Medicare:

PRO Review Does Not Assure Quality of Care Provided by Risk HMOs

HRD-91-48: Published: Mar 13, 1991. Publicly Released: Mar 13, 1991.

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Pursuant to a congressional request, GAO reviewed the: (1) Health Care Financing Administration's (HCFA) management of peer review organization (PRO) reviews of risk health maintenance organizations (HMO); (2) PRO review of the internal quality assurance programs at risk HMO; and (3) PRO external review of health care provided by risk HMO.

GAO found that: (1) effective internal quality assurance programs (QAP) for at-risk HMO were essential, since they were the first line of defense for protecting Medicare enrollees against substandard health care; (2) HCFA did not comprehensively assess QAP effectiveness because it focused on structure rather than effectiveness, and made PRO reviews of HMO QAP optional; (3) some HMO QAP did not have the capacity to identify and correct quality problems; (4) HCFA continued to rely on deficient QAP to correct serious quality problems; (5) the PRO external review process was hampered by such chronic sampling problems as incomplete information on HMO inpatient hospital enrollees, unreliable results from the current HCFA inpatient care sampling plan, and limited ambulatory reviews; and (6) HCFA was not using results of PRO reviews in its HMO oversight activities.

Matter for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: Congress did not act, but HHS modified its peer review methodology to obtain the necessary information directly from HMO.

    Matter: Although risk HMO are required to cooperate with PRO, Congress should amend the Social Security Act to give HCFA explicit authority to impose such remedies as suspending enrollment or payments or imposing civil monetary penalties to help ensure that risk HMO comply in collecting and submitting the inpatient hospital information needed by PRO to carry out their review responsibilities.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: HHS agreed that linking all data sources on HMO monitoring would be valuable. HHS was working on redesigning its PRO data system and incorporating PRO data into its HMO monitoring process. However, GAO made a similar recommendation in GAO/HEHS-95-155, Aug. 3, 1995, and will be following up under that report.

    Recommendation: The Secretary of Health and Human Services should direct the Administrator, HCFA, to: (1) require PROs to report the results of their quality reviews by specific HMO; and (2) link this information with that available from the HCFA compliance monitoring process and the Beneficiary Inquiry Tracking system to provide a more complete profile of HMO with risk contracts.

    Agency Affected: Department of Health and Human Services

  2. Status: Closed - Not Implemented

    Comments: HHS said that centralization of records was problematic. HHS did agree that there was a need for some level of centralized data but made no commitment about ensuring their availability.

    Recommendation: The Secretary of Health and Human Services should direct the Administrator, HCFA, to provide leadership in encouraging participating risk HMO to begin collecting centralized data on ambulatory care provided to Medicare enrollees.

    Agency Affected: Department of Health and Human Services

  3. Status: Closed - Not Implemented

    Comments: HHS believes that the quality of routine ambulatory care in HMOs is superior to that under providers fee-for-service.

    Recommendation: The Secretary of Health and Human Services should direct the Administrator, HCFA, to critically monitor the results of PRO reviews of ambulatory care for at-risk HMO as part of an ongoing effort to identify the most effective way of doing such reviews.

    Agency Affected: Department of Health and Human Services

  4. Status: Closed - Not Implemented

    Comments: HHS said that it could not implement the recommendation at this time because sufficient health outcome data did not exist. GAO believes that PROs could conduct meaningful evaluations using their medical expertise and available data.

    Recommendation: The Secretary of Health and Human Services should direct the Administrator, HCFA, to review the requirements for the PRO external quality review of HMO medical records and make adjustments to ensure that review levels are commensurate with the effectiveness of QAP. That is, HMO with QAP that can demonstrate the capacity to identify and correct quality problems should be subject to lower levels of external PRO review.

    Agency Affected: Department of Health and Human Services

  5. Status: Closed - Not Implemented

    Comments: HHS disagreed with the recommendation and said that no action would be taken. GAO believes that PRO should review QAP, but because PROs would need guidance for conducting such reviews, HHS disagrees about the need for the PRO reviews.

    Recommendation: The Secretary of Health and Human Services should direct the Administrator, HCFA, at the earliest opportunity, in cooperation with PRO and HMO, to develop uniform review guidelines to be used by PRO in assessing the effectiveness of HMO QAP.

    Agency Affected: Department of Health and Human Services

  6. Status: Closed - Not Implemented

    Comments: The Department of Health and Human Services (HHS) disagreed with the recommendation, stating that no legal obligation existed requiring PRO review of QAP and that HCFA already reviewed QAP as part of its certification program for HMO. GAO believes that PRO review of QAP would represent a medical evaluation of their adequacy, whereas the HCFA review is more administrative.

    Recommendation: The Secretary of Health and Human Services should direct the Administrator, HCFA, to amend the HMO and PRO contracts, at the earliest opportunity, to make mandatory the PRO review of QAP of all risk HMO participating in the Medicare program. This requirement should include provisions for HMO corrective action and PRO followup where HMO QAP cannot demonstrate the capacity to identify and correct quality-of-care problems and periodic PRO monitoring of those QAP found to be effective.

    Agency Affected: Department of Health and Human Services

 

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