The United States Sentencing Commission has published the updated 2011 Federal Sentencing Guidelines Manual at the following website: http://www.ussc.gov/guidelines/2011_Guidelines/index.cfm. Appendix C (Volume III) pages 102-120 cover the changes made to Chapter 8 Sentencing an Organization.
The following are the major changes noted in Chapter 8:
- The following was added to the introductory commentary to clarify the factors that the sentencing court must consider, “Culpability generally will be determined by six factors that the sentencing court must consider. The four factors that increase the ultimate punishment of an organization are: (i) the involvement in or tolerance of criminal activity; (ii) the prior history of the organization; (iii) the violation of an order; and (iv) the obstruction of justice. The two factors that mitigate the ultimate punishment of an organization are (i) the existence of an effective compliance and ethics program; and (ii) self-reporting, cooperation, or acceptance of responsibility.”
- The criteria set forth in Note 3(k) under §8A1.2 Application Notes, summarizing an effective program to prevent and detect violations of law was removed. The guidance may now be found under PART B – Remedying Harm from Criminal Conduct, and Effective Compliance and Ethics Program, Subpart 2 §8B2.1. While the existing framework of the seven minimum requirements is still embedded in the guidance it is more specific and elaborates on the criteria and imposes greater responsibility on the governing authority and executive leadership. It is important to note the following changes:
- The manual now states to have an effective compliance and ethics program an organization SHALL (emphasis added) exercise due diligence to prevent and detect criminal conduct and promote organizational culture that encourages ethical conduct and a commitment to compliance with the law.
- Due diligence now requires the organization’s governing authority to be knowledgeable about the content and operation of the compliance and ethics program and shall exercise reasonable oversight of the implementation and effectiveness of the program.
- The manual now describes how high-level personnel of the organization are to ensure an effective compliance and ethics program.
- Due diligence now includes employing specific individual(s) to be delegated day-to-day operational responsibility for the compliance program. The individual(s) must also report to the governing authority regarding the effectiveness of the program.
- The Sentencing Commission also expands on how to calculate the culpability score, makes compliance and ethics training mandatory, mandates the use of monitoring systems to detect criminal conduct, requires organizations to assess risk that criminal conduct will occur on a periodic basis, provides guidance on how to implement a compliance and ethics program in a small organization.
We recommend reviewing the updated Sentencing Guidelines for Organizations. We also recommend reviewing current compliance policies to ensure they include all the elements specified in the Sentencing Guidelines.
HC Healthcare Consulting staff includes certified coders, physicians, consultants certified in healthcare compliance, and statisticians that are available to provide expert assistance with your compliance programs.
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