Department of Health and Human Services 
OFFICE OF 
INSPECTOR GENERAL 
HOSPITAL REPORTING  TO THE 
NATIONAL PRACTITIONER 
DATA BANK 
JUNE GIBBS BROWN 
Inspector General 
FEBRUARY 1995 
OEI-01-94-00050  OFFICE  OF INSPECTOR  GENERAL 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452,  as 
amended,  is to protect the integrity of the Department of Health and Human Services (HHS) 
programs  as well as the health and welfare of beneficiaries  served by those programs.  This statutory 
mission is carried out through  a nationwide network of audits, investigations,  and inspections 
conducted by three OIG operating components:  the Office of Audit Services,  the Office of 
Investigations,  and the Office of Evaluation and Inspections.  The OIG also informs the Secretary of 
HHS of program  and management problems  and recommends courses to correct them. 
OFFICE  OF AUDIT  SERVICES 
The OIGS Office of Audit Services (OAS) provides  all auditing services for HHS,  either by 
conducting audits with its own audit resources or by overseeing audit work done by others.  Audits 
examine the performance  of HHS programs  and/or  its grantees and contractors  in carrying  out their 
respective responsibilities  and are intended to provide independent assessments of HHS programs  and 
operations  in order to reduce waste, abuse, and mismanagement  and to promote  economy and 
efficiency throughout  the Department. 
OFFICE  OF INVESTIGATIONS 
The OIGS Office of Investigations  (01) conducts criminal,  civil, and admkistrative  investigations  of 
allegations of wrongdoing  in HHS programs  or to HHS beneficiaries  and of unjust enrichment by 
providers.  The investigative efforts of 01 lead to criminal convictions,  adrnhlistrative  sanctions,  or 
civil money penalties.  The 01 also oversees State Medicaid fraud control units which investigate and 
prosecute  fraud and patient abuse in the Medicaid program. 
OFFICE  OF EVALUATION  AND INSPECTIONS 
The OIGS Office of Evaluation and Inspections (OEI) conducts short-term  management  and program 
evaluations  (called inspections) that focus on issues of concern to the Department,  the Congress,  and 
the public.  The findings and recommendations  contained in these inspection reports generate rapid, 
accurate,  and up-to-date information on the efficiency, vulnerability,  and effectiveness of departmental 
programs. 
This report was prepared under the direction of Mark R. Yessian,  Ph. D.,  Regional Inspector  General, 
and Martha B. Kvaal, Deputy Regional Inspector General, Boston Region,  Office of Evaluation  and 
Inspections.  Participating  in this project were the following people: 
Boston Region  Headquarters 
Barry McCoy  Alan Levine 
David Veroff 
Foradditionalcopiesof this report,please contacttheBostonregionalofllceby telephoneat 
(617)565-1050, or byfm  at (617) 565-3751.  EXECUTIVE  SUMMARY 
PURPOSE 
To conduct  a preliminary  inquiry  to help  the  Public  Health  Service  determine  how

hospitals  are  responding  to their  legal  obligation  to report  to the  National  Practitioner  Data

Bank  adverse  actions  they  take  against  health  care  practitioners.

BACKGROUND 
Under  the  direction  of the  Health  Resources  and  Services  Administration  in the  Public 
Health  Service,  the  National  Practitioner  Data  Bank  has  been  operating  since  September  1, 
1990.  Since  that  time  it has  received  and  maintained  records  of medical  malpractice 
payments  and  adverse  actions  taken  by hospitals,  other  health  care  entities,  licensure 
boards,  and  professional  societies  against  licensed  health  care  practitioners.  At  the  same 
time,  the  Data  Bank  has  been  making  these  data  available  to hospitals,  other  health  care 
entities,  and licensure  boards to facilitate their credentialing  and investigatory  activities. 
As indicated  in the Health  Care Quality Improvement  Act of 1986, which established  the 
Data Bank,  hospitals have a particularly  important  role to play in determining  its 
effectiveness.  For each practitioner  seeking clinical privileges,  they must query the Data 
Bank to determine  if it has any information  on that person.  Once a practitioner  receives 
privileges,  they must then make a follow-up query every two years.  In addition, 
hospitals,  as well as other health care organizations,  must report  to the Data Bank all 
adverse  actions they take that affect a practitioners  clinical privileges  for more than 30 
days.  Hospitals  that fail to meet their reporting  responsibilities,  risk losing the liability 
protections  afforded  their professional  review activities under the Health  Care Quality 
Improvement  Act. 
In this report,  we focus on the hospitals responsibilities  to report  information  to the Data 
Bank.  We do that because the Health Resources  and Services Administration  asked us to 
conduct  a preliminary  investigation  to determine  if there might be any basis for concern 
about how hospitals  were responding  to the Data Bank reporting  requirements. 
EXTENT  OF HOSPITAL  REPORTING 
From September  1, 1990 to December  31, 1993,  about  75 percent  of all hospitals  in the 
United States never reported an adverse action to the Data Bank. 
The State-by-State  varition in the rate of nonreporting  hospitals  is considerable  
ran~ngfrom  93.2 percent  of all hospitals in South Dakota to 51.7 percent  in New 
Jersey.  The median  rate is 76.4 percent. 
i  Among the nonreporting  hospitals are many large ones.  For instance,  in Massachusetts, 
among  112 hospitals  that did not report  an adverse action to the Data Bank in its first 3 
1/3 years of operation,  18 have 300 or more beds. 
Less populated  and/or  predominately  rural  States are heavily represented  among those 
with the highest  level of nonreporting.  On the other end,  among the States with the 
lowest rates  of nonreporting,  the more populous and/or  more urban ones are strongly 
represented. 
From September  1, 1990 to December  31, 1993,  the approximately  6,500  hospitals  in the 
United States submitted  3,154  adverse action reports to the Data Bank.  This represents 
2.6  reports per  1,000  hospital beds during the 3 1/3 year period. 
With the focus on the number  of reports  rather  than on number  of nonreporting  hospitals, 
the State-by-State  picture  changes somewhat.  For instance,  New Jersey,  which ranks first 
in the proportion  of hospitals  sending at least one report  to the Data Bank,  ranks  18th in 
the number  of reports  per  1,000 hospital beds. 
Repoting rates per  1,000  hospital beds vary greatly  State to State - ranging from  8.5 in 
Nevada  to .7 in South Dakota.  In most States,  the repoting rate is between  1.5 and 
4.0.  The median  rate is 2.5 adverse action reports. 
Some of differences  among States are considerable.  For example,  in California,  the State 
with the largest  number  of hospital beds,  the rate of adverse  actions is 3.7 per  1,000 beds. 
In New York,  the State with the second largest number of hospital beds,  the rate  is much 
less -2.1.  In Ohio, the rate is 2.9;  in nearby Illinois,  it is 1.5 
BASIS FOR CONCERN 
Our review  suggests a sufficient basis for concern  about the hospitals  response  to the 
Data Bank reporting  requirements.  The wide variation  in reporting  rates from State to 
State is in itself troubling.  It could suggest differences  in the quality of care rendered  or 
perhaps  in the capacity  or willingness  of hospitals to submit reports  to the Data Bank. 
The explanation  is unclear. 
Further,  the level of reporting  in the nation as a whole may be unreasonably  low. 
	 In a 1989 planning  document  submitted to the Office of Management  and Budget, 
the Public Health  Service estimated  there would be 5,000 hospital  adverse  action 
reports  a year.  Others had estimated  levels more than twice that.  The actual 
average  has been about  1,000 a year. 
	 During  the September  1, 1990- December  31,1993 period,  when hospitals 
reported  3,154 practitioners  to the Data Bank, State medical  boards took 
disciplinary  actions against about 8,000 physicians. 
ii  	 A 1991 Harvard  Medical  Practice  study of hospitalized  patients  in New York State 
found that in 1984, one percent  of the hospitalizations  in its random  sample 
involved  adverse events caused by negligence.  On the basis of this sample,  the 
study team estimated  that during  1984, negligent  care in the State accounted  for 
27,179  injuries,  including 6,895 deaths and 877 instances of permanent  and total 
disability.  
ISSUES WARRANTING  FURTHER  ANALYSIS 
That there  is a basis for concern  is not the same as finding there  is a problem  that must be 
addressed.  To determine  if that is, indeed,  the case,  fiu-ther inquiry  is necessary.  On the 
basis of our own preliminary  review,  we have identified four issues that warrant  further 
analysis. 
There may be few practitioners  with serious pe~ormance  problems.  The current  level of 
reporting  may be appropriate.  The early estimates,  based on little hard evidence,  may 
simply have been unrealistic.  Further,  hospital quality assurance  efforts may be 
contributing  significantly  to improved practice. 
Some hospitals  may be responding to poorly pe~orrning  practitioners  in ways that do not 
require repoting to the Data Bank.  They may be taking preventive  actions that lessen 
the need for adverse  action.  Another possibility  is that some may be circumventing  the 
reporting  requirements  by deliberately  taking  actions that fall below the threshold  that 
calls for reporting. 
Some hospitals  may be reemphasizing  or avoiding adverse actions against poorly 
pe~orming  physicians.  The reporting  requirements  raise the stakes associated  with an 
adverse  action and thus may serve as a deterrent  to such action.  Continuous  quality 
improvement  programs,  in seeking to create a safe environment  for physicians  to assess 
practice  data,  may discourage  hospital actions against outliers. 
Some reportable  actions may not in fact  be reported to the Data Bank.  In one State 
where we were  able to get some information,  we found that because  of administrative 
mix-ups,  some reportable  actions were not submitted to the Data Bank.  It is not clear 
how often such failures  occur in other States.  It is clear that neither  the Medicare 
Conditions  of Participation  for Hospitals,  nor the standards of the Joint Commission  on 
Accreditation  of Healthcare  Organizations  specify hospital responsibilities  concerning  the 
Data Bank. 
... 
111
 RECOMMENDATIONS 
The Public  Health  Service,  through the Health Resources  Services Administration, 
should suppoti further  inquiry to foster  a better understanding  of the factors  in.uencing 
hospital  repo~ng to the Data Bank.  Intensive case studies that examine  the extent  and 
nature  of adverse  actions,  and more generally  of peer review efforts  in particular 
hospitals,  probably  offer the best approach.  Although they would not result  in 
generalizable  findings,  they could result in deeper  insights into hospital practices  that 
could facilitate  effective  implementation  of the Data Bank law. 
The Public  Health  Service should sponsor a conference  to focus  attention  on issues 
influencing  reporthzg to the Data Bank.  The conference  should include representatives 
from the Public Health  Service and the Health Care Financing  Administration  as well as 
representatives  from the American  Hospital Association,  the American  Medical 
Association,  the Joint Commission  on Accreditation  of Heahhcare  Organizations,  the 
Federation  of State Medical  Boards,  and other organizations.  The conference  should pay 
particular  attention  to the issues identified  in this report  as warranting  firther  analysis.  It 
should also address  actions that might be taken to ensure that hospitals meet their 
reporting  responsibilities  as called for in the Health Care Quality Improvement  Act of 
1986. 
The Public  Health  Service and the Health  Care Financing Administrahon should work 
together  to ensure that the Joint  Commission  on Accredit&on of Healthcare 
Organizatzonsassesses more fully  hospitals  compliance  with the intent and paticulars 
of the Data Bank law.  Toward this end, they might consider the following  options: 
A Letter.  Send a joint  communication  to the Joint Commission  urging  that it incorporate 
the Data Bank requirements  into its standards,  conduct a more thorough  review  of hospital 
peer  review  efforts  and adverse  actions as part of its survey process,  and seek to identify 
any indications  of hospitals  circumventing  the intent of the Data Banks reporting 
requirements. 
Regulatory  Change.  Amend the Medicare  Conditions  of Participation  in a manner  that 
will specify hospitals  responsibilities  under the Data Bank law.  This,  in turn,  would call 
for the Joint Commission  to devote greater  oversight to the hospitals  performance  of their 
responsibilities. 
LegzshztzonP.ropose  legislation  that would call for hospitals  Data Bank responsibilities 
to be addressed  in the Medicare  Conditions  of Participation  and for the Joint Commission 
to focus more  attention  on the fulfillment  of these responsibilities  during  its survey 
process. 
iv  COMMENTS  ON THE DRAFT REPORT 
We solicited  and received  comments  on the draft report  from the Public Health  Service 
(PHS),  the Health Care  Financing  Administration  (HCFA),  the Joint Commission  on 
Accreditation  of Healthcare  Organizations  (JCAHO),  the American  Hospital  Association 
(AHA),  Public Citizens  Health Research  Group (PCHRG),  and the American  Medical 
Association  (AMA).  Their  comments  appear in fill  in appendix B.  Below we summarize 
the comments,  and,  in italics,  our responses. 
Recommendation  #1 Calling for PHS to Conduct Further Inquiry 
PHS concurred  but suggested that the case study analysis we suggested be deferred  until a 
study it has underway  is completed.  The JCAHO and PCHRG  strongly  supported  further 
inquiry.  The AHA and AMA did not comment  specifically  on the recommendation.  We 
continue  to urge that PHS give high priori~  to an in-depth case study inquiry.  The AHA, 
in its comments, provides jimther  rationale for  such inquiry by emphasizing  that concerns 
about insufficient  immunity protections  are exerting a  powe@d disincentive for  hospital 
peer  review activi~.  Focused  case reviews could help indicate the extent and nature of 
this problem. 
Recommendation  #2 Urging PHS to Sponsor a Conference 
The PHS agreed  with the thrust but not the specific content of the recommendation.  It 
stated that in the near-term  it will be holding ad hoc meetings  at professional  associations 
that would provide  a better  opportunity  for discussion.  At a later point,  it indicated,  a 
conference,  as we call for,  might be more desirable.  The JCAHO  supported  a conference 
as a solid first step toward defining the reporting  problem.   The AMA regarded  it as 
premature.  Others did not comment.  We strongly urge that PHS consider the conference 
as a near-term priority.  It could help frame  the agenda for firther  inquiry.  And,  if 
accompanied  by a report on conference  deliberations  that were widely disseminated,  it 
could help hospitals  around the country examine more fully  the factors  that may be 
in.uencing  peer  review and Data Bank reporting  in their own settings. 
Recommendation  #3 Calling for PHS and HCFA to Ensure that JCAHO  Assess More 
Fully Hospitals  Compliance  with the Data Bank Law 
The PHS and HCFA  agreed with the recommendation  and agreed that a joint  letter to 
JCAHO  was the best means of follow-up action at this time.  The HCFA  added that a 
joint  letter  should also be sent to the American  Osteopathic  Association  (AOA),  which 
accredits  150 hospitals  for Medicare  purposes.  The JCAHO and AMA regarded  any such 
follow-up  action as premature.  The PCHRG urged  strong follow-action  involving  a 
change  in the Medicare  Conditions  of Participation.  The AHA did not comment  on this 
point.  We regard a joint  letter to be a reasonable means of follow-up  at this time. 
Although  our inquiry did not address AOA accreditation practices,  we suppofl  a joint 
letter to it as well lf PHS and HCFA jind  that appropriate.  We have retained  the options 
v  involving  regulatory  and legislative  change.  Over the long term,  depending  on the 
response  to the joint  letter,  they may still warrant consideration. 
Methodology 
The AHA and AMA raised  some methodological  objections.  Both questioned  the 
relevance  of the  considerations  we offered in supporting  our finding that there  is a 
sufficient basis for concern  about the hospitals  response to Data Bank reporting 
requirements.  In this regard,  they cited as misleading  our references  to prior  estimates  of 
adverse  action reports  from hospitals,  the Harvard  Medical Practice  study,  and the number 
of disciplinary  actions taken by State medical boards  (only AMA cited the latter).  Both 
AHA and AMA sought more refined measures  of hospital reporting  than we offered.  We 
recognize  the potential  value of more rejined measures of hospital  reporting.  Our 
purpose,  as indicated,  was to conduct a limited inquiry to help PHS determine  how 
hospitals  are responding  to their Data Bank obligations.  Given that about  75 percent  of 
the hospitals  in the  United States never reported an adverse action during the first  3113 
years of the Data Banks  operation and the wide variation  in reporting  levels among the 
States,  we continue  to find  that there is sufficient  basis for  our modest recommendations. 
vi  TABLE  OF  CONTENTS

