Do Speech Therapy Centers Need Special Healthcare Compliance?

Key Takeaways:
Speech therapy centers are subject to many of the same healthcare compliance laws that apply to larger medical providers. Practices must follow strict HIPAA regulations to safeguard patient information, maintain state licensure through the Colorado Department of Regulatory Agencies (DORA), and meet Medicare and Medicaid documentation and billing requirements. Noncompliance can lead to severe financial penalties, loss of licensure and damage to a practice’s reputation. To stay compliant, speech therapy businesses should routinely review regulatory updates, train staff on data privacy and billing standards and work closely with a small business attorney experienced in healthcare law to ensure their policies, procedures and documentation remain current and legally sound.

Running a speech therapy center involves more than providing quality care to clients; it also means navigating the complex world of healthcare compliance. Many speech therapy business owners assume that only hospitals or large medical practices need to worry about regulations like HIPAA or Medicare documentation standards. In reality, even small or private speech therapy practices fall under many of the same rules designed to protect patient information, ensure accurate billing and maintain proper licensure.

Compliance can seem overwhelming, especially when you’re focused on growing your client base, delivering high-quality speech therapy services and managing day-to-day operations. But understanding your legal responsibilities early on can save your practice from costly fines, reputational damage and operational disruptions down the road. The key is knowing which regulations apply to your business and how to meet those requirements without letting them slow you down.

The following overview will highlight the most critical healthcare compliance matters impacting speech therapy practices. The best way to ensure your practice addresses these issues properly is to work with a team of individuals who know healthcare compliance including a compliance specialist, an IT company that works with healthcare professionals, and an experienced small business lawyer familiar with healthcare law. Receiving proper compliance and legal guidance can help you avoid costly penalties and other consequences which can be potentially damaging to your practice.

HIPAA Compliance

Speech therapy practices collect a wide range of patient-protected health information (PHI), including:

• Personal identification information
• Medical history
• Assessment results
• Therapy records
• Billing information

As a result, they must comply with regulations established under the Health Insurance Portability and Accountability Act (HIPAA). To adhere to HIPAA requirements, speech therapy practices must:

• Conduct risk assessments to identify and mitigate potential security vulnerabilities associated with protected health information
• Establish HIPAA-compliant policies and procedures for managing PHI
• Train their staff on HIPAA regulations and security measures
• Use secure communication methods, such as encrypted email and HIPAA-compliant telehealth platforms, whenever they share patient information
• Obtain patient consent and maintain business associated agreements with any partners who handle PHI
• Ensure the confidentiality and secure storage of both physical and electronic patient records
• Prepare an incident response plan in the event of a privacy breach

HIPAA compliance issues can result in harsh financial, legal and professional penalties. Fines for a HIPAA violation are structured in tiers:

• Tier 1 (Lack of Knowledge) – Your practice wasn’t aware of and couldn’t have realistically avoided the violation, even when taking a reasonable amount of care to adhere to HIPAA regulations. Fines range from $100 per violation to $50,000 per violation.
  
• Tier 2 (Reasonable Cause) – Your practice should have been aware of the violation but couldn’t have avoided it even with a reasonable amount of care to adhere to HIPAA regulations. Fines range from $1,000 per violation to $50,000 per violation.
  
• Tier 3 (Willful Neglect) – Your practice suffered a violation due to “willful neglect” of HIPAA regulations, but attempted to correct the violation within 30 days. Fines range from $10,000 per violation to $50,000 per violation.
  
• Tier 4 (Willful Neglect Not Corrected) – Your practice suffered a violation due to “willful neglect” of HIPAA regulations but made no attempt to correct the violation within 30 days. Fines range from $50,000 per violation to $1,500,000 per violation.

In addition, criminal penalties may be assessed according to the following tiered structure:

• Tier 1 (Lack of Knowledge/Reasonable Cause) – Up to 1 year in jail
• Tier 2 (Obtaining PHI Under False Pretenses) – Up to 5 years in jail
• Tier 3 (Obtaining PHI for Personal Gain or with Malicious Intent) – Up to 10 years in jail

In addition, HIPAA violations can result in damage to your reputation and a variety of other professional consequences. Data breaches or improper disclosure of patient information can result in loss of patient trust, reduced business and potential lawsuits from patients affected by the data breach. Your practice may also be required to implement corrective action plans in order to avoid suspension of your professional license.

State Licensing and Certification Requirements

The Colorado Department of Regulatory Agencies (DORA) has established licensure and certification requirements for speech therapists. These include:

• Completion of a master’s degree or higher in speech language pathology or communication sciences and disorders from an accredited institution
  
• Completion of a clinical fellowship program consisting of 1,260 hours under supervision
  
• Passing score of 162 or higher on the national Speech-Language Pathology Examination
  
• Submission of official transcripts, proof of clinical fellowship completion, national exam scores, a patient medical record security plan, proof of professional liability insurance and results of a background check

Renewal of speech therapy licenses is required annually, with a renewal deadline of November 30. In order to renew your license, you must complete all required continuing education coursework.

Failure to comply with all state licensure requirements can result in a variety of penalties, including:

• License suspension or revocation
• Fines
• Probation or letter of admonition
• Cease-and-desist order for your practice

Medicare and Medicaid Compliance Requirements

Speech therapy practices must also comply with federal Medicare and Medicaid requirements associated with proper billing, reimbursement and provision of services. These include:

• Providing proper documentation that treatments are medically necessary
• Using correct CPT and modifier codes
• Submitting timely, accurate claims consistent with Medicare and Medicaid regulations
• Adhering to any applicable state-specific Medicaid billing protocols
• Staying current with annual updates to fee schedules, codes and documentation requirements

Failing to comply with these regulations can result in claim denials, practice audits, loss of provider status and other penalties.

Legal Help for Speech Therapy Businesses

The penalties for compliance violations can be devastating for your speech therapy practice. To avoid these issues, it’s important to have a team to help you comply with legal rules, compliancy rules, and accounting rules. This means that you need a team to help you. Working with a business attorney who represents speech therapy practices is an important step that will help you avoid compliance violations in addition to a compliancy specialist and your CPA. If you need help with compliance issues, reach out to Elizabeth Lewis to make sure you have a team of support.

Elizabeth Lewis represents small and medium-sized businesses in the Denver area, and she regularly helps speech therapy practices navigate the business issues, including working with their compliance specialists, CPAs, IT companies, and healthcare billing companies in a team effort to avoid costly compliance violations. Elizabeth will ensure you remain current on the latest regulations and advise you on any actions your practice needs to take to have the best practice possible.

In addition, she provides comprehensive legal services that can ensure the interests of your speech therapy business are protected at all times. Whether you need assistance with business formation matters, drafting and reviewing contracts, navigating a contract dispute or employment law matters, Elizabeth will provide the sound legal guidance your practice needs.

Contact us today to schedule a consultation. The Law Office of E.C. Lewis serves clients in Denver and the surrounding areas.