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Moving beyond just compliance

June 1, 2006
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One agency's journey toward organizational improvement

The average behavioral healthcare executive has many things on his/her mind, including issues such as recruitment, board relations, “unfair” managed care authorization and payment rates, the latest service model or revenue stream, and perhaps even an antiquated heating and air-conditioning system. In the day-to-day life of the average executive, the mundane operational issues can be overwhelming. It is easier to believe this is the “big picture” than to lift your head up and see that your pond is actually only a drop in an ocean. This partially explains why the average behavioral healthcare executive oversees an average behavioral healthcare company.

Moving from average to good to great requires many things, not the least of which is to seize the challenges that confront us and turn them into opportunities. Many companies fell behind when managed care arrived in the behavioral healthcare universe. Some companies were opposed to managed care and fought it; many did not see the need to change how they conducted and managed their business; and many focused only on the marketing opportunities. The result was lost revenue, lost employees and, sometimes, lost companies. Now managed care is a fact of life, and the survivors exist because they changed their systems, adapted to the new environment and rules, and incorporated once dreaded managed care requirements into their daily life.

Yet we now must learn from the past and begin to plan, organize, and manage for a new world involving another paradigm change. Three key concepts in this new world paradigm are:

  • Compliance

  • Quality

  • Monitoring

This article describes one example of an effective system that combines these key concepts into an ongoing process that can help you both survive in this new world and stand above the competition.

Compliance as a Baseline

Not-for-profit behavioral healthcare providers may be the last segment of the healthcare industry to deny that the federal government's focus on compliance really does apply to us. As a company that was the subject of a lengthy and expensive federal investigation, NHS Human Services can confirm that all it takes to make a small army of federal investigators appear at your door is a single whistle-blower. Your size, your good-heartedness, your lack of a bottom line will not save you. If you don't think you will ever be at risk from a whistle-blower, then you have never fired anyone or made any consumer or family member unhappy.

If you believe that you do everything right and have nothing to fear from an investigation, I have a bridge I would like to sell you. Nothing can prevent a federal or other payer investigation. The only thing that can minimize both your risks and consequences is an effective compliance program.

The federal investigation showed NHS the need for an effective compliance program and a “culture of compliance.” This not only means adhering to regulatory requirements and ethical standards but also an open and honest awareness of our faults and a commitment to correct them. Honest self-assessment is hard for any executive or board, but that is only the beginning—you need to go beyond the established compliance baseline.


If you are accredited by JCAHO, COA, CARF, or other accrediting bodies, you have some sense of the importance of not just saying you provide quality care but of the need to demonstrate it. If you are managing based on anecdotal evidence or expecting your funding levels to continue on the basis of “reputation” or relationships with licensing or funding agencies, I still have that bridge I want to unload. Sooner or later performance contracting is going to arrive on your doorstep, and you will be well served if your systems and staff are prepared for it.

Moreover, government investigators and prosecutors have become more and more aggressive and successful in using quality of care or components of care, such as staff qualifications and treatment plans, to reclaim monies paid, collect fines, and sometimes criminally charge individuals and companies. Rather than seeing this as another intrusion by government, NHS saw this emphasis on quality as an opportunity to set ourselves apart.


An important part of an effective compliance program, as well as effective management, is monitoring internal performance. An important part of monitoring is having objective, documented measurement against a standard. Companies should not leave the characterization of who they are to payers, licensing entities, or the general public. NHS is trying to define itself to external parties through using performance data that have been monitored, documented, and measured against a standard. This not only helps us to define ourselves but gives us the first view of any weaknesses or flaws and allows us the opportunity to correct and improve. Continuous quality improvement (CQI) becomes much more real and vital when it is part of a management process and used to report above (to the CEO and board) and out (to payers and other external organizations).

The NHS Solution: Global Monitoring

To prepare for and take advantage of the shifting paradigm, NHS created a process called Global Monitoring designed to:

  • Measure performance objectively

  • Document processes and results

  • Compare results against standards

  • Report results to management and the board

  • Provide for CQI

  • Meet compliance and ethical requirements