100-10 Quality Improvement Organization Manual: Chapter 1 - Background and Responsibilities

Quality Improvement Organization Manual
Chapter 1 - Background and Responsibilities
Table Of Contents
(Rev. 19, 05-01-15)
Transmittals for Chapter 1
1000 - Authority
1005 - QIO Program Purpose
1010 - QIO Responsibilities
1015 - QIO Eligibility
1020 - QIO Contract Term and Renewal
1025 - Centers for Medicare & Medicaid Services (CMS) Role
1030 - QIO Support Center (QIOSC)

1000 – Authority
(Rev. 19, Issued: 05-01-15, Effective: 05-01-15, Implementation: 05-01-15)
The Quality Improvement Organization (QIO) Program is authorized by Title XI Part B
and Title XVIII of the Social Security Act (the Act). Citations in the Act indicate where
the governing statutes for the QIO Program are codified in the United States Code
(U.S.C.). Title XI Part B appears in the United States Code as 42 U.S.C. Sections1320c.-
1320c-8, and Title XVIII appears in the United States Code as 42 U.S.C Sections 1395-
1395ccc. The administrative entity responsible for the QIO Program is the Centers for
Medicare & Medicaid Services (CMS), Department of Health and Human Services.
Applicable regulatory provisions for the QIO Program are in Title 42 of the Code of
Federal Regulations (CFR).
The regulatory authorities and governing statutes for the QIO Program are as follows:
Title and
Part
CFR Heading 	Relevant
Sections
Social Security
Act and U.S.C
Provisions
Summary
42 CFR
Part 405
Determinations,
Redeterminations,
Reconsiderations
and Appeals under
Original Medicare
(Parts A and B)
405.900 to
990
Section 1869
(42 U.S.C.
1395ff)
Regulations governing
payment of Medicare
claims including
procedures related to
initial determination
reviews performed by
QIOs (See: 405.204
and 405.900-990).
42 CFR
Part 405
Expedited
Determinations and
Reconsiderations of
Provider Service
Terminations, and
Procedures for and
Inpatient Hospital
Discharge Reviews
42 CFR
405.1200 to
1208
Section
1869(b)(1)(F)
(42 U.S.C.
1395ff(b)(1)(F)
Beneficiary rights to
expedited
determinations and
hospital requests for
expedited QIO review
(See: 405.1200 -1208)
42 CFR
Part 412
Prospective
Payment Systems
for Inpatient
Hospital Services
412.42 to 48,
412.82 to 84,
412.508
Section1866(a)
(1)(F) and
(a)(3) (42
U.S.C. 1395cc)
and
1154(a)(4) and
(14) (42 U.S.C.
1320c-3(a)(4)
and (14))
Requires hospitals to
have agreements with
QIOs for performance
of Section 1154(a)(4)
and (14) functions
(See: Section
1866(a)(1)(F)).
Requires hospitals to
have agreements with
QIOs and provides for
QIO reviews of
medically unnecessary
inpatient hospital
services (See: 412.42-

Title and
Part
CFR Heading 	Relevant
Sections
Social Security
Act and U.S.C
Provisions
Summary
48) and reviews of
extended length of stay
cases and high cost
cases (See: 412.82-
84). Requires long-
term care hospitals to
have an agreement
with an QIO for
reviews of admissions
and quality of care
(See: 412.508)
42 CFR
Part 422
(Subparts D
and M)
Medicare
Advantage
Program
422.153,
422.562,
422.564, and
422.622
Section 1852
and
1154(a)(4)(B),
1154(a)(14)
(42 U.S.C.
1320c-
3(a)(14))
Requires Medicare
Advantage (MA) Plans
to conduct and
document
performance
improvement and
QIOs to collect,
acquire, and furnish
information about MA
Plans to CMS as
defined in 42 CFR 475
(See: 422.153).
Requires MA Plans to
establish complaint,
grievance, and
inpatient discharge
procedures for review
of its services by a
QIO (See: 422.562,
422.564, and 422.622)
42 CFR
Part 475
Quality
Improvement
Organizations
475.1 to
475.107
Sections 1151 –
1160 of the
Social Security
Act (42
U.S.C.1320c –
1320c-12)
Specifies eligibility
requirements to
become a QIO
selected by CMS and
defines the QIO
contract term
42 CFR
Part 476
Quality
Improvement
Organization
Review
476.1, 476.70
to 476.170
Section 1154 of
the Social
Security Act
(42
U.S.C.1320c-3)
Defines the QIO
functions including the
scope of case review
42 CFR
Part 478
Reconsiderations
and Appeals
478.10 to
478.48
Sections 1154
and 1155 of the
Social Security
Act (42
QIO procedures for
reconsiderations or
hearings related to its
diagnostic coding or

