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Compliance 101


Compliance 101 The pieces really can fit together truly! Lynette M. Schenkel Director, Responsible Conduct of Research University of Oregon You hoped compliance ... – PowerPoint PPT presentation

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Title: Compliance 101

The pieces really can fit together truly!
  • Lynette M. Schenkel
  • Director, Responsible Conduct of Research
  • University of Oregon

You hoped compliance was supposed to make life
like this.
But it really feels like this
Todays Puzzle Strategy
  • Lets find the edge pieces first
  • Do you have any identifiable pieces?
  • Grouping pieces into similar colors
  • Those must have pieces
  • It takes a whole team to make
  • The perfect fit

Finding the Edge Pieces
  • Federal Agency Rules Regulations
  • NIH, NSF, DoE, DoD, OHRP, OLAW, etc.
  • State Laws
  • Your Institutions Policies
  • But Lets take a closer look at HHS-OIG recently
    published DRAFT guidelines (included in your
    materials as Attachment 1)

OIG Compliance Guidance
  • For recipients of PHS Research Awards
  • To assist in preventing fraud and abuse
  • Focused specifically on grant compliance and
    administration issues
  • Contains 8 elements widely recognized as
    fundamental to an effective compliance program

Federal Sentencing Guidelines
(Or, rules will set you free.)
  • Implementing written policies procedures
  • Designating a compliance officer compliance
  • Conducting effective training and education
  • Developing effective lines of communication
  • Conducting internal monitoring and auditing
  • Enforcing standards through well-publicized
    disciplinary guidelines
  • Responding promptly to detected problems
  • Defining roles responsibilities and assigning

COGR Response to Guidelines
Attachment 2
  • We disagree with proposed guidelines
  • HHS NIH have provided and continue to provide
    extensive guidance in the broad area of pre- and
    post-award management and the ethical conduct of
  • Because guidance issued by OIG, grant recipients
    will likely view and auditors will treat it as
    mandatory, not as guidance.
  • Promotes proliferation of similar guidance by
    other federal agencies

List of Existing Policy-Guidance
  • NIH Grants Policy Statement
  • Compendium of Findings Observations
  • Resulting from the Proactive Compliance Site
    Visits conducted by NIH Office of Extramural
  • ORI - Model policies for managing research
  • OHRP IRB Guidelines
  • OLAW Guide for the Use of Laboratory Animals
  • NIH Objectivity in Research Policy
  • HHS-NIH Regulations, policies, guidance
    regarding stem cells, recombinant DNA, select
  • COGR Managing Externally Funded Programs at
    Colleges and Universities
  • AAMC Manuals on the Management of Academic
    Medical School Research Programs
  • NCURA Regulation Compliance (compendium)

OIG Thoughtful Considerations
  • Rely on the 8 basic elements, but develop your
    program suited to your needs
  • MAY require a significant commitment of time and
  • Institutions may also want to note that several
    of the elements of this compliance guidance are
    considered mitigating factors that must be
    considered as part of a formal debarment action
    by the OIG Department.
  • (45 CFR 76.870(l), (n), (p), and (q))
  • http//
    fr76.860.pdf (Included in your handouts as
    Attachment 3)

Written Policies Procedures
  • Should be provided to all faculty members and
    other employees who are affected by them, to
    students who may be conducting research and to
    any agents or contractors who may furnish
    services in connection with research awards.
  • Are yours web available?
  • Have you determined how your policies are
    practically implemented?

The Compliance Officer
  • Designate a CP who will have day-to-day
    responsibility for overseeing and coordinating
    the compliance program.
  • Designating a CP with the appropriate level of
    authority is critical to the success of the
  • Should have direct access to the governing body,
    senior administration legal counsel.
  • Should have sufficient funding, resources staff

Compliance Committee
  • Should have representation from operations,
    finance, audit, human resources, and legal as
    well as faculty members.
  • Should have the requisite seniority and
    comprehensive experience to recommend and
    implement any necessary changes to policies and

Effective Training
  • Should include administrators, both at the
    institution and dept. levels, faculty (including
    PIs), other staff, and contractors.
  • Areas of training may be identified through
    internal audits, monitoring, review of past
  • General and specific training should be provided
    both upon initial employment as well as on some
    periodic schedule.

