. 

Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

THE BENEFICIARY COMPLAINT


PROCESS OF THE MEDICARE


PEER REVIEW ORGANIZATIONS


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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 OIG’S 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 OIG’S Office of Investigations (01) conducts criminal, civil, and administrative 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, administrative


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 OIG’S 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 in the Boston regional office 

under the direction of Mark R. Yessian, Ph. D., Regional Inspector General, and Martha B. Kvaal, 

Deputy Regional Inspector General. Project staff included: 

BOSTON HEADQUARTERS 

Joyce M. Greenleaf, Project Leader Barbara Tedesco, Technical Support Staff 

Elizabeth A. Robboy 

To obtain a copy of this report, call the Boston Regional Office at (617) 565-1050. 
Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

THE BENEFICIARY COMPLAINT


PROCESS OF THE MEDICARE


PEER REVIEW ORGANIZATIONS 

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~v JUNE GIBBS BROWN 

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EXECUTIVE SUMMARY 

PURPOSE 

The purpose of this study is to assess the beneficiary complaint process of Medicare Peer 

Review Organizations. 

BACKGROUND 

In April 1993, the Medicare Peer Review Organizations (PROS) altered the way they 

ensure the necessity, quality, and appropriateness of care rendered to Medicare 

beneficiaries. Previously, PROS did this by addressing individual clinical problems 

identified primarily through reviewing random sample medical records. Now PROS aim 

to improve the overall practice of medicine by analyzing patterns of care and outcomes 

and by sharing information with the medical community. Under this approach, the PROS’ 

random sample record reviews--already reduced from earlier levels--are being completely 

phased out. Thus, the PROS’ process for receiving and investigating complaints from 

Medicare beneficiaries takes on added significance. It becomes a major vehicle through 

which the PROS can identify and respond to individual instances of poor medical care. It 

is vital, therefore, that the complaint process be functioning well. 

This report is based primarily on data from surveys of 22 PROS representing 72 percent 

of the beneficiary population in the country and aggregate data from the Health Care 

Financing Administration (HCFA) reflecting all the PROS’ record review workload, 

including complaints, during the fourth contract. Our findings are based on PROS’ 

experiences under the fourth contract with HCFA. 

FINDINGS 

Complaints to PROS can be an important source for identifying quality-of-care 

problems. 

F	 Between 10 and 15 percent of the complaints to all 53 PROS led to confirmed 

quality-of-care problems. 

�	 Half the PROS in our sample identified health systems problems through 

complaints. 

Medicare beneficiaries are often unaware of their oppotinities to complizin to PROS 

about the quality of their medical care. 

�	 Seventy-seven percent of Medicare beneficiaries did not even know about the 

PROS, according to a recent national OIG survey. 

i 
�	 Thirteen of the 22 PROS (59 percent) in our sample cited difficulties in making 

beneficiaries aware of the complaint process. 

As it works now, the complaint process has some flaws that undermine its effectiveness. 

F	 Lack of Substantive Responses. The Federal confidentiality regulations preclude 

PROS from sharing the results of their investigations with the beneficiaries without 

physicians’ consent. 

�	 Few Complaints. The PROS received too few complaints to identify patterns of 

poor care by individual physicians and hospitals. 

�	 Lengthy Process. Beneficiaries can wait a long time for the results of the PROS’ 

complaint investigation. 

RECOMMENDATIONS 

The complaint process needs to be working well in order for HCFA to achieve its stated 

mission. Below we offer our recommendation in three parts, one part to address each 

flaw we identified. It also addresses the lack of awareness about the PROS’ complaint 

process that we found among beneficiaries. If implemented, our recommendation would 

result in a complaint process that is more effective and more accountable to beneficiaries. 

Further, it would contribute to HCFA’S mission and to goals from its strategic plan. 

The HCFA should work with PROS to identify cost-effective ways to correct the jlaws in 

the complaint process. Toward that end, HCFA should: 

F	 Require PROS to respond substantively to the complainant. l%e HCFA should 

give this the highest priority. 

A substantive response would require a PRO to describe: (1) what it did to investigate the 

complaint, (2) what the investigation revealed, including whether a quality-of-care 

problem was confirmed and, if so, the nature of the problem, and, (3) if a quality-of-care 

problem was confirmed, what action the PRO took based on it. 

�	 Identifj cost-effective ways to enhance Medicare beneficiaries’ awareness of 

PROS and the complaint process. 

The HCFA should allow PROS more flexibility in conducting their outreach activities. 

Such flexibility could allow PROS to survey local beneficiaries, target outreach to family 

members of beneficiaries as well as pre-retirement groups, and even cultivate new 

outreach strategies in the medical community. The HCFA should also identify benchmark 

practices or promising approaches to informing beneficiaries of the complaint process. 

The recent work of HCFA’S Beneficiary Communications Steering Committee and others 

could contribute to this effort. 

ii 
F Streamline the complaint process. 

The HCFA should search for ways in which the process of investigating and responding to 

complaints could be expedited. It could benefit by examining ways in which other bodies 

conduct reviews for complaints about medical care. It could also identify and share 

promising approaches taken by individual PROS to streamline the complaint process. 

COMMENTS ON THE DRAFT REPORT 

We solicited and received comments on the draft report from the Health Care Financing 

Administration (HCFA), the American Medical Peer Review Association (AMPRA), the 

American Medical Association (AMA), the American Association of Retired Persons 

(AARP), and the Coalition for Consumer Protection and Quality in Health Care Reform 

(hereafter referred to as the Coalition). We include the complete text of the detailed 

comments in appendix E. We also received a comment of concurrence from the Assistant 

Secretary for Planning and Evaluation. Below, we summarize the major comments of the 

respondents on our three recommendations and then, in italics, summarize our responses. 

In the report, we also made a number of minor technical corrections in response to 

respondent comments. 

The HCFA took our first recommendation on substantive responses to complaints under 

advisement, expressing concerns about balancing such responses with the due process 

rights of providers. The AMPRA and the AMA expressed general support for substantive 

responses but also stressed the need to balance this with the due process rights of 

providers. The AARP and the Coalition both expressed strong support for our 

recommendation. With respect to concerns raised by HCFA, AMPRA, and the AA4A, we 

understand the dlficul~ of achieving a workable balance between the principles of the 

Health Care Quality Improvement Program and the basics of an e~ective complaint 

process. However, we maintain our commitment to the point made in our report: that 

without a substantive response to bene~ciaries, it is not likely that HCFA can develop a 

complaint process that is credible to beneficiaries. 

The HCFA and the other respondents all agreed with our recommendation to enhance 

beneficiary awareness of the complaint process. 

The HCFA expressed concern that our recommendation to streamline the complaint 

process might result in a less complete or conscientious review. All the other respondents 

agreed opportunities exist to streamline the process. We recognize oppotiunities to 

streamline may be limited but maintain that such oppotiunities do exist. Thus, we suggest 

that HCFA reconsider this recommendation. We believe that some streamlining of the 

complaint process is essential to achieving a more effective process. 

... 

111 
TABLE OF CONTENTS 

PAGE


EXECUTIVE SUMMARY


INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1


FINDINGS


Complaints Are an Important Source for Quality-of-Care Problems . . . . . . . . . . 3


Beneficiaries Often Unaware of Their Opportunities to Complain to PROS . . . . . . 5


Complaint Process Has Flaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...6


RECOMMENDATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9


COMMENTS ON THE DRAFT REPORT . . . . . . . . . . . . . . . . . . . . . . ...11


APPENDICES


A: Sources of Record Reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. A-l


B: Summary of the Fee-For-Service Complaint Timeframes . . . . . . . . . . . . . . . . B-1


c: Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. C-1


D: Random Sample and Complaint Review for all PROS . . . . . . . . . . . . . . . . . D-1


E: Complete Comments onthe Draft Report . . . . . . . . . . . . . . . . . . . . . . . . . E-1


F: Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. F-l

INTRODUCTION 

PURPOSE 

The purpose of this study is to assess the Medicare Peer Review Organizations’ 

beneficiary complaint process under the fourth contract period. 

BACKGROUND 

Peer Review Organizations and the Health Care Quality Improvement Program 

In April 1993, the Medicare Peer Review Organization (PROS) began implementing their 

fourth contracts with the Health Care Financing Administration (HCFA). These contracts 

marked major changes in the PROS’ aims and operations. Prior to the fourth contracts, 

PROS had sought to ensure the necessity, quality, and appropriateness of care rendered to 

Medicare beneficiaries by identifying and addressing individual clinical problems. They 

did this through reviewing medical records, which at times represented as much as 

15 percent of Medicare hospital discharges. 

Since 1993, PROS have airned to improve the overall practice of medicine by analyzing 

patterns of care and outcomes and by sharing information with the medical community. 

The HCFA refers to this initiative as the Health Care Quality Improvement Program 

(HCQIP). The HCQIP rests heavily on the precepts of continuous quality improvement, 

which hold that it is far more important to improve the overall performance levels even 

slightly than it is to identify and correct poor performers at the margin. This emphasis 

reflects the kind of redirection called for by the Institute of Medicine in its comprehensive 

assessment of Medicare quality assurance efforts. 1 

Thus, PROS’ operational responsibilities are much different than in the past. They have 

reviewed far fewer medical records. For at least part of the fourth contract period, the 

PROS have conducted record reviews on a 5 percent inpatient random sample, though by 

October 1995 that sample will be completely eliminated.2 Appendix A displays the 

sources of record reviews during the early implementation of the fourth contract. The 

HCFA still requires the PROS to conduct record reviews in certain instances under the 

fourth contract. These instances include quality-related beneficiary complaints.3 

The Complaint Process 

The Omnibus Budget Reconciliation Act of 1986 (Public Law 99-509) requires PROS to 

review all written, quality-related complaints received from Medicare beneficiaries.4 

Once the PRO receives a quality-related beneficiary complaint in writing, it must review 

the appropriate medical records. The PRO manual requires that each task in investigating 

the complaint be completed within certain timeframes (see appendix B for a complete 

review of the timeframes involved). Once all reviews and re-reviews are completed, the 

1 
PRO invites the provider and/or physician to comment on the case. It also seeks consent 

from the physician to allow information about the case to be disclosed back to the 

beneficiary, as required in the confidentiality regulations,5 

The Significance of the Beneficiary Complaint Process Under the Fourth Contract 

With less review under the fourth contract, the beneficiary complaint process has become 

especially important to PROS’ ability to identify questionable care. The process represents 

a key safety valve for beneficiaries, their families, and advocates, who can register 

complaints against individual physicians and hospitals. The HCFA recognizes the 

heightened significance of the complaint process and includes it in three of the four 

elements it uses to define beneficiary protections .6 In its vision statement describing the 

successful PRO in 5 years, HCFA suggests that “[PROS] will have earned a position of 

trust in the eyes of plans, providers, and practitioners and beneficiaries” and that this 

public trust will be “based on responsive investigation of complaints and protection of 

consumers.”7 Thus, it is important that the complaint process functions well. 