Title and
Part
CFR Heading 	Relevant
Sections
Social Security
Act and U.S.C
Provisions
Summary
U.S.C.1320c-3
and 1320c-4)
payment
determinations
42 CFR
Part 480
Acquisition,
Protection, and
Disclosure of
Quality
Improvement
Organization
Information
480.101 to
480.145
Section 1160 of
the Social
Security Act
(42
U.S.C.1320c-9)
QIO confidentiality
and disclosure
responsibilities related
to information it is
authorized to collect,
acquire, or generate
42 CFR
Part 482
Conditions of
Participation for
Hospitals
482.30 and
482.21
Section
1861(e)(6) and
1861(k) of the
Social Security
Act (42 U.S.C.
1395x)
Requires hospitals to
have a utilization
review plan, which it
may meet by having
reviews performed by
a QIO (see: 482.30).
Requires hospitals to
conduct and document
performance
improvement projects
and determine whether
to participate in QIO
cooperative projects
(See: Section 482.21).
42 CFR
Part 489
Provider
Agreements and
Supplier Approval
489.20(e)and
489.24(h)
Sections
1866(a)(1)(F)
and (a)(3) and
1867(d) of the
Social Security
Act (42 U.S.C.
1395cc and 42
U.S.C. 1320c-
3(a)(16))
Requires hospitals to
maintain an
agreement with QIOs
to allow for review of
the admissions,
quality,
appropriateness, and
diagnostic information
related to inpatient
services (See:
489.20(e)). Provides
for QIO reviews of
hospital compliance
with Emergency
Medical Treatment
and Labor Act (See:
Section 489.24 (h))
42 CFR
Part 1004
Imposition of
Sanctions on
Health Care
Practitioners and
Providers of Health
Care Services by a
1004.1 to
1004.140
Section 1156(a)
of the Social
Security Act
(42 U.S.C.
1302 and
1320c-5)
Review, notice, and
reporting procedures
for QIOs to
recommend a sanction
to the Office of the
Inspector General

Title and
Part
CFR Heading 	Relevant
Sections
Social Security
Act and U.S.C
Provisions
Summary
Quality
Improvement
Organization
(OIG). QIOs are not
responsible for the
imposition of
sanctions.
1005 - QIO Program Purpose
(Rev. 19, Issued: 05-01-15, Effective: 05-01-15, Implementation: 05-01-15)
CMS contracts with QIOs to perform core functions that include case review and quality
improvement. Sections 1152 and 1153(a), (b), (c), and (e) of the Social Security Act and
42 CFR Part 475.101 through 475.103 define requirements for an entity to be awarded a
contract to perform QIO functions.
The case review functions of a QIO include review of healthcare services and items for
which payment is made under Medicare Parts A, B, C, or D to determine whether
services or items are reasonable, medically necessary, and allowable, meet
professionally recognized standards of care, or in the case of inpatient care, could be
provided more economically on an outpatient basis or in an inpatient facility of a
different type. Generally, case reviews must be performed by a healthcare practitioner in
the same professional field as the healthcare practitioner who ordered or furnished the
services under review. The QIO must perform case review functions as outlined in 42
CFR Part 476 and as defined in its contract with CMS. Other chapters of this manual
provide more specific guidance on the various case review functions.
Quality improvement functions may include technical assistance, data analysis, and
stakeholder engagement activities that promote evidence-based healthcare practice and
patient-centered care principles to improve healthcare quality of care, improve outcomes
to beneficiaries, and lower costs. The QIO must perform quality improvement functions
consistent with the terms of its contract with CMS. Quality improvement functions may
include, but are not limited to, the following:
• 	Engaging patients, families, and care-givers with the goal of increasing patient
knowledge, skill, and confidence to take an active role in managing their health and
healthcare
• 	Technical assistance related to CMS quality measures across settings to help
providers and practitioners meet standards
An activity designed to serve as a catalyst and support for quality improvements that may
relate to safety, healthcare, health, and value, and involve providers, practitioners,
beneficiaries, and/or communities