Effective Communication
  • Develop confidentiality non-retaliation
  • You must be prepared to balance this
  • Use hotlines, email, newsletters, suggestion
    boxes, etc.
  • Employees should be permitted to report matters
    on an anonymous basis

Auditing Monitoring
  • Reviews should be focused on particular areas of
  • Post-award grant monitoring follow the money!
  • Post-approval protocol (animal human subjects)
  • Environmental health safety
  • The reviews should evaluate whether
  • The institution has polices covering the areas of
  • The policies were communicated implemented
  • The policies were followed

Enforcing Standards
  • Clear and specific disciplinary policies should
    set out the consequences of violating Federal,
    State requirements, the Institutions code of
    conduct or its policies procedures.
  • Each situation must be considered on a
    case-by-case basis, taking into account all
    relevant factors.
  • Intentional and material non-compliance should
    not be tolerated.

Responding Promptly
  • CP must immediately investigate allegations to
    determine whether a material violation has
  • The institution should promptly report the
    existence of misconduct to the appropriate
    authorities (within 60 days)
  • Provide information regarding which law was
    violated, potential financial and scientific

Roles Responsibilities
  • Ignorance is not bliss know your part
  • Compliance is not solely the CPs responsibility
  • More on this later!
  • The Institution may be the responsible legal
    entity but the PI accepts responsibility for
    the scientific conduct of the project
  • Departmental Administrators must not only be
    accountable, but equally importantly, be
    supported and protected.

  • Individual ethical behavior is likelier to
    flourish within a just society. So in order to
    lead an ethical life one should work for a just
    society. That is, if most of us will behave
    about as well as our neighbors, it is incumbent
    on us to create a decent neighborhood.
  • Randy Cohen
  • The Good, the Bad and the Difference

Do you have any identifiable pieces?
Begin With What You Have
  • Take stock of your resources
  • Make note of and communicate your gaps to the
    people with the purse strings.
  • Tell horror stories if necessary
    (hopefully they wont come from your
  • Catalyzing Events

Reasons to Invest in Compliance
  • 1998 University of Minnesota settles with
    Government for 32M for profiting from sales of
    an unlicensed drug
  • Expanded Authorities removed for 3 years, 55
    required Corrective Actions T. Schumacher,
    Dir., Office of Institutional Compliance, Univ.
    Minnesota NCURA conference, Nov. 2003
  • University estimates that by 2004 it had spent an
    additional 48M to recover reorganize NCURA
    Conference, July 2004
  • Chair of Surgery asked to resign (1994) and
    indicted on 18 felony counts (later exonerated on
    all counts) Time Magazine 05/11/95
  • Consulting group brought in to help reorganize
    concluded tenure was a major obstacle to
    re-engineering, sparked 1996 Tenure War
    American Association of University Professors,
    ACADEME, Vol 85, 6 (1999)
  • Marked decrease in NIH awarded funds American
    Association of University Professors, ACADEME,
    Vol 85, 6 (1999)

Build on Your Existing Resources
  • Sponsored Programs Office
  • Pull together your policies
  • Can you build from IRB IACUC resources?
  • What help can central business office provide?
  • Communicate, educate, implement

Grouping Pieces into Similar Colors
  • Create a compliance website that holds all
    available information from all areas.
  • Appoint one individual (if you dont have a CP)
    to be responsible for overseeing and advising
  • Keep your various groups talking (nascent
    compliance committee)

Those Must Have Pieces
HHS Designated Risk Areas
  • Time Effort Reporting
  • Institutions must have effective timekeeping
  • Must have accurate consistent treatment of
    institutional base salary (IBS)
  • Proper Allocation of Charges to Projects
  • It is fraudulent to bank or trade awards between
    personnel, or charges amongst awards.
  • Cost Sharing
  • The reporting of other financial support is a
    required elementfailure to provide this
    information could subject an institution
    tocriminal investigation.