EXECUTIVE  SUMMARY  . . . . . . . .  . . . . . . . .  ,..  .
 . . . . ,..  . . . . . . . .  i 
INTRODUCTION  . . . . . . . . . . . . .  . . . . . . . .  . . .
 . . . . . . . . . . . .  . . . 1 
FINDINGS

.  Extent  of Hospital  Reporting  . . . . .  ,.  ...  ,..  ,..  .
 . . . .  ,..  . . . .  ,..  3 
  Basis for Concern  . . . . . . . ..*C  .  . . .  . . . .
 . . . . ,..  . . . .  . . . 4 
...! 
.  Issues Warranting  Further  Analysis  .  . . .  . . . .
 . . . . . . . . . . .  . . . 5 
.  .  .  .  .
RECOMMENDATIONS  . . . . . . . . .  . . .  . . . .  . . . . . . . . . . .  . . . 7 
.  .  .  .  .
COMMENTS  ON THE DRAFT REPORT  . . . . . .  . . . .
 . . . . . . . . . . .  . . . 9 
APPENDICES

A:  Hospital  Adverse  Action Reporting,  by State  . . . .  . . . .
 . . . . . . . ,..  .  A-1 
B:  Complete  Comments  on the Draft Report  . . . . . .  . . . .
 . . . . . . . . . . .  . . B-1 
C:  Notes  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..
 C-l INTRODUCTION 
PURPOSE 
To conduct  a preliminary  inquiry to help the Public Health Service determine  how 
hospitals  are responding  to their legal obligation to report  adverse actions to the National 
Practitioner  Data Bank. 
BACKGROUND 
In the Health  Care  Quality Improvement  Act of 1986, Congress  called for the 
establishment  of the National  Practitioner  Data Bank (hereafter  referred  to as the Data 
Bank).  It did so to help health care entities and licensing boards make well- informed 
decisions  concerning  the credentialing,  the licensing,  and,  where necessary,  the 
disciplining  of health care practitioners.  Toward that end,  it stipulated that information  on 
practitioners  reported  to the Data Bank would be made available,  upon request,  to health 
care entities  and State licensing boards. 1 For hospitals in particular,  Congress  went 
t?.mtherand mandated  that they regularly  query the Data Bank as part of the application 
process  for physicians,  dentists,  and other practitioners  seeking clinical privileges  and 
every  two years for those having  such privileges. 
The Congress  also specified the types of information  that had to be reported  to the Data 
Bank.  The Data Bank was to include medical malpractice  payments,  sanctions taken 
against practitioners  by professional  societies and State medical  and dental boards,  and 
adverse  actions taken against practitioners  by hospitals and other health care entities.  The 
adverse  actions reportable  by hospitals and other health care entities would be those that 
affected  a practitioners  clinical privileges  for a period  greater  than 30 days.  They would 
also include  cases where a practitioner  surrendered  such privileges  while an investigation 
was underway  or in exchange  for not conducting  an investigation. 
Hospitals  that fail to carry  out their responsibilities  to report  to the Data Bank risk losing 
the liability  protections  afforded  to their professional  review  activities under the Health 
Care Quality  Improvement  Act.  The regulations  implementing  the Act calls for the 
Secretary  of the Department  of Health and Human Services (1) to investigate  hospitals  that 
appear  to be violating  their reporting  responsibilities,  (2) to provide  them with an 
opportunity  to correct  their practices  if they are found to be in noncompliance,  and (3) to 
remove  the liability protections  if the noncompliance  continues. 2 
The Data Bank,  administered  under the direction  of the Health Resources  and Services 
Administration  of the Public Health Service (PHS), began operation  on September  1, 
1990.  In late  1992 and early  1993, we issued reports examining  the usefulness  and impact 
of the Data Bank to hospitals  and licensing boards during the first year and a half of its 
operation.3  Currently,  at the request  of PHS, we are updating that work by examining  its 
usefulness  and impact in the ensuing period. 
1
 In this brief  report,  we focus on one discrete  and very significant  aspect of the Data 
Banks operation:  hospitals  reporting  of adverse action information  to the Data Bank. 
We do that because  the Health Resources  and Services Administration  asked us to 
determine  if there  might be a basis for concern  associated with the hospitals  response  to 
the reporting  requirements.  Any evidence,  for example,  of hospitals not complying  with 
the requirements  would certainly  cause concern.  These would also be a basis for concern 
if hospitals  are taking actions that serve to circumvent  the general  intent of the law to 
identify practitioners  who may pose a danger to the public. 
The hospitals  full cooperation  in carrying  out the reporting  requirements  is vital for a 
number  of reasons.  One is the sheer number of hospitals  involved.  With about 6,500 
hospitals  across the country,  they represent  a major potential  source of information  for the 
Data Bank.  A second reason has to do with the nature of the information  reported.  A 
loss or reduction  in clinical privileges  is a serious action that raises important  questions 
about the competence  and/or  professionalism  of a practitioner.  Finally,  and more 
basically,  hospitals have considerable  data on the medical practice  patterns  of physicians 
and are in a good position to identify those practitioners  who are poor performers. 
APPROACH  AND METHODOLOGY 
Per our understanding  with the PHS our inquiry was a limited one intended to help it 
begin  its consideration  of hospital reporting  issues.  In that context,  we focused our 
examination  on the extent of hospital reporting  during the first 3 1/3 years of the Data 
Banks operation.4  In the first section of the report  we present  data indicating  (1) the 
number  of hospitals that made no reports  or 1 or more reports  during the 3 1/3 year 
period  and (2) the number  of reports per  1,000 hospital beds.  In both cases,  we indicate 
the variation  among the States. 
After presenting  the data,  we seek, in the second section,  to help PHS assess if they 
present  sufficient basis for concern.  We draw on interviews  with representatives  of 
national  organizations,  State governments,  and PHS; and include a review  of pertinent 
literature  concerning  health care quality assurance. 
We close with three  recommendations.  Two directed  to PHS and the other jointly  to PHS 
and the Health  Care Financing  Administration. 
Our review  was conducted  in accordance  with the Quality Standards for  Inspections 
issued by the Presidents  Council  on Integrity  and Efficiency. 
2
 FINDINGS 
EXTENT OF HOSPITAL  REPORTING 
From September  1, 1990 to December  31, 1993, about 75 percent  of all hospitals  in the 
United States never  reported an adverse action to the Data Bank. 
The nonreporting  hospitals  include all types of hospitals in urban and rural  locations.  And 
they include  many large  ones as well as small ones.5 For example,  in Massachusetts, 
among the 112 hospitals  that did not report an adverse action to the Data Bank in its first 
3 1/3 years of its operation, 18 have 300 or more beds. 
The State-by-Stute  vatin  in the rate of nonrepting  hospitals is considemble  
rangzngfmm  93.2 percent  of all hospitals in South LMwkz to 51.7 percent  in New 
Jersey.  The mediun  tie  is 76.4 percent. 
Among the States with the highest level of nonreporting,  the less populated  and/or 
predominately  rural  ones  are  heavily  represented.  In addition to South Dakota,  they 
include Idaho,  Montana,  Mississippi,  Alaska,  Alabama,  and  Dakota.  On  the other 
North 
end,  among  the  States  with  the  lowest  rates  of nonreporting,  the  more  populous  and/or 
more  urban  ones  are  very  much  in evidence.  Along  with  New  Jersey,  they  include  the 
District  of Columbia  (classified  as a State  for  of this study),  Maryland,  New 
purposes 
York, California,  Ohio,  and Rhode Island (see appendix A, table  1). 
Fmm September  1, 1990 to December  31, 1993, the approximately  6,500  hospitals  in the 
United States submitted  3,154  adverse action repotis  to the Data  Bank.  This represents 
2.6 repotis per  1,000  hospkl  beds during the 3 1/3 year period. 
When the frame  of reference  shifts from nonreporting  hospitals to the total number  of

reports per hospital,  the State-by-State  picture  changes somewhat.  For  example,  we find

that New Jersey,  which ranks  first in the proportion  of hospitals sending at least one

report to the Data Bank,  ranks  18th in the number of reports  submitted  per  1,000 hospital

beds.  Even more  striking  is that New York shifts from 4th to 33rd.

