Western Maryland Health System
Standards of Conduct

In carrying out its health care governance in a manner consistent with the Mission, Vision and Values, each employee and agent of the Western Maryland Health System (WMHS) has responsibility to adhere to a high standard of individual and organizational ethical and legal business practices. The Core Values of the WMHS are Respect, Integrity, Quality, Community Advocacy and Resourcefulness. The Value of Integrity means that we are honest and ethical in our individual and business practices and that we comply with all laws and regulations that govern our health care system.

The WMHS Standards of Conduct are a practical extension of WMHS' values. They more fully articulate WMHS' expectations for how employees and agents should conduct themselves to promote and protect the integrity of the WMHS.

WMHS expects employees and agents to conduct the business affairs of WMHS in a manner consistent with the following principles:

• Conduct all activities in compliance with applicable laws and regulations. Laws specifically applicable to healthcare institutions include such areas as abuse, antitrust, employment discrimination, environmental protection, fraud, false claims, lobbying and political activity, self-referral prohibitions and tax.
• Promote the highest standards of business ethics and integrity. Employees must represent the WMHS accurately and honestly and must not engage in any activity intended to defraud anyone of money, property or services. Employees must act in good faith and in the best interest of the WMHS.
• Maintain the confidentiality of patient information and protect confidential and proprietary information about employees and the organization.
• Conduct activities and relationships with others so as to avoid actual conflicts of interest, in appearance or fact. If they do have conflicts, employees must make full disclosure and take appropriate action under the WMHS Code of Ethics/Conflict of Interest Policy.
• Conduct business transactions with suppliers, contractors, vendors and other third parties at arms-length and free from offers or solicitation of gifts and favors, or other improper inducements.
• Exercise responsible stewardship to preserve and protect WMHS' assets by making prudent and effective use of WMHS' resources.

Much that constitutes ethical business behavior is second nature to people. Sometimes employees encounter situations in which they are unsure of what to do or how to act. This document is accompanied by a reference guide that describes the principles and related standards in greater detail. This additional document covers a wide variety of circumstances and situations that employees encounter during the course of their work. Please use it as a reference whenever there are questions regarding appropriate business conduct.

WMHS is committed to full compliance with all federal health care program requirements, including the obligation to prepare and submit accurate claims consistent with such requirements.

WMHS expects, as a condition of employment or any business relationship, that all covered employees, directors, officers, contractors, suppliers or vendors will comply with the WMHS' Standards of Conduct, Compliance Policy and any additional requirements, such as the Office of Inspector General Corporate Integrity Agreement (OIG-CIA) agreed to by WMHS on November 6, 2003. Compliance with these policies is component of an employee's job performance evaluation.

WMHS employees and other covered persons are expected to report to the WMHS Compliance Officer, or other individual designated by WMHS, any suspected violations of the WMHS' Standards of Conduct or Compliance Policy, or any of the requirements of federal health care programs.

Any failure to report non-compliance puts WMHS and its covered employees, directors, officers, contractors, suppliers and vendors at risk for legal exposure for violations of administrative, civil or criminal statutes and further jeopardizes WMHS' right to seek payments for health care services rendered to federal health care program beneficiaries. WMHS is required to and will undertake appropriate disciplinary action or other reporting obligation as a consequence of any employee or other covered person failing to report noncompliance issues with federal health care programs or the WMHS' Standards of Conduct and Compliance Policy.

WMHS maintains a confidential disclosure program for reporting non-compliance issues. All WMHS employees and other covered persons have the right to report non-compliance issues or concerns in a confidential and anonymous manner and WMHS pledges to maintain a non-retaliatory and non-retribution environment for non-compliance reporting. The WMHS toll-free hotline is 1-866-463-2246. All concerns or issues reported will be reviewed and appropriate corrective action will be taken in response to any concerns or issues raised.

