ETHICS BOOKLET A GUIDE TO BUSINESS CONDUCT

Transcription

1 ETHICS BOOKLET A GUIDE TO BUSINESS CONDUCT

2 LabCorp leads the clinical laboratory industry in science, innovation and service. Just as importantly, LabCorp leads the industry in business ethics and compliance through the Company s long-standing Corporate Integrity Program. This Ethics Booklet (Booklet) is an important part of our Corporate Integrity Program, providing compliance guidance that governs the conduct of every employee and setting forth standards that all vendors, suppliers, and contractors working with LabCorp are expected to follow. Every employee is responsible for detecting and reporting unlawful conduct or conduct that may violate LabCorp s compliance policies. Any employee who becomes aware of an issue or practice that is unlawful or inconsistent with Company policy must immediately report the information to management or directly to the Corporate Compliance Department. Alternative avenues for reporting are described in this Booklet. Retaliation or other adverse employment action is prohibited by Company policy for employees raising good faith compliance concerns. We must all comply with the guidelines in this Booklet and follow all applicable laws and regulations governing our business. While this Booklet cannot provide an answer to every compliance inquiry, it addresses a wide range of relevant topics and provides information on additional resources available to employees. The principles included within this Booklet provide the framework of ethical conduct expected every day as we maintain our collective commitment to integrity. These values and standards will continue to support our ongoing success. David P. King Chairman and Chief Executive Officer i

3 Introduction Integrity: Always doing the right thing when no one else is watching. ~ Author Unknown LabCorp and each of its subsidiaries and affiliates (collectively the Company ) are committed to providing laboratory services of the highest quality to its clients and their patients in full compliance with all applicable laws and regulations. LabCorp is committed to uncompromising integrity in everything we do. The guidelines set forth in this Booklet are consistent with LabCorp s long standing commitment to compliance. In particular, this Booklet covers policies designed to deter wrongdoing and to promote: honest and ethical conduct; avoidance of conflicts of interests; compliance with Company policies; and compliance with applicable governmental laws, rules and regulations. All employees must comply with applicable Company and departmental policies and procedures as well as the guidelines set forth in this Booklet. ii

4 Table of Contents Corporate Integrity Program Management of the Corporate Integrity Program (CIP)... 1 Compliance Overview Federal Prohibitions Against Kickbacks (Anti-Kickback Statute)... 2 Federal and State Prohibitions Against False and Fraudulent Claims... 2 Antitrust and Competition... 3 Global Anti-Corruption... 3 LabCorp Employee Responsibilities Confidentiality of Information... 4 Security of Information... 4 Potential Conflicts of Interest... 4 Employee Receipt of Gifts and Entertainment... 5 Insider Trading... 5 LabCorp Standards and Practices Diagnosis Information... 6 Ambiguous Test Orders... 6 Standing Orders... 7 Advanced Beneficiary Notices (ABN)... 7 Physician Acknowledgement Letters (PAL)... 8 Record Retention and Record Destruction... 8 Quantity Not Sufficient/Test Not Performed (QNS/TNP)... 8 Human Resources Policies Environment, Health, and Safety (EHS)... 9 Substance Abuse... 9 Discrimination and Harassment... 9 Employment of Relatives...11 Exclusion...11 LabCorp and Its Customers, Clients, Vendors, and Suppliers Integrity In Customer Relations...11 Contracts With Clients...11 Client Supplies...12 Computer Placements/Connectivity...12 Rental of Office Space from a Physician or Other Referral Source...12 Courier Services...13 Reactivation of Accounts...13 Client/Commercial Adjustments...13 Professional Courtesy...13 iii

5 Waiver of Copayments, Coinsurance, and Deductibles...13 Managed Care Out-of-Network Testing...13 Charitable Contributions...14 Reporting a Compliance Issue and Resources for Guidance Compliance Action Line (CAL)...15 ecal...15 Accounting Hotline...16 International Hotline...16 Good Faith...16 Zero Tolerance for Retaliation for Reporting Concerns in Good Faith...16 The Compliance Action Quick Test...17 LabCorp Four-Step Communication Program...17 Resources for Guidance...17 Conclusion...18 Acknowledgement...19 iv