Looking more closely,  we find that in New Jersey,  among the 58 hospitals  that submitted

adverse action  reports  to the Data Bank, 25 submitted only 1.  In New

York, among  the  110 hospitals  reporting,  57 submitted only  1 (see appendix  A, table 2).

Repo~ng ties  per  1,000  hospdal  beds vary greatly fmm  State to State - ran~ngfrom 
8.5 in Nevada  to .7 in South Dakota.  In most States, the repo~ng rate is between  1.5 
and 4.0.  The medhm  mte  is 2.5 adveme  action reports. 
Some of the differences  among  States  are  considerable  (see appendix  A,  table  2).  For 
instance,  the  rate  of adverse  action  reports  in California,  the State  with  the  largest  number 
of hospital  beds,  is 3.7  per  1,000  beds;  the  rate  in  New  York,  the  State  with  the  second 
3
 largest  number of hospital beds, is considerably less -2.1.  In Ohio, the rate is 2.9;  in 
nearby  Illinois it is 1.5.  In Virginia,  the rate is 4.2;  in neighboring  Tennessee,  which 
has about the same number of hospi~ls  and hospital  beds,  the  rate  is  1.3. 
BASIS FOR CONCERN 
Our review  suggests that there is sufficient basis for concern about the hospitals response 
to the Data Banks reporting  requirements. 
This  is  most  clearly  the  case  because  of  the  wide  variation  in  hospital  reporting  rates  from 
&ate  to  State.  The  reporting  period  for  these  data  is long  enough  - more  than  3 years - to 
discount  short-term  aberrations  in the States.  What,  then, might account for the extensive 
variation?  Does it reflect  differenws  in the quality  of  care  being  rendered  in  hospitals? 
In the capacity  or willingness  of hospitals to take adverse actions?  In other factors 
associated  with the reporting  requirements?  The answers are not at all clear. 
Whatever  the State-to-State  differences,  there is alSOreason to suspect that the level of 
reporting  in the nation as a whole may be unreasonably low.  Some considerations  which 
may support such a suspicion are as follows: 
.	 During  the planning  stage for the Data Bank, the PHS,  in a 1989 planning 
document  submitted  to the office  of Management and Budget,  estimated  there 
would be 5,000  adverse  action reports a year from hospitals.b  Other estimates 
from other sources  were even higher.  Although all estimates  were based on little 
empirical  evidence,  the gap between them and the actual yearly average  of about 
1,000 adverse  action reports  is striking. 
1 
.	 During  the 1990 to 1993 period,  when hospitals reported  about 3,154 practitioners 
to the Data Bank,  State medical boards took disciplinary  actions against  about 
8,000 physicians. 7  These numbers are not directly comparable,  but,  again,  the 
discrepancy  is sufficiently  large to raise legitimate questions about whether 
hospitals are being sufficiently  rigorous in taking adverse  actions against 
practitioners  on their  staffs.g 
.	 A 1991 Harvard  Medical  Practice  study of hospitalized patients  in New York State 
found that,  in  1984, one percent  of the hospitalizations  in its random  sample 
involved adverse  events caused by negligence.  On the basis of its sample,  the 
study team estimated  that during  1984, negligent care provided  in New York State 
hospitals  was responsible  for 27,179 injuries,  including 6,895 deaths and 877 
instances  of permanent  and total disability.  g  TO be  sure,  all  of  these  cases  did 
not  warrant  the  hospital  taking  an adverse  action  against  the  practitioners  involved. 
Yet,  in  contrast,  it is  striking  to  find  that in the  first  3 1/3 years of the Data Banks 
operation,  close  to three-fourths  of the hospitals in the country  have not reported  a 
single physician  to the Data Bank. 
4
 ISSUES WARRANTING FURTHER ANALYSIS 
To state that there is a basis for concern is not the same as to state that there is a problem 
that must be addressed.  To determine if that is, indeed, the case, it is important to 
conduct further inquiry to fill the substantial informational void that now exists.  On the 
basis of our own preliminary review, we have identified four issues which warrant further 
analysis as part of an additional inquiry.  They are as follows: 
There may be few practitioners with serious perfonnance problems. 
Given the limited data available about the performance of hospital practitioners and about 
hospital adverse actions prior to the establishment of the Data Bank, we must recognize 
that whatever the seeming contradictions, it is possible that the level of reporting now 
being made to the Data Bank is appropriate.  The early estimates, which were widely 
acknowledged to be little more than informed guesses, may simply have been way off the 
mark.  Further, in the intervening years, credentialing practices and hospital quality 
assurance practices may have improved significantly, thereby reducing the likelihood of 
suboptimal performance by practitioners. 
Some hospitals may be responding to poorly perfonning practitioners in ways that do not 
require reporting to the Data Bank. 
Through their own quality assurance efforts, some hospitals may be identifying practice 
deficiencies early and taking educational or other interventions that serve to correct or 
minimize the deficiencies and thus lessen the need to report cases to the Data Bank. 
The establishment of continuous quality improvement programs in recent years may be 
stimulating such corrective actions and/or contributing to self-improvements among 
practitioners. 
Another possibility is that some hospitals, when they choose to take adverse actions, may 
be more inclined to take actions that fall below the threshold that calls for reporting to the 
Data Bank.  They may, for instance, be more likely to take adverse actions of 30 days or 
less since any action longer than that is reportable to the Data Bank. 
Some hospitals may be deemphasizing or even avoiding adverse actions against poorly 
perfonning physicians. 
The higher stakes associated with Data Bank reporting noted above probably make 
practitioners more inclined to contest adverse actions taken against them by hospitals. 
This raises the time and dollar costs to the hospitals and may have the effect, however 
subtly, of lowering the standard of minimally acceptable performance and/or of making 
hospitals less inclined to take any action at all.  This could be happening even as hospitals 
are seeking to improve overall practice norms. 
In fact, quite independently of the Data Bank requirements, the continuous quality 
improvement programs adopted by some hospitals may serve to discourage adverse actions 
5  against poof performers.  A tenet of such programs is to establish a safe environment for 
physicians, one in which they can share, examine, and discuss practice-related data, 
without the risk of outliers being penalized.  The rationale for this approach is that it will 
foster greater improvement in the quality of medical care delivered than will efforts 
directed at finding and penalizing poor performers. 10 
It is also possible, as some respondents to our draft report have noted, that the immunity 
provisions provided under the Health Care Quality Improvement Act of 1986 have not 
provided the intended protection.  As a result, there may still be a significant disincentive 
for hospital peer review activity. 
Some reportable hospital, actions may not in fact be reporled to the Data Bank. 
We have no basis for knowing how often such actions may not be reported.  In only one 
of the eight States where we sought information about hospital reporting were we able to 
obtain some information. 11  In that State, we found that there may, indeed, be a basis for 
some concern about compliance.  Among the approximately 200 hospitals in the State 
which had not sent a single adverse action report to the Data Bank in the 1990-1993 
period, we identified (with the help of the State medical disciplining body) 16 instances 
where such hospitals had taken adverse actions that almost certainly should have been 
reported to the Data Bank. 12  The failure to report in these cases involved administrative 
mix-ups associated with the use of incorrect forms and/or the incorrect routing of the 
information intended to go to the Data Bank. 
To ensure that hospitals are complying with the Data Bank reporting requirements, the 
Department of Health and Human Services relies upon the hospital accreditation process 
carried out by the Joint Commission on Accreditation of Healthcare Organizations.  The 
Department "deems" hospitals accredited by the Joint Commission as complying with the 
Medicare Conditions of Participation.13  These Medicare Conditions, in turn, call for 
compliance with applicable Federal laws, such as the Health Care Quality Improvement 
Act. 
As part of their regular site surveys of hospitals, the Joint Commission surveyors review 
hospital adverse actions affecting the clinical privileges of physicians to determine if they 
were reportable to the Data Bank.  This review, however, is very limited and a very 
minor part of the survey process.  It covers only a sample of the adverse actions taken by 
a hospital.  It does not result in apparent violations of the Data Bank reporting law being 
reported to the Department of Health and Human Services for investigation.  And it does 
not lead to any probing to determine whether or not a hospital might be circumventing the 
intent of the Health Care Quality Improvement Act by taking adverse actions of less than 
31 days or by other means. 
6  RECOMMENDATIONS 
The effectiveness  of the Data Bank depends greatly on the cooperation  of hospitals.  They

must query the Data Bank in a timely manner when they review the credentials  of

practitioners.  And they must identify and report  to the Data Bank practitioners

responsible  for serious quality-of-care  problems.  This report  supports further  inquiry  and

oversight  to determine  if hospitals are cooperating  fully in carrying  out their reporting

responsibilities.  Toward  that end,  we offer the following three recommendations.

