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Highlights

Pursuant to a congressional request, GAO reviewed the Health Care Financing Administration's (HCFA) processes to ensure that dialysis facilities meet quality-of-care standards, focusing on: (1) the extent to which on-site inspections of dialysis facilities are performed and problems are identified; (2) whether an effective process exists to ensure that dialysis facilities correct problems; and (3) what steps are being taken to use available monitoring resources as effectively as possible.

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Recommendations

Matter for Congressional Consideration

Matter Status Comments
To improve ESRD facilities' incentives to maintain compliance with Medicare's conditions of participation, Congress should consider authorizing HCFA to assess monetary penalties on ESRD facilities like those it is authorized to assess on nursing homes that have severe or repeated serious deficiencies.
Closed - Not Implemented
Legislation has not been introduced or considered by authorizing committees. However, CMS officials have proposed a legislative change that would establish generic alternative sanctions for all provider types.

Recommendations for Executive Action

Agency Affected Recommendation Status
Health Care Financing Administration The Administrator, HCFA, should strengthen HCFA's oversight of ESRD facilities by developing procedures on how and when to use HCFA's existing authority to impose partial or complete payment reductions for ESRD facilities that do not meet Medicare quality standards for dialyzer reuse.
Closed - Not Implemented
CMS officials recognize that they have the authority to deny payments to dialysis facilities that furnish treatments not in compliance with dialyzer reuse standards. However, they assert that alternative payment sanctions would be difficult to implement because a state surveyor would not be able to determine which specific treatments were delivered during a period of noncompliance. GAO maintains that procedures to exercise CMS authority should be developed and retroactive payment denials could be imposed for dialysis treatments received by a facilities' patient population in a given period of noncompliance.
Health Care Financing Administration The Administrator, HCFA, should strengthen HCFA's oversight of ESRD facilities by establishing procedures to facilitate better and more routine cooperation and information sharing between ESRD networks and state survey agencies, particularly in targeting facilities for on-site surveys.
Closed - Implemented
On July 18, 2001, CMS sent a memo to all the regional offices clarifying responsibilities and authorities for sharing information between state agencies and ESRD networks.
Health Care Financing Administration The Administrator, HCFA, should strengthen HCFA's oversight of ESRD facilities by evaluating the results of HCFA's project for using clinical outcome data to select facilities for on-site review before it recommends that states use such data as a key factor in the selection process. A central component of the evaluation should be determining the extent to which the data are sufficient to predict which facilities have a higher likelihood of not complying with Medicare's conditions of participation.
Closed - Implemented
HCFA has completed its pilot test and analysis to show that data it uses does have predictive value in detecting facilities with compliance problems. It is basing implementation on the results of these evaluations.

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