Compliance for Healthcare: Laws and Journey Ahead

Payal Wadhwa

Payal Wadhwa

Mar 14, 2024

Healthcare companies are facing increasing levels of scrutiny over the last few years. Compliance for healthcare companies now covers a wider scope of aspects—bringing in healthcare providers, third, and fourth-party vendors that work with health care providers under its purview. 

According to research by the Ponemon Institute published by IBM, the average cost of healthcare data breaches has seen a 53% jump since 2020 making it the most expensive industry for data breaches, 13th year in a row!

A number of new progressive disruptions such as the rapid adoption of online consultations and telehealth services have brought along new privacy and security challenges. Malicious actors are now looking to exploit patient information available online. This is one of many new instances that compliance aims to fix in the realm of healthcare.

This blog lists the steps to get you started on healthcare compliance laws and lays down a few healthcare compliance examples you need to follow.

What is compliance in healthcare?

Compliance in healthcare refers to the adherence of legal, professional, and regulatory standards laid down by healthcare compliance frameworks to prevent misconduct and misallocation when dealing with sensitive medical information.

It is regulated by authorities and organizations at different levels like federal, state, local entities, industry-specific organizations, and accreditation bodies to ensure safe and ethical practices in healthcare.

Why is compliance important in healthcare?

Compliance is important in healthcare to avoid substandard service delivery, unintentional or intentional deception, negligence in patient care, compromise of patient data privacy, and unethical practices.

Globally, there are multiple compliance regulations and laws that aim to protect the integrity of patient data. Becoming compliant with these regulatory laws is the first major check item for any organization that is a healthcare organization or is working with one.

Here’s why compliance for healthcare matters:

  • The enormous size of the healthcare industry and the sensitivity of services provided expose it to substantial risks. This is due to data passing through various hands making compliance a crucial concern.
  • Healthcare services directly affect human lives making it important to uphold standards of integrity for patient safety
  • Maintaining the confidentiality, integrity and availability of PHI (protected health information) is important for protecting patient rights, privacy and trust.
  • Compliance ensures the minimization of fraud and ensures proper utilization of funds.
  • Data breaches can cost organizations money, disrupt business continuity, tarnish brand image, and strain customer relationships
  • Compliance programs help proactively identify vulnerabilities and helps prevent or reduce the impact of incidents
  • Compliance fosters an environment of trust amongst stakeholders and clients and brings better business opportunities.

Check out: Complete Guide to HIPAA compliance

What is the scope of healthcare compliance?

The scope of compliance for healthcare is vast and can vary based on factors like geographical location, type of healthcare organization, and service provided. While it includes regulatory compliance, billing and coding practices, ethical research, and patient care, it is also constantly shaped by the evolving nature of risk, and changes in laws and standards.

How to get started with compliance for healthcare?

At the outset, getting started with compliance for healthcare can pose practical challenges. It requires an understanding of the persistent risks, selecting a framework, training the workforce, establishing communication channels, and tracking progress. Done right, it can however save the organization from various non-compliance repercussions.

Here’s how healthcare organizations can get started with their compliance program:

Prepare for the program

The preliminary work when initiating compliance for healthcare involves conducting a risk assessment to understand risk profile. Thereafter, a healthcare compliance program must be designed with the right protocols, implementation, communication channels and perpetual improvements.

Outline policies and procedures

Once the organization understands its current state and areas that need to be addressed, it must pick a framework. A hospital, for example, will begin by implementing HIPAA standards.
Next, the chosen framework must be mapped to policies, processes and people. This will bring clarity regarding the creation, revision, alteration or reinstatement of policies.

The policies must be regularly reviewed and updated to reflect changes in regulations, advancements or organizational requirements and they must be acknowledged by employees.

Set up program administration

The next step is to designate a compliance officer for program oversight, implementation and point of contact. This includes monitoring regular activities, assessing program effectiveness, tracking regulatory changes, reviewing reports, arranging employee training, and ensuring smooth audits.

On the external front, the compliance officer is required to have communication with vendors to periodically run third-party compliance checks, seek legal counsel, and liaise with auditors and regulatory bodies.

Arrange for workforce training

Workforce training is an essential aspect of healthcare compliance. Employees should be aware of best practices while handling sensitive PHI such as patient access, and breach notification. They must know how to identify and communicate non-compliance and put containment actions in place.

Training programs must be designed by designation. This ensures each person understands their role within the function. Examples of such training modules include compliance training, fraud prevention, and incident management.

Set up communication channels

For this step, two communication pathways need to be set up: internal and external. The internal channels should facilitate escalation of any compliance compromises across departments. The aim of an internal channel is to ensure quick containment, seamless coordination, and quick resolution.

Next, a system should be established for receiving and responding to customer complaints through various channels like emails and online portals. The idea is to proactively communicate with customers whenever needed.  

Conduct regular reviews and audits

More often than not, opting for a third-party audit without having internal audits and assessments does not work out in the organization’s favor. Regular reviews and internal audits must be a regular practice for progress visibility and process improvement. It serves as a litmus test of the strength of controls put in place.

Work on sustained progress

In order to maintain the highest standards of adherence, the compliance officer must demonstrate strong leadership and governance. Regular risk assessments, continuous compliance tracking, solid documentation, and a robust response mechanism are the pillars of sustained progress. 

You can make use of an automation software like Sprinto for tracking compliance status, gaps and progress. The health dashboard will give you a quick snapshot of passing, failing, critical and due checks to ensure quick responses and no compliance drift.

Also, before you begin setting up a compliance program, it is important you grasp certain healthcare compliance laws to select the right one. Let’s discuss them in the next section.

