Bill To Revise Medicare QIO System

Armen Hareyan's picture

Senate Finance Committee Chair Max Baucus (D-Mont.) and ranking member Chuck Grassley (R-Iowa) last week introduced a bill (S 1947) under which Medicare quality improvement organizations could not conduct investigations of beneficiary complaints about health care providers when they serve as consultants for those providers, The Hill reports (Young, The Hill, 8/8). CMS pays about $300 million annually to contract with 53 QIOs -- organizations based in all 50 states; Washington, D.C.; Puerto Rico; and the Virgin Islands -- to improve the quality of care provided to Medicare beneficiaries (Kaiser Daily Health Policy Report, 5/17/06). QIOs also investigate complaints from Medicare beneficiaries, although in some cases they refer complaints to the Department of Justice or the Office of Inspector General at HHS.

Recent investigations by committee staff, as well as recent studies conducted by the Institute of Medicine, the Government Accountability Office and HHS OIG, have found that QIOs focus more on their work as consultants for health care providers than on investigations of complaints from Medicare beneficiaries (The Hill, 8/8).


Grassley said that the committee investigation "revealed a program in desperate need of reform," adding that QIOs operate "with little or no oversight" at a cost of "more than one billion dollars every three years with little measurable results." Baucus said, "It seems there is a consensus that the QIO program could be doing more to help improve the quality of care" (Reichard, CQ HealthBeat, 8/7).

Bill Details
The bill would establish new Medicare Provider Review Organizations to investigate complaints from beneficiaries. Under the legislation, CMS could contract with current QIOs to serve as MPROs, although not for the same states in which QIOs serve as consultants for health care providers (The Hill, 8/8). The bill also would allow other organizations to compete with current QIOs and would prohibit the renewal of noncompetitive contracts. In addition, CMS would review QIOs based on consistent performance measures. QIOs that perform effectively would receive financial rewards, and those that perform ineffectively would receive financial penalties.

AHQA Response
Officials for the American Health Quality Association, which represents 42 QIOs nationwide, said that the group supports a "middle ground" for reform. "It's both costly and unnecessary" to establish MPROs, according to AHQA Executive Vice President David Schulke (CQ HealthBeat, 8/7).

He added that QIOs do not have conflicts of interest because they make the same recommendations to health care providers regardless of whether they find problems through case reviews or investigations of complaints from Medicare beneficiaries. "The quality problems are the quality problems," Schulke said, adding, "The things you need to do to fix them are the same things" (The Hill, 8/8).