The Public  Health  Service,  through the Health Resources  and Services Administrtion, 
should support further  inquiry to foster  a better understanding  of the factors  influencing 
hospital  repoting to the Data Bank. 
Given the lack of any central  repository  of information  on hospital peer review  actions and 
the considerable  diversity  among States and hospitals  (even within the same State), 
intensive  case studies  probably  offer the best near-term  approach  for further  examination. 
Case studies of hospitals  in a few States could help to elucidate  the extent and nature  of 
adverse  actions and more generally  of peer review efforts in particular  hospitals.  They 
could also identify some of the operational  realities  that influence hospital disciplinary 
efforts.  In this context,  the case studies could provide  information  that facilitates  effective 
implementation  of the Data Bank law and of broader  quality assurance  objectives  of the 
Department  of Health  and Human Services. 
In choosing  case study sites,  it may be particularly  helpful to include States with 
substantially  different  rates of hospital reporting  to the Data Bank.  Although the results 
would not allow for generalizable  conclusions  on a national  scale, they could allow for 
deeper  insights into what factors contribute  to differential  rates of reporting. 
The Public  Health  Service should sponsor a conference  to focus  attention  on issues 
influencing  reporting  to the Data Bank. 
The conference  should include representatives  from the Public Health  Service and the 
Health  Care  Financing  Administration  as well as representatives  from the American 
Hospital  Association,  the American  Medical Association,  the Joint Commission  on 
Accreditation  of Healthcare  Organizations,  the Federation  of State Medical  Boards,  and 
other organizations.  The conference  should pay particular  attention to the issues identified 
in this report  as warranting  further  analysis.  It should also address actions that might be 
taken to ensure  that hospitals meet their reporting  responsibilities  as called for in the 
Health Care  Quality Improvement  Act of 1986. 
The Public  Health  Service and the Health  Care Financing Administration  should work 
together  to ensure that the Joint  Commission  on Accreditation  of Healthcare 
Organizations assesses more fully hospitals compliance with the intent and particulars of 
the Data Bank law. 
7
 Given that the Joint  Commissions  efforts  serve  as the Departments  vehicle  for overseeing 
hospital  compliance  with  the  Data  Bank  law  and  given  its current  limitations  hi that 
regard,  this  recommendation  calls  for  a strengthening  of the Joint  Commissionss  reviews 
that  apply  to hospital  reporting  to the  Data  Bank. 
In 1994, the Joint Commission  amended its scoring guidelines  for surveyors  by specifying 
that hospital  queries  and reports  to the Data Bank should be timely and by spelling out 
more precisely  some facets of the Data Bank law. 14 At the same time,  the Joint 
Commission  considered  including the Data Bank requirements  in its statement  of 
standards,  but chose not to do so.  Such action would have given more prominence  to and 
underscored  the importance  of the hospitals obligations  under the Data Bank law. 
Because of its ongoing accreditation  reviews  of hospitals,  the Joint Commission  is in a 
good position  to help the Federal  government  better understand  if there  are problems 
associated  with hospitals  reporting  to the Data Bank.  But to take advantage  of this 
opportunity,  the Joint Commission  clearly  must devote greater  attention to this issue 
during  its survey visits to hospitals.  We recommend  that the Public Health  Service  and 
the Health  Care  Financing  Administration  collaborate  on how best to achieve this end. 
Among the options they might consider  are the following: 
A Letter.  Send a joint  communication  to the Joint Commission  urging  that it incorporate 
the Data Bank requirements  into its standards,  conduct a more thorough  review  of hospital 
peer review  efforts  and adverse  actions as part of its survey process,  and seek to identify 
any indications  of hospitals circumventing  the intent of the Data Banks reporting 
requirements, 
Regulatory  Change.  Amend the Medicare  Conditions  of Participation  in a manner  that 
will specify hospitals  responsibilities  under the Data Bank law.  Those responsibilities  are 
not addressed  at present  in the Medicare  Conditions  of Participation.  This inclusion 
would compel  the Joint Commission  to devote greater  oversight to hospitals  performance 
of the responsibilities. 
Legislation.  Propose  legislation  that would call for hospitals Data Bank responsibilities 
to be addressed  in the Medicare  Conditions  of Participation  and for the Joint Commission 
to focus more  attention  on the fidfillment  of these responsibilities  during  its survey 
process. 
Each of these approaches  has been taken previously  with respect to other matters  - for 
example,  discharge  planning  and organ recovery  procedures.  The first would most likely 
be the quickest to carry  out and may have a stimulative  effect,  but it would lack the 
authority  of the second or third measures.  The third would be the most authoritative 
approach  with the greatest  likely impact,  but would be likely to take longer to have an 
effect.  The second represents  a likely mid-point between the other two in terms  of time to 
implement,  expected  impact,  and degree  of authority. 
8
 COMMENTS  ON  THE  DRAFT  REPORT 
We solicited  and  received  comments  on  the  draft  report  from  the Public  Health  Service 
(PHS),  the  Health  Care  Financing  Administration  (HCFA),  the Joint  Commission  on 
Accreditation  of  HealthCare  Organizations  (JCAHO),  the American  Hospital  Association 
(AHA),  the  Public  Citizens  Health  Research  Group  (PCHRG),  and  the  American  Medical 
Association  (AMA).  We include the complete text of the comments  in appendix  B. 
Below we summarize  the comments of the respondents and then, in italics,  offer  our 
responses.  We do that first,  and at most length,  with respect  to our recommendations. 
We then summarize  and respond to the methodological concerns  raised by two 
respondents. 
RECOMMENDATIONS 
Recommendation  #1: The Public Health Service, through the Health  Resources  and 
Services  Adxrinistration,  should support further inquiry to foster a better 
understanding  of the factors influencing hospital reporting to the Data Bank. 
The PHS agreed  but indicated  that consideration  of the in-depth case study analysis  we 
suggested is best deferred  until a current  study they are supporting is completed  and the 
results reviewed.  The JCAHO  was more enthusiastic about further  inquiry,  indicating  that 
it should be a first priority  and was an essential prerequisite  to any informed  action 
concerning  hospital  reporting.  The PCHRG also expressed  strong support.  The HCFA, 
AHA,  and AMA did not comment  specifically on this recommendation. 
We urge PHS to give higher priority  to near-term irquiry  lhat would examine  in some 
&pth  the fwtors  influencing  hospital reporting to the Dtia  Bank.  Such inquiq  is likely to 
reqwremore than ~he survey  work it curretily  has underway and,  as we suggest  in the 
report,  would call for focused  inquiry at particular  hospitals.  77teAHA,  even  though it 
did not comment  specljically  on this recommendation,  o~ers additional  rationale for  the 
kind of inquiry  we suggest.  It poirued out tti  tti  peer  review immunity provisions  set 
forth  in the Health  Care Quulity Improvernen/ Act of 1986 have proven  to be insuficieti 
and have served  as a  powerjid disincetiive  for hospital peer  review activity.  l?z 
PCHRG  raised a similar  concern.  Focused case studies could examine  the extent  and 
ruuure of the problems  associated  with the immunity provision,  along  with other factors. 
We incorporated  this con.rideration into the text of thisjinal  report. 
Recommendation  #2:  The Public Health Service should sponsor a conference  to focus 
attention  on issues influencing  reporting to the Data Bank. 
The PHS agreed  with the thrust but not the specific content of this recommendation.  It 
noted that it will be engaged  in a series of ad hoc work group meetings  and presentations 
at various professional  society meetings.   It pointed out that such efforts  would reach a 
broader  audience  and allow for more one-on-one interaction.  It further  noted  that if these 
9  efforts prove unsuccessful,  it would consider  the conference  approach  we recommended. 
The JCAHO  was more  supportive,  calling a conference  a solid first step toward  defining 
the reporting  problem.   The AMA regarded  a conference  as premature,  given its 
concerns  about the  accuracy and completeness  of data.  Others did not comment 
specifically  on this recommendation. 
We strongly  suggest that PHS reconsider  our conference  recommetition  and,  in fact, 
accord  it a higher pnontythan our jirst  recommendation.  Such a conference,  attended  by 
knowledgeable  participants  jlom  the various sectors,  would allow for  more concefled 
attention  and interaction  than the ad hoc meetings PHS cited.  It could help outline  the 
scope of a subsequent,  in-depth inquiry.  And,  if accompanied  by a report on the 
deliberations  that were then widely distributed,  it could help others around the count~ 
examine  more fi.dly the factors  (such as insufficient  immuni~  protection)  that may be 
influencing  hospital  reporting  in their own settings. 
Recommendation  #3:  The PHS and HCFA should work together to ensure that the 
JCAHO  assesses more fully hospitals compliance  with the intent and particulars  of 
the Data Bank law.  (We elaborated  on three possible options toward this end:  (1) a joint 
letter to JCAHO  calling  for it to give greater  attention to hospital  compliance  with Data 
Bank reporting  laws,  (2) regulatory  change involving an amendment  to the Medicare 
Conditions  of Participation,  and (3) legislation  calling for hospitals  Data Bank 
responsibilities  to be addressed  in the Medicare  Conditions. ) 
The PHS supported  the letter option and indicated that it already  has had initial discussion 
with HCFA  concerning  it.  The HCFA  also expressed  support for a letter  and added that 
in addition to JCAHO,  it should be sent to the American  Osteopathic  Association,  which 
accredits  150 hospitals  for Medicare  purposes.  The JCAHO regarded  each of the options 
as somewhat premature,  without a better understanding  of the problem.  The AMA, 
even more  strongly,  felt that the options were premature.  On the other hand,  PCHRG 
sought action  stronger  than a letter and called for changes  in the Medicare  Conditions  of 
Participation.  The AHA did not comment  on this recommendation. 
We welcome  the commitment  of PHS and HCFA to proceed  with a joint  letter.  Our 
inquiry did not address the accreditation practices  of the American  Osteopathic 
Association  (AOA).  If HCFA and PHS jiind it appropriate  to send the joint  letter to AOA 
as well as JCAHO,  we certainly support their action.  We have still included the 
regulatory  and legislative  options under the recommendation;  they could be reasonable 
longer term actions depending  on the results of further  inquiry and the joint  letter. 
METHODOLOGY 
Both the AHA and the AMA raised methodological  concerns  associated  with our report. 
Both sets of concerns,  in effect,  have to do with the factors we rely upon to support our 
finding that  there is sufficient basis for concern  about the hospitals  response  to the Data 
Banks reporting  requirements.   The AHA pointed out the lack of any reliable  estimates 
of adverse  action reports  from hospitals,  the inadequacy  of reporting  rates per  1,000 
10  hospital beds as a measure  of hospital reporting,  and the inappropriateness  of the Harvard 
Medical  Practice  study as a point of comparison.  The AMA indicated  concerns  with both 
tables we presented,  noting that they do not reflect  adjustments  for the size of 
nonreporting  hospitals  or the size of the medical  staffs.  As did AHA,  it raised concerns 
about our reference  to the prior  estimates  of hospital reporting  (even with the caveats  we 
offered)  and our use of the Harvard  study as a point of comparison.  It also found our 
reference  to the number  of disciplinary  actions taken by medical boards  to be misleading. 
We recognize  that an understanding  of the hospital reporting  issue could be advanced 
through jimther  analysis  and more rejined measures of hospital reporting.  We would 
welcome  additional  inquiry of that sort.  Our own purpose,  as stated,  was to conduct a 
preliminary  inquiry.  Given the limits of our data,  we deliberately  did not make an 
unqualified  assertion  that there was a problem  involving the extent of hospital  reporting. 
Instead,  we concluded  that there was sufficient  basis for  concern.  Such concern,  we 
added,  was sufficient  to warrant ji.wther inquiry by PHS  (through a study and a 
conference),  and,  more immediately,  some joint  action by PHS and HCFA to assess more 
fully  hospital  compliance  with the Data Bank  law.  Given that 75 percent  of the hospitals 
never reported an adverse action during the jirst  3 1/3 years  of the Data Banks 
operation,  given the wide variation  in reporting  levels among the States,  and given the 
other  considerations we noted,  we continue to find  that there is adequate  basis for  our 
modest recommendations. 
11  APPENDIX  A 
HOSPITAL  ADVERSE  ACTION  REPORTING,  BY STATE 
TABLE 1

HOSPITALS SUBMITTING NO ADVERSE ACTION REPORTS TO THE

DATA BANK, BY STATE, SEPTEMBER 1, 1990- DECEMBER 31, 1993

1 1  I

S. DAKOTA  59  55  93.2%
 I

! I  I 
IDAHO  52  48  92.3%

MONTANA  59  54  91.5% 
MISSISSIPPI	 I  114  I  103  I  90.4%  II

ALASKA  (
 34  30  88.2%
 I

I I  I 
MINNESOTA  158  138  87.3%

ALABAMA  137  119  86.9% 
LOUISIANA  181  157  86.7%

1 
1 I

N. DAKOTA  56  48  85.7%

I 1  I

TENNESSEE  147  126  85.7% 
NEBRASKA  102  87  85.3% 
IOWA  I  127  I  107  I  84.3%  II

OKLAHOMA  160  132  82.5%
 I

I I  I
ARKANSAS  85  70  82.4% 
KANSAS  153  125  81.7% 
N. CAROLINA  157  127  80.9%

I 1  \ 1

I

HAWAII  26  21  80.8%

I I  I 
NEW MEXICO  I  61  I  49  I  80.3%  II

MISSOURI  158  I  126  I  79.8%  II

I  I  I  II 
TEXAS  540  429  79.4% 
WYOMING  29  23  79.3%  I

I I  I
W. VIRGINIA  62  49  79.0%
 I

1 I  I 
WISCONSIN  I  148  I  114  I  77.0%  II

S. CAROLINA  I  78  I  60  I  76.9%  II

I  I  I  II

MASSACHUSETTS  146  112  76.7% 
I  I  I  II

KENTUCKY  123  94  76.4% 
A-1  NEVADA
 38  29  76.3%  I 
II 
GEORGIA
 197  150  I  76.1% 
ILLINOIS
 233  176  I  75.5%  II 
UTAH
 I  58  I  43  I  74.1%  II 
VIRGINIA
 138  100  72.5% 
VERMONT
 18  13  72.2% 
PENNSYLVANIA
 I  277  I  198  I  71.5%  II 
I  I  II 
FLORIDA
 314  222  70.7% 
CONNECTICUT
 I  54  I  38  I  70.4%  II 
NEW HAMPSHIRE  39  27  69.2% 
MAINE
 41  28  68.3% 
II 
OREGON
 68  46  \  67.7% 
MICHIGAN
 192  128  66.7%  I