6 Corporate Integrity Program Focus Area Management of the CIP Management of the Corporate Integrity Program (CIP) Certain departments and individuals within LabCorp have been specifically charged with management of the CIP. These individuals and departments serve as a resource to all employees. Title Chief Legal Officer Corporate Compliance Department Divisional and Regional Compliance Officers Corporate Compliance Audit Team Compliance Policies and Procedures Ethics Booklet Business Practices Manual (BPM) Current Employment Policies Manual HIPAA Privacy Practices Manual HIPAA Security Practices Manual Contract Manual Responsibility Serves as the Chief Compliance Officer and is responsible for overseeing LabCorp s compliance activities. Manages day-to-day administration of the CIP. Assist the Corporate Compliance Department in administering the CIP at the divisional and regional levels. Provides audit and investigative support for LabCorp s CIP through a comprehensive audit program. One World Location Groups and Centers > Corporate Affairs > Corporate Compliance > Compliance Resources Groups and Centers > Corporate Affairs > Corporate Compliance > Compliance Resources Groups and Centers > Corporate Affairs > Corporate Compliance > HIPAA Resources Groups and Centers > Corporate Affairs > Corporate Compliance > HIPAA Resources Contact the Law Department or a Divisional Contract Administrator. The Ethics Booklet summarizes basic Company standards to be followed by LabCorp employees in conducting Company business. The Business Practices Manual (BPM) provides targeted compliance policies. The Current Employment Policies Manual addresses employee rights and responsibilities. The HIPAA Privacy Manual and the HIPAA Security Practices Manual address protected health information and related security. The Contract Manual provides standard business transaction agreements and related policies. Questions regarding the Contract Manual should be addressed to the Law Department or a Divisional Contract Administrator. The above noted policy manuals will be referenced throughout this Booklet. 1

7 Compliance Overview Focus Areas Federal Prohibitions Against Kickbacks (Anti-kickback Statute) Federal and State Prohibitions Against False and Fraudulent Claims Antitrust and Competition Global Anti-Corruption Federal Prohibitions Against Kickbacks (Anti-Kickback Statute) The Anti-kickback Statute prohibits the knowing and willful offer, payment, solicitation, or receipt of remuneration (something of value) to influence the referral of business that may be reimbursable under a federal health care program (including Medicare and Medicaid). The term remuneration is defined to include kickbacks, bribes and rebates made directly or indirectly, overtly or covertly, in cash or in kind. There are criminal and civil penalties for violating the Anti-kickback Statute. The penalties consist of substantial criminal fines and/or imprisonment, the imposition of civil monetary penalties, and exclusion from participation in federal health care programs. Federal and State Prohibitions Against False and Fraudulent Claims Federal law and the laws of many states contain specific prohibitions against the submission of false or fraudulent claims and provide for the imposition of civil, criminal and administrative penalties. Individuals may bring qui tam actions asserting civil false claims. The qui tam provisions allow private citizens to file lawsuits on behalf of the United States. A qui tam action is brought by an individual, the qui tam relator, filing a complaint in federal court under seal. The government investigates the allegations in the complaint and decides whether it will join the action, in which case the Department of Justice or comparable state agency takes the lead role in prosecuting the claim. If the government decides not to join, the qui tam relator may pursue the action alone. Qui tam relators are also offered certain protections against retaliation for bringing an action under the False Claims Act. Employees who bring a qui tam action against an employer may not be discharged, demoted, harassed, or otherwise discriminated against for bringing forth such an action in good faith. For additional information, please refer to LabCorp s policy regarding Compliance with False Claims Acts Under Federal and State Laws Policy (BPM Policy #27). Contractors, vendors, and suppliers can access the policy at 2

8 Antitrust and Competition Employees are not to discuss non-public competitively sensitive topics with competitors. Employees should consult with their supervisors or the Law Department for guidance concerning competitive activities, discussions, or potential sharing of information. Global Anti-Corruption The United States Foreign Corrupt Practices Act (FCPA), the United Kingdom s Bribery Act (UKBA), and international and local law apply to LabCorp s global business operations. The Company is committed to compliance with these anti-corruption laws which prohibit bribery. Bribery is defined as improperly providing anything of value in order to obtain a business advantage both in the commercial and government sectors. The definition of a bribe payment is expansive and can include cash payments, kickbacks, illegal facilitation payments, and other unreasonable or excessive business courtesies. These laws require ethical dealings in global business relationships, especially with foreign government officials. In the majority of foreign countries, governments exert considerable control over the health care industry and, therefore, health care employees, including physicians and their staff, may be considered government officials. These laws also apply to LabCorp s associated entities. As such, arrangements with any non-us third party, such as consultants, agents, subcontractors, and joint venture partners, must be approved in advance by the Law Department. Penalties for violations of these laws are severe. Individuals can face lengthy prison terms, substantial fines, and suspension/debarment sanctions, including exclusion from Medicare, Medicaid or other government-funded programs. Corporations can be subject to similar fines and sanctions. For additional information, please refer to LabCorp s Anti-Corruption Policy (BPM Policy #30). LabCorp Employee Responsibilities Focus Areas Confidentiality of Information Security of Information Potential Conflicts of Interest Employee Receipt of Gifts and Entertainment Insider Trading 3

