Report Cites Problems in Medicare Complaint Process

Medicare beneficiaries are still without an adequate complaint process, according to an August report of the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS). Since 1987 the complaint process has been a statutory responsibility of Medicare Peer Review Organizations (PROs).

The August report, “Medical Equipment Suppliers: Compliance With Medicare Standards,” faults the existing process on seven of eight elements that the Centers for Medicare and Medicaid Services (CMS) endorsed as essential to an effective complaint system. The OIG found the system flawed on accessibility, investigative capacity, interventions and follow through, quality improvement orientation, responsiveness, timeliness, and public accountability. It was judged adequate only in its objectivity.

In 1995 the OIG issued a report that criticized the complaint system then in place. It identified three flaws. Federal confidentiality regulations precluded the PROs from responding to complainants in a meaningful way, PROs received too few complaints to identify patterns of poor care, and the complaint process was lengthy.

CMS (then the Health Care Financing Administration) began a process to revise the regulations concerning confidentiality, but was unable to publish a rule that would allow a substantive response to complaints without explicit physician consent because of existing federal peer review legislation. Its proposed rule was on hold for more than a year and finally withdrawn last February.

The 2001 OIG report again found that procedures requiring physician consent before PROs can share their review results with complainants preclude the PROs from responding substantively to complainants. Organizations reacted strongly to that finding in their formal comments to the OIG.

Cecil B. Wilson, M.D., chair of the medical services committee of the American College of Physicians and American Society of Internal Medicine (ACP-ASIM), wrote, “Confidentiality is essential if the PRO program is to continue to have the degree of trust in the physician community that is required for it to function as a quality improvement organization. . . .”

The Citizen Advocacy Center (CAC), which sponsors a network of beneficiary and consumer representatives on PROs, argued that as long as physicians are given veto power over a release of the results of a PRO investigation, “the program will be severely criticized by all consumer advocates.” CAC and other beneficiary advocacy organizations recommended that if the confidentiality provisions remain, PROs should be required to notify complainants of the restrictions so they can register their complaints elsewhere.

The OIG also found that the accessibility of the current system is “questionable,” and beneficiaries often lack a clear understanding of the complaint process. Substantiated complaints rarely trigger any intervention beyond a letter. An OIG examination of 66 confirmed complaints revealed that the PROs had called for corrective action in only six of the complaints.

The report identified two obstacles to the achievement of a more effective beneficiary complaint process. First, contracts with PROs stress quality improvement and payment reduction error and treat complaints as a “distinctly minor activity.” Second, PROs tend to be more oriented toward the medical community than to the beneficiaries. This orientation can help in conducting quality improvement projects, but also it can hinder the development of an effective complaint process, according to the OIG report.

CMS, according to the OIG report, has two options for developing an effective complaint process. The agency could fix the process within the existing PRO program. That approach would require making the process a “prominent part” of the PRO program, specifying clear contractual requirements for an effective process and developing contracting approaches that would hold the PROs more accountable.

The second option is to establish a complaint process outside of the PRO program. Under this option, which would require change in federal legislation, CMS could establish an entirely new program or contract mechanism that would focus on complaints and educating beneficiaries about the complaint process. Or CMS could build on the work of existing entities, such as state survey and certification agencies that have already been established to respond to complaints about care provided in certain health facilities.

Lloyd Sederer, M.D., director of APA’s Division of Clinical Services, said, “Proper patient care is every physician’s primary responsibility and stands as the principal goal of APA. But it is difficult to imagine that the adversarial nature of many Medicare processes offers the best road to achieving optimal patient care.

“The problems with Medicare processes are exacerbated by the often accusatory and demonstrably ineffective methods used by the OIG to improve those processes. For example, the OIG identified the same problems with the complaint process in its 1995 report as it describes in the August report. Yet little progress was made in the intervening years to solve those problems.”

Sederer added, “APA and its district branches and state associations are very interested in working with CMS to improve patient care. But we can do so only in cooperation with CMS in an effort to move beyond outdated and burdensome regulations, often poorly administered by Medicare carriers and intermediaries.”

The report, "The Medicare Beneficiary Complaint Process: A Rusty Safety Valve," is posted on the Web at www.hhs.gov/oig/oei/reports/a535.pdf. It can also be obtained by calling the Boston Regional Office at (617) 565-1050. ▪