METHODOLOGY 

We relied on three primary sources: (1) surveys of officials from 22 PROS, (2) aggregate 

data from HCFA reflecting all PROS’ record review workload, and (3) a national survey 

of Medicare beneficiaries. The 22 PROS represent 72 percent of the beneficiary 

population in the country. We chose those 17 PROS in States with the largest beneficiary 

populations and 5 of those with the lowest beneficiary populations. (See appendix C for a 

more detailed discussion of our methodology.) 

Our findings are based on PROS’ experiences under their fourth contract with HCFA. 

Hereafter, we use the term complaints to refer to those quality-related complaints made to 

PROS by or on behalf of beneficiaries that prompted the PROS to review medical records. 

We conducted our review in accordance with the Quality Standards for Inspections issued 

by the President’s Council on Integrity and Efficiency. 

2

FINDINGS


Complaints to PROS can be an important source for identifying quality-of-care 

problems. 

b	 Between 10 and 15 percent of the complaints to all 53 PROS led to contkmed 

quality-of-care problems. In contrast, less than 1 percent of the random sample 

record reviews led to such problems. Proportionally, then, complaints have been a 

richer source of quality-of-care problems, even though the majority of such 

problems have emerged from the random sample record reviews. 

Data from our sample of 22 PROS confirm the value of complaints as a source of 

information about quality of care. Between 8 and 14 percent of complaints led those 

PROS to identify and confirm quality-of-care problems.8 All but one PRO in our sample 

confirmed least one quality-of-care problem through a beneficiary complaint.9 

The quality-of-care problems identified through complaints involved both physicians and 

hospitals. About two-thirds of all the quality-of-care problems the 53 PROS identified 

involved physicians and one-third, hospitals. In our sample of 22 PROS, we found about 

half the problems involved physicians and half, hospitals. 

The importance of complaints as a source of confirmed quality problems is magnified 

when we consider just how few record reviews are triggered by complaints. Just 

0.1 percent of all PRO record reviews were conducted due to complaints (see appendix 

D). Yet the quality-of-care problems stemming from those reviews accounted for 

2 percent of all problems identified by the PROS under the fourth contract. As the 

random sample reviews continue to decrease, however, complaint reviews will constitute a 

larger share of the PROS’ remaining review work. 

�	 Half the PROS in our sample identified health systems problems through 

complaints. These systemic issues included such problems as beneficiaries being 

prematurely discharged from hospitals and lapses in their treatment during transfers 

among different care settings. 

Identi@ing systemic causes of quality-of-care problems is clearly a focus of the PROS 

under their fourth contract. In our sample, 11 PROS (10 from the high-population and 

1 from the low-population stratum) reported having identified 17 instances of health 

systems problems through their investigations of complaints. The systems problems 

included: four systems related to discharge planning; three to communications; two to 

transfers; and eight to issues such as patient restraints, protocols for pressure ulcer 

prevention, and lack of timely reporting of test results, among others. 10 

A health systems problem identified by one PRO, for example, concerned the proper 

placement of feeding tubes. Based on a complaint, this PRO learned that a beneficiary 

suffered complications due, at least in part, to being fed through a feeding tube inserted 

3 
into a lung. No protocol existed to confh-m the tube’s proper placement through x-ray or 

other imaging. The PRO alerted facilities in its area and its own reviewers to the 

potentially catastrophic consequences of improper tube placement. 

F	 Sixteen of the 22 PROS (73 percent) in our sample rated the complaint process as 

critical to their ability to protect beneficiaries from individual instances of poor 

care. 

Officials from one PRO with whom we spoke pointed out that the opportunity to complain 

is an important safeguard to identifying problems that will no longer be caught through the 

random sample review. Officials from another PRO noted that identifying even one 

quality-of-care problem through a complaint can protect many other beneficiaries from 

facing the same problem. Others pointed out that the experience of complaining, could, 

in fact, be cathartic for beneficiaries. 

The HCFA also recognizes the importance of the complaint process, as reflected in an 

internal memorandum on beneficiary protection: 

The purpose of the beneficiary protection program is to reduce the likelihood of 

harm, from both systemic causes and from individual incompetent or impaired 

providers and practitioners. Additional protection will be afforded by addressing 

specific instances of poor care identified through beneficiary complaints. 11 

The extent to which PROS have referred complaints to other parts of the medical 

community, known as joint referrals, underscores the importance of their roles within 

those communities. The PROS make referrals when complaints raise concerns beyond the 

PROS’ authority, such as concerns about the cleanliness of a facility or the qualifications 

of its staff. In our sample, 19 of the 22 PROS referred some of the complaints they 

investigated to others in the medical community. Overall, these PROS referred at least 

17 percent and possibly as many as 29 percent of all the complaints they received.12 As 

shown in figure 1, PROS referred the majority of complaints to fiscal intermediaries 

(33 percent), followed by HCFA project officers (25 percent), and survey and certification 

agencies (13 percent). 13 

4

Figure 1 

Complaints Jointly Referred by PROS Under the Fourth Contract 

HCFA Proj 

F1/Carrier(33%) 

HMO(2%) 

spital (i’%) 

Survey & Certifkation Agency (13%) 

Note N=560 complaints. These represent joint referrals for 19 of the 22 PROS in our sampie. 

Complaints may be jointly raked to more than one entity. 

Sourcw HHS Offiea of inspeetor Generai Survey of 22 PROS, January 1995 

In addition to making joint referrals to others, the PROS in our sample reported 

occasionally receiving referrals from members of the medical community. Most often, 

these referrals came from physicians, but some also came from hospitals and State 

medical boards. Not one PRO in our sample, however, had explicit policies to encourage 

referrals from either physicians, hospitals, or medical boards. While these referrals were 

few in number, the PRO officials described them as solid and often including specific 

details. 14 

Medicare beneficiaries are often unaware of their oppo~nities to complain to PROS 

about the quality of their medical care. 

F	 Seventy-seven percent of Medicare beneficiaries did not even know about the 

PROS, according to a recent national OIG survey. 

F	 Thirteen of the 22 PROS (59 percent) in our sample cited difficulties in making 

beneficiaries aware of the complaint process. 

In accord with their contracts, the PROS in our sample have conducted outreach activities 

aimed at increasing beneficiaries’ awareness of their rights under Medicare and of their 

opportunities to complain about quality to the PROS. They reported undertaking roughly 

the same range of outreach activities (see the box on the next page). 

5

Twenty of the 22 PROS judged their 

outreach activities critical. When asked 

which outreach activities lead to the most 

complaints, PROS identified local 

presentations more often than any other 

activity. 15 Yet reaching beneficiaries 

through such presentations has presented 

some difficulties. In many large States, 

the beneficiaries are dispersed and thus 

difficult to reach. 16 Many beneficiaries 

are unable to attend local presentations due 

to frailty, weather conditions, 

inconvenience, or lack of knowledge about 

the presentations. 

Successfully reaching beneficiaries not 

involved in local senior centers presents 

challenges to the PROS. Although many 

PROS rely in part on direct mailings to 

beneficiaries, some questioned their value, 

because beneficiaries are often inundated 

with reading materials. And while 

indications from HCFA suggest that PRO 

outreach activities have become an 

increasingly important part of the work 

that PROS do, resources for those 

activities remain limited. 

As it works now, the complaint process has ,

some jlaws that undermine its effectiveness. 

�	 Lack of Substantive Responses. The Federal confidentiality regulations preclude 

PROS from sharing the results of their investigations with the beneficiaries without 

physicians’ consent. Thirteen of the 22 PROS (59 percent) in our sample judged 

these regulations to be a major barrier to a more effective complaint process. 

The confidentiality regulations hinder the PROS’ ability to be responsive to beneficiaries 

who complain. These regulations require the PROS to gain the consent of physicians 

before disclosing information to the beneficiary. Without that consent, PROS cannot 

reveal the results of the record reviews and must therefore respond in generalities. The 

box on the next page presents one PRO’s response to a beneficiary complaint in which the 

PRO did in fact confirm a physician problem, but the physician failed to consent to 

disclosure. These restrictions frustrate the PROS, and, in the words of one PRO official, 

“leave beneficiaries feeling cheated. ” 

6

When the physician does consent to 

disclosure, theinformation released by the 

PRO is still limited in some important 

ways. The response would likely exclude 

any PRO actions directed to the physician, 

such as education or referral to the 

hospital quality assurance committee. The 

box below presents part of such a 

response. 

According to the complaint data for the 

22 PROS in our sample, physicians 

consented to disclose information to the 

beneficiary 45 percent of the time.17 

However, when the complaint involved a 

contlrmed physician quality-of-care 

problem, physicians consented 13 percent 

of the time. Some PROS appear more 

successful than others in gaining physician 

consent for disclosure. For example, one 

PRO in our sample gained physicians’ 

consent for 90 percent of all complaints 

for which it requested consent and for 

50 percent of the complaints involving 

confirmed physician problems. Thirteen 

of the 22 PROS in our sample reported 

that they had yet to gain consent for any 

complaint involving a confirmed physician 

quality-of-care problem. 18 

�	 Few Complaints. The PROS received too few complaints to identify patterns of 

poor care by individual physicians and hospitals. In fact, 9 of the PROS 

(41 percent) judged lack of beneficiary complaints to be a major barrier to their 

ability to identify quality-of-care concerns. 

During our telephone interviews, PRO officials often noted that while they judge the 

complaint process as critical to their ability to protect beneficiaries, they lack the volume 

of complaints to identify patterns emerging from them. Under the HCQIP, identifying 

patterns is an important prerequisite to taking any action directed toward a physician or a 

hospital based on quality-of-care problems. With PROS receiving so few complaints, the 

likelihood of identifying such patterns is small. The PROS in our sample received 

between 8 and 164 complaints per million beneficiaries. Even when we accounted for the 

length of time these PROS have operated under the fourth contract, the number of 

complaints remained low. 19 

7

Overall, complaints have accounted forabout O.lpercent oftie PROs' review caseload. 

The bulk of their review caseload comes from the 5 percent random sample (about 

72 percent) .20 And the low volume of complaints coupled with the reduction in record 

review overall weakens the PROS’ ability to identify quality-of-care problems, and thus 

patterns. 