1010 - QIO Responsibilities
(Rev. 19, Issued: 05-01-15, Effective: 05-01-15, Implementation: 05-01-15)
Only those entities that hold a contract with CMS to perform as a QIO are QIOs. QIOs
perform a function or functions defined in Section 1154(a) of the Social Security Act (42
U.S.C. 1320c-3(a)) in accordance with the terms that CMS defines in its QIO contracts.
QIO contracts may require performance of one or more functions governed by statute as
defined in 42 U.S.C. 1320c-3(a)(1) through (18). These statutory responsibilities may
include the following:
1. 	Review the provision of health care services and items for which payment may be
made. Involve healthcare practitioners of the type under review in such reviews.
Determine through review whether services were reasonable and medically
necessary, meet professionally recognized standards, and, if provided in an
inpatient setting, could be provided more economically on an outpatient basis or
in an inpatient facility of a different type. (42 U.S.C. 1320c-3(a)(1))
2. 	Determine, on the basis of the review described above, whether payment shall be
made, provided that determinations to deny payment because the quality of care
did not meet professional standards are based on criteria developed by the
Secretary (42 U.S.C. 1320c-3(a)(2))
3. 	Notify the healthcare provider, patient, and the agency or organization
responsible for the payment of claims of the review determination within specific
parameters (42 U.S.C. 1320c-3(a)(3))
4. 	Conduct a reasonable proportion of quality of service reviews among the different
cases and settings. Review both inpatient and outpatient services provided by
Medicare cost plans under section 1876 pursuant to a risk-sharing contract.
Maintain a beneficiary outreach program designed to apprise individuals
receiving care under Medicare health plans of the QIO program. (42 U.S.C.
1320c-3(a)(4))
5. 	Consult with nurses and other professional healthcare practitioners and
providers of healthcare services with respect to the organization's responsibility
for the review of the professional activities of such practitioners and providers
(42 U.S.C. 1320c-3(a)(5))
6. 	Apply professionally developed norms of care, diagnosis, and treatment. Provide
a physician representative to meet several times a year with medical and
administrative staff of each hospital whose services are reviewed by the
organization. Publish not less often than annually its review findings. (42 U.S.C.
1320c-3(a)(6))

7. 	Utilize the services of persons who are practitioners of, or specialists in, the
various areas it reviews, make professional inquiries, examine pertinent records,
and inspect facilities in support of its reviews (42 U.S.C. 1320c-3(a)(7))
8. 	Carry out reviews to approve exceptions to the payment exclusion for assistants at
surgery in a cataract operation as specified in Section 1862(a)(15) of the Social
Security Act (42 U.S.C. 1320c-3(a)(8))
9. 	Collect, maintain, and permit access to information relevant to its functions and
notify appropriate state boards in the event of a violation of section 1156(a) (42
U.S.C. 1320c-3(a)(9))
10. Coordinate activities for economical and efficient operation of the program (42
U.S.C. 1320c-3(a)(10))
11. Make available its facilities and resources for contracting with private and other
public entities that pay for health care to provide similar review services (42
U.S.C. 1320c-3(a)(11))
12. Review ambulatory surgical procedures specified pursuant to section
1833(i)(1)(A) of the Social Security Act (42 U.S.C. 1320c-3(a)(12))
13. Review early readmission cases (42 U.S.C. 1320c-3(a)(13))
14. Review all written complaints from Medicare beneficiaries about the quality of
services (42 U.S.C. 1320c-3(a)(14))
15. Perform on-site reviews (42 U.S.C. 1320c-3(a)(15))
16. Upon request from the Secretary or CMS pursuant to section 1867(d) of the Act,
review hospital and physician performance for compliance with the Emergency
Medical Treatment and Labor Act (42 U.S.C. 1320c-3(a)(16))
17. Offer quality improvement assistance pertaining to prescription drug therapy to
providers, practitioners, and Medicare health plans (42 U.S.C. 1320c-3(a)(17))
18. Perform activities deemed necessary by the Secretary for purposes of improving
the quality of care (42 U.S.C. 1320c-3(a)(18))
In order to fulfill these statutory responsibilities, QIOs may perform activities that
include, but are not limited to, the following:
• 	Establishing methods and procedures for involvement of healthcare practitioners in
performing reviews of healthcare services and investigating complaints

