HMO Complaints and Appeals:

Most Key Procedures in Place, but Others Valued by Consumers Largely Absent

HEHS-98-119: Published: May 12, 1998. Publicly Released: May 15, 1998.

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Pursuant to a congressional request, GAO examined: (1) what elements are considered important to a system for processing health maintenance organization (HMO) member complaints and appeals; (2) the extent to which HMOs' complaint and appeal system contain these elements; (3) what concerns consumers have regarding HMO complaint and appeal systems; (4) what information is available on the number and types of complaints and appeals HMOs receive from their members; and (5) how, if at all, HMOs use their complaint and appeal data.

GAO noted that: (1) a majority of HMOs in GAO's study incorporated most criteria considered important for complaint and appeal systems, however, consumer advocates remain concerned that complaint and appeal systems do not fully meet member needs; (2) additionally, HMOs in GAO's study do not uniformly collect and report data on the complaints and appeals they receive to health care regulators, purchasers, or consumers; (3) nationally recognized regulatory, consumer, and industry groups have identified elements that are important to an enrollee complaint and appeal system; (4) 11 elements were identified by at least 2 of these groups and fall into 3 general categories: timeliness, integrity of the decisionmaking process, and effective communication with members; (5) the policies and procedures at the 38 HMOs in GAO's review contained most of the 11 important elements, although they varied considerably in the mechanisms adopted to meet them; (6) the lack of an independent, external review of plan decisions and the difficulty in understanding how to use plan complaint and appeal systems were of particular concern to consumer advocacy groups, who contend that plans' systems, therefore, do not adequately serve the needs of plan enrollees; (7) however, consumer concerns about the impartiality of HMO decisionmakers could be addressed by using independent, external review systems for HMO members; (8) consumer concerns about the difficulty in understanding how to use complaint and appeal systems might be addressed by revising written plan materials, which are often difficult to understand; (9) additionally, although experience to date is limited, such concerns are being addressed by ombudsman programs in some parts of the country; (10) publicly available data on the number and types of complaints and appeals, if consistently defined and uniformly collected, can enhance oversight, accountability, and market competition; (11) comparative data would provide regulators, purchasers, and individual consumers with a view of members' relative satisfaction with health plans, thereby supplementing other performance indicators; (12) all HMOs in GAO's study stated that they review complaint and appeal data to identify problems that the plan needs to address; and (13) several HMOs reported using complaint and appeal data, together with data from other sources, to make changes in benefits and plan processes, and to attempt changes in member and provider behavior as well.

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