We noted previously that beneficiaries are often unaware of the PROS and that PROS 

acknowledge difficulties in reaching beneficiaries. The low volume of complaints may 

also be related to other factors as well. For example, half the PRO officials with whom 

we spoke identified beneficiaries’ reluctance to file a complaint as a major barrier and 

nearly half as a minor barrier. These officials noted that beneficiaries fear reprisals from 

the medical community on which they rely and also respect. This reluctance can be 

exacerbated in rural areas where beneficiaries have fewer choices of where to receive their 

care. Another factor that may account for the low volume of complaints is that 

beneficiaries can complain to others, such as State medical licensure boards, ombudsmen, 

hospitals, or their own physicians, rather than the PROS. But how often they complain to 

these other entities is unknown. Nothing in the PRO manual, however, directs the PROS 

to encourage beneficiaries to lodge their complaints with all the possible entities. 

�	 Lengthy Process. Beneficiaries can wait a long time for the results of the PROS’ 

complaint investigation. Fifteen of the PROS (68 percent) judged the length of the 

process to be a major barrier to a more effective beneficiary complaint process. 

The complaint process involves multiple steps, ending with the PROS’ final responses to 

the beneficiaries who complained. Each step has a specific timeframe for completion, and 

these make it difficult for PROS to respond quickly (see appendix B for the complaint 

timeframes). If a complaint involves no confirmed quality-of-care problem, the process 

should last a maximum of 110 days. However, when the PRO identifies a quality-of-care 

problem, the process can take up to 220 days--25O if a re-review is requested. In one 

complaint we reviewed, which involved both a confirmed quality-of-care problem and a 

re-review, the beneficiary received the PRO’s final response 266 days after the PRO 

received the complaint. 

The PRO officials who cited length of the process as a major barrier reported being 

constrained by it. They identified with the beneficiaries’ frustrations and suggested that 

the length could discourage beneficiaries from complaining to the PRO. 

Many PRO officials with whom we spoke are trying, where possible, to streamline the 

process, or at least to better prepare beneficiaries for the long wait. For example, one 

PRO routinely combines its request for consent to disclosure with the physician’s 

opportunity to request a re-review, thereby shaving as many as 60 days. Another PRO 

employs a case management approach, so that beneficiaries have a single contact person 

throughout the process. Other PROS inform the beneficiaries about the timeframes when 

they complain. Some correspond routinely with beneficiaries throughout the process. 

8

RECOMMENDATIONS 

The complaint process needs to be working well in order for HCFA to achieve its stated 

mission of serving “beneficiaries effectively. “21 Below we offer our recommendation in 

three parts, one part to address each flaw we identified. It also addresses the lack of 

awareness about the PROS’ complaint process that we found among beneficiaries. If 

implemented, our recommendation would result in a complaint process that is more 

effective and more accountable to beneficiaries. Further, it would contribute to HCFA’s 

mission and to goals from the strategic plan that call for HCFA to “act on [program] 

weaknesses to assure they respond to beneficiaries’ needs. “22 

The HCFA should work with PROS to identijj cost-effective ways to correct the flaws in 

the complaint process. Toward that end, HCFA should: 

F	 Require PROS to respond substantively to the complainant. The HCFA should 

give this the highest priority. 

A substantive response would require a PRO to describe: (1) what it did to investigate the 

complaint, (2) what the investigation revealed, including whether a quality-of-care 

problem was confirmed and, if so, the nature of the problem, and, (3) if a quality-of-care 

problem was confirmed, what action the PRO took based on it. 

Many physicians and hospitals are likely to have concerns about providing such feedback 

to those who have complained to the PROS. But at a time of increasing consumer 

involvement in patient-care decisions, beneficiaries (and their families) are unlikely to 

have confidence in a process that fails to afford them substantive feedback on how the 

PROS responded to their complaints. 

To facilitate substantive responses, HCFA could amend the PRO regulations to eliminate 

the requirement that physicians consent to disclosure before providing feedback to 

complainants. It has been considering such a revision for some time. Another, more 

expeditious approach would be for HCFA to issue contract modifications or manual 

instructions calling for substantive responses to complainants. This approach would 

require an interpretation that a regulatory amendment is unnecessary because of HCFA’S 

existing statutory authority that allows disclosure “to the extent that may be necessary to 

carry out the purposes of” the PRO program. 

F	 Identi! cost-effective ways to enhance Medicare beneficiaries’ awareness of 

PROS and the complaint process. 

The HCFA should allow PROS more flexibility in conducting their outreach activities. 

Such flexibility could allow PROS to survey local beneficiaries, target outreach to family 

members of beneficiaries as well as pre-retirement groups, and even cultivate new 

outreach strategies in the medical community. Any efforts in this realm could tie in 

closely with HCFA’s consumer information strategy. 

9 
The HCFA should also identify benchmark practices or promising approaches to


informing beneficiaries of the complaint process. The recent work of HCFA’S Beneficiary


Communications Steering Committee, the Communications Network sponsored by the


American Medical Peer Review Association, and the Citizen Advocacy Center could all


contribute to this effort.


� Streamline the complaint process. 

The HCFA should search for ways in which the process of investigating and responding to 

complaints could be expedited. It could benefit by examining ways in which other bodies 

conduct reviews for complaints about medical care. It could also identify and share 

promising approaches taken by individual PROS to streamline the complaint process. A 

benchmarking effort of this kind would be in concert with the PROS’ overall emphasis on 

continuous quality improvement. 

10

COMMENTS ON THE DRAFT REPORT 

We solicited and received comments on the draft report from the Health Care Financing 

Administration (HCFA), the American Medical Peer Review Association (AMPRA), the 

American Medical Association (AMA), the American Association of Retired Persons 

(AARP), and the Coalition for Consumer Protection and Quality in Health Care Reform 

(hereafter referred to as the Coalition). We include the complete text of the detailed 

comments in appendix E. We also received a comment of concurrence from the Assistant 

Secretary for Planning and Evaluation. Below, we summarize the major comments of the 

respondents on our three recommendations and then, in italics, offer our responses. In the 

report, we made a number of minor technical corrections in response to respondent 

comments. 

RECOMMENDATIONS FROM THE DRAFT REPORT 

The HCI?A should work with the PROS to identify cost-effective ways to correct the jlaws 

in the complaint process. Toward that end, HCFA should: 

F	 Require the PROS to respond substantively to the complainant. This is the 

standard to which the Joint Commission on the Accreditation of Health Care 

O~ani@”ons holds hospitals accountable. The HCFA should give this the 

highest priori~. 

The HCFA took this recommendation under advisement, expressing concerns about 

balancing such responses with the due process rights of providers. The AMPRA and the 

AMA expressed general support for substantive responses but also stressed the need to 

balance this with the due process rights of providers. The AMA specified in detail the 

due process elements that it favors and expressed a preference for a regulatory approach 

to any changes in the physician disclosure process. The AMPRA questioned the accuracy 

of our reference to a standard from the Joint Commission on the Accreditation of Health 

Care Organizations. The AARP and the Coalition both expressed strong support for our 

recommendation. The AARP favored implementing the recommendation through contract 

modifications rather than through regulation. The Coalition expressed frustration with the 

lack of meaningful responses and questioned the PROS’ ability to represent Medicare 

beneficiaries without a much improved complaint process. 

With respect to concerns raised by HCFA, AA4PRA, and the AMA, we understand the 

difficulty of achieving a workable balance between the principles of the Health Care 

Quali~ Improvement Program and the basics of an e~ective complaint process. However, 

we maintain our commitment to the point made in our report: that without a substantive 

response to beneficiaries, it is not likely that HCFA can develop a complaint process that 

is credible to beneficiaries. 

We appreciate AMPRA pointing out the out-of-date standard from the Joint Commission, 

and we dropped the reference j70m the recommendation. The Commission’s 1996 manual 

11 
calls for the resolution of complaints and recognizes the rights of patients to include 

“unrestricted access to communication. “ 

F	 Identifl cost-effective ways to enhance Medicare beneficiaries’ awareness of 

PROS and the complaint process. 

The HCFA and the other respondents all agreed with this recommendation. 

While we welcome the widespread support for this recommendation, we stress that 

increased beneficiary outreach sends a mixed message if it is not accompanied by refom 

that lead to more substantive responses to complaints. Increased outreach is likely to 

raise beneficiaries’ expectations regarding complaint resolution. Those expectations could 

be largely unmet without addressing ourjirst recommendation. 

F Streamline the complaint process. 

The HCFA expressed concern that streamlining the complaint process might result in a 

less complete or conscientious review. It suggested that beneficiaries be made aware of 

the timeframes involved rather than streamlining the process. All the other respondents 

agreed opportunities exist to streamline the process. The AMPRA and the AMA 

suggested some steps of the review process can be performed concurrently, thereby 

streamlining the process. 

We recognize opportunities to streamline may be limited but maintain that such 

opportunities do exist. Thus, we suggest that HCFA reconsider this recommendation. We 

believe that some streamlining of the complaint process is essential to achieving a more 

efiective process. 

12

APPENDIX A 

SOURCESOF RECORDREVIEWS DURINGTHE EARLY IMPLEMENTATION 

OF THE FOURTHCONTRACT 

(FORREVIEWSCOMPLETEDTHROUGHJUNE 30, 1994) 

Source of Record Being Reviewed 

Random Sample Record Reviews 

Mandatory Reviews, including 

;omplaints” 

Vliscellaneous Reviews~ 

rOTAL 

~OIXS:N=53 PROS. 

Number 

(Percent) of 

Inpatient Record 

Reviews 

381,875 (72.3%) 

44,575 (8.4%) 

101,681 (19.2%) 

528,541’ (100%) 

PRO mandated reviews include beneficiary complaints and records flagged for the following 

tasons: assistmrt at cataract surgery, Medicare code editor, hospital adjustment, referral from tfre 

iserd intermediary or regional office, and hospital-issued notices of noncoverage. 

Includes records selected for the following reasons: specialty hospital, DRG 468, day and cost 

mtliers, unifnrm clinical data set and cooperative cardiovascular project, focussed review selection, 

ntcrvening we, fiscal intermediary prepayment rejcet, intensified review, ventilator-dependent 

mit, deemed admission, and nther. 

Frequency missing =410. 

IOURCE: HCFA PROD3 database. 

!NALYSIS: HHS Ofticc of Inspector General. 

A-1

APPENDIX B 

SWmY OF THE FEE-FOR-SERVICECOMPLAINTRmmw Tmmmmms 

Number of Cumulative 

Days Days 

Acknowledge complaint 15 15 

Receive medical records 30* 45 

Complete Review 30 75 

If no quality concern: 

Seek physician consent and 30 105 

provider/physician comments; and 

provide notice required by 476.132(a)(2) 

Respond to complainant 5 110 

If potential quality concern: 

Provide opportunity for discussion 30 105 

Confirm/resolve quality concern 20 125 

Provide opportunity for re-review 60 185 

If re-review not requested: 

Seek physician consent and 30 215 

provider/physician comments; and 

provide notice required by 476.132(a)(2) 

Respond to complainant 5 220 

If re-review requested: 

Resolve/confirm quality concern 30 215 

Seek physician consent and 30 245 

provider/physician comments; and 

provide notice required by 476.132(a)(2) 

Respond to complainant 5 250 

x If documentation is incomplete or illegible, allow an additional 15 days for submission of requested information. 

