Background check compliance is highly important, in large part because of the penalties organizations can incur for noncompliance. Conducting background checks that aren’t compliant can have a range of negative implications for an organization, including reputational risk and hefty fines. For healthcare organizations, there are additional risks associated with falling out of compliance with background checks, including injury to patients, possible loss of accreditation, and even the clawback of Medicare or Medicaid payments.

There are some important signs that can show your background check activities are out of step with compliance regulations. Here are seven factors that could indicate your healthcare background check isn’t compliant, as well as some tips for making improvements.

1. Current Employees with a Criminal Past, Assessing the Past and Adverse Action

If a background check fails to provide you with a complete picture of an individual’s criminal past, it is not doing its job, and it is also possibly not compliant. Background checks are required by the Fair Credit Reporting Act (FCRA) to make use of the most accurate and up-to-date sources of information. If a candidate had a background check, was hired, and was later discovered to have a criminal past that was not uncovered by the background check, it is very possible the background check didn’t rely on the most accurate and up-to-date sources of information, in which case it was likely in violation of the FCRA. Since there is not a single database or public records search capable of providing the full picture of a candidate’s criminal history, it’s best to develop a comprehensive background screening program that draws upon a variety of searches and sources. 

Notwithstanding the problem of paying a company for an incomplete background check, you also don’t want to miss an opportunity to make a well-informed hiring decision. Though not every person with a criminal history is ineligible for hire, every organization needs a chance to consider all aspects of a background check before making a final determination. A thorough, compliant background check provides such an opportunity. The days of denying anyone with a criminal past from employment are over.  The EEOC has provided guidance for considering arrest and conviction information in employment decisions. Employers should have consistent procedures in place for evaluating any applicant with a criminal history on an individualized basis and healthcare facilities may also need to weigh state laws and regulations regarding who can work with vulnerable populations.

If you decide not to hire an individual due to a criminal record on a background check, or any other item in the background check, you must follow the Adverse Action procedures dictated by the FCRA and some local laws.

2. Poor Drug Screening Procedures

Pre-employment and post-hire drug screening are  governed by regulatory agencies and laws. For example, the EEOC and ADA (Americans with Disabilities Act) both set confidentiality requirements as well as guidelines for notifying employees about drug testing policies and results. Therefore, any drug screening should be developed with legal requirements in mind, and should also be consistently administered. If your drug screening policy and procedures are inconsistent, and don’t take into account applicable laws, they’re probably not compliant and may not be doing enough to make sure illegal drug users aren’t being employed in a healthcare setting.

Drug screening procedures should also have clear parameters. Pre-employment drug tests should only be used to determine illegal drug use, and should not be used for other purposes. It’s important to be sure drug screening activities stay within their predefined scope. If they don’t, drug screening could be mistaken for a medical exam, which carries additional compliance requirements.

In addition, if you haven’t evaluated your drug screening policy lately, it may have fallen out of compliance because of the many new state laws legalizing some forms of marijuana use. As states continue to pass laws  legalizing medicinal or recreational marijuana, or both, you’ll need to re-evaluate existing drug screening policies and consider all the implications of marijuana in the workplace.

3. Unverified Licenses or Medical Sanctions

Healthcare employers must take care to hire only those individuals with the required medical credentials. If a background check fails to identify individuals with revoked or lapsed licenses, or candidates who have falsely claimed certain licenses they don’t possess, your organization can be at risk of fines, loss of accreditation, or both. 

Just as having the proper medical license is a good indication a person can legally perform certain medical procedures, it is also important to be sure individuals don’t appear on any medical exclusion or debarment lists. Your healthcare background check could be noncompliant if it fails to check any one of the following databases and lists to verify individuals are legally able to work in a healthcare organization:

  • System for Award Management (—lists individuals who have been debarred, sanctioned, or excluded by a federal agency
  • National Practitioner Data Bank—contains reports on medical malpractice payments and other adverse actions taken against healthcare practitioners, providers, and suppliers Food and Drug Administration (FDA) Debarment List—lists individuals barred from involvement in drug development or approval activities
  • DHHS Office of Inspector General (OIG) List of Excluded Individuals and Entities (LEIE)—lists individuals excluded from working for healthcare organizations  receiving federal funding 

Here are 10 ways healthcare organizations can ensure accurate and efficient  background screening programs.