I I  I
ARIZONA
 102  68  66.7%  I

I
DELAWARE
 15  10  66.7%

1 I 
I
 1  I 
INDIANA
 165  109  66.1% 
I 1  I 
COLORADO
 90  59  65.6%

I I  I 1

RHODE ISLAND
 20  13  65.0%

OHIO
 212  136  64.2% 
CALIFORNIA
 I  557  I  355  63.7%  II 
WASHINGTON
 97  61  62.9% 
NEW YORK
 294  184  62.6% 
I  I  I  II 
MARYLAND
 81  50  61.7% 
D.C.
 16  9  56.3%  I 
I 
NEW JERSEY
 120  62  51.7% 
I I 
U.S. TOTAL
 I  6588  I  4917  II    NA  II 
I  I  I  II 
STATE MEAN
 127  95  74.6% 
STATE MEDIAN
 I  117  I  90.5  I  76.4%  II 
Source:AdverseActions by State, 1990-1993,  HealthResources& ServicesAdministration,U.S. Public  II

HealthService. 
A-2
 TABLE 2 
HOSPITAL ADVERSE ACTION REPORTS PER 1000 HOSPITAL BEDS, 
BY STATE, SEPTEMBER 1, 1990- DECEMBER 31, 1993 
Numberof  Numberof Reports  ReportsPer 1000 
STATE  HospitalBeds  Madeby Hospitals  HospitalBeds 
NEVADA  4,144  35  8.5 
D.C.  7,527  61  8.1 
ARIZONA  13,629  94  6.9 
COLORADO  13,691  90  6.6 
WASHINGTON  15,735  88  5.6 
VIRGINIA  29,349  124  4.2 
DELAWARE  2,808  11  3.9 
MAINE  6,083  23  3.8 
OREGON  10,153  38  3.7 
CALIFORNIA  105,270  390  3.7 
UTAH  5,641  20  3.6 
NEW HAMPSHIRE  4,831  17  3.5 
MARYLAND  19,982  70  3.5 
INDIANA  26,143  90  3.4 
KANSAS  15,477  52  3.4 
OKLAHOMA  15,100  50  3.3 
ALASKA  1,909  6  3.1 
NEW JERSEY  37,796  117  3.1 
NEBRASKA  10,292  30  2.9 
MICHIGAN  39,913  116  2.9 
OHIO  51,701  149  2.9 
FLORIDA  63,415  174  2.7 
WYOMING  3,026  8  2.6 
VERMONT  2,290  6  2.6 
GEORGIA  36,334  91  2.5 
NEW MEXICO  6,867 17  2.5 
.   
TEXAS  79,982  190  2.4 
KENTUCKY  19,052  43  2.3 
N. DAKOTA  5,213  11  2.1 
MONTANA  4,742  10  2.1 
A-3
 RHODE ISLAND  4,301  9  2.1 
WISCONSIN  23,971  50  2.1 
NEW YORK  102,036  210  2.1 
S. CAROLINA  15,166  29  1.9 
MISSOURI  29,455  56  1.9 
ARKANSAS  13,328  24  1.8 
IOWA  17,009  30  1.8 
CONNECTICUT  14,238  25  1.8 
PENNSYLVANIA  66,298  116  1.8 
N. CAROLINA  30,151  52  1.7 
MASSACHUSETTS  31,973  55  1.7 
W. VIRGINIA  10,590  18  1.7 
IDAHO  4,045  6  1.5 
ILLINOIS  57,343  84  1.5 
LOUISIANA  23,980  35  1.5 
MINNESOTA  24,019  35  1.5 
HAWAII  4,274  6  1.4 
ALABAMA  23,574  33  1.4 
TENNESSEE  29,420  37  1.3 
MISSISSIPPI  17,577  19  1.1 
S. DAKOTA  5,450  4  0.7 
U.S. TOTAL  1,206,293  3,154  NA 
STATE MEAN  23,198  61  2.6 
STATE MEDIAN  15,606  37.5  2.5 
Sources:  Adverse  Actions by State, 1990-1993,  Health  Resources  & Services  Administration,  U.S.  Public  Health 
Service;  and State Sumry  of Hospital Beds, Quality  Resource  Systems,  Inc.  (from  data provided  by the 
American  Hospital  Associations  1991 MM  Annual Survey). 
A-4
 APPENDIX  B 
COMMENTS  ON THE DRAFT REPORT 
In this appendix,  we present  in full the comments  from the Assistant  Secretary  for Health 
and the Health  Care Financing  Administration,  We also present  the comments  from the 
Joint Commission  on Accreditation  of Healthcare  Organizations,  the American  Hospital 
Association,  the Public Citizens Health Resource  Group,  and the American  Medical 
Association. 
B-1
 ,f4-   F@GC+kdlllsmic9
DEP-M~  OF EIEALfM& HUW  SEUVICES 
%4  Memorandum  . 
JAI11919S
Dam 
Assistant  Secretary  fox Heaith 
ROm 
OffLCO  of Inspectar  General  (OXG) Draft Repoti  Rospital
was

Reporting  to  the  NationaL  PractLtfoner  Data  Bank, 
OE1-01-94-00050 
Attached  are  the  Public  Heaith  Senice  comments  on the subject 
draft  report.  we concur  fully or in part with  the  reports 
recommendations.  The attached  Comments  delineate  thq Actions

we plan  to tm.ke to i.m,pJementthese recommendations.

Attachment
 Jm LIC  HEALTH  SERVICE  (PHSI COMMENTS  ON  OFFICE  OF 
lNSPECTOR  GENERAL  (OIGI  DRAFT  REPORT  HOSPIT~  REPORTING  TO 
~ 
@nerul  Cmnments

The UIG  report  focuses  on the issue of hospital  compliance 
with  NatSonai  Practitioner  Data  Bank  (Data Bank)  repo-lng 
requirements.  The period  studied encompasae8  3  1/3  yeaz=, 
from  the  opening  of the Data EMnk on September  1, 1990  through 
December  31,  1993.  -ing  this period,  3,1S4  di8clos*le 
adverse  clinical  privileges  reports were  submitted  to the Data 
Bank by  hospitals.  During  this same period,  State  llcensure 
boards  reported  almost  9,000 adverse  licensure  actions,  and

malpractice  insurers  reported  over 60,000 malpractice

payments.  ,..

The (YIG report  raises  concerns  about hospital  compliance  with

reporting  requirements  based on the relatively  low number  of

clinical  privileges  reports  from hospitals  in comparison  to

PMs  pre-Data  Bank opening  planning  estimate  of 5,000

cllnical  privileges  reports  per year ~rom  hospitals.  The  fact

that the  rate  of hospital  reporting  varies  widely  from  State

to  State  also  raises  concerns,  as does the number  of  clinical 
privileges  reports  in relation  to  the  laxger  numbers  of 
reports  of  other  types. 
We note  that  the issue  is not one  of  the  efficiency  of  Data 
Bank  operations  themselves.  Hospitals  use  the  same  reporting 
form6  and  procedures  that  are successfully  used  by  malpractice 
insurers,  State  licensing  boards,  and others  to report  to the

Data Bank.  During  the study  period,  the Data  Bank  processed

over  73,000  disclosable  malpractice  payment  and adverse  action

reports  and  over  3 million  queries  from authorized  entities.

In addition,  the Data  Bank provided  over 122,000  responses

concerning  malpractice  payments  anciioradverse  actions  to

queriers.  Data  from other CYIGreports  indicate  that Data  Hank

information  provided  co queriers may have resulted  in

decisions  not  to provide  privileges  to about  2,000

practitioners  with poor  zecords, who otherwise  would  have  been

granted  privileges.

The Data  Bank  relies  on voluntary  compliance  by hospitals  with

reporting  requirements.  The Data Bank uses  several  means  tO

make the  required  reporting  as easy as possible.  For example,

the Data  Bank  provfdes  guidance materials  on what  is to be

reported  and how it should be reported.  A new  (third)  edition

of  the Llata  Bank Guidebook  is scheduled  fcr mailing  to ail

hospitals  in late JanUarY  1995.  In addition,  a free telephone

help line  for questions  about reporting  requirements  is

available  to  hospitals.  ,-
2. 
Paper 
Reporting  forms  and methods  are also being  improved. 
reporting  forms ware  revised  in 1994 to simplify  their 
completion c  During  1995,  the  Data Banks  cUrrent  system  foz 
electronic  querying  will  be expanded  to also  provide  a 
capability  for electronic  reporting.  rhIs  w~ll  eMainatO  the 
necessity  to fill out paper  fox.  The Data  Bank  will  pxcnr$do 
free reporting  software  to hospitals  and  other  reporters  and 
will provide  tollfree  modem  connections  for  submitting  reports 
electronically. 
Despite  these  efforts  to  facilitate  voluntary  compi$azace with

xeporting  requirements  the OIG report  identifies  &o  specific

types of potential  problems  in hospital  reporting  to the Data 
Bank.  Although  PI-ISHealth  Resouzces  and  Services 
Administration  (HIWA) was aware  of the possible  problems 
identified  in the repo=  (in fact, HRSA requested  that  the OZG 
conduct  this  study)z  we believe  the report  is valuable  beuause 
it  highlights  the problems.  By documenting  these problems, 
the report  will  serve  as a basis  for discussion  and as a means

to gain  cooperation  of others,  including  hospitals,  the Jofnt

Commission  on Accreditation  of Healthcare  Organizations

(JCAHO),  and  the Health  Ca=  Financing  Administration  {HCFA), 
in resolving  them. 
There  axe two  types of under-reporting.  The  first is

noncompliance  with  the law by failing  to report  disciplinary

actions  which  are required  to be reported  to the Data  Bank. 
The second  type involves  a change  in the manner  in which 
hospitals  impose  penalties  in  professional  disciplinary  canes 
to minimize  the imposition  of penalties  which  would require 
reporting  to the Data  Bank.  For example,  clinical  privileges 
suspensions  of more  than 30 days must be  reported;  shorter 
suspensions  are not reportable.  By reducing  the length  of 
suspensions  to les6 than 30  days,  hospitals  could  avoid 
reporting  to the Data  Bank. 
The first  type of und=-reporting  is  illegal.  The second  type 
is legal,  but contrary  to  the  intent  of  the law and 
detrimental  to the general  utility  of the Data  13ank  program. 
Although  the OIG report  primarily  focuses  on  the first  type; 
the second  type may  actxxally be of much  greater  significance 
to the Data  Bank, depending  on the extent  of each type.  The 
OIG report  identifies  the second  type as  an  issue warranting 
further  analysis  and suggests  that WSA  conduct  some intensive 
case studies  on the issue.  HRSA is focusing  attention  on this 
issue in a major  survey  of hospitais  and  other  erititfe8  which 
interact  with  the Data  Bank.  3

designed  to-e~  e, among  other  issues?  the  s-end  t--of 
Unde=-reportfngs  Walcoff  and Associates  s~  a sampie  of 
~,MO  entftfs=,  f=c~u@w  600 hospitals~  tO  d@t*s  ~OW  ~W 
f.nteract  with  the Data  Bank, use Ilata  Bank  tifomtlori  (if  * 
entitie=  are  asking  for  data)~  and  how Oata  Sank  reportfng  and 
querying  p~ocedures  can be improved.  Results  are due  in-t!xa 
early  spring  of 1995.  If the s~y  remxlts  inticat~t hat 
changes  in  hospital  behavior  are being made  to avoid Data  Bank 
repofilng,  we may  want  to conduct case studies  as recommended 
in the  OIG  report. 
The OZG report  also  contributes  new information  in relation  to 
the first  type  of under-reportfng.  M  one unnamed  Stats,  16 
act~ons  by  hospitals  which  should hava been  reported  to the 
Data  Rank  were  found  to  have  not  been reported.  Since  the (YIG 
only  examined  incidents  from hospitals  which  had reported  to

the State  Licensing  boati,  but had made  no reports  to the  Data 
Bank,  We cannot  dete~ine~  (1)  the  extent  of under-reportiIZg 
by hospitals  which  did make at least one report  to the  Dat8

