GAB Dicision 241
December 21, 1981 Prince George's Foundation for Medical Care, Inc.;
Docket No. 81-106 Ford, Cecilia; Settle, Norval Teitz, Alexander
Introduction
The Prince George's Foundation for Medical Care, Inc. (PGFMC)
appealed the Health Care Financing Administration's (Agency) decision to
terminate its grant, No. 97-P-99636/3, effective November 30, 1981. The
determination provided that the grant would be extended, if necessary,
to permit this Board to make a final decision. In its appeal letter,
dated July 16, 1981, PGFMC requested a hearing pursuant to Sec.
1152(d)(2) of the Social Security Act (Act). A hearing before the
Presiding Board Member was held in Washington, D.C., on September 14 and
15, 1981. This decision is based on the Record in this case, which
includes the written submissions of the parties and the evidence
presented at the hearing (as recorded in the transcript (Tr.) of the
hearing). /1/ Based on the analysis set out below, we conclude that
PGFMC's grant should not be terminated.
(2) This decision is divided into three sections. The first provides
general background information on the Professional Standards Review
Organization (PSRO) program and the nationwide evaluation of PSROs which
led to this dispute. The second discusses the evaluation of PGFMC - how
it was conducted, and what general objections PGFMC raised regarding the
evaluation. The third section sets out the Board's findings and
conclusions on whether PGFMC should receive any additional points for
the contested criteria.
I. General Background
A. Information on the PSRO Program
The 1972 Amendments to the Social Security Act provide for the
creation of PSROs, administered and controlled by local physicians, and
designed to involve local practicing physicians in the review and
evaluation of health care services covered under Medicare, Medicaid, and
the Maternal and Child Health programs. (Title XI, Part B, of the Act.)
PSROs are responsible in specifically designated geographic areas for
assuring that the health care paid for under these programs is medically
necessary and consistent with professionally recognized standards of
care. The PSROs also review whether the health services are provided at
the level of care which is most economical, consistent with the
patient's medical care needs. The major focus of the PSRO program has
been on review of inpatient hospital services. While PSROs are also
charged with review responsibilities in other health care settings,
budget restrictions have limited the PSROs' ability to review outside
the hospital setting.
The PSROs are responsible for developing and operating a quality
assurance system based on peer view of the quality and efficiency of
services and continuing education. In hospitals, the peer review system
must include: concurrent review, which is review focusing on the
necessity and appropriateness of inpatient hospital services performed
while the patient is in the hospital; medical care evaluation studies,
which the assessments, performed retrospectively, of the quality or
nature of the utilization of health care services and assessments of the
PSROs' impact where corrective action is taken; and profile analysis,
which is the analysis of patient care data to identify and consider
patterns of health care services. (See, e.g., PSRO Program Manual,
Chapter VII, p. 1, March 15, 1974.)
The Act, and regulations governing the program, provide that a PSRO
is "conditionally designated" for a period of time, and that there
will
be an agreement between the Secretary and the PSRO "fully designating"
the PSRO after it has satisfactorily performed PSRO functions during its
trial period as a conditional PSRO. After a maximum of six years, a (3)
conditional PRSO must be fully designated or it can no longer
participate in the program. (Section 1154(b) and (c) of the Act.) A
fully designated PSRO may be terminated only after an opportunity for a
hearing, upon a finding by the Secretary that the PSRO "is not
substantially complying with or effectively carrying out the provisions
of such agreement." (Section 1152(d) of the Act.)
B. The Nationwide Evaluation of PSROs
The Agency has stated that it implemented a nationwide evaluation of
the performance of PSROs in response to proposals by the President in
February and March, 1981, to phase out the PSRO program within three
years, and to reduce funding for fiscal year 1981. In June, 1981,
Congress approved a rescission of $28,701,000 from the PSRO program.
(Pub. L. No. 97-12, Title I, Chapter VIII; 94 Stat. 3166.) The Agency
maintained that the legislative history of the rescission bill indicated
that the Agency was to accomplish the rescission by terminating
ineffective PSROs. (Agency Response, pp. 3-4, 9.)
