Search Frequenty Asked Questions

The Balanced Budget Act of 1997 (BBA) directed the Department of Health and Human Services (the Department) to contract with an independent quality review organization to develop protocols to be used to fulfill the statutory requirement that State Medicaid agencies annually provide for an external, independent review of the quality outcomes and timeliness of, and access to, services provided by Medicaid managed care organizations (MCOs). In the final rule to implement this provision, the Department's Centers for Medicare & Medicaid Services (CMS) also requires annual, independent, external review of prepaid inpatient health plans (PIHPs).

In response to the BBA requirement, nine protocols and one appendix to several of the protocols were developed in six areas:

1. Determining MCO/PIHP Compliance with Federal Medicaid Managed Care Regulations - (Includes Appendix A) (PDF 534KB)
• Appendix B (PDF 447KB)
• Appendix C (PDF 291KB)
  
2. Performance Measurement
   There are two protocols that address this activity.
• One addresses validation of performance measures produced by an MCO or PHP. (PDF 640KB)
• The second protocol addresses calculating measures of the performance of an MCO/PHP. (PDF 408KB)
  
3. Validating Encounter Data (PDF 286KB)
   
4. Performance Improvement Projects
   There are two protocols that relate to projects for improving performance.
• One protocol addresses the validation of performance improvement projects undertaken by an MCO or PHP. (PDF 322KB)
• The second protocol addresses conducting a performance improvement project for the MCO/PHP. (PDF 302KB)
• A third protocol addresses the conduct of focused studies of health care quality when one wishes to assess the quality of care, independent of undertaking a quality improvement effort. (PDF 273KB)
  
5. Using Surveys - Administering or Validating Surveys (PDF 346KB)
   
6. Assessing MCO/PHP Information Systems (PDF 781KB)
   Appendix Z provides an adjunct to several protocols. It includes a tool for assessing the Information Systems of MCOs and PHPs.

Of these nine protocols, DHHS' final rule on External Quality Review (EQR) of Medicaid Managed Care Organizations published on January 24, 2003 requires only three to be used by state Medicaid agencies. The three are: (1) determining MCO/PIHP compliance with federal Medicaid managed care regulations; (2) validation of performance measures produced by an MCO or PIHP; and (3) validation of performance improvement projects undertaken by an MCO/PHP. The final rule also states that EQR activities are to be conducted in a manner consistent with (as opposed to identical to) the protocols. This approach will ensure that the protocols do not prevent states and their EQR contractors from using more refined approaches to these activities as they develop.

The remaining six protocols are offered for use at the option of a state whenever a state wants information from these activities to be used as a component of external quality review and enhanced Federal Financial Participation in the costs of these activities.

All protocols were developed by The Joint Commission for the Accreditation of Healthcare Organizations (JCAHO), working with a number of contractors and in consultation with an expert panel composed of representatives of private accrediting organizations, quality measurement experts, state Medicaid agencies, and advocates for Medicaid beneficiaries. JCAHO was selected through a competitive process to develop the protocols consistent with the following three directives:

• Consistency with industry standards. All protocols have been designed to follow protocols and quality review activities currently used in the managed care and quality oversight industries. For example, several of the protocols follow processes used by the National Committee for Quality Assurance (NCQA), the Joint Commission for the Accreditation of Healthcare Organizations (JCAHO), and/or private sector organizations widely used to validate encounter data or administer surveys.
  
• Accommodate continued evolution of quality assessment. The art and science of assessing health care quality is continuously evolving. For example, private accrediting bodies revise their standards on a frequent basis, and also allow their surveyors to exercise judgement in pursuit of information that provides evidence of compliance with their standards. These protocols similarly allow states to incorporate better ways of performing protocol activities as they are developed, or to undertake more effective or efficient monitoring activities that might be proposed by entities that would be performing quality assessment reviews on behalf of the state Medicaid agencies.
  
• Technical assistance to state Medicaid agencies. The protocols are also intended to provide state Medicaid agencies with a clear description of the scope and depth of quality review activities that are consistent with the current state of the art. They also include sample worksheets that can be used or modified, at the states' discretion. This detail is intended to provide states with a practical information to assist in the development of a scope of work for entities that would be undertaking this work on the state's behalf and tools that could be used as needed. It will also promote more standardization of common quality review practices across states.

These protocols were previously published in draft in order to obtain comments on their burden, prior to implementation. A Federal Register notice was published on November 23, 2001 (PDF 49KB) announced the opportunity for comment. Responses to all of the public comments received are addressed in the final External Quality Review Regulation.

Questions about the above protocols should be sent to Deborah Larwood at dlarwood@cms.hhs.gov