~an.k; (2) the extent  of under-re~ofiing  M  hospitals  which  did 
not  :eport  some  or  all  incidents  which  should  have been 
reported  ta the State  ~lcensing  board;  or  (3) the overall 
extent  of  under-reporting  in the unnamed  State.  We Qniy  know 
for certain  that there  was some under-reporting  in this  one 
State,  but  ~ecannot  d=temine  either  the true  extent  or the 
significance  of the under-reporting.  The  cucwnented  fact  of 
this wxier-reporting~  ~ow@ver.  indicates  the  possibility  that 
sj.milar  under-reporting  may take piace in other  States  and maY 
be a significant  problem. 
The reports  other  argument  that there may  be  under-reporting 
by hospitals  seems  less  explanatory.  The report  cites  the

fact that  rates  Of  reporting  of adverse clinicai  privileges 
actions  .~ary considerably  from State to State.  It  should  also 
be  noted,  however,  that  there is no  evidence  that the 
variation  results  from  under-reporting  (or a greater  degree  of 
under-reporting)  in some  States.  !ialpraccice payment 
reporting  also  varies  considerably  from State  to State,  There 
is  on~y  a Weak  correlation  between  a States  malpractice 
report  =ate  and its clinical  privileges  report  :ate.  TO  date, 
the state-t~-s~ate  var~ations  are unexplained,  hut  we  have  no 
particular  xeason  to believe  that some  States  have  higher 
under-reporting  rates  than others  fur clinicai  privileges 
actions  =nd  that under-reporting  explains  the differences  in

clinical  privileges  r@porting  rates ubserved  among  the  states.
 OIG  Recommendation 
1.	 The PHS~  Eh=ough  the -A,  should  suPE$ort further 
inquiry  to foster  a bettez  understanding  of the 
factors  influencing  hospital  reporting  to the  Da%a 
Oank . 
We  concur.  We  are currently  undeztakirig one  such study  (one 
portion  of the Walcuff  and Associates  study  discussed  under 
the general  comments  above  examines  hospital  reporting),  In 
addition,  we received  some relevant  information  from the WAMI 
(Washington,  Alaska,  Moxacana,  and Idaho)  study  of  the 
experience  of rural  hospitals  with  the llata  Bank.  liowever, we 
note  that  data  are Mnited  on which  to assese  the  issues 
specifically  identified  by the  QIG  as warranting  further 
analysis.  rn particular,  further examination  may be required 
concerning  the proportion  of hospitals  that  either  do not take 
actions  against  practitioners  or take actions  which  are not

reportable.  The extent  of failure  by hospitals  to  make 
required  reports  also may  require  further  examination, 
Intensive  case  studies  invoiving  review  of peer  review 
records,  as recommended  by the OIG, may be the best way  to 
examine  these  issues  even  though it may be difficult  to get 
hospitals  to participate.  It is important  to note  that HHSA 
does not have  the staff  or financial  xesouxces  to perform  the 
type of detailed  examinations  envisioned  by  the OIG.  If

resources  became  available,  any studies would  have  to be

performed  by contractors.

OXG Recommendation

2.	 The  PHS should  sponsor a conference  to focus 
attention  on issues  influencing  reporting  to the 
Data  Bank. 
FHS Comment 
We concur  with  the thrust  of this zecc.mmenciation,  but  believe 
that Ne can achieve  the desired  resul:s  by  taking  a different 
approach.  In order  to establish  strcnger  direct  communication

with hospitals,  the HRSAS  LIivision  of Quality  Assurance, 
which  manages  the operation  of the Data Bank,  will  be engaged

in a series  of &  ~  work group meetings  and  presentations  at

various  professional  society meetings.  These  work  group 
meetings  and presentations  should reach  a  broader  audience 
ehan  would  a  one-time  cmference.  In addition,  these  types Of 
fora will  allow  for more  one-on-one  interaction  between  the 
relevant  parties  and Shouid be more  effective  at focusing
 s 
~ttm~on,  g=  both  ~hg hospital  and Data  Bank points  of 
viewr  on issues  affectfng  report~ng.  However,  if tlzese 
meetings  and  presentatf~- do  not  P=- tO  be  @ffectl~  fi 
idezmffyhzg  issues  influencing  repar%~ng  to  the  Data  Bank,  we 
will  g~ve  further  consfdezatfon  tu the conference  approach 
reooaunended  by  the OIG. 
9=  rzecomm endatfon 
3.	 The  PHS and the JfCFAshouid work  together  to ensure 
that  the  JCAMO  more  ftzllyassess  hospitals 
compliance  with  the  intent and parzicuiars  of the

Data  ~ank  law.

s  Resvo  nse 
we  concur.  The OZG proposed  three optfonss  (1) sending  a 
jofnt  Letter  f.-m PHS and  HCFA urging  that  it incorporate 
compliance  with  Data  Bank  requirements  into  its  standards  and 
identify  hospitals  which  do not comply  during  its reviews; 
(2) amending  the Medicare  Conditions  of Participation 
(regulatory  change)  to rewixe  Compliance  with  Data  Bank 
requ~x=~ents,  which  would  in  turn  lead to better  JCA.HO 
oversight  in this area;  and  (3) proposing  legislation 
requiring amendment  of the Medicare  Conditions  of

Parcic:pation,  as proposed  in (2] above.  #e support

impiemencation  Oi the  first  option.

Data  ~ank  s~aif .Ni~l work  with HCFA an this  ~ette~. 
Initial

discussions  have already  been held.  .%meeting  wi.Ll be

scfi.eciuleds
oon between  Data Bank and ENA  staff  tu discus6

this  issue  ana begin  drafting  ths necessary  correspondence.

It  ~h=  ~o~n~  ~~~~er  to  J~O  apprcac~  does  ~OC  :esu~t  ~~  the 
needed  change,  :hen we wouid  support  afforts  ta change  the 
Me~icare  Conditions  of PartlClp?itfO~,  :hrough  legislation  if 
necessary  (options  2 anti 3),  *,,,.
/  ,C,,  ,/, ,  Health  Care 
~.+   DEPARTMENT  OF HEALTH & HUhlAhSERVICES  Financing Adm(nis[ra[ion
; k 
Memorandum 
DATE  DEC  I 2  1994 
+-v 
FROM  Bruce C. V1adeck
Administrator 
SUBJECT  Office  of  Inspector  General  Draft  Repoxt:  fHospital  Reporting  to  the 
NationalPractitioner

TO  June Gibbs Brown

hspector General

We  reviewed  the  subject  draft  report  which looks  at how hospitals  are  responding  to 
their  legal  obligation  to report  to the  National  Practitioner  Data  Bank  adverse  actions 
they  take  against  heahh  care  practitioners. 
The  EIealth  Care  Financing  Adrninistration  concurs  with the  report  recommendations. 
Our  comments  are  attached  for your  consideration. 
Thank  you for  the  opportunity  to review  and  comment  on this report.  PIease  advise  us 
~~j--&fidLn&  ffid~~~wadd  like to discuss our  position  on  the  reports 
(requlato~  chanqe)  ta  requixe  compliance  WA ~.A  . . . . 
requirements,  .~hich would  in turn  lead  to  better  JCAHC) 
avers  ight  in this area;  and  (3) proposing  legislation 
reauir=ng  amendment  of the  Medicare  Candi tiuns  of 
?arciczpaci~n,  as  proposed  in (2) above.  i?esupport 
impiemenratiun  of the  fixsc option. 
-~ .wi~~ work  ~ithHCFA an thiS  ~ette~ c  Initial

Data  Eank  stax.

discussions  have already  been heid.  .%meeting  will  be

scfie.a
uled  soon ketween  Data Bank and EP3A  szaff  to discuss 
tiis  issue  antibegin  drafting  the necessary  correspondence. 
letter  to JUUKl  apprcac.h does  not :esu Lt in the 
If the  joint 
needed  change,  :hen we would  supporz  afforts  ta  champ  the 
Meaicare  Conditions  of ~articipacfsn,  :hrouqh  legislation  if 
nece5saq  (options  2 ana  3),  Comments  oftheEIeaIthCare FinancingAdministration(HCFA)  on

OfficeofImsuectorGeneral(OIG) DraftReport

l?IosnitRaelp ortingtothePJationaPlr actitioneDra
 ta 13ank.

[oEI-ol-94-ooo50\ 
OIG  Recommendation 
The Public HeaM  Service  (PHS),  through the Health  Resources  Services 
Administration,  should support further inquiry to foster a better  understanding  of the 
factors influencing  hospital reporting  to the  Data  Bank. 
HCFA  Response 
We defer  to PI-IS. 
OIG  Recommendation 
The  PHS  should  sponsor  a conference  to focus attention  on issues  influencing  reporting 
to the  Data  Bank. 
HCFA  Response 
We defer  to PHS. 
OIG  Recommendation 
The  PHS  and  the  J3CFA  should  work  together  to ensure  that  the  Joint  Commission  on 
Accreditation  of HeaIthcare  Organizations  assesses  more  fully hospitaIs  compliance  with 
the intent  and  particulars  of the  Data  Bank  law.  Toward  this  end,  they  might  consider 
thefollowingo
ptions:A Letter,  Regulatory  Change,  and/or  Legislation.
HCFA  Response 
We concurand recommend  theletterap
proachasopposed toregulatoryorstatutory 
change,  \Ve alsorecommend includingtheAmerican OsteopathicAssociationw,hich 
accredits  150 hospitals  for Medicare  purposes,  in the  communication.  JointCommission 
w
December  19, 1994  Acueat@lan  o! tkwmcare  Llmami:,ons
June Gibbs  Brown 
Inspector  General 
Department  of  Health  and  Human  Services 
Wilbur  J.  Cohen  Building  - Room 5250 
330 IndependenceAvenue S.W. 
Washington, DC 20201

Dear Ms. Brown:

I am writing in response to your letter of November  1S,  1994  which 
invites the comments  of the Joint  Commission on Accreditation  of 
Healthcare Organizations  on  your  draft inspection  report, Xospital 
Reporting to the National  Praccicioner  Data Bank.  Our cormnencs are

limited to the recommendations  that appear in your draft  report.

More  in-depth Public Health Service  (PHS) inquiry to achieve  a better 
understanding  of the factors influencing  hospital  reporting  to the Data 
Bank should, we believe,  be the first priority.  Such an understanding  is 
an essential prerequisite  to any  informed action concerning  che issue of 
National Practitioner  Data Bank  (NPDB) reporting.  We are persuaded  that

there are a host of factors influencing  hospital  reporting  to the Data

Bank.  If a decision  is made to expiore  these more fully,  che Joint

Commission would  be pleased  to cooperate  in such an endeavor  before new

seeps are taken CO reined-ythe perceived  problemwith hospital  reporting.

.-iP
HS-sponsored  conference  focusim  on issues which may  in~luence  DZCZ 
Bank reporting sounds  like a soiid f:rsc step coward defining  the 
reporting problem.  We certainly  su?porc this approach,  znd would suggest 
chac such a conference  be limited  in size and be structured  in a manner

designed to facilitate  participation  of appropriate  experts.  .+

conference designed  in this fashion  .Gouldbe most likely  to yield  the

concrete information  and recommendations  we all seek.