9 Confidentiality of Information Employees must maintain the confidentiality of information entrusted to them by LabCorp and its customers. Confidential information includes all non-public information such as financial information, customer lists, supplier lists, price information, strategic plans, and descriptions of Company processes or operations. Information received, created, and maintained by LabCorp in the course of business is considered confidential and/or proprietary. The requirement of confidentiality does not restrict employees rights to discuss the terms and conditions of employment or engage in activities protected by the National Labor Relations Act. LabCorp employees have an obligation to ensure that no patient information is used or disclosed unless it is done so according to the Company s policies and procedures. If it is necessary to share patient information for a business function, only the minimum amount of information required to achieve the intended purpose should be disclosed. LabCorp employees who handle patient information must take measures to ensure that the information is secure and not subject to accidental or improper disclosure. Accessing Confidential Information LabCorp employees may access only information necessary to perform their job functions. Accessing or disclosing LabCorp confidential and/or proprietary information outside of job functions is strictly prohibited, unless otherwise permitted by the National Labor Relations Act. Accessing a LabCorp system to view test or billing information on yourself, a family member, a friend, or a coworker is strictly prohibited. Employees in Right of Access states can request their own test results by contacting Divisional Customer Service. Security of Information Computer systems and software must be safeguarded to prevent misuse or destruction of information. Any passwords or personal security codes must be kept confidential. For additional information, please refer to LabCorp s HIPAA Privacy Practices Manual, HIPAA Securities Manual, and IT policies. Potential Conflicts of Interest A conflict of interest occurs when a person s private interest actually or potentially interferes with the interests of LabCorp. A conflict situation can arise when an employee takes actions or has interests that may make it difficult to perform his or her LabCorp duties objectively and effectively. A conflict of interest may also arise when an employee or a member of his or her family, receives improper personal benefits as a result of his or her position at LabCorp. The potential for a conflict of interest also exists when an individual s position or responsibilities with LabCorp present an opportunity for personal gain apart from the normal rewards and compensation of employment. Conflicts of interest may not always be clear-cut, so if you have a question, consult with your supervisor, manager, Human Resources Department or Law Department. 4

10 Conflicts of Interest include, but are not limited to, the following: having an outside interest which prevents you from devoting your full abilities to the performance of LabCorp duties during your designated work time; owning a business that is a customer, supplier or competitor with LabCorp; or receiving compensation, loans, or certain gifts from a customer, supplier, or competitor. Employee Receipt of Gifts and Entertainment No gift or entertainment should ever be solicited or accepted by any LabCorp employee, family member of an employee or agent unless it: (1) is consistent with customary business practices, (2) is nominal in value, and (3) does not violate any laws or regulations. In addition, no gifts or entertainment shall be a condition of any potential or current vendor or supplier relationship. If you are unsure of the appropriateness of a gift or entertainment or need more information regarding gifts and entertainment please contact the Law Department. Insider Trading If any employee has material, non-public information relating to the Company, it is LabCorp s policy that neither that person nor any related person may buy or sell securities of the Company or engage in any other action to take advantage of, or pass on to others, that information. In performing duties at LabCorp, employees may come in contact with important information about LabCorp or another company that may be considered inside information. Employees of LabCorp may not trade in the stock of any company (including LabCorp) while in possession of inside information about that company. This restriction applies until the inside information has been publicly disclosed and disseminated. If an employee wishes to buy or sell any security based on information that was learned in the course of LabCorp business, he/she must first verify with the Corporate Securities Officer, General Counsel or the Law Department that such information is not considered inside information. For additional information, please refer to LabCorp s Insider Trading Policy (BPM Policy #11). LabCorp Standards and Practices Focus Areas Diagnosis Information Ambiguous Test Orders Standing Orders Advance Beneficiary Notices (ABN) Physician Acknowledgment Letters (PAL) Record Retention and Record Destruction Quantity Not Sufficient / Test Not Performed (QNS / TNP Review) 5