Those Must Have Pieces
2006 OIG Work Plan Attachment 4
  • Conflicts of Interest (COI)
  • Must have written policy, must report to NIH
    PIs COI how it has been managed, reduced or
  • Time Effort Reporting
  • Sub-contract Costs Monitoring
  • We are responsible to know whether or not our
    sub-recipients have met their audit requirements
    (site visits, review of perf., financial
    reporting, risk assessments)
  • University Administrative Clerical Salaries
  • Are support staff, clerical grant
    administrators being incorrectly charged as
    direct expense?
  • Cost Transfers
  • Are they allowable, are they properly documented?
    NIH total cost transfer are approaching 20
    Billion annually

Those Must Have Pieces
NSF 2006 Audit Plan Attachment 5
  • Proper Allocation of Charges to Projects
  • Subcontract Costs Monitoring
  • Close Out Award Financial Management
  • Disposition of Federally owned property
  • Overstating IDC recovery
  • Hurricanes Katrina Rita
  • The NSF has gt60 awardees in the states effected
    by the hurricanes.
  • Transfer awards for faculty students
    temporarily at other institutions supplemental
    funding requests fund grants studying the quick
    response on natural disasters.

On Site Review Modules Used during the Site Visit
to Conduct the Review of Targeted Areas
  • Time effort reporting for personnel
  • Fringe benefits
  • Travel
  • Consultants
  • Cost Sharing
  • Participant Support
  • Indirect Costs
  • Procurement
  • Subrecipient Monitoring
  • Property

Director, Division of Institution and Award
Take note of the overlap
  • Time Effort Reporting
  • Allocation of Charges-Cost Transfers
  • Subcontracts Monitoring

It Takes a Whole Team
Roles Resp Matrix Attachment 6
  • First Base The PI
  • Second Base Dept Grants Admin.
  • Third Base IRB, IACUC
  • Pitcher Sponsored Programs Office
  • Home Base Institutional Official
  • Short Stop Compliance Officer
  • Outer Field Ancillary Support Services
  • Umpire Agency Auditors Administrators

Event versus Operational Compliance
  • Compliance Officers
  • Write policy
  • Help PIs, departments, schools create processes
    and procedures
  • Provide education or are an educatory resource
  • Investigate issues of Non-compliance

Event versus Operational Compliance
  • PIs, Dept Personnel, SPOs
  • Incorporate principles of policy into their daily
  • Have a general knowledge of applicable
    regulations and work accordingly
  • Handle day-to-day issues on their own
  • Call upon the CP as needed

Striving for the Perfect Fit
  • "For a scientist research administrator,
    integrity embodies above all the individual's
    commitment to intellectual honesty and personal
    responsibility For an institution, integrity
    is a commitment to creating an environment that
    promotes responsible conduct by embracing
    standards of excellence, trustworthiness, and
  • - Integrity in Scientific Research, The National
    Academy of Sciences

Striving for the Perfect Fit
  • the effectiveness of an ethics and
    compliance program is not only measured in terms
    of the channels and messages it uses for
    communicating with employees it is also
    effective in terms of the ways and extent to
    which it institutionalizes itselfOne way to
    institutionalize itself is the command-and-control
    structure that sets up the program, designs its
    policies and procedures, and communicates them to
    the organization.

Striving for the Perfect Fit
  • The otherand far more effectiveis the
    participatory structure that seeks the
    participation of employees, managers, officers,
    and directors (and other stakeholders, as
    appropriate) in the design, implementation, and
    evaluation of the programThus, if an ethics and
    compliance program is going to be truly
    effective, it will need to become simply the way
    the organization goes about its business.
  • - Justification for Suggested Changes to Proposed
    Amendments to FSGO Stuart Gilman, Robert Olson,
    Michael Hoffman.