The third recommendation,  that :he PHS and che Health  Care Financing

Administration  (HCFA) work together  zo ensure that che Joint Commission

assesses more fully hospitals  compliance  with che intent and particulars

of the Data Bank  law, seems somewnac  premature when contrasted  with che

previous recommendations  aimed z: .d~fining che problem.  .Absenc z better

unaerscancing  of this problem,  ..-zs:ggestthere is a substantial  risk

:hac nore  costly  and burdensome  feaerai requirements may be piacea on 
providers without  a clear sense of :he likelv outcomes  chat may result. 
It is Worthy of note  chat this recommendation  ignores  the face chat XCFA

direccly certifies  approximate;;  2.000 unaccredited  hospitals  for

Medicare participation.
 June Gibbs Brown

December 19, 1994

Page Two

We believe  it is appropriate  to expect the Joint Commission  to

collaborate with PHS and HCFA to assess more fully hospitals  compliance

with the intent and particulars  of the Data Bank law.  However, we

suggest it is premature  to draw conclusions  about the most appropriate

remedy for disparate  reporting at this time.

Thank  you  for  providing  us  the  opportunity  to  comment  on  this  important 
matter. 
Sincerely,

Dennis S[.OLeary!  Y.D.

President
 Cl&go.  Rfii  60604 
WOOO 
Tdqdmu 3124
hnuary  26.1995 
June Gibbs Brown 
InspectorGencrd 
Oflke  of InspezmrGenemi 
Depamnentof Heaith & Human Services 
Washington, D.C  20201 
Re:  DraftReport  - Hospitai Reporting  to the Nationai  Practitioner  Data Bank 
I)car Ms. Brown 
7%e American HospitaAis sociatio(nA
HA),onbehalfofits 5,000 hospi~i  m~bcrs.  wclcomea 
thisopportunitmy comment on theOfficeof  Inspector Gcncmis ~~t  EPOR on hospital 
qorring  to the Nationai PtaccicioncrData Btmk  Because our rrtcrnbers am pficipa.i contributors 
to and u.scrosf  hta  Bank infoxrnation. the AHA hasasignificainntt eresitnr eportinpgatterns 
andthefactorKsM   Mucrtce them. Althoughwc salutey ourofficecso ntinuincgf forItso

monitorandcvduatecoxrtplhncwci
thData Bank requirements. we have .tious  concerns with 
some ofthereportfsi ndingosm,issions.  and interpretations. 
Mcthoduloticd  Cortccrns:  .Asthe report acknowkdges,  the PHS tXh7X~Rthat them would be 
5,000 hospi~  adverse action reports peryearwas  justthat:ancstimam~vichouatnycmpiricai

evidence.  theDepartments bestguess m to what  it  wouid findonce  repottinregquirements
were inqdemented.  To theextent[hateswnateIn factmis..cs  the  mark.  xiktbie  conclusions 
~bouctk  mwmableness  of hosp:mi  reporting  arc irnpossibic.  \loreovcr.  =  the OIG  suggests. 
lmprovcmettitnsc retfentiawhmnigq ualitays surancper acticeSsi ncethecsumatewas formulated
can be expected  to improve practitioner  performance.  To the extent they have doneso.the5,000 
per yesr estimate  becomes an even  less reliance  basis foreva.iuati[rhtegdata.

C)thcirnd icatom  used in the reponalsoareproblematic.  There is  Iitdem nxommcnd reporting
hospitahlcdsasa rciiabic measure of hospital rcpurting.  Sirnii+,  tic ~xv~~ 
~atcs  per  1000 
Medical Pl~ studyhtil.whileinteresting,  fad  to provide  a basis  for comparison:  incidents  of 
ncgii:encc wc not inmmhwge~bje ~~~i  adverse acti~~$ for Dam B@  WIJo*s 
Indeed. omong the data presented.  only the .wace-m-sci.ttereporting  vuiatiuns.  presented  in Table 
1 of Appendix  A- suggest  thatfunher  analysis  might  bc fruitfuI.  [II the discussion  of  issues it 
believes  warrant  further  maiy.sis.  however.  [hcOIG foilsco focus  on  tk  insufficiency  of the 
I{tiilth  CiIR  Quality  lmorovernenc  .4CCS  (HCQIA)  immunity  provisions  and  the  powerful 
Jisinccntivc  (hey cfta~c  rtr h(~spltai  cecr rewew activity.  Analytical Concern:  When HCQIA was enacted,  itwas recognized  that maadatoty qxmittg 
mquircnxntswould lead to an inctmsc in litigation as physicians faced with discipiimtry  action 
challenged  adverse  peer review  aah?ns.  In m effortto mducc the chiilinegf fecstuchlitigation
wotdd have on cfftivc  peer review. Congress provided  qwdifkd immwi[y topwc@ncs in~ 
peer review prtmss. 
HCQIASpeer review immunity, however. has been oniy panialleyf fectivbeecausemany courts 
ttavenot required physicianCsO rcbucthestatutnrpyre sumption of  immunity with credible
evidencepxiurco&M.  Earlymsoiuaon  in these cases is impossible. even where thtxc is no 
objective evidence of improper peer review activity.  Although by no means W the cases have 
misimcrpnmd  the immunity provisio~  some mum  have substantially ignomi  tlmm  denying 
moaons for suznmazyjudgment and forcing triais.  Unless the avaiiabifit y of these provisiork is 
detmnined objective&yand early in the {itigation,they cannot hcip bat fall short of theirstatuttxy 
purpose.  The specter  of baseicss. time-cunsuming and expensive  iicigation serves as a powcrfid 
disincentive to effective peerreviewactivityA.ny study of reporting behavior needa to take this 
disincentive into ixcount inorder10accwafeiy  interpret adverse actions  that fall  below the 
r.h.msholdfor Data Bank reporting. 
The AHA appreciates the opportunity  10 provide  our comments on the OIGs draft reporton 
hospital reporting to the National practitioner Data Ebnk.  We hope our comments am Mpftzi 
and wili  await xmciving  die finai  rcpom 
Sinccreiy, 
2L?L..& 
FnxlriJc.
 Entin 
Resident 
Senior  Vice 
md Gencrai Counsci  @@h&!2

u 
~! 
1 
Buyers Up . Congress  Watch   critical  Mass. Health RcsemCGhr wup  Liti~aGlrioounp

JoanC@bmok.President 
January  9, 1!395 
June Gibbs  Brown

Inspector  General

Department  ofl-lealth  andt-iuman  Sewices

Washington,  DC 20201

Dear  Ms. Brown: 
Please  find  enclosed  our  comments  on OIGS draft  repofi:  Hospital  Repofiing 
to the  National  Practitioner  Data  Bank.  We  appreciate  the  opportunity  to review  and 
comment  on this  repoft.  Please  let us know  if we can  be of fudher  assistance  to you 
or your  staff  in your  studies  regarding  the  I4ationai Practitioner  Data  Bank. 
d 
t!- Sincerely, 
*O  -
*  ef~ 
Joan  Stleber,  JD,  MSW
Sidney  M. Wolfe,  D 
Staff  Attorney 
Director 
Public  Citizens  Health  Research  Group 
Enc!osure 
Ralph  Nader,  Founder 
2000 P %ce[ NW   Wkhin~ton,  D.C. 20036  (202) 833-3000 
9  @ wmw0. medal Pam  COMMENTS  ON HOSPITAL  REPORTING  TO  THE  NATIONAL 
PF?ACTITiONEF? DATA  BANK [OEJ-01-94-00050) 
Submitted  by Public  Citiiens  Heaith  Research  Group 
January  9, 1995 
We  appreciate  the  oppodunity  to  comment  on  this  report  by  the  OIWe  of 
Inspeotor  General  (01(3} of the  Department  of tieatth  and  Human  SerVioes  (12HHS). 
The  report  represents  an  important  first  step  Ioward  understanding  the  faotors 
irtfiuencing  hospitais  reporting -or  faiiure  to report  - to the  Natlc?naiPraotithxwr Data 
Bank,  as mandated  by the !-ieatth  Care  Quality  Improvement  Act  of  1986  (HCQIA). 
However,  the repod  raises more questions  than  it answers,  and follow  up study  on this 
issue is imperative. 
As  noted  by the  OIG,  hospitals  cooperation  is especially  criticai  to  the  Data 
Banks  effective  operation,  since: 
  the  nations  approximately  6,500  hospitals  represent  a  major  source  of 
information  for the  Data  Bank; 
  a  loss  or  reduction  of  hospitai  privileges  raises  serious  questions  about  a 
physicians  competence  and/or  professionalism;  and 
  hospitals  have  considerable  data  on thepractice  patterns  of individual  doctors, 
and are  in a good  position  to identify  those  who  may  be placing  their  patients  at 
risk. 
We share  the  OIGS concern  about  the suspiciously  low rate at which  hospitals 
are repotilng  adverse  actions  to the  Data  Bank,  A shocking  75 percent  of all hospitals 
never  reported  a single  adverse  action  during  the  3-1/3  year  period  covered  by  the 
OiGs  report,  While  the OIG offers  several  possible  hypotheses  for thh deficiency, We 
find the first -- thatthere  may be few  practitioners  with  serious  performance  problems 
-- to be highly  improbable. 
In fact,  published  estimates  of negligence  in hospitals  strongly  discredit  this idea. 
The 199~ Harvard  Medical  Practice  Study (as noted by the 01(3) found  that one percent 
of hospitaiizaticm  in New York  state in one year involved  adverse  events  caused  by 
negligence,  inGiUdinfjalmost 7,000 cieaths~Thisresultprujected to b@talS  nati~n~i~~ 
suggests that 80,(??0patients a year are kiiied by negligence, mostly by physicians, in 
hospital  settings  alone. At this rate, there would have been 266,400 patient deaths due 
to negligence  in hwpital$  cwer the  3-1/3 year period  in which  hospitals  reported  only 
3,154  adverse  atitons  to the  Data  Bank, 
For this reason  as well as others  noted  by the OIG, we suspect  that hospitais  are 
either failing  to take  serious  disciplinary  actions  against  doctors  as  needed,  or they  are 
taking such actions but grcms{yunderreporting them to the Data 5ank, Therefore, we  Comments  by  Public  Citizens  Heaith  Research  Group 
Page  Two 
strongly  support  the OIGS recommendation  for further  study,  both to team more  about 
factors influencing hospitals reporting practices, and as a basis for enforcement aotions 
against hospitals found out of compliance with the law. We also support the OIGSother 
recommendations,  with  particular  attention  to the  option  of  revising the  Medioare 
Conditions of Participation to speci~  hospitais responsibilities under the l-iCQtA. 
t%aily,  we  note  that  the  current  penaity  provided  by  the  HCQiA  for 
noncompliance by hospitals maybe insufficient to deter violations of the law. Hospitals 
that faii to repofl adverse actions  to the Data Bankas required risk Io$lngthe IICQIA6 
liability  prokticm  for  three  years.  That  protection  exempts  peer  reviewem  from 
monetary  damages  in  private  iawsuits  over  professional  review  aotions  that  meet 
certain standards, However, the law appears to provide only immunity from damages, 
not from suit, leaving peer reviewers still at risk of having to defend against claims for 
injunctive or declaratory  reiief, Even suits seeking damages  may still go to trial to 
decide whether  discipline was imposed  in bad faith.  Thus,  some  view the  HGQIAs 
liability  protection  as relatively  weak, and its loss may not appear k?pose ~UGh cif a 
threat. 
The penalty  for noncompliance  by hospitais  is aiso  inconsistent  with  most other 
penaity  provisions  in the iaw. The t-iCQIA authorizes  monetary  penaities  upto$10,000 
per  inoident  for  faiiing  to  repoti  payments  on  malpractice  claims,  as  weil  as  for 
violations  of the  confidentiality  provision. 
We urge the Pubiic  Heaith  Service  to propose  legislation  strengthening  penaities 
for noncompliance  by hospitais.  That  legislation  should  authorize  (in adcfltlon to loss of 
the  laws  limited  liability  protection)  monetary  penajties  up to $10,000 per  incident for 
hospitals that faii to report to the Data Bank as mandated by law, This would  make 
hospitai  penaities  at ie$st comparable  t~ those  applied  to malpractice  insurers  who  fail 
to submit  payment  reports. 
Of course,  even  stronger  penalties  wiii be ineffective  unless  enforced  by DHHS. 
We are  unaware  of any  instance  since  the  Data  Banks  inception  in which  a hospitai 
was  penaiized  for faiiing  to submit  reports.  VVe recommend  that  the OIG,  in its foiiow 
up studies,  consider  whether  DHHS  is appropriately  exercising  its enforcement  powers 
under  the  tiCQIA.  American  Medicai  Association 
Ptt@cIwdMedicated10th?healthIIf.Wermi 
JamesS.W.  MD  516NorthSW4-!WI=  312464.5000 
hSCUUvWh 5hrSMeM  -.  i~OU  60610  312464-4184 Fex
February 1, 1995 
T& Honorable June Gibbs Brown