Source HCFA, Peer Review Organization Manual, p, 537, 

B-1

APPENDIX C 

METHODOLOGY 

We collected the data presented in this report primarily through telephone interviews and 

mail surveys of 22 PROS. We chose these PROS through a stratified sample in which we 

arrayed PROS according to the number of Medicare beneficiaries in each State (high and 

low beneficiary population). We chose all 17 of the PROS for States in the highpopulation stratuml and a random sample of 5 PROS for States in the low-population 

stratum.z The PROS in our sample represent 72 percent of the Medicare beneficiary 

population in the country. The response rate for both the telephone interviews and the 

mail survey was 100 percent. 

We sent out a mail survey in which we asked PROS for specific data under the fourth 

contract. The data included how many complaints triggered a record review, how often 

physicians consented to disclosure for both confirmed and non-confirmed problems, cases 

that were referred elsewhere, and sources for confirmed quality-of-care problems. 

We supplemented the mail survey with more in-depth telephone interviews. For the 

interviews, we designed and pretested a discussion guide with questions about identifying 

quality-of-care problems, the complaint process, outreach activities, barriers to identifying 

individual quality-of-care problems, and barriers to establishing a more effective 

beneficiary complaint process, among others. 

We also drew on data from HCFA’S PROD3 data base (which includes the results of all 

inpatient record reviews) and PROD5 data base (which includes the results of all physician 

reviews). Through these we obtained data on the number and sources of confhrned 

physician and hospital quality-of-care problems for all PROS for reviews completed under 

the fourth contract through June 30, 1994.3 Our tests of the data revealed that 10 PROS 

reported no beneficiary complaints when, in fact, they had received such complaints. 

1 These included the following States (listed in descending order of beneficiary 

population): California, New York, Florida, Pennsylvania, Texas, Ohio, Illinois, 

Michigan, New Jersey, North Carolina, Massachusetts, Missouri, Indiana, Georgia, 

Virginia, Wisconsin, and Tennessee. 

2 These included the following States (listed in descending order of beneficiary 

population): New Mexico, Utah, Montana, South Dakota, and Delaware. 

3 In analyzing our data on complaints and confirmed quality-of-care problems, we 

report the most conservative interpretations. We chose this approach to avoid double 

counting complaints that resulted in confirmed problems with both a physician and a 

hospital. 

c-1 
Nevertheless, when these data are viewed in the context of our telephone interviews and 

survey data, we believe the findings and recommendations in this report are valid. 

We also relied on data from a beneficiary survey conducted by the Office of Inspector 

General (OIG) in the summer of 1994. The question relevant to our study sought to 

determine the level of beneficiaries’ awareness of PROS. The OIG mailed this survey to a 

randomly selected national sample of 1,299 Medicare beneficiaries, of which 20 were 

either nondeliverable or mailed to beneficiaries who had died. A total of 

1,002 beneficiaries returned completed surveys, a response rate of 78 percent. The 

survey results presented in this report have a margin of error of 3.5 percent at the 

95 percent confidence level. 

To strengthen our understanding of the complaint process, we reviewed the PRO manual 

and statutory and regulatory requirements concerning the complaint authority, 

confidentiality, and disclosure. 

c-2 
APPENDIX D 

RANDOM SAMPLEm COMPLAINTREVIEW FOR ALL PROS 

UNDERm-m Fomm Comwx 

FOR INPATIENTIWcow Rmmws COMPLETEDTHROUGHJum 30, 1994 

Source of Records Number of Record 

Reviews 

Being Reviewed 

Random Sample


Record Review 381,875 (72.3%)


Beneficiary


Complaints 737 (o. 1%)


Number of Records Percentage of 

with a Confirmed Records with a 

Quality Problem Confirmed 

Involving a Problem 

Physician and/or Concern 

Hospital 

4,255 (70.9%) 0.7% to 1.1% 

108 (1.8%) 9.8% to 14.7% 

NOTE: N =53 PROS. The number of beneficiary complaints represented here should be considered conservative because of reporthrg flaws. 

Ten PROS reported no beneficiary complaints when in fact they received such eomplairrts under the fourth contract. 

SOIJHCE HCFA PROD3 and PROD5 data bases. 

ANALYSIS: HHS Office of Inspector General. 

D-1

APPENDIX E


In this appendix, we present in full the comments from the Health Care Financing 

Administration, the berican Medical Peer Review Association, the American Medical 

Association, the American Association for Retired Persons, andthe Coalition for 

Consumer Protection and Quality in Health Care Reform. Inaddition to receiving 

comments from the groups listed, we also received a comment of concurrence from the 

Assistant Secretary for Planning and Evaluation. 

E-1

— 

. ,,.”l,, , 

+* 

:Jg ,­

.

DEP.\RT.MENT OF HEALTH & HU,IIAN SERVICES Health Care Financing Admlnlstratlc 

. 

-, 

.,

‘*[w,,. > The Administrator 

Washington, D.C. 20201 

DATE: SEP 11995 

TO:	 June Gibbs Brown 

Inspector General + 

&u!!! 

FROM: Bruce C. Vladec &L 

Administrator 

% 

SUBJECT:	 Office of Inspector General Draft Report: “Beneficiary Complaint Process 

of the Medicare Peer Review Organizations (PROS)” (OEI-O 1-93-00250) 

We reviewed the above-referenced report which assesses the beneficiary compkint 

process of Medicare PROS. Attached are our comments on the report findings. 

Thank you for the opportunity to review and comment on this report. 

-Attachment 
Comments of the Health Care Financing Administration (HCFA\


on OffIce of Insuector General (OIG) Draft Reuort:


Beneficiary Comnlaint Process of the Medicare Peer Review Orm.nizations (PROS)


(OEI-01-93-00250)


OIG Recommendation 1 

HCFA should work with PROS to identi& cost-effective ways to correct the flaws in the 

complaint process. Toward that en~ HCFA should: require PROS to respond 

substantively to the complainant. This is the standard to which the Joint Commission on 

the Accreditation of Health Care Organizations holds hospitals accountable. HCFA 

should give this the highest priority. 

HCFA Response 

HCFA will take this recommendation under advisement and tier analyze its options. 

Physician consent is a complex and sensitive issue, entailing the balancing of physician 

due process and privacy interests with the need for meaningful feedback to beneficiaries.. 

We are also sensitive to the issue of fll disclosure to the beneficiaries as it may impede 

the cooperative exchange of information between physician and PRO which enhances the 

peer review process. A provider and/or practitioner might be far willing to less volunteer 

of information which might directly or indirectly place them in jeopardy of civil 

malpractice actions. 

OIG Recommendation 2 

HCFA should identify coj.t-effective ways to enhance Medicare beneficiaries’ awareness 

of PROS and the complaint process. 

HCFA Resuonse 

HCFA concurs. Our OffIce of Beneficiary Services and Health Standards and Quality 

Bureau will work together on beneficiary outreach activities which will enhance 

beneficiary awareness of the complaint process. The beneficiary complaint process is an 

important and complex issue, affecting beneficiaries, providers, physicians, and managed 

care plans. We intend to meet with representatives of beneficiary, provider, physiciw 

and managed care organizations in developing a regulation that will improve this process. 
Page 2


In addition to regulatory changes, it wilI be necessary for our outreach program to help


beneficiaries understand that an effective peer review process may limit fid.1disclosure.


We will consider the complainant’s right to have information about hirnseWherseK and


the plan’s, provider’s, and practitioner’s rights to accurate informatio~ while maintaining


personal privacy, to ensure a balanced approach.


Recommendation 3


HCFA should streamline the complaint process.


HCFA Resnonse


We are concerned that attempts to expedite the process may actually result in less than


complete or conscientious review. The timefiarnes were established to allow adequate


time for all parties to consider and take appropriate action including, where necess~,


dialogue. We, therefore, are concerned about shortening the process, particularly in the


way cited in the report.


Rather than shortening the process, we would suggest making the beneficial aware of


the timeframes and the necessity of the length of the process as part of an improved


information process.


In revising the PRO process, HCFA and the OIG could examine the End Stage Renal


Disease Network Grievance/Complaint policy which apparently works well.


Additional Comments


We are concerned about another aspect of the complaint process which has not been


addressed in the OIG report. We are concerned that current policy may not eliminate


barriers for minority and disabled beneficiaries. There should be studies to determine


whether complaints filed with PROS are submitted at at least the same rate from minority


and disabled beneficiaries as from the general Medicare population. The HCFA strategic


plan requires us to focus attention on eliminating barriers to special needs populations.


Revised:ES :PLB :PSirnons for Meta Thomas


Typist: CCook:x65225


Disk: WPThomas2:complain. wpd

--

--

Nil??A AMERICAN MEDICAL PEER REVIEW ASSOCIATION 

1140 Connecticut Avenue, NW � Suite 1050 � Washington, D.C. 20036. 202/331-5790 . FAX: (202) 833-2047 

September 8, 1995


June Gibbs Brown


Inspector General


Department of Health & Human Services


Office of Inspector General


330 Independence Avenue, S.W.


Washington, D.C. 20201


Dar Ms. Brown: 

On behalf of the American Medical Peer Review Organization (AMPRA) the trade 

association representing the nation’s network of peer review organizations I appreciate the 

opportunity to review the draft inspection report, “The Beneficiary Complaint Process of the 

Medicare Peer Review Organizations.”. 

While AMPRA generally agrees with the philosophy of the report, we offer specific comments 

and suggestions on the matters described below 

Require PROS to respond substantively to the complainant. This is the standard to which the 

Joint Commission on the Accreditation of Healthcare Organizations holds hospitals 

accountable. 2%e HCFA should give this the highest priori~. 

Responding substantively to a complaint has always been a delicate and complex issue 

for the PRO community and indeed all who engage in medical peer review. While we 

ail sympathize with the beneficiary who wants to be fully informed about the results of 

the investigation of his complaint, such disclosure has serious ramifications for the 

conduct of peer review. Any new approach needs to be considered thoughtfully and 

carefully before a decision is made. Therefore. we recommend that changes be made 

thorough the reguia~ory process. 

First, AMPRA supports the need to provide beneficiaries and their families with 

substantive feedback while maintaining the due process provisions currently in place 

for handling quality concerns, i.e., an appeals process. In addition, the response from 

the physician on the PRO findings could be forwarded to the beneficiary concurrently 

with the PRO’s report. Finally, if fill disclosure is implemented, AMPR4 recommends 

expansion of existing immunity protection for PROS from civil suits. 

