objectivity and INDEPENDENCE

The key characteristic of an effective compliance officer is independence, and this core value is the foundation that supports each of the elements of an effective compliance program.

• The 2023 OIG General Compliance Program Guidance notes that the compliance officer “must report either to the CEO with direct and independent access to the board or to the board directly.”

• The 2023 Guidance also notes that compliance officers should participate within, and even chair, a compliance committee.

Similarly, the 1998 OIG Compliance Program Guidance for Hospitals notes that the best practice in terms of creating a reporting structure for compliance professionals is a “free standing” function to “help ensure independent and objective legal reviews and financial analyses of the institution’s compliance efforts and activities.“

Separating Compliance and OPerations

The reporting structure of a compliance program should be designed to allow compliance professionals to be unbiased. For example, compliance professionals should not be working in both operational and compliance functions.

• Further, working from within an operational department may place pressures on compliance professionals that may lead to a lack of objectivity.

• There could be pressure from within the department to suppress auditing and monitoring reports from going outside the department to other institutional officials as required.

• Moreover, there could be conflict with individuals within the department who feel uncomfortable with audit results without the formal boundary of being audited by a distinct department.

  Please note that this page is meant to only provide an overview of the 2023 OIG General Compliance Program Guidance and focuses mainly on designing the reporting structure to ensure compliance officer independence.

Checks and balances

Compliance professionals oversee the monitoring and auditing of operations and conduct program evaluations; therefore, it is important that their role is not combined with an operations role.

• The separation of operations from compliance in terms of both work responsibilities and compliance functions ensures that the OIG’s 1998 vision of “a system of checks and balances is established to more effectively achieve the goals of the compliance program.”

• Therefore, both the reporting and work description of compliance professionals should be designed to promote independence.

  Compliance COmmittee

  The 2023 OIG General Compliance Program Guidance notes that a compliance committee, Note that this committee is not the same as an Institutional Review Board for the approval of research.