The document is a letter to the Board of Directors of Golden Valley Health Centers requesting that they thoroughly review and strengthen the organization's ethics and compliance programs. It outlines key elements of an effective program, including oversight by high-level individuals, clear standards and procedures, training, monitoring systems, and whistleblower protections. The letter provides recommendations for developing an updated code of conduct that addresses important risk areas and sets an ethical tone from leadership. It emphasizes building an ethical culture where patients receive quality care.

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SECOND LETTER TO THE BOARD OF DIRECTORS
OF GOLDEN VALLEY HEALTH CENTERS
December 9, 2014
SUBJECT: ETHICS AND COMPLIANCE
Dear GVHC Board of Directors,
As a follow-up to Dr. Liza Pham’s December 2, 2014 Open Letter to the Board, we are writing to request the Board to thoroughly review and take a closer look at corporate governance at Golden Valley Health Centers (GVHC) – more specifically Ethics and Compliance. Dr. Pham’s Open Letter of December 2 outlined some serious concerns and issues relating to the behavior and ethics of the GVHC leadership team. As you are aware, good corporate governance begins with the behavior and ethics of the leadership team. In fact, a factor that is often cited in governance failures is a poor “tone at the top”. Beyond overseeing and asking the right questions of the leadership team regarding GVHC’s ethics and compliance efforts, this Board has a significant role to play in building and promoting an ethical culture.
One of the important tools of ensuring a culture of ethics and compliance is a whistleblower policy, which appears to be lacking and/or not addressed at GVHC. In its simplest form, whistle blowing involves the act of reporting wrongdoing within an organization. We respectfully request that a whistleblower policy be immediately created and approved by the Board of Directors. Successful whistle blowing procedures require strong leadership from the Board to develop a culture in which all employees are encouraged to raise their concerns without a fear of retaliation (which is one of the issues, among others, raised in the Open Letter of December 2).
AN EFFECTIVE AND COMPLIANCE PROGRAM
For the Board’s convenience, we respectfully provide below some key elements of an effective ethics and compliance program for GVHC, which include:
 A GVHC culture that encourages ethics and compliance with the law
 Day-to-day oversight by a high-level individual who has adequate resources and authority (e.g., Chief Ethics and Compliance Officer, reporting directly to the Board, if appropriate)

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 Clear responsibility on the part of leadership team and active oversight by the Board of Directors
 Effective communication of standards and procedures, as well as periodic training for all levels of GVHC, including the Board, management, employees and contractors
 Care in delegation of substantial discretionary authority to individuals (e.g., background checks)
 Reasonable steps taken to achieve compliance and consultation (e.g., monitoring and reporting systems, helpline)
 Incentives for compliance with the Guidelines, appropriate response after detection of an offense, and consistent enforcement of disciplinary mechanisms
 Periodic risk assessments
Building a culture of ethics and compliance within GVHC is a business imperative. From the Boardroom to the mailroom, everyone should adhere to the same standards, including the CEO, COO, and Chief of HR. We believe that an Independent Director’s role in oversight of GVHC’s ethics and compliance program is important to its success. That said, in addition to Board involvement, an effective ethics and compliance program requires involvement from the leadership team, organization wide commitment, an effective communications system, and an on-going monitoring system. Some questions that will assist Board members in assessing whether elements of an effective ethics and compliance program are in place include:
 Does the “tone at the top”, as communicated by leadership, demonstrate to every employee that ethics and compliance are vital to continued business success?1
 How has GVHC supported the ethics and compliance program through training and communication efforts?
 Can GVHC describe the process for assessing ethics and compliance risks within GVHC? Has GVHC ever performed a cultural assessment?
 How is the current ethics and compliance program structured?2
 Does GVHC have an ethics and compliance officer?3 Which Board member is overseeing Ethics and Compliance?
 Does the code include statements regarding responsibilities to employees (including the leadership team), suppliers, patients, and the community at large, and is it distributed to all relevant parties, including the Board, employees, management and vendors?
1 Does GVHC’s culture support making ethical and compliant choices?
2 Has it addressed the high-priority areas? Has GVHC’s ethics and compliance program and code of ethics/conduct been updated periodically. Has GVHC reevaluated its internal reporting mechanisms in light of these regulations?
3 Is a senior executive with adequate time, financial resources, and Board access in charge of the program? Are there dedicated, full-time resources?