11 Diagnosis Information Only a physician may render a diagnosis for a patient. Diagnosis information received verbally from the ordering physician must be documented in writing on the test request form, on another piece of paper available for attachment to the test request form or in another approved format that is retained with the test order. In the event an ordering physician does not provide a diagnosis, does not provide a diagnosis code at the highest level of specificity, or provides a diagnosis code that cannot be translated, LabCorp shall contact the client for clarification. All information related to diagnosis codes should be fully documented and retained so that it is readily available upon request. LabCorp employees must document the following when calling a physician for diagnosis information: the LabCorp caller s full name; the specific diagnosis code or narrative diagnosis exactly as provided; the complete name of the physician or authorized designee who provided the diagnosis information; and the date on which the diagnosis was received. For additional information, please refer to LabCorp s Collection and Documentation of Diagnostic Information Policy (BPM Policy #13). Ambiguous Test Orders An ambiguous test order is any order received by LabCorp which does not provide sufficient information to clearly set forth which test or tests should be performed by LabCorp. Ambiguous test orders include, but are not limited to, the following: a handwritten order on a LabCorp test request form which lists a test by name only and which cannot be definitively transcribed to a LabCorp test number; a handwritten order on a LabCorp test request form that does not correspond with or is inconsistent with a written test code number or a marked box on the test request form; any test order written on a form or piece of paper other than a LabCorp test request form (e.g. scrips, prescription pad sheets, another laboratory s test request form, etc.) which cannot be definitively transcribed to a LabCorp test number; or any specimen received without a test indicated on the accompanying test request form. The above list includes only the more common types of ambiguous test orders and it is not intended to be all inclusive. Whether or not a given test request constitutes an ambiguous test order will frequently depend upon the surrounding facts and circumstances. When in doubt, seek clarification of the test order and document that clarification. For additional information, please refer to LabCorp s Ambiguous Test Order Policy (BPM Policy #5). 6

12 Standing Orders In some circumstances, patients may need certain tests performed at regular intervals over a period of time. Rather than writing an order for a lab test every time the patient needs the test performed, some physicians will write a standing order. A standing order requests that LabCorp perform a particular test for a designated patient at predetermined intervals for a specific duration of time. LabCorp accepts standing orders which meet the following criteria: the standing order is written, signed and dated by an authorized provider or authorized designee; the standing order is clear and unambiguous; the standing order includes all information necessary for billing, including diagnosis code(s); the standing order states an effective time period (not to exceed six months); the standing order states with specificity the frequency at which the test is to be performed (e.g., weekly, monthly, etc.). PRN or as needed is not an acceptable frequency; and the standing order refers to a specific individual patient. In addition, LabCorp periodically requests that the ordering provider confirm in writing the continued validity and accuracy of the standing order, or, alternatively, note any required deletions or changes in billing and/or diagnostic information. For additional information, please refer to LabCorp s Standing Order Policy (BPM Policy #6). Advance Beneficiary Notices (ABN) For certain tests, Medicare requires LabCorp to submit information that must be provided by the ordering physician to establish that the tests are medically necessary. These tests are referred to as limited coverage tests. If the required information is not provided for a limited coverage test, Medicare will not pay for the test. Medicare rules also prohibit the laboratory from billing the patient for these services unless the patient has signed an ABN prior to the service. The ABN informs patients, before any service is rendered, that Medicare may not pay for the laboratory test ordered by the physician. A complete ABN: identifies the laboratory test; identifies the estimated cost(s); specifies the reason(s) that Medicare will likely deny payment for the test; advises on patient responsibility for payment if Medicare denies payment; and allows the patient to make an informed decision about whether to have the test performed. For additional information, please refer to LabCorp s Advance Beneficiary Notices Policy (BPM Policy #12). 7