Inspeetor General

Office of InspectorGcnend

Departmentof Heakh& HumanSexvices

330 IndependenceAvenue. SW - Room5246

Cohenlhtiiding 
Washington. D.C. 20201 
~s  HospItaiRepmting to the National Practitioner  Data
The American Medical As=iah  (~)  ww=ia~s  your solic@I  ow co-em  .OSI 
the OffIce of Ioapector General*sdraft inspection report.  Hospital kporting  to the 
NationaPlra
 ccitiomrData Bati.   Ocmf=  iw  (O~G Rep).  ~  O~G ~CPOfiW= 
writun for the purpose of helping tie  Public Health Service (lVIS) determine whether 
hospitals am reporting adverse actiow to the National Practitioner  Data Bank (NPDB). as 
requiredby the HealthCam Quality Improvement Act (HCQIA).  TM AMAs review, 
however, conciudes that the Report fails far short of its purported goai.  Even given the 
preliminarystatusof the Report, our review has revealed important gaps in both 
accuracy and completeness of data, creating a rnisieading pietttre.  We offer the foflowing 
comments and suggestions for your consideration. 
The dam presemed on the extent of hospwti repordng isflawed and incomplete.  For 
example, Tsble 1 of Appendix A does not take utto account any adjusnncnt for the size 
of the non-mpming  hospitals or the number of physicianstcktltis~ on their medicalstaffs. 
And although Table 2 does provide information on the number of reports per 1.000 
hospid  beds. the number ofreportpse r 1.000 practicingphysicianmsu stalsobe
pnxemed inorderrodemonstratsei gnificasnrc.ea(vcariation.

Becauseof the irsxmpIete nature of the Reporrs data, tie  OIGS co=iusion+  based on 
this data. that the number of hospitals  reporting  adverse  actions  is uMMwnddy  IOW 
seems unfounded.  The AMAs concernis heightenedby he Reportsmlkuxe on chc 
following three items to support its case: (1) the 19i39planning cfoettmentsubmitted to the 
Oflice of Management and Budget; (2) the disparity between the number of lieemum 
actions against physicians and the number of adverse actions taken against hospital-b
physiciam only: and (3) the 1991 Hamrd  Medical Practice study of hospitalized pasients  POgc2 
FCbNaL-Y1, 1995 
The Honorable June Gibbs Brown 
in New  York state.  .None of t~ese  rkee  items  credibly  supports  rhe OIGS coneiusiona. 
The i989  estimate that hospitals may report 5.000 adverse actionrqxm  per year is 
invalid. In OIGS WOdS  the esdrnate was  based on iittle emptica~ evidence and was 
widely acknowledged to be iittle more than informed guesses.  
To determine if therehas been 8 change in the frequency of RPOf@l  hospiti  ahrse 
actions as a result of the implementatioonfHCQIASreporting mqttifmem  to the 
,NPDB,the OIG  Shouk!conraccch emedicallkensingboarda.which-*  hospiraltao

reporatd verseactionsl.f thedarashowsnochangeinthereportinrga
tesinceSeptember

1.1990.itwouldconfhmthattheearlycsdxnatewse
resimplyway offticmark.

Comparison  of the Number  of  Actions &po rrcd by Liccnsirw Boards and H-
There is a difference between tie  number of actions reported by licensing boards and 
hospitals.  This diffcmnce in andofitseldfo esnotindicataen
ypanicuhtrpxwblctn;
neverthelestsh,eO
 IG uses this difference to suggest that Imspitak are not taking 
~ssazy  actiom to ensure the qudiry of their medicai staff.  The AMA dispures this 
conclusion. 
Tbe OIG should  have analyzed  tic  reasons  these numbers  may  be different.  in concert 
with  information avadab]e on the 7,675 prejudicial actions taken by Iieensing boards 
against physicians.  The diffmtmees couidbe basedona varietyof factorsnotconsidered 
h-tth
 eReport.  Most sunifxanti y, how many of the phys~ciansreported ate on a hospital 
.medicai sraff.  and how many are office-baaed/ambulatory  care-based  physicians?  How 
many of that number  are multiple  iicensurc  actions against  a single  physicianp.erhaps 
evenregardingthesameevenras sanctionedby rnuitiple  jurisdictions?  What are the 
degreesof sanction  imolved  and do they vary by state? 
Evahuttionof questionssuch as rhesemaYhelp 10explain quantitative disparities and 
resot~ceo ncernabout hospiraUlnder-mponing.The broadening  of the OIGSevaluation 
[o include ~alitative  data wilI Iead  uscoa morecompleteandcrediblcportrayalof whet 
[sactually happening.  For exampie, the (XG might consider raking a random munpk of 
reporteldi ccnsuracct
ions to determine if a hospitai shouid have initiated an adverse
action atior  reporteadn adverseactionc
otheNPDB.  Page 3

February1, 1995

TheHonorableJune Gibbs Brown

1991 Harvard Medical Practice Studv of New York  State 
T&ereference cothis  study does not SUWXMa concern about w  UIUC~OIIMY low ievei 
ofbospiudrepotting. Cleady, adversecvemsdo occur.  Ina msjofiw of immmces. 
though.the event is not the responsibiIiV  of a bad physicti.    Mr.  adverse events 
am fmqumttly attribu@bleto flawed systems or processes.  It is u~vefidly  t=ognized 
that punitive !neasm=  against physicians do noc prevent adverse evenu  from occurring 
and overail is not an effectwe patient safcty~quaiiwimprovement me=um.  It is more 
cfkctive  to improve the process or system by wfich health care is delivered than ro 
penalize a physician who practices in a bad system. 
In conclusion.  we urge tie  OIG to ~on.wdcr  m data and h  cowhsions  drawn from 
that data to either cotirm  or refute tie charge that hospitals are not fully compiying with 
chairkgaI obligation to report adverse acuons to the Natiomd Practitio=  Data Bank. 
Without further analysis.  it is pmmaturc  to recommend  that  the PHS sponsora 
conferenceon issues irdluencingreporthg  to IJXNPDB, or to take steps to have cheJoint 
Commission on Accreditation of Heaithcare Organizations increase its focus on assessing 
the hospitais Compliance witi  the H~QIA- we offer our  asskf=e  to obtain  the best 
available  information  and understanding  of the facto=influencinhgo spitarle portintgo 
theNPDB. 
~  James S. Todd. MD  APPENDIX  C

NOTES 
1.  Information,  under certain  conditions,  could also be made available  to 
plaintiffs  attorneys. 
2.  45 CFR Part 60 (1989). 
3.  See Department  of Health and Human Services,  Office of Inspector  General, 
National Practitioner Data Bank:  Use@lnessand Impact of Repotis  to 
Hospitals,  0E1-01-90-O0520,  February  1993 and Department  of Health  and 
Human  Services,  Office of Inspector  General,  National  Practitioner  Data 
Bank:  Use&lness and Impact of Repotis  to State Licensing  Boards,  OEI-Ol-
90-00523,  March  1993. 
4.  At the time of our inquiry,  December  31,  1993 was the latest date for which data 
were available  to us. 
5.  Across the United States we are reporting  on a total of 6,588  hospitals, 
based on data provided  by the Health Resources  and Services 
Administration.  The total represents  hospitals which were in existence 
sometime  during the September  1, 1990 to December  31,  1993 period  and 
which,  therefore,  could have submitted adverse action reports  sometime 
during  that period.  The total is not a count of the number  of hospitals  in 
existence  on December  31,  1993. 
6.  54 Fed.  Reg.  52,853,  Dec.  22,  1989. 
7.  For calendar  years  1991, 1992, and 1993, the Federation  of State Medical 
Boards reports  7,675  prejudicial actions against physicians.  These 
include  license revocation,  suspension,  or surrender;  probation  or licensure 
restrictions  of some kind; and other formal actions such as penalties  or 
reprimands.  We arrived  at a 3 1/3 years estimated  total of 8,000 
prejudicial  actions by assuming that at least 325 were taken in the last 4 
months  of 1990.  Given that 2,361 were taken in all of 1993, the 325 
estimate  appears to be reasonable. 
8.  All physicians  disciplined  by boards  are not necessarily  on hospital  staffs.  On the 
other hand,  some could be on the staff of more than one hospital. 
9.  Troyen  A. Brennan,  et al.,  Incidence of Adverse Events and Negligence  in 
Hospitalized  Patients:  Results of the Harvard  Medical  Practice  Study 1,  The New 
England  Journal  of Medicine  324, no.6 (February  7,  1991): 370-76. 
c-1  10.	 Improving  the overall performance  of the medical  staff and assuring that 
certain  minimum  standards  of performance  are maintained  are not 
necessarily  incompatible  objectives.  Indeed,  the director  of one well-
respected  quality insurance  program  told us that in his program  involving 
multiple  hospitals  both objectives  coexist.  At the same time that the overall 
standard  of care has been improved,  a number  of physicians  have been 
disciplined  and/or  reported  to the risk management  program. 
Yet,  in the quest to maintain  a safe environment  for physicians  to 
participate  in reviewing  data on practice  variations,  it certainly  is plausible 
that a hospital  may choose to reemphasize  or even avoid disciplinary 
activities,  perhaps  by allowing physicians  whose performance  is 
questionable  over a substantial period  of time to leave the staff and find 
other practice  settings. 
11.	 To obtain  some information  on the extent to which reportable  hospital  actions may 
not in fact be reported  to the Data Bank,  we sought the cooperation  of medical 
licensure  boards  in eight States.  Our intention had been to give them a list of all 
hospitals  in their  States that had not reported  a single practitioner  to the Data Bank 
in the  1990- 1993 period  and then to have asked them to identify any referrals 
they received  and disciplinary  actions they took involving physicians  from those 
hospitals.  With that information,  we would then have checked to see if any of 
those cases involved hospital actions that should have been reported  to the Data 
Bank. 
Unfortunately,  during the brief period  of our inquiry,  only one State was 
able to provide  us with sufficient information.  Other States either  were not 
readily  able to identify referrals  or disciplinary  actions by source or to free 
up sufficient  resources  to review hospital referrals  to determine  if they 
should have been reported  to the Data Bank.  In the participating  State, 
officials  were able to provide  such information  and afforded us the 
opportunity  to review hospital  reports  ourselves. 
12.	 These actions  included reductions,  surrenders,  suspensions,  and 
terminations  of physicians  clinical privileges.  Information  was obtained 
from case files. 
13.	 Through  the Health Care Financing  Administration,  the Department  conducts 
validation  surveys of a sample of hospitals to assure that they comply  with the 
Medicare  Conditions  of Participation. 
14.  The more precise  explanations  that the Joint Commission  inserted  in the scoring 
guidelines	 respond to suggestions made by the Health Resources  and Services 
Administration  of the Public Health  Service.  The amendment  concerning  timely 
querying  responds  in part to a recommendation  we made in a February  1993 
report.  In that report,  National Practitioner Data Bank:  Usefi.dnessand Impact of 
Reports  to Hospitals  (OEI-01-90-O0520), we called for the Joint Commission  to 
c-2  establish guidelines  on how quickly hospital should query the Data Bank after 
receiving  applications  for privileges.  
c-3