While full disclosure is advocated for the beneficiary, such a decision could harm the 

provider relationships which PROS have formed as part of the Health Care Quality 

Improvement Program (HCQIP). A concerted effort would have to be made to increase 

the awareness and support of the providers, physicians, and plans in regard to this 
-- --

—— 

matter. AMPRA would welcome the opportunity to participate in any discussions to 

seek an improved process. 

Finally, to our knowledge, the Joint Commission does ~ have a standard which holds 

hospitals accountable to respond substantively to complaints about quality of care issues 

in the manner which this report recommends. 

Identlfi cost-e~ective ways to enhance beneficiaries’ awareness of PROS and the complaint 

process. 

As has been pointed out in previous studies conducted by the Office of the Inspector 

General (OIG), there exists a lot of room for improvement in the ways beneficiaries are 

made aware of their rights. HCFA is currently working with the PROS on this topic, 

and PRCS would welcome additional opportunities for iiexibiiity in their outreach 

activities. AMPIL4 would be pleased to be to be part of such efforts. 

Streamline the complaint process. 

AMPRA agrees that there are many efficiencies and economies which can be built into 

the complaint process to afford a speedy response to the beneficiary. Potential change 

could simply be the by-product of a revised disclosure policy. For example, if 

physicians were made aware of the fill disclosure requirement in the initial 

correspondence to them, the response time fiarnes to the beneficiary could effectively 

be shortened by 30 days. 

AMPRA would also like to point out that, while the random sample review has been 

eliminated, the improvement efforts initiated through HCQIP projects have the potential 

for greater impact by improving care and protecting beneficiaries on a broader scale 

than does review of an individual case. 

AMPRA recommends that the Health Care Financing Administration (HCFA) form an 

improvement team to address the aforementioned issues and increase the effectiveness of the 

beneficiary complaint process. The improvement team at a minimum should consist of 

the follow@ iC~itXtxlt~tiVt3S: .LUWW; FRO leadership and applicable personnel; 

malpractice/legal expert; members of applicable trade associations (i.e., AMA, AHA. AARP, 

JCAHO. GHAA/AMCR.A, etc.). HCFA, and OIG. 

Again. we thank you for allowing us the opportunity to comment. Please feel free to contact 

me at 202/331-5790 should you have any questions. 

Sincerely, 

A4?i’liif? 

Executive Vice President 
AmericanMedicalAssociation 

Physicians dedicated to the health ot’ Mer]ca 

JamesS.Todd.
MD 515NorthStateStreet 

Executive VicePresident Chicago,Illinois60610 

September 11, 1995 

June Gibbs Brown


Inspector General


Department of Health and Human Services


330 Independence Avenue, S.W., Rrn. 5250


Washington, D.C. 20201


Dear Ms. Brown:


312464-5000 

312464-4184Fax 

I 

The American Medical Association (AMA) greatly appreciates the opportunity to respond to the 

recommendations contained in the Office of Inspector General (OIG) reporr. The Benefrciarv 

Comcdaim Process of the Medicare Peer Review Organizations. We believe that it is essential for 

patlen[s to have an opportunity to express their concerns about the quality of care they receive 

from any provider of health care services, and that when problems of quality are identified they 

are addressed and corrected. However, just as the rights of patients must be observed and 

protected, so must we protect the rights of physicians and other providers of medical care. 

The resolution of concerns raised by patients should be done in a fair and equitable reamer that 

protects the rights of privacy and confidentiality of those being investigated. While the ALMA 

agrees that, if possible, the complaim process should be streamlined, it must not be at [he expense 

of denying full due process to the provider whose services are being examined. Only after 

affording the physician his or her full due process rights should the patient be provided a 

substantive response to his or her complaint. 

The PRO Fourth Scope of Work correctly and appropriately attempts to improve the overalI 

practice of medicine by analyzing patterns of care and outcomes and by sharing information with 

the medical community while moving away from the prior punitive approach. We are pleased 

that the new Fifth Scope of Work, which will provide the future direction for the PRO program, 

continues to emphasize cooperation and education for those providing medical care. It would be a 

serious mistake for the PRO program [o revert to a more punitive approach (as suggested by the 

OIG) in an attempt to change behavior by setting aside the rights of the individual physician 

through eliminating the physician’s consent to disclosure. 

The A!hl.Ahas no objections [o a PRO describing what it did to investigate a complaint, what the 

investlgacion revealed (including whether a quality-of-care problem was confirmed), and what 

action [he PRO took based on the complaint, but not until the provider of services has been 

afforded a full opportunity for due process. We believe, however, that any change in current 

physician disclosure regulations must be accomplished through the usual no[ice and comment 

process rather than by way of contract changes or manual instruction changes. Moreover, as it 

considers changes, HHS must take great care not to undercut the educational, non-puni[ive 

approach of the current PRO program. as well as the improving cooperative relationship between 

PROS and the medical community. 
Page 2- June Gibbs Brown 

The AMA believes that prior to notifying the patient of the ou[come of a PRO investigation following 

a complaint about quality, the physician’s due process rights should be exhausted. EIements of that 

process should include: 

a written statement of the charges/complaint against him or her; 

adequate notice of the right to a hearing, his or her rights in the hearing, and a reasonable 

opportunity to prepare for the hearing; 

detailed disclosure of the evidence and witnesses against him or her sufficiently in advance of 

the hearing to enable preparation of the defense; 

a fair, objective, and independent hearing,, with the right to ask questions of the panei 

members and of any hearing officer designed to reveal bias or prejudice, and the right to 

challenge the impartiality of any member or hearing officer; 

the right to be represented by an attorney or other person of the physician’s choice; 

the opportunity to be.present at the hearing and to hear all of the evidence against him or her; 

the opportunity to present a defense to the charges, including, but not limited to, the right to 

call, examine and cross-examine witnesses; 

a presumption of imocence and an assurance that the hearing body shall not render a decision 

against the physician unless the evidence produced at the hearing clearly supports that adverse 

determination: 

a hearing within a reasonable proximity of the location of the physician’s practice; and 

a hearing which protects the imeres[s of the physician’s patients, and the public in quaiity 

pauem care. 

The ALMA isalso concerned about the possibility of well-meaning but erroneous referrals to [he PRO 

& &L-d”dl’ Uh; ~ih”lti~” L~~~~l&lin\”.$JYISY XJ&-L’U?CIYIllAYLhliUAIi~ c&” LV WiYal’ ukii” cilid .%25S” LXI’ 

constitute poor quality care, there is a significant possibility that a patient’s genuine concerns may 

lead to a referral to the PRO for care which does not reflect a quality problem at all, and which in 

fact is entireiy appropriate. Adhering to proper due process provisions assures that no information is 

communicated to the patient until the physician has had the opportunity for a full and open hearing on 

the nature of the complaint. 

We believe [hat HCFA should be as interested in protecting [he due process rights of individual 

physicians as they are in providing substantive follow-up to individual patients. The AMA would 

welcome the opportunity to work with HCFA and the patient community in reviewing and 

commenting i:. advance on the proposed contents of any letter sent to the patient by the PRO about 

the quality of a physician’s services. It is important that all communications with the patient 

regarding the complaint be handled in a nonbiased and nonprejudicial reamer to protect the rights of 

the physician while the case is being investigated. 
Page 3 - June Gibbs Brown 

We concur with the OIG that a lack of a timely response to a patient’s complaint may serve as a 

deterrent to a patient’s willingness to refer complaints to the PRO program. We believe that it may 

be possible to find more efficiency in the review process by performing some s~eps of the review 

process concurrently, but the program must not compromise the physician’s opportunity for due 

process in pursuit of more timely reviews. 

Physicians have had, in large part, a positive reaction to quality review process enumerated in the 

PRO Fourth Scope of Work. The AMA is pleased that HCFA incorporated many of our 

recommendations for improving the quality review mechanisms of the PRO program. As I indicated 

earlier, we believe the Fifth Scope of Work builds on the positive changes of the Fourth by increasing 

the level of collaboration among PROS, hospitals, and physicians on quality improvement efforts. 

The emphasis on internal quality improvement which uses pattern analysis is to be commended, rather 

than a punitive approach that addressed individual clinical errors. 

The AMA strongly believes that physicians must continue to play an active role in any public or 

~irate sector effort to develop national medical quality and performance standards. And that when 

individual problems of quality are identified, they mus[ and will be addressed bu[, it must be done in 

a way that respects and enforces patient and physician confident iali[y and without abridging the due 

process rights ot’ individuals. 

Once again. I want to express my appreciation for the opportunity we have had to comment on this 

process. The AMA wants [o continue to play an active role to ensure that physicians’ perspectives 

are part of the PRO process. 

Sincerely, 

J. y~ , %@ 

ames S. Todd, MD 
September 27, 1995 ,.


June Gibbs Brown


Inspector General


Dep@nent of Health & Human Services


OffIce of the Inspector General


330 Independence Ave., S.W.


Washington, D.C. 20201


Dear Inspector General Bro~:


Horace Deets has asked me to respond to your request for comments on the draft report,


“The Beneficiary Complaint Process of the Meclicare Peer Review Organizations.” We


appreciate the opportunity to comment. AARP has long supported the effective


implementation of the PROS’ complaint authori~y, and believes that yow report is a great


service to the beneficiary community. It is useiiul to be reminded of the Congressional


mandate regarding PRO consideration of beneficial complaints:


‘The organization shall conduct an appropriate review of all written complaints


about the qutdity of services ..... not meeting professionally recognized standards


of health care .... The organization shall itiorm the individual of the


orgtization’s final disposition of the complaint.”


In light of the elimination of random sample record review by the PROS, the process of 

investigating and responding to beneficiary complaints assumes even greater importance 

as a means of protecting beneficiaries from poor quality care. 

Our specific comments follow. We welcome the report’s recommendations, and offer 

suggestions for some additional ones. We also raise a few questions of clarification 

about the report’s findings. 

Comments on the Recommendations 

� Require PROS to respond substantively to the complainant 

The OIG recommends that HCFA either: (1) amend the PRO regulations to eliminate the 

requirement that physicians consent to disclosure before providing feedback to 

complianants; or (2) issue contract modifications or manual instructions calling for 

.%neric3sl .+ssociariun of Retired I’crwns 60] E Strcc’t, X.’!v.. \l”dlir;sym, D.C. 20049 {202”:1 4;4-2277

Eugene 1. Lci-.rinmn !?-uin’tf:: H cm~c: B. Lhrs Etm/rirc I)irmmr 
--

--

Inspector General Brown 

Page 2 

substantive responses to complainants. We support both recommendations, both of 

which are consistent with N policy, but feel that the latter approach would be most 

expeditious. 

