applicable Federal and State statutes and regulations.
  • ­ Employment Policy
    • a) A reasonable and prudent background investigation, including a reference check, will be conducted as part of every employment application. The application will require the applicant to disclose any criminal conviction, as defined by 42 U.S.C. 1320-a-7 (I), or exclusion action.
    • b) The Medical Center will prohibit employment of individuals in the Medical Laboratories who have been recently convicted of a criminal offense related to healthcare which involves conduct of a nature that to employ the individual would constitute negligence in regards to the Medical Center's duties to health benefit plans or their beneficiaries.
    • c) The Medical Center will prohibit employment of individuals in the Medical Laboratories who are listed as debarred, excluded or otherwise ineligible for participation in Federal health care programs as defined in 42 U.S.C. 1320-a-7 (I).
    • d) Currently employed individuals will be removed from direct responsibility for or involvement in any Federal health care program pending the resolution of any criminal charges or proposed debarment or exclusion.
    • e) Employment will be terminated for Medical Laboratories employees if resolution of a related matter results in conviction, debarment or exclusion.
    • f) Contract arrangements, if existing, with physicians or other individuals authorized to order Medical Laboratories tests would be terminated if resolution of a related matter results in conviction, debarment or exclusion.

D. Auditing and Monitoring

Standard: Quality assurance and zero tolerance of fraud and abuse are the goal of the Medical Laboratories Compliance Plan. Thorough monitoring of the implementation of the Medical Laboratories Compliance Plan followed by on-going, periodic audit and review of Medical Laboratories operations, has been designed and implemented to ensure adherence with the Medical Laboratories Compliance Plan, policies and procedures, and all applicable Federal and State laws.  Audits and reviews will emphasize monitoring of Medical Laboratories operations as they relate to billing, sales, marketing, notices and disclosures to physicians, requisition forms, pricing, and activities of phlebotomists and others involved in ordering of Medical Laboratories services.  All lab audits and reviews will be undertaken in concert with the Health System Corporate Compliance Office.


  • ­ To ensure compliance practices are being satisfied, periodic audits and reviews will be conducted under the guidance of the Medical Laboratories Lab Compliance Manager. Examples of audit and review methods include:
    • a) Periodic audits to determine that Medical Laboratories charges accurately reflect physician orders, with consistency between the original test order, the order entered into the Medical Laboratories Information System and charges billed on patient claims.
    • b) Interviews with personnel involved in management, operations, billing, sales, marketing and other related activities to ensure compliance with the UVA Health Sciences Center Compliance policies and the Medical Laboratories Compliance policies.
    • c) Reviews of written materials and documentation used by the Medical Laboratories for sales, marketing, physician notices & disclosures, requisition forms, pricing, specimen collection, test performance and billing.
    • d) Trend analysis studies by the Medical Laboratories Compliance Manager that seeks deviations in billing or ordering patterns over a given period.
  • Review reports will be prepared and submitted to the Medical Laboratories Compliance Committee members, Medical Laboratories Administration and the Hospital Compliance Officer. Audit reports will include attention to the following specific points, if identified:
    • a) Areas where corrective actions are needed.
    • b) Results of subsequent audits when corrective actions are indicated to ensure that the recommended actions have been implemented and are successful.
  • ­ If an audit reveals unexplained utilization trends, a copy will be forwarded to the Medical Laboratories Outreach Department to take action to address the issues and provide education to the physicians as needed. In determining what action, if any is required, the Hospital Compliance Officer shall be consulted.

E. Written Procedures and Policies

(please contact Tammy Audia ( for information regarding compliance policies)

Appendix I: Legend for Abbreviations

ABN - Advance Beneficiary Notice

CFR - Congressional Federal Register

CMS - Centers for Medicare and Medicaid

CPT - Current Procedural Terminology

ESRD - End Stage Renal Disease

HCFA - Health Care Financing Administration

HCPCS - Medicaid Healthcare Physicians Code System

HHS - Health and Human Services

ICD - International Classification of Diseases

LMRP - Local Medical Review Policy

NCD - National Coverage Decision

OIG - Office of the Inspector General

POC - Point of Care

Appendix II: Resources

Federal Register

  • ­ Compliance Program Guidance for Clinical Laboratories: 63 FR 45076 (August 24, 1998)

OIG Website

Appendix III : Annual Review

All policies are reviewed annually. The signature for the annual review is found on the title page of the Compliance Plan. Any revisions and/or updates to the policies are done as needed and documented on the individual policies.

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