WMHS will be undertaking policy review, training, education, auditing, reporting and other obligations in connection with the OIG Corporate Integrity Agreement. WMHS expects that all employees and other covered persons will cooperate and assist with the OIG-CIA obligations as requested. The key requirements of the OIG Corporate Integrity Agreement will be available at the WMHS training sessions and will otherwise be publicized periodically.

Principle 1 - Legal Compliance

WMHS is committed to conduct all of its activities in compliance with applicable laws and regulations. These laws pertain to such areas as employment discrimination, self-referral prohibitions, fraud, abuse and false claims, lobbying and political activity, environmental protection, antitrust and tax.

Standard 1.1 - Discrimination

The Western Maryland Health System believes that the fair and equitable treatment of our employees, those we serve and the community at large is vital to the fulfillment of our mission. We demonstrate that commitment through Core Values, especially Respect and Integrity as related to the treatment of individuals.

The WMHS will, therefore, treat patients and recruit, hire, train, select, promote and terminate employees without regard to race, creed, color, national origin, disability, age or any classification protected by law.

The WMHS will not tolerate any form of harassment or discrimination of patients, their families or employees. Allegations of abuse, harassment or discrimination should be promptly reported to the Department Director and Human Resources. The allegation will be properly investigated in accordance with governmental regulations, laws and WMHS policies. Timely and appropriate action will be taken after the investigation.

Standard 1.2 - Fraud, Abuse, or False Claims

WMHS expects employees to refrain from conduct that may violate federal or state fraud, abuse and false claims laws. Such laws generally prohibit:

• Payment or receipt of remuneration, in cash or in kind, in exchange for the referral of patients or for ordering items or services to be reimbursed under Medicare or Medicaid.
• Submitting false, fraudulent or misleading claims to the government or a third-party payor, including claims for services not rendered, claims which characterize the service differently than the service actually rendered, or claims which do not otherwise comply with applicable program or contractual requirements: and
• Making false representations to any person or entity in order to gain or retain participation in a program or to obtain payment for any service.

Standard 1.3 - Lobbying and Political Activity

WMHS expects its Employees to refrain from engaging in activities that may jeopardize the tax-exempt status of the organization, including certain lobbying and political activities.

• Employees may not contribute any of WMHS' money or property, or the services of any WMHS director, officer, employee, or contractor to any political candidate, party, organization, committee, or individual, in violation of any applicable law. Employees may personally participate in and contribute to political organizations or campaigns as individuals - not as representatives of WMHS - and they must use their own funds.
• Where its expertise may be helpful, WMHS may publicly offer recommendations concerning legislation or regulations being considered. In addition, it may analyze and take public positions on issues that have a relationship to the operations of WMHS when WMHS' experience contributes to the understanding of such issues.
• WMHS has many contacts and dealings with governmental bodies and officials. All such contacts and transactions must be conducted in an honest and ethical manner. Any attempt to influence the decision-making process of government bodies or officials by improper offer of any benefit is absolutely prohibited. Any requests or demands by any government representatives for any improper benefit should be immediately reported to the Corporate Compliance Officer (CCO).

Standard 1.4 - Environmental Protection

WMHS respects the environment and strives to conserve natural resources in managing and operating its business. Employees are expected to use resources appropriately and efficiently, recycling where possible; disposing of all waste according to applicable laws and regulations, and working cooperatively with appropriate authorities to remedy any environmental contamination for which WMHS may be responsible.

Standard 1.5 - Tax

WMHS will make every effort to conduct its activities in a manner that justifies and protects its tax- exempt status, as well as, to fully comply with federal, state, and local laws and regulations. As a not-for-profit, tax-exempt entity, WMHS has a legal and ethical obligation to comply with applicable laws, to engage in activities to further its charitable purposes, and to ensure that its resources are used to further the community benefit rather than the private or personal interest of any individual. Consequently, WMHS and its employees must avoid compensation arrangements and benefits in excess of fair market value, accurately report payments to appropriate taxing authorities, and file all tax and information returns according to applicable laws.