13 Physician Acknowledgement Letters (PAL) In some cases a physician may frequently order the same combination of chemistry tests for several of his or her patients. Rather than repeatedly writing out an order for each test, the physician may request that LabCorp group the tests into a custom chemistry profile. It is LabCorp s policy to disclose all components of custom chemistry profiles ordered by physicians. A PAL is required when any new custom chemistry profile is set up for a client or the first time a physician orders a custom chemistry profile. LabCorp also sends annual notification to clients listing the custom chemistry profiles ordered by the client within the previous year. The PAL lists the individual components of each custom chemistry profile and the Medicare National Limitation amount for each test component. Further, the PAL advises that: the client should only order those tests which he or she believes are medically necessary for each patient; using a customized profile may result in the ordering of tests for which Medicare, Medicaid, or third-party payors will deny payment; the client should order only individual tests or a less inclusive profile if not all the tests in the customized profile are medically necessary for an individual patient; and the Office of Inspector General (OIG) takes the position that a client who orders medically unnecessary tests may be subject to civil penalties. For additional information, please refer to LabCorp s Physician Acknowledgement Letters Policy (BPM Policy #15). Record Retention and Record Destruction Various laws and accreditation standards require LabCorp to prepare and retain certain businessrelated records and documents. To ensure compliance with these laws and standards, LabCorp has adopted policies for both retention and destruction of records. All of LabCorp s books, records, accounts and financial statements must be maintained in reasonable detail, must appropriately reflect LabCorp s transactions and must conform both to applicable legal requirements and to LabCorp s system of internal controls. Additionally, all employees must follow any separate instructions provided by the Law Department regarding the retention of documents that might otherwise be subject to destruction based on LabCorp s policy. For additional information, please refer to LabCorp s Record Retention Policy (BPM Policy #20) and Record Destruction Policy (BPM Policy #21). Quantity Not Sufficient/Test Not Performed (QNS/TNP) If a test is not performed for any reason, such as breakage, insufficient specimen, etc, the test must not be billed. If any employee becomes aware of such billings, he or she must immediately bring this matter to the attention of his or her supervisor, the Corporate Compliance Department, or the Law Department. For additional information, please refer to LabCorp s Quantity Not Sufficient/Test Not Performed (QNS/TNP) Policy (BPM Policy #24). 8

14 Human Resources Policies Focus Areas Environment, Health, and Safety (EHS) Safe and Productive Work Environment Discrimination and Harassment Employment of Relatives Exclusion Environment, Health, and Safety (EHS) LabCorp conducts its operations with the highest regard for safety and health of all employees. All LabCorp employees are responsible for complying with safety rules and regulations and for taking the necessary precautions to protect our colleagues and ourselves. All accidents and work-related injuries must be reported and action taken to address unsafe practices or conditions. For additional information regarding specific EHS policies, please refer to: Groups and Centers > Corporate Affairs > Corporate Environment, Health, and Safety (EHS). Substance Abuse The Company seeks to create and maintain a drug and alcohol free environment by identifying any existing and potential employees who abuse illegal drugs, prescription medication, or alcohol. Substance abuse signifies the misuse or unlawful use of alcohol, drugs (prescribed or otherwise) or controlled substances. Employees may be subject to disciplinary action, up to and including termination of employment, for the following conduct while in a Company facility, vehicle, or while engaged in LabCorp s business: unauthorized use, possession or concealment of alcohol; being under the influence of alcohol, illicit drugs, or controlled substances; or unlawful use, possession, concealment, manufacture, sale, purchase, dispensation, or distribution of drugs or controlled substances. Discrimination and Harassment LabCorp is firmly committed to providing equal opportunity in all aspects of employment and will not tolerate illegal discrimination or harassment of any kind. Examples include derogatory comments based on racial or ethnic characteristics, religion, disability, gender, sexual preference, or unwelcome sexual advances. It is LabCorp s policy to provide equal employment opportunity for all persons employed by or seeking employment with LabCorp, in compliance with applicable federal, state and local laws and regulations. This policy extends to all areas of employment, such as selection, job assignment, supervision, training, promotion, job grading, transfers, terminations, compensation, benefits, and educational opportunities. 9

15 Each LabCorp employee has the right to work in an environment free of harassment and disruptive behavior. LabCorp has zero tolerance for harassment by anyone based on the diverse characteristics or cultural backgrounds of those who work with us. Degrading or humiliating jokes, slurs, intimidation, or other harassing conduct is also not acceptable. Harassment or workplace violence incidents include, but are not limited to, the following: threats or actions taken in a threatening manner; verbal abuse; robbery and other commercial crimes; stalking; violence directed at the employer or employee; terrorism; or hate crimes committed by current or former employees. Sexual harassment is prohibited. This prohibition includes unwelcome sexual advances or requests in conjunction with employment decisions. Moreover, verbal or physical conduct of a sexual nature that interferes with an individual s work performance or creates an intimidating, hostile, or offensive work environment will not be tolerated. It is also LabCorp s policy to provide employees with a workplace that is free from sexual harassment as well as harassment based on other protected categories such as race, color, ethnicity, religion, age, and disability. Harassment, whether verbal, physical, or environmental, is unacceptable in the workplace. Anyone engaging in such activities is acting beyond the scope of any authority he or she may have from LabCorp and may be subject to disciplinary action, up to and including termination of employment. Any manager or supervisor who becomes aware of a complaint of discrimination or harassment and fails to take action may be subject to disciplinary action, up to and including termination of employment. Sexual harassment incidents include, but are not limited to, the following: unwanted sexual advances; demands for sexual favors in exchange for favorable treatment or continued employment; jokes of a sexual nature; flirtations, advances, or propositions; verbal abuse of a sexual nature; or displays in the workplace of sexually suggestive objects or pictures. Individuals who believe they have been subjected to discrimination or harassment should report the incident to a supervisor or manager, the local Human Resources manager, Corporate Human Resources or the Compliance Action Line. Individuals found to have engaged in either unprofessional conduct or misconduct constituting discrimination or harassment may be disciplined, up to and including termination of employment. If an investigation reveals that the complainant knowingly or maliciously falsely accused another of discrimination or sexual harassment, the complainant may be subject to disciplinary action, up to and including termination of employment. 10