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 Does a reporting process exist to keep the Board informed on ethics and compliance issues, as well as the actions taken to address those issues?4
 Is there an effective and utilized reporting mechanism in place to let all employees raise ethics and compliance issues without fear of retribution?5
 What type of ongoing monitoring and auditing processes are in place to assess the effectiveness of the program?6
 Does GVHC regularly and systematically scrutinize the sources of compliance failures and react appropriately? Are employees appropriately and consistently disciplined?
We believe that if GVHC follow both the letter and the spirit of the law by taking a “value-based” approach to ethics and compliance, GVHC will have a distinct advantage in the marketplace –in patient care and quality, in branding, and in recruitment. We do not recommend that the GVHC Board give the average employee a legalistic “thou shall not….” code as a negative response is almost guaranteed. Rather, we recommend that the GVHC Board give employees a document that states clearly and concisely GVHC’s expectations, outlines acceptable behaviors, and presents viable options for asking questions and voicing concerns. This approach will increase the likelihood that GVHC employees will meet those expectations and exhibit the desired behaviors. Most importantly, make the contents of the code equally applicable to everyone in GVHC—at all levels, including the CEO, COO, and Chief of HR. With the above, we believe the GVHC Ethics and Compliance program will become cultural, with all of the benefits.
CODE BASICS
There is no standard wording for a code of ethics/ conduct. GVHC should develop one in defining expected behaviors and in addressing the risks, challenges, and customs of the Central Valley, as well as to fit the healthcare industry, particularly health care clinics for the underserved. That said, we recommend the following basic points in creating or modifying the GVHC code of conduct and in creating an Ethics and Compliance program:
 The code language should be simple, concise, and readily understood by all employees
4 Is ethics and compliance a regular Board agenda item?
5 Is there an anonymous reporting mechanism or helpline? Who fields the follow-ups on concerns raised through the helpline? Are audit committee members or the audit chair named as an additional outlet for employee concerns?
6 Is the code and ethics and compliance program reviewed at least annually by the Board and the leadership team to determine if it needs updating due to business, legal, or regulatory changes? Does Audit Committee (which should be a Board lead committee) conduct reviews? Are employee surveys conducted? Has the program been reviewed by outside consultants/experts for possible improvement?

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 The code should not be legalistic - written as “thou shall not” - but rather state expected behaviors
 The code should apply to all employees, including the leadership team
 The code should be written, reviewed, and edited by a multidisciplinary team in order to be reasonably confident that it is consistent with other GVHC communications and policies, addresses relevant risk areas, has buy-in across GVHC, and represents GVHC’s culture. Consider inclusion of representatives from the following areas: Providers, Staff, Risk Management, Human Resources, Communications, Internal Audit, Security and relevant departments
 The code should be revised and updated as appropriate to reflect business and regulatory changes
RECOMMENDED ELEMENTS
Although the elements or sections within a code can vary, we recommend the following:
 An introductory letter from the leadership team, CEO and/or the Board that sets the tone at the top and defines the importance of ethics and compliance to each employee
 GVHC Mission statement, Vision, Core Values, and guiding principles that reflect the GVHC’s commitment to ethics, integrity and patient care and quality
 An ethical decision framework to assist employees in making choices. For example, the code might ask employees to answer some questions to guide them in making an ethical decision about a possible course of action.
 A listing of available resources for obtaining guidance and for good faith reporting of suspected misconduct. For example:
o A means to report issues anonymously, such as a helpline or postal address
o How to contact the ethics and compliance officer or the Board
o A definition of the reporting chain of command (e.g. supervisor, department head, etc., and even the Board)
o A listing of any internal ethics and compliance web site or materials
 A listing of any additional ethics and compliance resources and/or the identification of supplementary policies and procedures and their location
 Enforcement and implementation mechanisms that address the notion of accountability and discipline for unethical behavior. For example, unethical behavior will be subject to disciplinary action up to and including termination, regardless of position.
 Generic examples of what constitute acceptable and unacceptable behavior could be included to further explain risk areas.