The Agency stated that in order to identify ineffective PSROs, it
developed evaluation criteria to measure performance, and asserted:
These criteria were based on the requirements for PSROs imposed by
the PSRO statute and regulations, and further interpreted through the
PSRO Program Manual and Transmittals. Many of the criteria were based
on those used to convert PSROs from conditional to fully designated
status.... Because of the Presidential and Congressional mandates to
terminate ineffective PSROs, however, more emphasis was placed in this
most recent evaluation on the effectiveness and the actual impact of a
PSRO's activities. Although the weight attached to certain areas
changed, these criteria impose no new responsibilities on the PSROs.
(Agency Response, pp. 8-9.) The Agency further explained that the
major change from the criteria previously used to assess PSROs was the
increased emphasis on cost effectiveness examined in Part I of the
evaluation criteria, and the PSRO's impact on the utilization and
quality of health care services examined in Part III. (Agency Response,
p. 4.) The proposed criteria were sent to all PSROs for review and
comment on March 20, 1981. After considering the comments received and
implementing some of the suggestions, the Agency distributed the final
version of the criteria to all PSROs on April 15, 1981. The criteria
were not promulgated as a regulation or published in the Federal
Register.
(4) The final version of the criteria was sent to the Agency's
Regional Offices to be completed for each PSRO, with instructions for
marking the evaluation. The evaluations were conducted by the Agency's
project officer. The instructions included the following:
Performance described in the indicators must be sustained throughout
calendar year 1980 or the most recent grant period (period should cover
12 months). If another time period is to be considered, it is specified
in the instructions for that item within the criteria set.
Each scoring level, positive or negative, must be reasonably
verifiable by previous site visit, reports, grant applications, PSRO
reports, correspondence or other relevant documentation. The Project
Officer should assure the completeness of documentation on each PSRO.
PSROs may be consulted for additional information.
The Central Office (CO) scoring methodology will be sent to each RO
(Regional Office) following CO receipt of the evaluations. After CO has
completed scoring ROs will be notified of the scores of each PSRO for
verification.
($USee, e.g., Agency Exhibit C.)
The Agency stated that in order to insure uniformity and objectivity,
the "Regional Offices were instructed that no consideration was to be
given to factors not included in the criteria," and representatives from
central office staff were sent to the regions to review the evaluations
and determine the validity of the supporting documentation. (Agency
Response, pp. 4-5.) Mr. Paul Mendelsohn, Senior Public Health Analyst
for the PSRO program, testified that the central office also conducted
telephone conferences with regional personal to discuss the evaluation
criteria. (Tr., p. 246.) He said that in order to have consistent
application of the criteria, the Agency's central office sent the
regions a "Question and Answer" packet which listed the questions
that
staff in the various regions had raised and the responses of the central
office. ($UId.)
C.The Format of the Evaluation Criteria and the Scores Needed to Pass
The evaluation was composed of criteria which measured three areas of
performance: Part I -- organization and program management; Part II --
performance of review: compliance and process; and Part III -- (5)
performance of review: impact/potential impact. Each criterion was
assigned a point value which the Agency awarded to a PSRO if it "met"
the criterion or, with some criteria, the points were awarded based on
the PSRO's level of performance, as described in the criteria. In order
to pass the evaluation, a PSRO needed a total score of 1105 (of the 2350
available points) and passing scores on two of the three parts.
Part I evaluated organization and management by examining the
following areas: commitment of the PSRO Board and committees;
administration and financial management; cost efficiency and relations
with the State. A PSRO needed 190 of the 300 available points to pass
this part. Part II examined performance of PSRO review based on
compliance with established review processes including the acute care
review process, special actions taken to address identified problems
such as the modification of a review system and adverse actions, medical
care evaluation studies, the adequacy of the PSRO's data system, and the
use of profiles. A PSRO needed 400 of the 850 available points to pass
this part. Part III evaluated PSROs on the basis of their impact and
potential impact on utilization objectives and the quality of health
care. A PSRO needed 515 of 1200 available points to pass this part.
