An Informational Guide for Hotline Vendor Selection and Tips on What to Expect from Your Vendor
By definition, all effective compliance programs should have a hotline. It is an important avenue of communication between employees and management that permits employees to report sensitive matters outside the normal supervisory channels. Both the U.S. Sentencing Commission and HHS OIG call for maintaining a hotline. Failure to establish positive internal compliance reporting channels often results in complainants reporting externally to the OIG and DOJ as “whistleblowers.” Today, it is the exception to find organizations trying to manage a hotline function internally, as establishing effective internal compliance communication can be a challenge. The fact is that any advantages of internally operated hotlines are greatly offset by the disadvantages. In fact, internally operated and managed hotlines are extremely inefficient, costly, and seldom meet any minimum standards. Hotline numbers will need to be “backstopped” against tracing, and all caller identification systems have to be blocked. People answering the calls in-house should not be highly visible to the workforce. Confidence to use the hotline comes from neither party being known to the other. On the other hand, compliance and ethics hotline vendors have the training and experience to handle complainants. Because callers are generally nervous and afraid, they feel reassured in knowing they are providing information to an outside party. They often raise the question of whether anonymity is truly offered, and whether employees will ever sufficiently trust calling another employee. With all the benefits an outsourced hotline offers, determining who can provide the best service at the right price is a challenge.
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Tips for evaluating hotline vendors include the following:
- Services Provided by Vendors. In today’s environment, it is advisable to have two levels of service: the option to call and speak with a live operator, and a web-based reporting system that prompts individual complainants. Over the last decade, there has been a trend towards reporting via web. In the healthcare sector, web-based reporting is almost equivalent to an operator-answered call. In any case, pass on any vendor not providing both services.
- Hotline Operations Experience. Don’t engage a startup firm with little experience in operating a hotline, which may wind up in you paying for the firm’s mistakes. The more experience the vendor has with hotlines, the fewer the problems you will have. Ask for a statement outlining that experience.
- Industry expertise. A significant factor for those in the health care sector to consider is the level of expertise and understanding of the legal and regulatory issues they face. The problems confronting businesses in other sectors are different. In banking and finance, there are many regulatory and legal issues unknown to healthcare. In some sectors, the Foreign Corrupt Practices Act is a major concern. In other areas, such as manufacturing and construction, employee safety concerns rank at the top. In retail, the focus is on employee theft. It is advisable to have a hotline vendor familiar with issues, concerns, and regulatory issues unique to your sector. The vendor staff needs to be able to recognize and ask questions about the issues and high-risk areas identified by the HHS OIG, including those related to the Stark Law and Anti-Kickback Statute.
- Avoid Being Trapped by Contracts. Hotline vendors should hold clients by good service, not by contracts. As such, any contract that makes it difficult for the client to cancel should be avoided. The contracts should permit cancellations without cause with a simple 30-day written notice. Look to see if cancellation of service is restricted. If so, consider finding a way out of the arrangement or obtaining service elsewhere.
- Report Timeliness. It is important that as part of any contract, a full written report will be provided within the same day of receipt of the call. For urgent matters, the report should be available immediately. Reports on individual calls should be well written, clear, concise, and of high quality.
- Method of Report Delivery. The manner in which the report is delivered is important. Avoid any vendor that provides reports by facsimile or email, as they are not secure and could be a complicating HIPAA privacy factor where PHI is involved. Web-based reporting is the most secure, with notification of a report provided via email.
- Anonymity. The hotline must provide an option for anonymity. The U.S. Sentencing Commission, DOJ, and OIG all call for it in their guidelines. In the healthcare sector, nearly two-thirds of all hotline reporters request anonymity. Anonymity is generally in the best interest of the organization, as there is no burden of protecting identity if it is unknown. The downside of anonymous reports is a communication barrier. If the Compliance Officer finds the information important but needs additional information to answer a question, getting that information cannot be done if the person remains unknown. The hotline vendor’s service should include a means of communication for the Compliance Officer and anonymous reporter. Insist on having that included in the service.
- Cost of Service. Compare costs of service, keeping in mind that a vendor should be able to provide services at a set fee that can be compared to other vendors. A good rule of thumb is that the cost of a hotline service should not be more than $1 per employee per year. Periodically compare costs of your vendor against others. It may prove an opportunity to save money.
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If you are interested in setting up a confidential compliance and ethics hotline with web and telephone-based reporting channels, visit our Hotline Service Center to contact an ethics hotline provider online. Our compliance experts can provide detailed information on what a successful hotline should look like in the health care industry.Subscribe to blog