16 Employment of Relatives To avoid situations that potentially may result in unfair or inequitable treatment of employees, or the appearance of such, LabCorp has established a policy regarding the employment of relatives. LabCorp may hire relatives of current employees; however, related employees generally may not work in the same department or in any supervisor/subordinate relationship. When possible, relatives should be assigned to different departments. Questions regarding the employment of relatives should be directed to the Human Resources Department. Exclusion LabCorp does not hire or contract with individuals or companies who have been excluded from participation in a government-funded program. Any employee who during the term of employment becomes sanctioned or excluded from Medicare, Medicaid, or other government-funded programs will be disqualified from continued employment. Each employee has an affirmative duty to notify his/her supervisor and local Human Resources Manager if he/she is subject to sanctions or exclusion under Medicare, Medicaid or other government-funded programs. LabCorp and Its Customers, Clients, Vendors, and Suppliers Focus Areas Integrity in Customer Relations Contracts with Clients Policies Addressing Relationships with Clients Integrity in Customer Relations LabCorp obtains and retains customers solely because of the quality of its services. LabCorp does not (nor may any employee) directly or indirectly offer or give any form of unethical or illegal kickback, under-the-table payment, or other improper payment, gift or favor to customers, potential customers, or their representatives. Gifts of any kind to government employees are a violation of Company policy. Contracts with Clients Contracts, bids, letters of intent, letters of agreement, and sales proposals are covered by LabCorp s Contract Review Policy located within the LabCorp Contract Manual. All LabCorp agreements must be prepared by and coordinated with the appropriate Divisional Contract Administrator. 11

17 Important components of LabCorp s CIP are those areas that address client relations and services. To this end, LabCorp maintains policies concerning various aspects of LabCorp s relationships with its clients. Policies addressing relationships with clients Client Supplies Computer Placements/Connectivity Rental of Office Space from a Physician or Other Referral Source Courier Services Reactivation of Accounts Client/Commercial Adjustments Professional Courtesy Waiver of Copayments, Coinsurance, and Deductibles Managed Care Courtesy Testing Charitable Contributions Client Supplies As part of its services, LabCorp may provide laboratory supplies to clients that are used solely for the purpose of collecting, processing or transporting specimens to LabCorp for testing. LabCorp may not offer supplies for use in a client s own in-house laboratory or for any function that is not directly related to laboratory tests performed by LabCorp. 12 LabCorp may not provide to clients any supplies that are reusable, usable for multiple purposes, or have a clear independent value to the client (bone marrow kits, amniocentesis trays, biopsy needles, speculums, gloves, strep kits, etc.). Some states have established additional restrictions on the provision of supplies and equipment. Divisional and Regional Compliance Officers should be consulted for state specific listings. For additional information, please refer to LabCorp s Client Supplies Policy (BPM Policy #22). Computer Placements/Connectivity In certain circumstances, LabCorp may provide computer software or, in some cases, hardware to transmit client test orders and results directly between a client and LabCorp. In general, it is necessary that the software and hardware be restricted by contract, technology, or otherwise to ordering, receiving, and managing LabCorp test data. The software or hardware shall not be used by the client for any other purpose. Any mechanism or device for restricting the use of the connectivity cannot be disabled. Rental of Office Space from a Physician or Other Referral Source Rental of any space in which a physician or a client (or an immediate family member of a physician) has an ownership or investment interest must be reviewed by the Law Department. Only space that is needed for LabCorp activities may be leased. Rental payments must be based on fair market value and for an initial term of at least one year. Such lease agreements must be in writing and signed by an authorized LabCorp employee and the landlord before LabCorp occupies the space. All leases must be processed by the appropriate Divisional Lease Administrator in accordance with the Real Estate Lease Review Policy in the LabCorp Contract Manual.