• WMHS will ensure, to the extent reasonably possible, that (1) unrelated business activities of WMHS are identified; (2) the result of operations of such unrelated business activities are properly reported pursuant to federal and state requirements; and (3) applicable taxes upon unrelated business income are properly computed timely paid.
• WMHS will make good faith efforts to ensure that individuals who are compensated for the performance of services are appropriately classified under applicable federal and state law principles as employees or independent contractors. WMHS will ensure that compensation paid to employees is properly reported in accordance with federal, state and local requirements and that applicable tax are properly withheld and remitted, or paid by WMHS.
• WMHS will not engage in an excess benefit transaction resulting in the imposition of federal excise taxes as a penalty under IRS code section 4958.
• WMHS will ensure its activities are conducted for the benefit of the community. It will not operate for the benefit of hospital employees, medical staff physicians, or other private interests, nor will its governance under control or influence of such interests.
• WMHS will ensure that no parts of the hospital's earnings will, directly or indirectly, inure to the benefit of its directors, officers, employees or physicians, and that any private benefit which results from such system activities will be incidental to the public benefit.

Principle 2 - Business Practices

WMHS is committed to the highest standards of business and ethics and integrity. Employees must represent WMHS accurately and honestly and must not engage in any activity intended to defraud anyone of money, property or services. Employees must act in good faith and in the best interest of the WMHS.

2.1 - Dealings with Vendors

WMHS will conduct all business with vendors in a lawful and ethical manner to assure that the WMHS and the vendor receive fair value in all business relationships. WMHS will ensure relationships are free from inappropriate influence, such as kickbacks or favoritism.

2.2 - Cost Reporting

Improper reporting of costs, statistics and other data on Medicare Cost Reports has been identified as Medicare Fraud by the Office of the Inspector General. Improper reporting violates the ethical business conduct standards of WMHS and shall not be condoned or permitted by employees, agents or consultants of WMHS. WMHS shall establish policies and procedures to assure that, to the best of the abilities of the individuals compiling cost reports; the information is presented in legal and ethical manner on all cost reports.

Principle 3 - Confidentiality

WMHS and its employees possess and have access to a broad variety of confidential, sensitive and proprietary information. The inappropriate release of this information can be harmful to individuals, WMHS' business partners, and WMHS itself. WMHS employees must actively protect and safeguard confidential, sensitive and proprietary information.

3.1 - Patient Information

All WMHS employees must maintain the confidentiality of patient information according to applicable laws and regulations. Employees must not reveal personal or confidential information concerning patients unless supported by legitimate business or patient care purposes. If questions arise regarding information, employees should seek guidance from their supervisor or the CCO.

3.2 - Proprietary Information

Information, ideas and intellectual property assets of WMHS are important to the organization's success. Information pertaining to WMHS' competitive position or business strategies, payment and reimbursement information, and information relating to negotiations with employees or other organizations needs to be protected and share only with employees who must know such information in order to perform their job responsibilities. Employees should exercise care to ensure that intellectual property, including patents, trademarks, copyrights and software, is maintained and managed to preserve and protect its value.

3.3 - Personnel Actions/Decisions

Salary, benefit and other personal information relating to employees must be treated as confidential according to applicable Human Resources policies.

3.4 - Peer Review Information

WMHS employees shall take all reasonable steps to protect the confidentiality of peer review information. Violation of state or federal peer review statutes governing the confidentiality of peer review information and documents may cause WMHS to lose favorable immunities from civil liability.

Principle 4 - Conflicts of Interest

WMHS employees may not use their positions to profit personally or to assist others in profiting in any way at the expense of the organization. All employees are expected to conduct their activities so as to avoid conflicts of interest and/or the appearance of conflicts.

