Medicare: PRO Review Does Not Assure Quality of Care Provided by Risk HMOs

GAO discussed peer review organizations' (PRO) effectiveness in assessing the quality of care Medicare beneficiaries received at health maintenance organizations (HMO). GAO noted that: (1) the Health Care Financing Administration's (HCFA) PRO review program did not ensure that Medicare beneficiaries received adequate care; (2) HCFA did not ensure that internal quality assurance programs effectively identified and corrected quality-of-care problems; (3) HCFA made PRO review optional for some HMO, and most HMO elected not to have their quality assurance activity reviewed by PRO; (4) PRO external medical records review did not provide a valid quality-of-care assessment, since PRO did not have access to comprehensive HMO data from which to select their review samples; (5) HCFA did not use PRO review results in its own HMO compliance monitoring process; (6) HCFA recently proposed a new PRO review methodology to correct some of the identified problems; and (7) the HCFA proposal did not address the underlying data problems of the PRO/HMO review program.