18 Courier Services Clients may periodically request that LabCorp couriers transport items to non-labcorp facilities. Clients should generally be referred to an independent courier for such services whenever possible. In certain circumstances where the provision of limited transportation services could promote efficient delivery of services (such as when the recipient s facility is on the LabCorp courier s standard route) LabCorp may provide transportation services for items such as documents or blood specimens at a fair market value fee. In each case, a written agreement outlining the items to be transported and the charges for the service must be executed in advance of providing such services. Reactivation of Accounts Clients who are lost or terminated by LabCorp for compliance policy considerations may not be reactivated without the approval of the Law Department or Corporate Compliance Department. Client/Commercial Adjustments Client adjustments shall be made only in cases of actual misunderstandings between the client and LabCorp or as a result of a LabCorp error. LabCorp shall perform an adjustment to a client account only when there is documentation to support the accuracy of the proposed action. For additional information, please refer to LabCorp s Client/Commercial Adjustments Policy (BPM Policy #17). Professional Courtesy LabCorp does not offer professional courtesy to its clients. This decision is based on the consideration that providing free or deeply discounted laboratory testing to health care providers, their families, and their employees may be construed as an unlawful inducement. Testing services provided to health care providers, their families, and their employees must be billed directly to the client, the patient, or the patient s insurance carrier. LabCorp does not write off or retroactively adjust testing provided to clients, their families, or their employees. For additional information, please refer to LabCorp s Professional Courtesy Policy (BPM Policy #23). Waiver of Copayments, Coinsurance, and Deductibles Many private third-party payor contracts require LabCorp to collect copayments, coinsurance, and deductibles for laboratory tests performed on their insured patients. In addition, Medicare requires beneficiaries to pay copayments and/or deductibles for certain laboratory tests. The OIG has taken the position that the routine waiver of copayments and/or deductibles for Medicare beneficiaries is a potential violation of the Anti-kickback Statute. Questions regarding the waiver of copayments, coinsurance, and deductibles should be directed to the Law Department or Corporate Compliance Department. Managed Care Out-of-Network Testing When a client has patients of a managed care organization (MCO) which has an exclusive arrangement with another laboratory under which the MCO will not accept or pay claims from LabCorp, LabCorp may test the specimens of patients who are members of the MCO at no charge, but only in accordance with the requirements of the Out-of-Network Laboratory Services Agreement Policy which is located in LabCorp s Contract Manual. Questions regarding this policy should be directed to the Law Department. 13

19 Charitable Contributions LabCorp s policy allows contributions to charitable organizations in the following categories: health and welfare; education; and arts and culture. Corporate Contribution Check Request Submission Process All charitable contribution requests should be sent to Corporate Community Affairs using the Accounts Payable Check Request Form. Information regarding the organization, its 501(c)(3) status and details regarding the charitable request should accompany the check request. A charitable contribution request for payment made directly to a client, potential client, hospital or foundation of a client/hospital must receive prior approval from Corporate Community Affairs and the Corporate Compliance Department. All contributions should be made in accordance with LabCorp s Charitable Contributions Policy and Procedures. For more information, contact Corporate Community Affairs. Reporting a Compliance Issue and Resources for Guidance Focus Areas Compliance Action Line (CAL) ecal Accounting Hotline International Hotline The Compliance Action Quick Test LabCorp s Four-Step Communication Program Employees are required to immediately report any issue or practice that involves a violation or potential violation of any Company policies, rules, regulations, or laws. Employees are encouraged to talk promptly to supervisors or managers about perceived illegal or unethical behavior. Any supervisor or manager who receives a report of violation or potential violation must report it immediately to the Law Department or Corporate Compliance Department. 14