• 	Maintaining current knowledge of Medicare programs in order to conclusively
determine whether payments must be made for services under Title XVIII of the
Social Security Act
• 	Entering into Memoranda of Agreement with healthcare providers, payers, and other
organizations prior to conducting Medicare case reviews in the service areas and for
the types of cases it will have authority to review, and conducting outreach to inform
beneficiaries about how to exercise their right to QIO reviews
• 	Establishing procedures for notifying any patient, practitioner, provider, and any
organization responsible for payment to communicate with them about the QIO
review determination and rights to reconsideration or appeal
• 	Planning for and maintaining sufficient staffing to assure that resources are allocated
to performing reviews by duly licensed professionals for all of the different cases and
settings
• 	Establishing methods for identifying cases where there is a likelihood that quality of
services do not meet professionally recognized standards of care
• 	Coordinating activities and information exchanges across QIO contractors and
Program stakeholders such as public and private organizations involved in
healthcare delivery
• 	Publishing at least annually a report of QIO activities and findings
• 	Performing any other services to improve the quality of care for services under Title
XVIII of the Social Security Act that CMS determines are appropriate for
performance under QIO contract awards
• 	Maintaining procedures to continuously monitor, mitigate, or avoid any actual,
potential, or apparent conflicts of interest of the QIO organization, its employees and
subcontractors when performing any function of the QIO contract
Section 1153 of the Social Security Act requires that CMS ensure there is no duplication
of the functions carried out by QIOs if more than one QIO operates in the same area.
QIO contractors should assist CMS and work together with other stakeholders to identify
and mitigate any duplication of effort identified in their geographic or service area.
1015 - QIO Eligibility
(Rev. 19, Issued: 05-01-15, Effective: 05-01-15, Implementation: 05-01-15)
Section 1152 of the Social Security Act and 42 CFR Part 475 provide the authority for
CMS to enter into contracts with entities to perform QIO functions. In awarding such
contracts, CMS complies with the Federal Acquisition Regulation (Title 48 CFR) unless
the Secretary determines that a specific provision is inconsistent with the purposes of

Title XI, Part B of the Social Security Act. In order to be awarded a QIO contract, an
entity must meet the following qualifying requirements:
• 	Have a governing body that includes at least one individual who is a representative of
healthcare providers and at least one individual who is a representative of consumers
(42 CFR 475.101(a))
• 	Demonstrate capability to meet the eligibility requirements and perform the activities
specified by CMS in the solicitation for award of a QIO contract (42 CFR
475.101(b)(1))
• 	Demonstrate the ability to perform case reviews as set forth in 42 CFR 475.102
and/or perform quality improvement as set forth in 42 CFR 475.103 (42 CFR
475.101(b)(2)
• 	Demonstrate the ability to actively engage beneficiaries, families, and consumers in
case reviews and/or quality improvement activities (42 CFR 475.101(c))
• 	Demonstrate the ability to perform QIO functions with objectivity and impartiality
and in a fair and neutral manner (42 CFR 475.1010(d))
• 	Demonstrate that it is not a healthcare facility, affiliate, or payer organization. QIOs
may not perform reviews of healthcare services other than the review of the quality of
care (42 CFR 475.105).
Pursuant to Section 1153(c) of the Social Security Act, the contract between CMS and a
QIO must provide the right for CMS to evaluate the quality and effectiveness of the QIO
in carrying out QIO functions. Further, CMS has the right to negotiate contractual
performance objectives and to provide specifications or modifications based on regional
or national norms for QIO contractors performing the quality improvement and case
review functions.
CMS has the responsibility to determine the efficient and effective administration of the
QIO Program, establish the program structure, determine the number of contracts and
limitations, define the service areas, solicit for QIO services, and negotiate awards. CMS
abides by the Federal Acquisition Regulation excepts when Section 1153(e) of the Social
Security Act permits an exception.
1020 - QIO Contract Term and Renewal
(Rev. 19, Issued: 05-01-15, Effective: 05-01-15, Implementation: 05-01-15)
Beginning with contracts awarded after January 2012 and pursuant to Section
1153(c)(3) of the Social Security Act and 42 CFR 475.107 the contract between CMS and
a QIO has a five-year term. Section 1153(b)(4) of the Social Security Act further grants
CMS authority to renew QIO contracts for additional five-year terms of performance.
CMS must assess the performance of QIO contractors in accordance with the contract

