Two PYA executives were guests on a national healthcare compliance podcast. During the May 25, 2023, Compliance Perspectives Podcast, PYA Atlanta Principal Valerie Rock and Consulting Senior Manager Kristen Lilly Davidson discuss the trend of private equity (PE) firms entering the healthcare market and the importance of compliance due diligence. The podcast is sponsored by the Society of Corporate Compliance and Ethics (SCCE) and the Health Care Compliance Association (HCCA).
During the podcast, Rock and Davidson discuss the historical trends of PE physician practice diligence and the transition PE firms are making from diligence focused on financial aspects to an expansion to include regulatory compliance. Often PE firms have learned these risks through post-acquisition operational issues arising, payer audits, litigation, or enforcement actions.
“The bottom line: The health of the practice is rooted in its operations, and if the practice has any operational deficiencies, this can lead to compliance risks,” said Rock.
Also discussed is the risk to the revenue cycle. Davidson explains that PE firms should examine the operational processes and do onsite assessments of the healthcare entities to uncover indicators of risk to the revenue cycle.
“PE firms are learning that thorough compliance diligence is more than just financial diligence or coding audits,” Davidson said.
Rock and Davidson’s appearance on the podcast was inspired by their related article, “Building a strong physician practice compliance infrastructure: Lessons learned from physician practice diligence,” which was published in the April 2023 issue of HCCA/SCCE’s Compliance Today. They also presented this topic at the 27th annual HCCA Compliance Institute in April.
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