Why have a corporate code of conduct? An effective compliance program has two major components. First, it must encompass training and oversight in specific areas of legal compliance so that the business of the corporation will be conducted in accordance with the law. Second, it must advance a corporate attitude of legal and ethical compliance, a key ingredient to a successful compliance program. This corporate attitude will be reflected in a corporate ethics guide, frequently referred to as a code of conduct. This code will embrace the core values firmly held by the corporation that cannot be the subject of compromise.
Ethical and legal behavior starts at the top and filters down. This means that company executives must set the example that all employees will follow. If employees see higher level executives and managers transgressing company rules, then they will not take any code of conduct seriously.
Example
Here is an example of a code of conduct adopted by one midwestern hospital, which we will call ABC Hospital. The guiding principles are succinctly stated and then followed by more detailed explanation.
ABC Hospital Code of Conduct
At ABC Hospital we are committed to conducting business in an ethical and honest manner and within the bounds of the law. This Code of Conduct is intended to provide employees, physicians, volunteers, vendors, and other agents of ABC Hospital with guidelines for conducting business in a manner which fulfills that commitment. The Code of Conduct is supplementary to the mission, vision and values of ABC Hospital and applies to all who provide services under the auspices of ABC Hospital or its affiliates.
The standards contained in this Code of Conduct are important, and therefore any violation will be handled in accordance with the Progressive Disciplinary Policy, as outlined in Personnel Policies or other applicable policies and procedures of ABC Hospital and its Medical Staff. In addition, referral of certain matters will be made to government and regulatory agencies as appropriate. The offender may also be responsible in a civil suit for losses or other damages caused by his or her inappropriate conduct.
The Corporate Compliance Program
The Corporate Compliance Program has been established to prevent the occurrence of illegal or unethical behavior, to stop any such behavior as soon as reasonably possible after it has been discovered, to discipline the individuals involved (including those who know of violations but fail to report them), and to recommend and implement changes in policy and procedure necessary to avoid a recurrence of any prior violation.
Questions and How to Report Violations of the Standards
It is important to ABC Hospital that employees have an effective way to get an answer to any question they may have about how to conduct their job. It is also important for employees and other agents to report any instance of a known or suspected violation of this Code of Conduct.
In the event that an employee has a question or concern or believes that someone is conducting their business in an illegal, unethical, or otherwise questionable manner, or violating ABC Hospital’s policies, it is preferred that the employee first contact his or her supervisor to discuss the matter. There are times, however, when either the response the employee receives may be inadequate or the employee may feel uncomfortable in discussing the matter with his or her supervisor. In those cases, the employee should contact the Corporate Compliance Officer or call the toll free telephone hotline at 000.000.0000. All calls to the hotline are confidential, and the caller may remain anonymous. To ensure confidentiality, the telephone hotline is operated by an organization not affiliated with ABC Hospital. Calls are answered 24 hours and day, seven days a week. Follow up on all calls is available by a return call to the hotline. Callers will not be retaliated against in any manner for making as long as the information being reported is truthful.
ABC Hospital’s Commitment to Compliance
ABC Hospital strives to…
1. Comply with the Law. ABC Hospital is subject to numerous local, state and federal laws pertaining to all aspects of its operation. All employees are required to understand and abide by those laws which are applicable to them in the performance of their jobs.
2. Provide Excellent Patient Care. ABC Hospital employees shall strive to treat all patients with a spirit of kindness, patience and understanding. Each patient is an individual and should be treated as such. Each patient should be respected, with their needs and desires considered as health care decisions are made. Steps shall be taken so that each patient understands his or her treatment needs and options, treatment methods utilized, and treatment outcomes. ABC will provide services in a manner that does not discriminate against any person because of age, race, religion, gender, sexual orientation, disability, national origin, or for any other reason prohibited by applicable state and Federal law. At all times, competent and qualified individuals will provide appropriate care, while considering the safety and well being of the patients.
3. Protect Confidential Information. ABCl Hospital is committed to maintaining the confidentiality of patient, personnel, and other proprietary information in accordance with applicable legal and ethical standards.
4. Adhere to Anti-Referral and Health Care Fraud and Abuse Legislation. All employees of ABC Hospital are required to comply with laws which prohibit health care fraud and abuse. Activities that are prohibited include, but are not limited to:
Intentionally or knowingly making false or fraudulent claims for payment or approval;
- Offering or receiving remuneration (such as a kickback, bribe, or rebate) as an inducement to make a referral for the furnishing (or arranging for the furnishing) of any item or service;
- Submitting false information for the purpose of gaining or retaining the right to participate in a plan or obtain reimbursement for services; and,
- Referrals by a physician of Medicare or Medicaid patients to any entity for "designated health services" when the physician or an immediate family member has a financial relationship with the entity (unless the arrangement complies with applicable legal exceptions).