We have long believed that the confidentiality regulations have a chilling eff6ct on the 

beneficiary complaint process: The fact that beneficiaries have no assurance that they will 

ever receive a substantive response to their complaint cannot help but serve as a deterrent 

to ~gistering one. Those beneficiaries who do voice complaints, and whose physicians 

thti refhse to consent to disclosure which happens in 87 percent of cases when there is 

a confirmed quality problem likely feel frustrated or even an~ at the lack of 

meaningfid response. Such a situation serves to undermine overall beneficiary 

confidence in the PRO program. 

While we recognize that many physicians and hospitaIs have serious concerns about 

changing the coti]dentiality regulations, the finding that over half (59 percent) of the 

PROS smeyed viewed these regulations as a major barrier to a more effective complaint 

process is compelling evidence that the regdations bear revision. In addition, the report 

notes that at least one PRO has been successful in gaining physicians’ consent in a 

majority of cases, even when the complaint involved a conilrmed quality problem. It 

would be a valuable addition to your final draft to indicate any specific methods used by 

that PRO. This finding suggests that, if regulations are revised, PROS will be able to 

respond substantively (e.g., according to the OIG’S definition of what constitutes a 

substantive response) without alienating the physician community. 

In order to help allay f=s among the provider community that these responses will be 

used unfidrly against them we suggest: 

�	 permitting physician responses to PRO findings to be attached as part of the PRO 

response to the beneficiary. This practice would parallel that used by HCFA in 

attaching voluntary hospital comments when it released the hospital mortality data. 

.	 developing a recommended response letter that informs the beneficiary of the final 

disposition of the complaint without becoming tantamount to a verdict in malpractice 

litigation. 

We also urge thatproven quality of care findings be referred to other oversight entities as 

required by Memoranda of Understanding entered into by PROS in the Fifth Scope of 

Work. 
Inspector General Brown 

Page 3 

“	 IdentifJ cost-effective ways to enhance.h’fedicarebeneficiaries’ awareness of 

PROS and the complaint process. 

We strongly support this recommendation, which is consonant with AARP policy calling 

upon HCFA and the PROS to actively encourage beneficiaries to use the PROS’authority 

to investigate quality of care complaints. The extremely low volume of complaints 

(beWeen 8 and 164 per one million beneficiaries), coupied with the elimination of 

random case review, jeopardizes the PROS’ ability to identi~ quality of care problems. 

We agree that HCFA should give PROS more flexibility in conducting their outreach 

activities, including permitting them to survey local beneficiaries and targeting outreach 

to family members of beneficiaries as well & pre-retirees. We would like to offer any 

assistance that AARP may be able to provide in this effort. We finther believe that the 

PROS’ budgets should be increased to permit concerted outreach efforts. 

The fact that only 23 percent of beneficiaries surveyed were aware of the existence of 

PROS is, of course, a major barrier to the complaint process. We are curious if the 

beneficiary smey reveaIed any other barriers. Were respondents asked if they would be 

tiling to lodge a complaint, or if they would he reluctant to do so, and the like? Any 

data bearing on this issue from the beneficiary sumey should be reported. 

� Streamline the complaint process. 

The current timeline for PRO review and response to beneficiaries, as outlined in the 

PRO manual, is fa too long. For example, the process can take up to 250 days to respond 

to identified quality concerns in cases requiring a re-retiew. Over two-thrids of the 

PROS surveyed (68 percent) felt constrained by this lengthy process. Moreover, it is 

quite feasibte that beneficiaries who are seriously ill may no longer be alive by the time 

the review is completed. 

We support the OIG’S recommendation to HCFA to find ways to expedit the process, 

e.g., by examining ways other bo~les conduct complaint reviews and identifying and 

sharing promising approaches taken by individual PROS. For example, ail PROS should 

be encouraged to use a case management approach as is being used with one PRO, and to 

regularly communicate with beneficiaries throughout the process. 
Inspector General Brown 

Page 4 

Comments on Findings 

Page 1. The text states that OBRA-86 requires PROS to review all writte~ quality-related 

complaints received from Medicare beneficiaries. However, the footnote to which this 

statement refers (#4 in Appendix E) does not list physician offices as one of the settings 

for which PRO review is mandatory. This should be clarified. 

Page 3. We suggest adding an Appendix which lists the total number of beneficiary 

complaints received, and gives more descriptive information about the nature of the 

complaints reviewed, especially those that resulted in confirmed quality probIems. For 

example, the report states that about two-thirds of these problems invoived physicians, 

and about one-third hospitals. Were quality of care problems found in any other settings, 

e.g., in home health or HMOS? Such information would provide more context for 

interpreting the report’s fmiings. 

Page 5. Based on the discussion here, the OIG may wish to state that PROS should 

establish explicit poIicies to encourage complaint referrals from physicians, hospitals, or 

medical boards. 

Page 6. The majority (59 percent) of PROS cited difficulties in making beneficiaries 

aware of the complaint process, It wouid be helpful to know whatspecific difficulties 

they encountered. If this was asked on the PRO survey, it would .usefid to report the 

responses here. 

Thank you again for the opportunity to comment. If you should have any questions, 

please contact Mary Jo Gibson in AARP’s Public Policy Institute at (202) 434-3896 or 

Cheryl Matheis in Federal Affairs at 434-3774. 

* Sincerely..W 

Uohn Rother 

Director, Legislation 

and PubIic Policy 
—. 

Coalition for Consumer Protection and QuaIity in Heakh Care Reform 

1275 K Street N.W., Suk?9W Wa$hiniww DC 20005 

(202)789-3606 Fax (202) 842-1 1S0 

September 15, 1995 

Ms, June Gibbs Brown


Inspector General


Department of Health and Human Servictx


Cohen Buiiding, Room 5250


330 Independence Ave., S,W.


Washington, D.C. 20201


Dear Ms. Brown: 

Thank you for the opportunity to review and comment on your draft inspection 

report, “The Beneficiary Complaint Process of the Medicare Peer Review 

Organizations. ” I am pieased to provide to you the comments of four of the Consumer 

Coalition’s members, and I know that others in the Consumer Coalition have provided 

their comments to you indepcndcntiy. 

Piease keep our Coalition in mind coreview and comment on other reports that 

you produce in the areas of health care consumer protection and quaiity, We would 

aiso be wiiiing to assist with your studies in any other ways that you consider 

appropriate, 

Thank you again for inciuding us and for your efforts to improve these 

important heaith care programs. 

Sincerely, 

/& bJ#=L$z_ 

Brian W. Llndberg 

Executive Director 
/ 

Center fbr 

Health Care Rights 

A step ttt tbe rdgbts dfrect ion 

TO: Brian IJndberg


FROM: Geraldine Dallek, Center for Health Care Rights


RE: The OIG Drafl Report on The BeneficiaryComplaintProcess of the Medicare


Peer Review Organizations 

DATE: September 5, 1995 

The OIG repofi provides a thoughtful critique of the PRO complaint system and otlkrs some 

criticallyimportant suggestions for reform of the system. Given the likelihood of some basic 

reform in the Medicare pmyam and the potential fcwsubstantialincreased Medicare enrollment in 

manased care, the repon is especially timely, 

What follows are some specific comments on the report and additional suggestions for improving 

the PRO complaint process. 

NEED FOR A PRO PROCESS RESPONSIVE TO BENEFICIARY COMPLAINTS 

The Center for Health Care Rights (CHCR) provides education+counseling and legal services to 

over 15,000 Medicare bencficimiesannually. With the exception of hospital discharge cases, we 

refix few Medicare beneficiariesto our PRO (CMRI), The reasons are two-fold: 

(1)	 The inability of PROs to Provide Comdainants with Information on the 

Disposition of Their Comdaints 

Asthe OIG notes, the lack of a meaningfidPRO response to beneficiaries’complaintsis


incredibly fimstrating, Indeed, it is such an impedimentto the review process, that I believe unless


it is ~hanged, MK)s will never be able ?Qdlkcthdy represent Medicare beneficiaries, Nor wi]l


PROS,regardless of outreach efforts, be sent more than a trickle of complaints. 

(2)	 The Lemzthof the Review Process and Inabilitvof PROSto Respond in a Time& 

Manner to Emer~encv Cases 

As the OIG also noted, the review process is too lengthy. I am especially concerned about the 

lackof formal procedures fur the PRO to investigate emergency cases where deIays could result 

in serious harm to a beneficiary. Agai~ with the exception of hospital discharge cases, CHCR 

does not view a complaint to the PRO as an effective way to obtain redress for our client 

concerns, especially those relating to denials of care by HMOS. 

520 S. Lafayette Park Place, Suite214 a Los Angeles, CA 90057 

213/383-45 19 � 800/824-0780 m Fax: 2 13/383-4598 
Lindberg 

page 2 

NEED FOR GREATER SPECIFICITYON THE COMPIx41NTPROCESS 

The OIG report contains a number of recommendationsfor changes in the PRO complaint Syst% 

inoludingspecific requirements detailingto the complainantwhat it didto investigatethe 

complaint,the outcome of the investigation andanyactiontalmnbythe PRO. 

In addition, I believe the 010’s repoti should hiclude recommendations to HCFA on substantive 

additional changes in the complaintsystemincluding:recommended time ties for handling 

complaints,protocolsfor whoinvestigatescomphdnts;standardsforwhat typesof complaints 

shou~dbe handled by the PROS;standards on how comphdnts should be investigated; ant as 

discussed below, reporting of outcomes of complaint investigations to the public. 

Currently, the PROS do not seem to investigate cases when care is denied, focusing instead on the 

delivery of poor quality of care. We believe [hat denialsof appropriate care are, by definition, 

poor quality care and should be investigated by 

LACK OF COORDINATION BETWEEN THE PROS, HCFA AND STATE 

REGULATORY AGENCIES 

The CaIifomiaDepartment of Corporations (DOC), which regulates HMOSin the state, willsoon 

inaugurate a hot line for HMO consumer complaints. DOC has told CHCR that it plans to refer 

allMedicare HMO complaintsto HCFA Region 9 

We do not know how HCFA will handle the large number of expected calls. HCFA and CMRI 

need to establish protocols for handling these complaints and sharing complaint information. 

OIG should include in its report specific recommendations for ways that the PROS, HCFA and 

state agencies should coordinate the handlingof beneficiarycomplaints and share complaint 

information. 