and the applicable Federal Acquisition Regulations defined in Title 48 of the CFR prior
to determining whether to renew a QIO contractor for an additional five-year term.
Further, any CMS decision to terminate or not renew an awarded QIO contract is not
subject to judicial review under the authorities provided in Section 1153(f) of the Social
Security Act.
1025 - Centers for Medicare & Medicaid Services (CMS) Role
(Rev. 19, Issued: 05-01-15, Effective: 05-01-15, Implementation: 05-01-15)
CMS was established in March 1977 to combine healthcare financing and quality
improvement programs into a single agency. CMS is responsible for the Medicare
Program, federal participation in the Medicaid Program, the Quality Improvement
Organization (QIO) Program, and a variety of other health care quality improvement
programs.
CMS's primary mission is to administer its programs in a manner that:
• 	Promotes the timely delivery of appropriate, quality healthcare to
beneficiaries
• 	Ensures that beneficiaries are aware of the services for which they are
eligible
• 	Ensures that those services are accessible and of high quality
• 	Promotes efficiency and quality within the total healthcare delivery system
• 	Promotes the award and administration of all CMS contracts in
accordance with the Federal Acquisition Regulations (48 CFR)
Central Office Policy-making Responsibility: Overall policy-making responsibility for
administration of the QIO Program is centralized in CMS’s Center for Clinical Standards
and Quality. The CMS Central Office is responsible for:
• 	Monitoring and overall administrative control of the QIO Program, including
coordinating with CMS’s Office of Acquisition and Grants Management on
contracts and financial aspects
• 	Establishing operational policy for the QIO Program
• 	Developing operational instructions and official interpretations of policy for QIOs
and CMS Regional Offices (ROs)
Regional Office Assistance to QIOs: CMS Regional Offices are responsible for assuring
that QIOs meet applicable federal requirements under the provisions of their contracts
through the duties of Contracting Officer’s Representatives. The Regional Offices:
• 	Provide liaison, direction, and technical assistance to QIOs in the day-to-day
management of their operations

• 	Interpret CMS guidelines, policies, and procedures applicable to QIO activities
• 	Analyze QIO budgets and spending patterns to assure that funds are economically
and appropriately utilized
• 	Recommend the allocation of funds for conducting additional activities
• 	Conduct assessments of QIO operations
• 	Review QIO actions
• 	Provide feedback to each QIO
1030 - QIO Support Center (QIOSC)
(Rev. 16, Issued: 06-30-06, Effective: 06-30-06, Implementation: 06-30-06)
For certain topics, settings, populations, and project processes, CMS is contracting with
designated QIOs to provide support for CMS and the QIO community for the particular
areas of interest. These QIO Support Centers (QIOSCs) will work in conjunction with
corresponding Topic Area Teams (TATs) established by CMS. The QIOSC will serve as
a clearinghouse of topic-specific information and provide technical assistance to QIOs as
necessary.

Transmittals Issued for this Chapter
Rev # 	Issue Date 	Subject 	Impl Date CR#
R19QIO 	05/01/2015 	QIO Manual Chapter 1 – “Background,
Eligibility and Responsibilities”
05/01/2015 N/A
R16QIO 	06/30/2006 	Revisions to Chapter 1, “Background and
Responsibilities
06/30/2006 N/A
R10QIO 	10/05/2003 	Initial Release of Chapter 	N/A 	N/A
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