Check out: HIPAA compliance checklist

Healthcare compliance laws

The health industry is governed by several laws and regulations with the overarching objectives of providing quality healthcare services and ensuring the safety of patient data. Each of these laws has its own set of requirements and ensure compliance across different concerning areas.

Some key healthcare compliance laws include:

Health Insurance Portability and Accountability Act (HIPAA)

A federal law enacted in 1996 requires organizations working directly or indirectly in a healthcare capacity to maintain the confidentiality, integrity, and availability of PHI (Patient health information). The law grants certain rights to patients to ensure that any sensitive information is not accessed or disclosed by unauthorized users.

Health Information Technology for Economic and Clinical Health (HITECH) Act

The HITECT Act of 2009 aims to increase the adoption of electronic health records (EHR) and the effective utilization of health information technology (HIT) within the US healthcare system. It is a part of the American Recovery and Reinvestment Act (2009) and promotes healthcare efficiency and patient safety.

Emergency Medical Treatment and Labour Act (EMTALA)

Enacted in 1986, EMTALA act requires hospitals to provide the necessary treatment to a patient who arrives at the emergency department or arrange for an appropriate transfer for stabilization. The screening and stabilization can’t be refused for any discriminatory reason like an inability to pay. The act safeguards patient rights and ensures equitable access to emergency services.

Patient Protection and Affordable Care Act (ACA)

The Patient Protection and Affordable Care Act known as ACA or Obamacare aims to improve access to quality healthcare by making it affordable for low-income groups. It ensures subsidies, access to affordable health insurance, and medical aid to households living below the federal poverty line.

Anti-Kickback Statute (AKS)

The Anti-Kickback Statute is a federal law that prohibits the offer/payment/receipt of any kind of remuneration in exchange for referrals or business generation including services reimbursed by Federal health care programs. It aims to combat healthcare fraud and abuse and can lead to civil and criminal penalties.

Stark law

Also known as the Physician Self-referral law, the Stark law prohibits physicians from referring patients to receive designated health services (DHS) reimbursed by Medicare or Medicaid to entities with whom they or their immediate family members have financial relationship. Examples of designated health services include clinical laboratory services, home health services, etc.

False Claims Act

The False Claims Act in the United States imposes a liability of three times the government damages and other penalties linked to inflation on individuals submitting or causing to submit false claims to the federal government.
On the other hand, it also provides a percentage of monetary recovery to individuals filing successful lawsuits on behalf of the government for such false claims, under its qui tam provisions.

Coming up next is how these laws are put into practice at healthcare organizations. Check out healthcare compliance examples below.

Healthcare compliance examples

Any task or activity executed in good faith ensuring the adherence to legal, ethical, and professional standards in the healthcare industry is compliance for healthcare. This includes following regulations, ensuring patient safety and privacy, maintaining quality services, and abiding by medical ethics.

Some examples of healthcare compliance include:

  • Hospitals implementing a security policy that defines restrictions on access to PHI and unauthorized disclosure
  • Clinical laboratories maintaining quality standards for reliable testing
  • Healthcare entities adhering to billing and coding practices to prevent fraudulent activities
  • Healthcare organizations ensuring safety and well-being of employees and patients
  • Pharmacies signing Business Associate Agreement with third-parties
  • Healthcare providers implementing physical, technical and administrative safeguards to secure e-PHI.
  • Physicians not indulging in any unethical referral or business generation activity in which they have financial interest.

The consequences of non-compliance 

Any instance of non-compliance comes with adverse impacts. Depending on severity these can result in very serious consequences, some of which include legal penalties, fines, and lawsuits as well as reputational damage and loss of business. Healthcare entities may also lose their licenses and may be excluded from government programs.

Ace healthcare compliance with Sprinto

Compliance for healthcare is multi-faceted and challenging. It requires the most stringent adherence to several constantly evolving regulations while keeping pace with technological advancements. It also demands a very high level of collaboration to manage investigations, conduct audits, coordinate with third-party vendors, etc.

A comprehensive healthcare compliance tool like Sprinto helps you every step of the way. With our powerful platform, you can align your organizations with the requirements of various frameworks, establish best practices, leverage pre-built policy templates, automate evidence collection and more. 

Looking for expert advice? We have you covered. Speak to our healthcare compliance experts today.


What are the three main areas of healthcare compliance?

The three main areas of healthcare compliance are patient safety, patient privacy and data security and billing and coding compliance.

What is an example of patient compliance?

Patient compliance or patient adherence is the degree to which a patient follows the prescribed medical treatment by the healthcare provider. An example is if the patient is prescribed a medicine for a chronic disease twice a day along with regular exercise and he follows the guidelines as instructed, the patient is compliant.

Who regulates healthcare compliance?

Healthcare compliance is regulated by agencies at federal level and state level. Some of these entities include Office of Inspector General (OIG) and Centre for Medicare and Medicaid Services within the HHS, The Joint Commission (TJC), Food and Drug Administration (FDA) and Drug Enforcement Administration (DEA).

Payal Wadhwa

Payal Wadhwa

Payal is your friendly neighborhood compliance whiz! She turns perplexing compliance lingo into actionable advice about keeping your digital business safe and savvy. When she isn’t saving virtual worlds, she’s penning down poetic musings or lighting up local open mics. Cyber savvy by day, poet by night!

How useful was this post?

0/5 - (0 votes)

Found this interesting?
Share it with your friends

Get a wingman for
your next audit.

Schedule a personalized demo and scale business

Here’s what to read next….

Sprinto: Your growth superpower

Use Sprinto to centralize security compliance management – so nothing
gets in the way of your moving up and winning big.