Employees should fully disclose to their managers any actual or potential conflicts of interest. The WMHS Code of Ethics/Conflicts of Interest Policy provides additional guidance in this area and applies to WMHS directors, officers, administrative staff members and key employees. To assure compliance with this principle, key employees are required to submit a Conflicts of Interest Disclosure Statement and a Confidentiality Agreement to WMHS annually.

4.1 - Examples of Conflicts

Following are a few examples of conflicts. Further guidance can be obtained from the annual Disclosure Statement.

Outside Interests and Activities

• Holding, directly or indirectly, a material ownership or financial interest, or employment or management position in any outside concern from which WMHS purchases goods or services considered a conflict of interest. This includes any material financial interest held by a member of the immediate family. The "immediate family" is defined as spouse, parents, children, spouses of children, brothers and sisters, or spouses of brothers and sisters of the employee. As a general rule, an ownership or financial interest is "material" if the interest has a value in excess of $500,000 or represents in excess of 5% of the ownership or control of the entity. WMHS may, following a review of the relevant facts, permit ownership interests which exceed these amounts if management concludes such ownership interests will not adversely impact WMHS' interests or the judgment of the employee.
• Competing, either directly or indirectly, with various health services, products or plans offered by WMHS.
• Serving as a director or rendering managerial or consulting services to any outside concern that does business with or competes with the services offered by WMHS.
• Borrowing money or anything of value from a patient, individual or entity which is transacting business with WMHS other than on terms and conditions which are offered to the general public.

Gifts and Entertainment

Inside Information

4.2 - Services for Competitors/Suppliers

Employees must not perform work or render services for any competitor, supplier or potential supplier of WMHS outside of the normal course of their employment with WMHS without approval of their supervisors. Employees must not be directors, officers, or consultants of such organizations, and must make sure their names are not used in any way that would indicate a business connection with such organizations.

4.3 - Participation on Outside Boards of Directors

Employees are encouraged to participate actively in the civic and social affairs of their communities. This may include serving on the boards of directors of various civic or charitable organizations. When serving on such boards, employees should observe the following standards:

• Employees must obtain approval from their supervisors prior to serving as members of boards of directors of any organizations that my have interest that conflict with those of WMHS.
• All fees/compensation paid to an employee - other than reimbursement for expenses arising from board participation - that are received for board services during normal work time must be paid directly to WMHS unless the employee took personal time off to perform the service.

Principle 5 - Business Relationships

Business transactions with suppliers, contractors, vendors, and other third parties must be at arm's length and free from offers or solicitation of gifts and favors, or other improper inducements and all conduct by the employee must be in the best interest of WMHS.

The following standards are intended to guide Employees in their business relationships with suppliers, providers, contractors, third-party payors and government entities. It is WMHS' intent that this policy be construed broadly to avoid even the appearance of improper activity. If there is any doubt or concern about whether specific conduct or activities are ethical or appropriate, contact the CCO. Above all, employees should use common sense and good judgment in accepting or refusing gifts, gratuities and other inducements offered to or by WMHS' suppliers, contractors and customers.

5.1 - Gifts and Gratuities

WMHS aims to preserve and protect its reputation and avoid even the appearance of impropriety. The following guidelines are designed to cover a wide variety of situations employees may encounter related to gifts and gratuities.

Employees are prohibited from soliciting money, personal gratuities or gifts from patients and from accepting money, personal gratuities and gifts of more than a nominal value. If a patient, member of a patient's family, or other individual wishes to present a gift of money of more than a nominal value, he or she should be referred to the Director of the WMHS Foundation.

Employees may retain gifts of a nominal value from suppliers. If an employee has any concern whether a gift should be accepted, the employee should ask his or her supervisor. To the extent possible, these gifts should be shared with coworkers. Employees must not accept excessive gifts or expensive meals or entertainment, nor may they solicit gifts - other than gifts in support of WMHS' charitable activities - from vendors, suppliers, contractors or other persons.