4. Incomplete Educational and Employment Verifications

An important part of healthcare background checks is the verification of candidate employment and educational history. Not only is it important to be sure  nurses, physicians, and other staff have the experience they claim on their resumes, but it is also necessary to verify that they possess the required educational qualifications. If background checks are being completed without full and complete educational and employment verifications, it is possible you have employees who don’t possess the required qualifications for their role. For example, employing someone who claims to possess a masters in hospital administration but hasn’t actually earned one could create all sorts of compliance and legal issues for your organization.

Verifications shouldn’t simply confirm that the person worked within a certain organization or graduated, but also that the employer is real and the educational institution is accredited and not a diploma mill. Verifications should also be made with an authorized representative of a former employer, university, or credentialing institution. 

5. Outdated Disclosure and Authorization Forms 

The FCRA requires background checks to be accompanied by the required authorization forms and disclosures. Any candidate who undergoes a background check must have received and signed the necessary forms, and those forms must be current as dictated by the FCRA. If you’re providing the same disclosure and authorization forms to candidates you used years ago, they’re likely outdated and noncompliant. The disclosure form is the most litigated segment of the background screening process, with class-action settlements reaching millions of dollars for technical violations of the FCRA. Therefore, it’s necessary to routinely review disclosure forms to be sure they’re up-to-date.

The FTC (Federal Trade Commission), which enforces the FCRA, periodically provides guidance to employers on the use of background reports, including the need to utilize proper disclosure and authorization forms. In all cases, employers are responsible for using the correct forms. Given the considerable litigation risk, it’s important to work with your legal counsel and background screening partner to facilitate compliance.

6. No Process for Staying up to Date on New Legislation

States routinely pass new laws  affecting background checks, whether it’s marijuana legalization, new Ban the Box legislation, or laws banning interview questions about a candidate’s salary history. Not only are there new laws being passed each month, but states and local municipalities can have conflicting laws, which can create even more challenges if you make hires in multiple states. If you don’t have a process for keeping track of new or changing laws and considering how they affect your organization, your background check program can quickly fall out of compliance with the passage of time.

7. No Consistent Compliance Review Process

If you’ve never spoken with anyone from your background check company and they haven’t reviewed your background check program for compliance, you may not even be aware of pockets of noncompliance in your program. Given the potential impact on patient safety and wellbeing, thorough and compliant background checks are critical for healthcare employers. Therefore, it is necessary to periodically review your program to be sure your screening activities are consistent with policy and that your existing policies take into account regulations that vary from city to city and state to state.

How to Achieve Compliant Healthcare Background Checks

Healthcare organizations face a complex maze of regulations and rules for conducting compliant background checks. Thankfully, when you work with a background screening company that is dedicated to keeping you well-informed about the compliance regulations facing your industry, you’re in a better position to make changes and improvements to your program. Here are some key actions you can take to conduct more compliant background checks:

  • Use a combination of database searches, court searches, and list searches to facilitate thorough background checks.
  • Take steps to stay up to speed on legislation changes and new laws governing background checks and drug screening.
  • Make sure background checks include healthcare employment exclusion and debarment lists.
  • Work with a background screening company with a proven track record of conducting healthcare background checks. 

This last suggestion is perhaps the most important. Your background check partner can provide:

  • Resources and advice that keep you informed about legislation changes  impacting background checks and drug screening
  • Regular reviews of your overall background screening program, helping you to identify areas for improvement
  • The commitment to go beyond the standard three employment and educational verification attempts, making the effort to fully verify candidates’ employment and educational history
  • Background screening technology that allows you to easily request background checks, generate and securely store authorizations and disclosures, and keep better track of background check reports

Better background check compliance is an attainable goal. With the right tools, resources, and partner, you can have a fully compliant background screening program and better-informed hiring decisions. Download this helpful Healthcare Compliance Checklist to see if there are any gaps in your process you need to address.


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