5. Not Accept Inappropriate Gifts or Gratuities. The following standards apply to the giving or receiving of gifts and gratuities. Receiving Gifts from Patients and vendors. Employees are prohibited from soliciting tips, personal gratuities or gifts from patients and vendors. Employees may, however, accept non-monetary gratuities or gifts of a nominal value, such as cookies, flowers or candy if the gift would not influence, or reasonably appear to others to be capable of influencing, the employee’s business judgment in conducting affairs with the patient or vendor.
If the value of the gift is substantial or there is any question regarding whether the gift meets this standard of reasonableness, the employee must seek prior approval from the Corporate Compliance Officer (who will take the request to the Compliance Committee for review) or refuse the gift and promptly return the gift to the vendor or patient. Substantial gifts to ABC can be made by contacting the Chief Development Officer for the ABC Endowment Association.
Giving Gifts to Patients and Vendors: Employees shall not offer or give money, services or other things of value with the expectation of influencing the judgment or decision making process of any purchaser, vendor, patient, governmental official or any other person.
An employee who is in doubt about whether a situation involving the giving or receiving of something of value is acceptable, should ask his or her supervisor, or the Corporate Compliance Officer.
6. Avoid Conflicts of Interest. It is the policy of ABC Hospital to prohibit its employees and other associates from engaging in any activity, practice, or act which conflicts with, or appears to conflict with, the interests of ABC Hospital, its patients or its vendors. Therefore, Employees, Medical Staff members, Board members, and other individuals must disclose to their supervisor or the Compliance Officer any potential conflict of interest they or their immediate family have in any firm which does business with ABC Hospital or which competes with ABC Hospital.
7. Follow All Antitrust Regulations. A number of activities engaged in by ABC Hospital are subject to state and federal antitrust laws. Generally, these laws prohibit agreements or actions that may illegally restrain trade or reduce competition. Examples of activities that violate these laws include, but are not limited to, agreements among competitors to fix or stabilize prices, inappropriate exclusive dealings, and boycotts of specified suppliers or customers.
8. Keep Accurate and Complete Records. It is essential that ABC Hospital report accurate information to governmental entities and other third parties. In order to meet this obligation, it is equally essential that every employee accurately and clearly report the relevant facts or the true nature of a transaction. No employee should knowingly or with reckless disregard for the truth make any false or misleading statement on any form or to any other officer, employee or auditor for ABC Hospital. All patient records must meet the documentation standards required for quality care and to meet reimbursement regulations. Employee travel and entertainment related expenses must be accurately documented and supported when seeking reimbursement from the hospital.
9. Conduct Political Activities According to the Law. ABC Hospital does not participate or intervene in (including the publishing or distributing of statements), any political campaign on behalf of or in opposition to any candidate for public office.
While ABC Hospital supports employee participation in the political process, employees are not permitted to use positions in ABC Hospital to try to influence the personal decisions of others to contribute or otherwise support political parties or candidates except as lawfully permitted through political action committees.
ABC Hospital may participate in lobbying activities or advocating the passage or defeat of certain legislation that pertains to issues that affect the healthcare community. Lobbying activities, or advocating the passage or defeat of certain legislation, shall not constitute a substantial part of the activities of ABC Hospital.
10. Protect the Environment. It is the policy of ABC Hospital to comply with all state and federal laws protecting the environment. Employees shall dispose of all waste and other materials and store all chemicals and substances in accordance with applicable laws and regulations. It is important to file all necessary environmental reports accurately and promptly and to cooperate fully with all governmental authorities in the event of an environmental incident.
11. Provide a Safe Workplace. It is the policy of ABC Hospital to comply with all applicable state and federal laws designed to improve workplace safety. ABC Hospital is committed to training employees to carry out their work in manner that is safe for them, their coworkers and the patients they serve.
12. Not Tolerate Harassment or Discrimination. It is ABC Hospital’s policy not to discriminate on the basis of race, color, religion, national origin, age, disability, sexual orientation, or gender in providing services to patients or the public, nor in relation to employment practices. Furthermore, ABC Hospital prohibits harassment of its employees in any form by supervisors, coworkers, customers or vendors.
13. Appropriately Use its Assets. All employees are charged with protecting and preserving ABC Hospital’s assets and resources by following procedures to prevent their loss, theft or unauthorized use. No part of the net earnings of ABC Hospital shall inure to the benefit of, or be distributed to, its trustees, Executive Staff, employees or other private persons having directly or indirectly any personal or private interest in the activities of ABC Hospital, except to the extent that such payments constitute reasonable compensation for services rendered in the necessary course of ABC Hospital’s business.
14. Protect Access to Information Systems. ABC Hospital is committed to protecting all aspects of its information systems. All employees and other associates with access to ABC Hospital’s computerized information system shall sign and abide by ABC Hospital’s Responsible Use Policy, including the protection of confidential passwords and other access information.
15. Adhere to Intellectual Property Laws. ABC Hospital is commited to adhering to all applicable intellectual property laws. All software used in connection with ABC Hospital’s business must be properly licensed and used in accordance with that license. Additionally, ABC Hospital will respect the intellectual property and copyright laws regarding books, trade journals, magazines, and other applicable resources.