Medicare Compliance & Reimbursement

A Medicare quality improvement organization must tell a complaining beneficiary, at a minimum, whether or the QIO believes the beneficiary's treatment met "professionally recognized standards of health care."

So said a unanimous three-judge panel of the U.S. Court of Appeals for the D.C. Circuit in a June 23 opinion, which affirmed a 2001 trial court decision that had been stayed pending appeal.

The court was construing a provision of the Social Security Act stating that a QIO - the law and the court use the older term "peer review organization" - "shall inform the individual (or representative) of the organization's final disposition of the complaint." Following the Centers for Medicare & Medicaid Services manual, QIOs currently tell beneficiaries only that their complaint has been received and examined and that the QIO will take unspecified appropriate action if warranted.

"The decision is a victory for Medicare patients who are the victims of substandard ... care," said Amanda Frost, an attorney for the Public Citizen Litigation Group, which brought the suit. But the head of the American Health Quality Association, which represents QIOs, said that "the court decision reflects the law as it was written in the 1980's," when the health care community believed that "bad people or incompetent people explained most quality problems, and the appropriate response to such people is to punish them."

We have since learned that "systems failure is the underlying cause of most quality problems," said AHQA Executive Vice President David Schulke, MD. "To single people out, to make it more likely that they will be sued or punished, to damage the relationship that they have with their patients and their peers, is an antiquated notion that doesn't hold water anymore."

At one point in its briefs, Public Citizen argued that a QIO should have to tell the complainant what action it was taking in response to the complaint, as well as whether the care delivered was substandard or not, wrote Merrick Garland for the court. Garland called this argument a "reasonable elaboration" of the statutory term "final disposition," but refrained from deciding the issue.

Because even the more limited decision "will require CMS to rethink the kind of notification required of QIOs, there remains ample room for an administrative resolution of this question," Garland pointed out.