How OFAC Sanctions Lists Screening Apply To the Healthcare Industry

The healthcare industry is heavily regulated to protect the safety of its patients.

Hospitals and other businesses operating in this field need to be sure that the physicians they hire and the suppliers and distributors they work with are proven to be safe and trustworthy. 

To that end, the Office of Foreign Assets Control (OFAC), which acts as part of the U.S. Department of the Treasury, has long maintained sanctions lists to distinguish risky entities that are barred from working with domestic companies. The office specifically oversees U.S. dollar transactions and international financial activities with national security and foreign policy goals in mind. 

OFAC sanctions lists screening is required for all incorporated entities in the country, as well as any of their foreign branches and subsidiaries. The regulations also apply heavily to the healthcare industry, as hospitals hire professional physicians and staff members and partner with third-party firms regularly. 

Addressing screening requirements is one of the biggest benefits of compliance. But there are business benefits too – compliance keeps organizations in a good standing with government agencies, which in turn facilitates growth. 

How Do OFAC Regulations Work? 

The Office of Foreign Assets Control itself was created back in 1950 to address foreign policy enforcement during the Korean War. Even today, it’s still responsible for sanctions programs that bar certain individuals and corporate entities from doing business with domestic organizations. 

Sanctions generally occur as a result of terrorism, drug trafficking, and other illicit activities that the agency deems a threat to national security. Some sanctions cover entire nations as well, such as the well-known economic embargoes against Iran and North Korea. 

How Do OFAC Sanctions Lists Apply To Healthcare? 

OFAC sits in a bit of a gray area for hospitals, as the agency is more of a general regulation that applies to all businesses rather than one specific to healthcare. But it’s still essential to keep track of OFAC exclusions if you work in this field. 

People and organizations on OFAC sanctions list are deemed too risky to work with, and partnering with such entities can prove deleterious to your internal operations. This high risk also means that the safety and effectiveness of the treatments you provide are likely compromised when working with banned parties, thereby putting your patients at risk. 

The result is that OFAC has been enforcing its sanctions on medical providers as well. It’s clear that restricted party screening will remain a priority in this sector. 

How Does OFAC Screening Work? 

There are actually multiple OFAC sanctions lists to keep track of for international trade compliance, including: 

Any hospital’s compliance program must include regular cross-checking of these lists, as they are updated frequently. Regular screening is a best practice. Also consult the official website for country sanctions programs. 

Under some circumstances, OFAC may issue General or Specific Licenses for certain exceptions to these rules. It’s possible to submit an application for an exception, but there’s no guarantee of approval, as OFAC uses its own discretion in these cases. 

For more comprehensive information about effective compliance in the healthcare industry, download our white paper or visit our Resource Center. 

Implement a Comprehensive Compliance Program Today with Descartes Visual Compliance 

Hospitals hire physicians and other medical staff regularly and work with suppliers and distributors all across the world. They must screen all their partnerships and hires continually to avoid working with restricted parties. 

Staying compliant with OFAC sanctions lists rules and other similar regulations has never been easier. If you’re working on a denied party screening program for a hospital, Descartes Visual Compliance can help. 

Setup a free demo with Descartes Visual Compliance and see how healthcare providers can navigate the complex legal requirements of the medical industry. 

To help manage compliance risks more effectively, Descartes provides a range of robust denied party screening and 3rd party risk management solutions as well as comprehensive and trusted trade content for leading business systems such as SAP, Oracle, Salesforce and Net Suite to name a few. 

Descartes compliance solutions are flexible and modular, allowing organizations to pick the specific and exact functionality and content they need and scale up later as and when necessary. By utilizing these solutions, organizations can strengthen their compliance processes, enhance their competitive edge and increase sales velocity. 

To learn more about how Descartes Visual Compliance and Descartes MK Denied Party Screening can help you stay on top of the latest sanctions, please click here and here.