LACK OF PUBLISHED PRO COMPLAINT DATA 

In addition to informing Mividual complainants of the outcome of the PRO’s investigation of 

their complaints, PROSshould be given authority to publishcomplaint data on an annual basis, 

including; 

+	 The number of complaints by provider type (FFS, Physician, Hospital, HMO, 

Home Health Agency) and types of complahts (e.g., denials of care, poor quality 

care, etc.), 
Lindberg 

page 3 

+ Outcome of complaints by provider typq 

+ The names of institutional providers ( HMOSand when applicable, contracting 

providergroups, hospitela, home health agencies, etc.) for whom complaints were 

found to be, following an investigatio~ justi.tlable. 

OUTREACH THROUGH GROUPS REPRESENTING MEDICARE BENEFICIARIES 

All states have fderally finded ICA programs which could be a potential source of beneficiary 

complaints. A number of other organizations also represent the interest of Medicare beneficiaries. 

However, for the reasons stated above and a sense among some beneficiary groups 

that PROShave not, in the past, been responsive to beneficiaryconcerns, PROSwilfhave to make 

a special effort to gain the trust of some of these organizations. 

I believe that complaints from bem%ciariescan bean effective source of monitoring quality of 

care. However, heavy relianceon complaints will not produce an effi?ctivequality monitoring 

system unless the entire PRO complaint system is changed to meet beneficiary needs. 

Thank you for the opportuni& to comment on the OIG’S drafl report. 
— 

NATIONAL SENIOR CITIZENS LAW CENTER 

1815 H STREET,N.W., SUITE 700 

WA5HIffiTON, D.c. 20006 

TELEPHONE (202) 887-5280 FACStMILE (202) 78S-6792 

WA!WINCTON, o c 

DUR70N D, mm 

EXECUTIW mmc-roa 

September 14, 1995


Brian Lindberg


Executive Director


Coalition on Consumer Protection


and Quality in Health Care Reform 

1275 K Street, N.W. , Suite 900 

Washington, DC 20005 

Re:	 Comments on OIG Report on Beneficiary Complaint Process of the 

.Medicare Peer Review Organizations 

Dear Brian: 

Thank you for the opportunity to submit comments on behalf of the National 

Senior Citizens Law Center (NSCLC). Over the years, NSC.ZC has been involved in 

nuxnerw+s matters involving quality of care issues and Peer Review Organization 

(PRO) review, particularly issues of premature hospital discharges, For the most 

part, we have found the l?RO review process to be unsympathetic to beneficiaries and 

theprocess ofobtaining reviewcumbersome, even when working through an 

experienced advocate. 111addition, the Iack of a detailed and substantive response to 

beneficiaries complaints has impeded our ability to advocate on behalf of our clients. 

1. & a general matter, there is still a question among beneficial advocates 

about whether the PRO process should be maintained as it. relates to bene-ficiary 

coverage and quality issues. Some advocates are of the opinion that the process 

delays meaningful review before a hearing officer, und administrative law judge 

review, etc, as appropriate. 

2. Hospital notices explaining PRO review procedures have improved over the 

years, Nonctheiess, beneficiaries do not always receive these notices in a timely 

fashion, nor do they always receive sufficient instruction from hospital staff about the 

importance of these notices. 

3. We applaud the notion of expanding PRO outreach efforts in terms of 

publicity about the PRO review process. We wotdd be happy to work with the 

La ANGELE2 ~. S1.RTE4230, 777 SO~ ffilJER~ STREET,102 ANGELES, (XLIFORNL4 9W17 � (213) 23&3890 

s 
NATIONAL SENIOR CITIZENS lAW CENTER 

Brian Lindbcrg 

Page2 

September14, 1995 

Health Care Financing Administration (HCFA), the PRO community, and others in 

exploring ways of reaching Medicare beneficiaries to tell them about the role and 

function and vaIuc of the PRO process as it is improved. 

4. We agree that the low number of beneficiary complaints being filed with the 

PRO is a problem. The problem is a function of poor outreach, bad beneficiwy 

experiences with the PRO system, and ineffective notice systems within hospitals. 

We have long sugg~stcd that ho~pilalsbe reqt.drcd to play a larger role in the patient 

education and outreach efforts about the PRO process, Wc suggest theuseof notice 

boards in hospitak, presenting information about the PRO process at several points 

during a patient’s stay in the hospital, and the use of patient advocates or a hospital 

ombudsman to augment education andoutreach efforts.

5, Hospital utilization review committees should involve Medicare beneficiaries 

in all upects of utilization questions. This would given benefiaaries greater access 

to the PRO process and increase beneficiary comfort lcvels in using the PRO review 

process. 

6. It would also be useful if PROS were required to publish and make available to 

the beneficiary community statistical information about the number, nature, and 

disposition of complaints received. 7%1sinformation could be made available in 

hospitals, at senior centers, and to individuals upon request. 

Again, thank you for the opportunity to comment. 

Sincerely, 

Alfred J. Chipiin, Jr. 

Staff Attorney 
clWTERFORMEDIOAM ADVOCACY, lNCwSOUIIHBRNAR120NA LRQALAXD 

MB. SIWADW# BWD. 

TVCOON,ARQ4YNA~l.1~ 

(6@ 6WM65 1 (BW) !Mw7W 

FAX(60Z) 620-0449 

AlluNwv8 

CMARU?SC, MULJ14

Juol?14 S7EIN NULIN 

0-0 S. �LI?OANI 

WALTCR R. KCCNAN 

USMMA PAW!L+4ARVIL 

or couNscb 

9ALLV 14AUr WIL80N September 7, 1995 

Brian Lindberg


Executive Director


Coalition far Consumer Protection


and Quality for Health Care Refo~


1275 K Streett N.W.


Washington, D.C. 20005


Dear Brian:


Thank you for giving me.the opportunity to comment on the OIG 

draft inspection report, “The Beneficiary Complaint Process of the 

Z4edicare Peer Review” OrganlzatiozsX’! MY comments”on the draft 

report, in no particular order,’ ure, as follows: 

1. The OIG and PROS are,correct in concluding that randont 

reviews of sample medical records were an ineffective way to 

improve quality of care,’ and that responding to beneficiary 

complaints is a far better way to uncover problem areas, (Why did 

it take them so long to figure this out?) 

2. We should urge the PROS to devote much more attention to 

investigating instances of underservice by HMOs~ as this is the 

area in which Medicare beneficiary advocates find the greatest 

pzoblexcs. 

3. Closer links should be developed between PROS and 

Medicare beneficiary advocates. Until now, many PROS have been 

quite unresponsive to beneficiary advocates in their regions. 

Greater contact would help 

receive and sensitj.ze them 

4. PROS should not 

investigating beneficiary 

reliably document instances 

all, .who;:creates the~zecazds?) 

likely to document si,tu,ations 

medical care was provided, 

HMOS are involved, 

increase the number of complaht~ they 

to beneficiary interests. 

rely only on medical records i.n 

complaints. Medical Tecords” do not 

of poor quality medical care (after 

,..Me.dical :rec,ords are even less 

where the problem was.that not enough 

which is the most common problem where


(mmI?ALoFFIcE: l?o.mxsso
 wlumwvmc,cToez2a (209)456-7’WI
Brian Lindberg


September 7, 199S


Page 2


5. The report’s statistic that PROS have found confirmed 

quality of care problems in 10 to 15 % of complaints is shockingly 

low. Beneficiaries rarely go to the trouble of lodging complaints ~ that are not justified. This low confirmation rate may result from 

a number of factors: PROS are gOnerally too solicitous of 

providers; PROS can not obtain all of the relevant facts from 

suedical records; PRO quality of care protocols in many case? simply 

do not measure underservice. Beneficiaries will not bother lodging


complaints unless the resulting investigations are more balanced.
,.


6. Many observers have noted that PROS do not seem to be the 

appropriate agencies to monitor qqality of caref since they are 

also entrusted by HCFA with the job of performing hospital 

utilization review. This inconsistency in their two hats should be 

removed. 

7. HCFA should work on developing a penalty System that 

gives beneficiaries an’ incentive for ,referring their problems to 

the PROs--e.g., monetary fines levied in response to deficiencies 

that are found in health care. 

8. PROS should work with other agencies that review medical 

quality	 such as licensing boards and HMO regulatory agencies to 

create stronger incentives for providers to provide adequate, 

quality care.


I am sorry to have been slow in getting these comments to you. 

Please let me know If I can be of further assistance. 

Very truly yours,


< > 

Sally H t Wilson


~F
 Attorne at Law


SHW:md

CitizenAdvm~ Center 

A tiining, R~ and SWport Network for Public 

Membem of Hbalth Clzre Regulatory and Gove?ningBou@s 

September 14, 1995


Mr, Brian Lindberg, Executive Director 

coalition for Consumer protection and 

‘Quality for Health Care Reform 

1275 K Street, NW, Suite 900 

Washington, DC 20005


Dear Brian:


Thank you for asking CAC ‘ to comment ‘on the OIG draft 

inspection repoxt entitled, “The Beneficiary Complaint .. . pro-- of

the-Medicare Peer Review 0r9an~zationa (PRO=) -“ ‘A? .You ‘now’ ‘c 

is a unique support program for the thousands of public members who


serve on healtih care -regulatory boards and governing bodies as


representatives of the consumer interest. Whether appointed by 

governors to serve on regulatory or other health policy boards or 

selected by private sector institutions and agencies to serve on 

boards or advisory panels, public members are typically in-the 

minority and are usually without the resources and ,technlcal 

support available to their counterparts from professional and 

business communities. CAC is a not-for-profit 501(C) (3) 

organization created to serve the public interest by providing 

research, training, technical support, and networking opportunities 

to help public members make their contributions Informed, 

effective, and significant.


One of our networks under the CAC umbrella is PRONET, made up


of the Medicare beneficiary members who serve on the boards of


directors of all PROS. At PRONET’S annual meeting in Salt Lake


City, Utah, on September 28, 1995, these beneficiary members will 

be discussing the draft report and most likely issuing their own 

comments on it. However, because of the deadline you told us you 

were operating under, we wanted to give you the comments of CAC. 

Please understand that the CAC comments may or may not be similar 

to those that PRONET will make later this month. I will send you 

a copy of whatever results from the PRONET meeting. 

We appreciate your asking our views. AS one of the members of


your coalition, we are pleased to respond, since we closely observe


the PRO program.


The OIG makes three findings, and offers three 

recommendations. we would like to comment briefly on each. 

1424Six&enthStree~ NW. Suke106.Waahi-n@On,
DC20036


PHONIU(202)462-1174
NAX(202)2654Y564

PIG Findirau #l.	 Complaints to PROS can be en important source 

for identifying quality-of-car. problems. 

commeJ&. We agree. AS you know, we also are deeply involved with 

the operation of state health licensing boards, Both the PROS and 

the licensing boards can do a much better job of protecting the 

public health and safety if they have direct access to the users of 

health services, while PROS can and do have the authority to 

review medical records of patlenta, that is not the same as hearing 

from patients who have had an adverse experience. Granted, some 

complaints are frivolous, and some do not really fall within the 

PRO’s authority, Neverthelessr enough of them do allege actions or 

inactions that should be investigated and, if substantiated, dealt 

with in an appropriate manner. 