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AREAS OF RISK
It is important that the GVHC code cover relevant and important issues or risk areas. For example, GVHC should place greater emphasis on patient care and quality. Also, code topics can be organized alphabetically or organized to reflect groupings that make sense to all employees. For example, following is a list of issues, topics and risk areas that could be addressed in GVHC’s code:
 Accurate records, reporting and financial recordkeeping/management
 Billing for services
 Communications on behalf of GVHC (pr, media, speeches, articles)
 Communications systems
 Community activities – civic activity
 Compliance with professional standards and rules
o Conflicts of interest
o Independence
o Licensure and professional certifications
 Confidential and proprietary information
 Consultation
 Contracting (approvals)
 Conflicts of interest
 Copyrights
 Corporate governance
 Discrimination
 Diversity and inclusion
 Document retention
 Electronic professional conduct
 Employment practices and affirmative action
 Environment
 External inquiries/public disclosure and reporting
 Family and personal relationships
 Fraud
 Gifts, entertainment, gratuities, favors and other items of value to/from patients, suppliers, vendors, contractors, government employees
 Government contracting, transactions, and relations
 Government reporting, inquiries, investigations, and litigation
 Harassment (sexual and otherwise)
 Health and safety

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 Honesty and trust
 Improper influence on auditors
 Marketing, sales, advertising, and promotions
 Money laundering
 Outside employment and other activities
 Outside businesses
 Patient service/relations
 Patient, supplier, and vendor relationships
 Patient/supplier/vendor/contractor confidentiality
 Professional organizations
o Charities and community service
o Fundraising
 Personal conduct
 Political contributions and activity: lobbying, holding office, and finance
 Privacy
 Procurement/purchasing
 Professional competence and due care
 Quality
 Securities trading and insider information
 Security
 Social responsibility
 Supplier, vendor, and contractor relationships
 Use of GVHC resources
o Computer and network security (information security)
o Computer software and hardware
o Email and voicemail (communications systems)
o Internet and intranet
 Waivers of the code of business conduct and ethics
 Work/life balance
 Workplace violence
IMPLEMENTATION
We respectfully request the Board to direct or assign a core team, reporting to the Board, the task of drafting the code. The code development or enhancement will require the successful completion of the following steps:

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 Appoint a multidisciplinary advisory team
 Draft an outline of the proposed code and circulate amongst the multidisciplinary team for review and comment
 Draft code based on approved code outline (see above)
 Consider whether the code is aligned with GVHC policies, procedures, values and industry standards
 Circulate draft code amongst the multidisciplinary team for review and comment
 Update code to reflect input of advisory team
 Use focus groups and other methods to get feedback from all levels of personnel on the code update based on their feedback
 Present “final” version of code to Board of Directors for approval
 Communicate the code to all employee
In conclusion, compliance means obeying the law. Ethics is the intent to observe the spirit of the law, in other words, it is the expressed INTENT TO DO WHAT IS RIGHT (EVEN WHEN OTHERS ARE NOT LOOKING). Further, in the context of health care, GVHC has an enhanced ethical and moral obligation to provide quality patient care. As eluded to in Dr. Pham’s Open Letter of December 2, the aftermath of unethical behavior or noncompliance to laws can be devastating to GVHC. Unfortunately, GVHC’s current code of conduct is obsolete and a compliance program appears to be non-existent or insufficient. For an organization of this size (numbering over 700), a program that strongly emphasizes both ethics and compliance is good for business and the patients of GVHC. It is time.
We sincerely thank you for your attention to Ethics and Compliance and your services as Board members of GVHC. We and the entire GVHC staff look forward to hearing from the Board on Ethics and Compliance.
Respectfully Submitted,
Golden Valley Health Centers Providers and Staff