False Claims Settlement: 5 Items in Banner's Integrity Agreement

The document outlines the terms to which Banner Health agreed under a settlement to end False Claims Act litigation brought by a whistleblower.

As part of an $18.3 million settlement announced last week by the Department of Justice, Phoenix-based nonprofit Banner Health signed a corporate integrity agreement in which it committed to fixing the way it handles claims submitted to federal healthcare programs.

That agreement, which was released Friday by the Health and Human Services Office of Inspector General, calls for a long list of reforms that Banner must implement then maintain for five years.

Banner's present legal trouble stemmed from a whistleblower complaint filed under the False Claims Act in 2013 by Cecilia Guardiola, who worked less than three months for the organization in 2012 as corporate director of clinical documentation.

Related: Whistleblower Suit Costs Banner Health $18.3M

Banner's settlement marks the third time Guardiola has squeezed a multi-million-dollar deal out of a former employer.

The agreement Banner signed is designed to ensure the organization's compliance efforts are up to snuff, as the DOJ acknowledged. Below are five requirements from the agreement:

1. Appoint compliance officer. Banner must designate one member of its senior management team as its compliance officer, who must report directly to the chief executive officer. That person cannot be the chief financial officer, the general counsel, or anyone who reports to the general counsel or who serves as Banner legal counsel in any capacity. A spokesperson for the system said Banner's vice president of ethics and compliance has served and will continue to serve as chief compliance officer (CCO).
    
2. Name area compliance program directors. Banner must, within four months, pick area compliance program directors to assist the compliance officer with implementation and day-to-day monitoring. The agreement, which applies to 12 hospitals, does not specify how many directors must be appointed. The spokesperson said Banner has CCOs throughout the system to oversee compliance on a facility basis.
    
3. Conduct additional training. Banner must put together a written curriculum outlining how it will ensure that everyone covered by the agreement receives annual training on what Banner's legal requirements are, both generally and under the agreement. The training must address Stark Law and Anti-Kickback Statute requirements.

4. Hire an independent auditor. Banner must hire an independent review organization, such as an accounting, auditing, or consulting firm. That firm is to be tasked with evaluating Banner's admissions data and determining whether Banner's claims to Medicare are appropriately documented, coded, and billed.
    
5. Prepare for transparency.  Banner must keep all reimbursement records for at least six years, and the HHS OIG has authority to conduct investigations and review Banner's books. If the organization makes a "false certification" while the agreement is in force, it will be on the hook for a $50,000 stipulated penalty per violation.

The agreement, which Banner Health President and CEO Peter S. Fine signed on March 29, notes that the organization had already complied voluntarily with some of the agreement's requirements.

Editor's note: The story was updated Monday, April 23, 2018, to include a response from a Banner Health spokesperson.