019 Findina #2s	 Modicaze baneficiarie- are often unaware 02 

tlmir opportuuitiem to complain to PROS about 

the quality of tlaoir medical ca=e. 

Comment. The 01(3 finding does not surprise US. Most studies Show 

that the public is uninformed as to the existence of PROS and 

licensing board and the authorities uizder which they operate. ThiH 

lack of awareness is a problem that cannot be corrected overnigh~, 

but the effort should be made. If one examines the budgets of most 

PROS, one will find precious few dollars allocated to beneficiary 

education and outreach. CAC did a study a while back (copy 

enclosed) that examined PRO outreach programs. As you will see, 

some PROS spend as little as $5,00 0 a vear on outreach (Table 25, 

page 72). Almost half the PROS (24) had outreach budgets of 

between $5,OOO and $50,000. Not a single PRO had an outreach 

budget of over $100,000. Some PROS have developed imaginative 

outreach programs to do a better job of beneficiary education. 

Furthermore, the Fifth Scope of Work in HCFA’S contracts with PROS 

elevates outreach to a higher priority than it has had in the past, 

But , until there is a much larger financial commitment, these 

programs are unlikely to overcome the lack of knowledge found by 

the OIG and others. 

OIG F- ixuf#~.	 As it works now, the complaint process has 

some flaws that undermine its effectivezxessg 

o Laak of substantive response


0 Faw complaints


0 Langthy process


Comment. Again, the OIG finding is disturbing but not surprising.


If few beneficiaries know that they have a right to complain


(Finding #2), then of course there won’t be very many complaints


registered. If those who do complain get a non-substantive


response, and if chat non-substantive response takes an unduly long


2 
--

--

time to arrive, then the complainant is unlikely to ever complain 

again, and is likely to discourage friends and relatives from 

registering complaints of their own, 

In eummary, the 01(3 finds that complaints can bai an important 

source of information to help PROS identify quality of care 

problems, but very few beneficiaries know about the complaint . 

process, and those few who do use the system find it seriously 

flawed and non responsive.


The OIG offers three solutions, in the form of


recommendations, namely;


b	 !rheHCFA should work with PROS to identify cost-affective waym 

to correat the flawe in the complaint proceos. Toward that 

end, FICFA shoulds 

o	 Requ3x= PROS to respond substantively to the 

complainant. TMs’im the standard to which the 

Joint CommissioA on the Mcredltation of Health 

Care Organizations holds hoepitals accountable. 

The HCFA should give this the highest priority. 

o	 Identify cost-effeotive ways to enhanca Medicare


beneficiaries’ awareness of PROIYand the complaint


process.


o Streamline the mxmplaint process.


We support eaah of these recommendations, and find them on 

target. In addition, we would add a recommendation that PROS not 

only be allowed more flexibility in conducting outreach activities, 

but that these activities be allocated higher levels of funding. 

We would also recommend that as part of streamlining the 

complaint process, PROS be given specific deadlines for each phase 

of complaint handling fox example, 14 days to acknowledge 

receipt of the complaint; 30 days to complete a preliminary 

investigation; 60 additional days to complete a fuller 

investigation and be required to justify each instance where the 

time limits were exceeded. 

Finally, we believe that 14CFA should regularly compile 

complaint handling statistics from all PROS and issue an annual 

report describing their substance and their resolution. A good 

model would be the California Board of Medicine’s Annual Report. 

CAC is aware that PROS have moved away from case-by-case 

review and toward pattern analysis. However, PROS still retain 

authority to receive, investigate, and act upon complaints. so 

long as they have this authority, PROS should be expected to 

exercise it responsibly. Otherwise, PROS leave complainants with 

3

. 

a false confidence that their complaints are being handled 

appropriately. 

There are really only two viable choj.ce~; either correct the 

deficiencies documented in the OIG report, or remove from PROS the 

responsibility for handling complaints, reduce their budgets 

accordingly, and direct the funds to organizations better equipped 

or more willing to handle complaints effectively, promptly, and 

appropriately. 

Again, we appreciate this opportunity to comment.


Sincerely,


4 
APPENDIX F 

NoTEs 

1. The Institute of Medicine, Medicare: A Strategy for Quality Assurance (Washington, 

D. C.: National Academy Press, 1990). 

2. Hebbeland McMullan to Executive Directors, Peer Review Organizations, 

20 December 1994, Health Care Financing Administration, Baltimore, MD. 

3. Other instances in which HCFA requires the PROS to conduct case reviews include 

hospital-issued notices of noncoverage, referrals from HCFA or the fiscal intermediary, 

adjustments to higher-weighted DRGs, and other limited instances. 

4.	 The PROS must review complaints about the quality of care in the following settings: 

fee-for-service inpatient hospitals; fee-for-service freestanding ambulatory surgical centers; 

fee-for-service home health agencies, skilled nursing facilities, hospital outpatient areas, 

and emergency rooms; risk-sharing health maintenance organizations; and services 

received through cost-based health maintenance organizations. The PRO review is 

mandatory for written, quality-related complaints about services received in a physician’s 

office when the physician is a part of a health maintenance organization in which the 

beneficiary is enrolled. 

5. See 42 CFR 476. 

6.	 The Health Care Financing Administration defines beneficiary protection under HCQIP 

as comprising four key elements: 

1. A quality surveillance system. The HCFA defines surveillance as “an 

ongoing epidemiologic strategy to identify quality problems, structured by 

hypotheses about what the problems are. ” The HCFA further defines the aims of 

the quality surveillance system as targeting and supporting quality improvement 

projects by “finding and fixing unacceptable patterns as diverse as high rates of 

medication errors, high rates of unnecessary right heart catheterization, and 

systematic delays in providing antibiotics to patients with infections, ” 

2. Strategies to identify and intervene in instances of incompetent and 

impaired physicians and providers. According to HCFA, the HCQIP employs 

two methods to effectively identify and root out incompetence. First, physicians 

and hospitals who fail to participate in and improve as a result of projects will 

become “increasingly isolated and obvious. ” It states that “data collected in 

projects and shared on a confidential basis will become persuasive evidence for 

implicit peer pressure and for exclusion if that becomes necessary. ” Second, PROS 

will become more aggressive in soliciting and investigating complaints, “including 

F-1

strengthened liaison with licensing and certifying agencies and existing local 

consumer protection and advocacy programs. ” 

3. A more comprehensive and informative approach toward resolving 

beneficiary complaints concerning quality issues. The HCFA states that 

“traditional peer review of individual cases will remain a key tool for investigating 

complaints. ” In addition, HCFA is revising its regulations to “provide more 

thorough and sensitive follow-up to beneficiary complaints. ” According to HCFA, 

the new rules and procedures for complaints “will permit (and HCFA will require) 

PROS to explain health care events to beneficiaries to promote understanding and 

encourage conflict resolution. ” 

4.� Enhanced beneficiary information activities. The HCFA is currently 

“exploring ways to improve educational and informational activities to ensure that 

beneficiaries are filly aware of their rights and opportunities under Medicare, 

including the right to have complaints about poor quality medical care investigated 

by the PROS. ” 

(Gagel to Vladeck, 3 May 1994, “Beneficiary Protection Under the Health Care Quality 

Improvement Program (HCQIP)--DECISION, ” Health Standards and Quality Bureau of 

the Health Care Financing Administration, Baltimore, MD.) 

7.� Health Care Financing Administration, “The Successful PRO in 5 Years, ” Baltimore,


MD, November 8, 1994.


8. This is based on our analysis of data representing 11 PROS’ beneficiary complaints


and the number of cases with at least 1 confirmed quality-of-care problem. Each case can


have multiple quality-of-care problems. For 20 PROS in our sample, we had number of


individual problems. When we calculate the rate for those 20 PROS, the result is within


the range of the case results presented: at least 10.5 percent to as many as


17.3 percent.


9. This PRO, from the low-population stratum, reported having received 13 complaints


under the fourth contract at the time of our survey.


10. The PROS’ responses to these systems issues also varied, and included action plans,


HCQIP projects, and consideration of sanction, among others.


11. Gagel to Vladeck, 3 May 1994. 

12. We asked the PROS how many complaints that triggered a case review were also 

referred elsewhere and listed the following choices: FI/carrier, managed care institution, 

hospital, HCFA project officer, survey and certification agency, and other. Because a 

PRO could have referred a single complaint more than once, we present both the most 

conservative interpretation of joint referrals (16.7 percent) and the most liberal 

(28.9 percent). 

F-2

13. Because the HCFAproject officer islkely torefer the complaint again, for example 

to the appropriate survey and certification agency, the percentages shown may be underreported. 

14. Thirteen of the 22 PROS reported having received referrals from physicians during 

the fourth contract period. Nine of these PROS reported having received either a small 

number or between 1 and 4 such referrals; 1 reported having received 6; and 2, 10 or 

more. One PRO did not offer an estimate. 

Eight PROS reported having received referrals from hospitals. Those who offered an 

estimate reported having received between one and four referrals. 

Six PROS reported having received referrals from State medical licensure boards. Those 

who offered an estimate reported having received one or two, or a few. 

15. When we asked the PROS to identify two outreach activities leading to the most 

complaints, half the PROS identified local presentations. 

16. Of the 13 PROS that judged reaching beneficiaries a major barrier to a more effective 

complaint process, 4 were from the low-population stratum. 

17. Five of the 22 PROS in our sample noted that, in some cases, the response to the 

request for consent was pending. 

18. The 5 PROS in the low-population stratum gained consent 84 percent overall 

compared to 43 percent for the 17 PROS in the high-population stratum. The PROS in the 

low-population stratum gained consent in 25 percent of the complaints involving confirmed 

physician quality-of-care problems (3 of 12 such complaints) compared with 13 percent 

for the high-population PROS (22 of 176 such complaints). 

19. The 7 cycle-1 PROS in our sample received between 31 and 141 complaints per 

million beneficiaries, a spread of 110 per million; the 7 cycle-2 PROS, between 50 and 

164, a spread of 114 per million; and the 8 cycle-3 PROS, between 8 and 125, a spread of 

117 per million. 

20.Miscellaneous reviews account for 19.2 percent of the review caseload. Other 

mandatory reviews, such as hospital-issued notices of noncoverage, account for 8.4 

percent. After October 1995, the PROS’ review caseloads will include complaints and 

other mandatory reviews. 

21. Health Care Financing Administration, “Strategic Plan, ” Baltimore, MD, 1994, p.3. 

22. Ibid, p. 17. 

F-3