Employees must not accept gifts, favors, services, entertainment or other things of value to the extent the acceptance influences - or creates an impression of influencing - decision-making. Similarly, WMHS prohibits its employees from offering or giving money, services or other things of value with the expectation of influencing the judgment or decision-making process of any purchaser, supplier, customer, government official or other employee. Any such conduct must be reported to the CCO.

At a supplier's invitation, an employee may accept meals or refreshments at the suppliers' expense. Occasional attendance at a local theater or sporting event, or similar entertainment at supplier expense may also be accepted. In most circumstances, a regular business representative of the supplier should be in attendance with the employee.

5.2 - Workshops, seminars and training sessions

Employees may attend local, supplier-sponsored workshops, seminars and training sessions. Supplier-funded attendance at out-of-town seminars, workshops and training sessions is permitted only with prior approval of an employee's supervisor.

5.3 - Contracting

All business relations with contractors must be at arm's length and must comply with WMHS policies and procedures. Employees must disclose personal relationships and business activities with contractor personnel that may be construed by an impartial observer as influencing the employee's performance of duties. Employees are responsible to obtain clarification from their supervisors on questionable issues which may arise and to comply with WMHS' Ethic and Business Conduct Policy.

5.4 - Business inducements

WMHS employees may not offer, give, solicit or receive any form of bribe or other improper payment. Commissions, rebates, discounts and allowances are customary and acceptable business inducements if they are approved by WMHS management and if they do not constitute illegal or unethical payments. Such payments must be reasonable in value, competitively justified, properly documented, and made to the business entity to whom the original agreement or invoice was made or issued. These payments should not be made to individual employees or agents of business entities.

In addition, Employees may provide gifts, entertainment and meals of nominal value to WMHS customers, current and prospective business partners and other persons when these activities have a legitimate business purposes, are reasonable and are consistent with applicable law.

Principle 6 - Protection of Assets

Employees must preserve and protect WMHS' assets by making prudent and effective use of WMHS resources and properly and accurately reporting its financial condition.

The following standards state WMHS' expectations related to activities or behaviors that may have an impact on its financial condition or that reflect a reasonable and appropriate use of its assets. Questions or concerns relating to this principle should be directed to the CCO.

6.1 - Internal Control

WMHS has control standards and procedures to ensure that assets are protected and properly used, and that financial records and reports are accurate and reliable. All WMHS employees share responsibility for maintaining and complying with required internal controls.

6.2 - Financial Reporting

All financial reports, cost reports, accounting records, research reports, expense accounts, time sheets and other financial documents must accurately and clearly represent the relevant facts or true nature of a transaction. Improper of fraudulent accounting, documentation or financial reporting is contrary to WMHS' policy and is often illegal under federal and state law and program requirements.

6.3 - Honoraria

Employees are encouraged to participate as faculty and speakers at educational programs and functions related to their work at WMHS. However, any honoraria in excess of $50 must be returned to WMHS unless the employee used personal time off to attend the program and that portion of the program for which the honoraria is paid. Employee expenses associated with participation will not be paid by WMHS without the approval of the employee's supervisor.

6.4 - Personal Use of Corporate Assets

Travel and entertainment expenses should be consistent with the employee's job responsibilities and the organization's needs and resources. Employees should not have a financial loss or gain as a result of business travel and entertainment. Employees are expected to exercise reasonable judgment in using WMHS' assets and to spend them as carefully as they would their own. Employees must also comply with WMHS' policies relating to travel and entertainment expense.

6.5 - Personal Use of Corporate Assets

WMHS assets should not be used for personal purposes unless the use is considered minimal personal use. Property of WMHS must be used and the business of the company conducted in a manner designed to further WMHS' interest rather than the personal interest of an individual employee. Employees are prohibited from unauthorized use or taking of WMHS' equipment, supplies, materials or services. Employees must obtain approval of their supervisor before engaging in any activity on company time which will result in remuneration to the employee or to use WMHS' equipment, supplies, materials or services for personal or other purposes unrelated to their WMHS work.