(See, e.g., Agency Response, p. 7.)
II. The Evaluation of PGFMC
A. Summary of the Scores Awarded PGFMC
The Agency awarded PGFMC a base score of 935 points, 170 points short
of the 1105 points needed to pass the evaluation. PGFMC passed Parts I
and II with 250 and 575 points respectively. PGFMC did not pass Part
III; PGFMC's score of 110 was 405 points short of the 515 needed to
pass.
B. PGFMC's Objections to the Criteria
PGFMC presented a number of arguments contesting the validity of the
national evaluation process and of individual criteria. (See, e.g.,
PGFMC Post-hearing Brief, pp. 1-2.) The Board finds it unnecessary to
address PGFMC's arguments since the Board has determined that PGFMC
should have been awarded a sufficient number of points to pass the
evaluation.
C. Deference to the Agency's Determination
The Agency contended that in judging the evaluation process:
(The) Board must note how the government worked to assure that the
process was even-handed and how it was uniformly (6) applied not just to
PGFMC but to every PSRO in Region III (Philadelphia) and across the
country.
(Agency Post-hearing Brief, p. 10.)
The Agency argued that if the Board is satisfied that the evaluation
was fairly designed and applied, the Agency's administrative decision to
terminate PGFMC's grant should be accorded deference by this Board and
accordingly upheld.
The Board has previously stated that it will not interfere with an
Agency's exercise of its discretion if the Agency acts in accord with
the rules and regulations, and the discretion is exercised in a
reasonable manner. (See, e.g., Wisconsin Department of Health and
Social Services, Decision No. 116, August 14, 1980; New York Department
of Social Services, Decision No. 101, May 23, 1980; Family Health Care,
Inc., Decision No. 147, January 29, 1981.)
Nevertheless, the Agency had a burden to support its determination
that PGFMC did not meet certain criteria. The Agency had to show a
reasonable basis, supported by the Record, for its determination on the
contested criteria in order for the Board to uphold the determination.
PGFMC had a corresponding obligation, as the appellant, to demonstrate
where the Agency's evaluation of PGFMC lacked a reasonable basis /2/ or
to show either that PGFMC met the criteria or performed at a certain
level described in the criteria. (See, e.g., Idaho Professional Review
Organization, Decision No. 236, December 8, 1981.)
IV. The Board's Assessment of the Special Criteria in Dispute
This portion of the decision sets out each criterion in dispute (in
the same order as it appears in the evaluation criteria), the arguments
of the parties regarding whether PGFMC should receive points for the
criterion, and the Board's findings.
(7) Part I of the Evaluation Criteria: Organization and Program
Management
PGFMC received 250 of 300 possible points on this part; 190 points
were needed to pass. PGFMC disputed the Agency's scoring of the
following criterion in this part:
CRITERIA SECTION D. Relationship to State. Indicators of State
relationships:
CRITERION I.D.3. PSRO had modified review system to accommodate State
defined needs where problems were identified by PSRO and/or State (e.g.,
pre-surgical review, weekend admissions, etc.).
The Agency had originally scored this criterion as "not met" by
PGFMC. However, based on testimony adduced at the hearing and
discussions with different people within the Agency, the Agency
determined that PGFMC had indeed met this criterion. (See, Tr., p.
420.) Therefore, PGFMC should receive the 10 points for this criterion.
Part II of the Evaluation Criteria: Performance of Review Operations -
Compliance and Process
PGFMC received 575 of 850 possible points in this part; 400 points
were needed to pass. The Board has determined that PGFMC should receive
an additional 110 points for this part. PGFMC disputed the Agency's
scoring of the following criteria in this part:
CRITERIA SECTION A. Acute Care Review. Indicators of acute care
review process are:
CRITERION II.A.1. The review process is resulting in the issuance of
at least 10 denials per 1000 discharges under review.
Although this criterion was marked as "not met" on the evaluation,
the Agency subsequently conceded that PGFMC had met this criterion and
should be awarded 15 points. (See, Agency Response, p. 18; Tr., p.
38.)