20 Compliance Action Line (CAL) LabCorp has established a Compliance Action Line ( ) where employees may anonymously report perceived unethical behavior or any violations of Company policies, rules, regulations, or laws. The CAL is available Monday Friday 8:00 AM to 12 Noon and 1:00 PM to 5:00 PM (Eastern Time). LabCorp prohibits retaliation for reports made in good faith. However, any use of these reporting procedures in bad faith or in a false or frivolous manner can result in disciplinary action up to and including termination of employment. When calling the CAL please refer to the chart below: Option 1: Human Resources Issues Co-Worker / Employee Conflicts Sexual Harassment Equal Opportunity Substance Abuse Employment Issues Option 2: Regulatory and Compliance Issues Violation of Compliance Policies Fraud and Abuse Kickbacks CLIA CAP Foreign Corrupt Practices Act Privacy and Security Unauthorized Access Document Security Patient Privacy Safety Issues Employee Health and Safety Environmental Safety OSHA Option 3: Sarbanes-Oxley Internal Accounting Controls Financial Auditing Insider Trading ecal Another alternative for reporting is to use the ecal, an electronic form. No address or identifying User name is received by the Corporate Compliance Department unless voluntarily disclosed on the ecal form. The ecal can be located on OneWorld: QuickLinks > Hotlines > Compliance Action Line (CAL) Form. 15

21 Accounting Hotline In addition to the CAL, LabCorp provides a separate confidential and anonymous method for employees to report questions regarding internal accounting controls or auditing matters. The Accounting Hotline ( ) is available 24 hours a day, 365 days a year. Employees are not required to identify themselves and have the option to use a code word or number during the call. All inquiries received will be reviewed and/or investigated by LabCorp s Internal Audit Department. International Hotline For employees located outside the United States, LabCorp has established an anonymous incident reporting system. This system enables international employees to submit a report via the Internet at or by dialing the international toll-free number from locations outside the United States. Good Faith The CAL and the Four-Step Program are tools for employees to report compliance concerns in good faith. Good faith does not mean that an employee needs proof of a problem to initiate a report, only that he or she has a reasonable and honest basis for concern. The CAL and the Four-Step Program should not be used for reports or accusations that are known to be false. Deliberate abuse of the compliance reporting process may lead to disciplinary action up to and including termination of employment. Zero Tolerance for Retaliation for Reporting Concerns In Good Faith It is LabCorp s policy that no employee shall retaliate, directly or indirectly, in any way against an employee for reporting in good faith any known or suspected violation of any laws, regulations, or Company policies or against any employee who has participated in the investigation of such a report. This includes the use of the CAL. Any person who engages in such retaliation shall be subject to disciplinary action, up to and including termination of employment. 16

22 If you are unsure about the appropriateness of an action or proposed action, follow the Compliance Action Quick Test: The Compliance Action Quick Test Does it comply with the law or LabCorp s compliance policies and procedures? How would it make you feel if you did it? How would it look to your family and our clients, shareholders, or the general public? If you are not sure, ask. Keep asking until you get an answer that makes sense. Get the right answer, not the easy answer. LabCorp Four-Step Communication Program Discuss the issue with your supervisor; Speak to your department manager; Speak to your Divisional Compliance Officer, local Human Resources Representative, General Manager, and/or Divisional Senior Vice President; or Bring the matter to the attention of a corporate representative. We must all work to ensure consistent ongoing compliance with the principles outlined in this Booklet. Since we cannot anticipate every situation, it can be helpful to ask the following: Do I have all the facts? What specifically am I being asked to do? Does it seem unethical or improper? What specifically did I witness? There are many resources available to help employees resolve a compliance issue. The answers to many questions can be found in various policies, procedures, manuals, and handbooks related to specific departments or business areas. If you cannot find the answer to your question or concern in Company documents discuss the issue with your supervisor or manager. If you feel uncomfortable reporting an issue to your supervisor or any other Company manager or you feel an issue reported has not been adequately addressed in a timely manner, you should call the Corporate Compliance Department directly, or call the appropriate hotline number listed below. Resources for Guidance Resource Phone Number or Hours of Operation Compliance Action Line Monday through Friday 8 AM to 12 PM and 1 PM to 5 PM Eastern Accounting Hotline hours/7 days a week HIPAA Privacy Hotline HIPAA 24 hours/7 days a week e-cal [email protected] 24 hours/7 days a week HIPAA [email protected] 24 hours/7 days a week International Hotline hours/7 days a week 17

23 Conclusion Each employee is expected to know and understand LabCorp s compliance policies and the basic laws and regulations that affect his or her job. In addition to information in this Booklet, other resources are available including the Business Practices Manual and other compliance documents. Review these resources and talk to a supervisor if you do not understand how these policies apply to your job. If you have questions that your supervisor cannot resolve, follow the Four-Step Communication Program and keep asking your question until you get an answer that makes sense. With the assistance of every employee, LabCorp will continue to fulfill its commitment to provide laboratory services of the highest quality to its clients in full compliance with all applicable laws, regulations, and Company policies. Anyone who suspects a violation of LabCorp s standards has a duty to report that suspected violation. 18

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