CRITERION II.A.2. PSRO is reviewing the medical necessity of selected
surgical (procedures) on a presurgical basis and/or PSRO is reviewing
the appropriate setting for selected surgical procedures.
The Agency did not award PGFMC the 20 points available for this
criterion because the Agency determined that PGFMC did not implement its
process of presurgical review within the period of the evaluation.
(See, Agency (8) Response, p. 19; Tr., p. 438.) The project officer
testified that the documentation submitted by PGFMC for this criterion
consisted of revised Hospital Services Regulations issued by the State
of Maryland Department of Health and Mental Hygiene. (See, Agency
Exhibit A, Tab C, pp. 000081-000086.) The regulations required
preprocedure review for Medicaid patients. The project officer stated
that "the process was implemented by the PSRO (PGFMC) effective January
1, 1981." (Tr., p. 438.) The Agency contended that, in accordance with
the "Instructions for Completing the PSRO Performance Evaluation,"
the
proper rating period for PGFMC was calendar year 1980. (See, Agency
Exhibit C.) The Agency argued that since PGFMC's date of implementation,
January 1, 1981, was outside the evaluation period, the criterion was
properly marked "not met."
PGFMC argued that it became involved in presurgical review in June,
1980 in connection with the development of a cost containment program in
conjunction with the State of Maryland. (See, PGFMC Appeal Supplement
II, Sec. II.A.2; Tr., p. 39.) The Executive Director testified that
after June 1, 1980 he spent many hours with state officials developing
the policies and procedures of the program. (Tr., p. 39.) Thereafter,
PGFMC's Board of Directors reviewed the program at their November 10,
1980 meeting. (Id.) The program was referred to PGFMC's Executive
Committee which subsequently authorized the implementation of the
program on December 24, 1980. (Id.) PGFMC asserted that its December,
1980 implementation date was attested to by the Acting Director, Medical
Assistance Compliance Administration, State of Maryland. (See, PGFMC's
Appeal Supplement II, Sec. II.A.2.)
The Agency contended that even if it were to accept PGFMC's argument
that the program was implemented on December 24, 1980, the criterion
would remain properly marked as "not met." (Agency Post-hearing Brief,
p. 6; Tr., p. 438.) To meet the criteria the instructions required that
the performance be "sustained" throughout the rating period. (See,
e.g.,
Agency Exhibit C.) The Agency argues that the implementation of the
review program on December 24, 1980 could not be used to show sustained
performance throughout the rating period and, therefore, the criterion
was "not met" by PGFMC. (Agency Post-hearing Brief, p. 6; Tr., pp.
438-439.)
Finding: PGFMC should not receive the points for this criterion.
The instructions for completing the evaluation read as follows:
Performance described in the indicators must be sustained throughout
calendar year 1980 or the most recent grant period (period should cover
12 months). If another time period is to be considered, it (9) is
specified in the instructions for that item within the criteria set.
(emphasis added)
(See, e.g., Agency Exhibit C.)
The Board agrees with the Agency's interpretation of this instruction
as it pertains to the proper rating period for PGFMC. The instruction
was aimed at evaluating the most recently completed 12 months period.
PGFMC's grant period ran from October 1 through September 30. In April,
1981, when the evaluation took place, PGFMC was in the seventh month of
its current grant. Since this was less than a 12 month period, it was
an improper period for purposes of this evaluation.
PGFMC's most recently completed (12 month) grant period was October
1, 1979 through September 30, 1980. Since calendar year 1980 (January 1
through December 31, 1980) covered a more recent overall time frame, it
was the proper period for the evaluation under this instruction.
The evidence presented by PGFMC at best shows PGFMC as having a
review program newly in place in December, 1980. No evidence was
presented exhibiting actual performance in 1980 under this program. In
fact, the Executive Director testified that "(a)s a practical matter, we
did not receive a form until after the first of the year (1981)." (Tr.,
pp. 109-110.)
Even if evidence of actual review beginning December 24, 1980 had
been presented, the Board would conclude that PGFMC did not meet the
criterion as it failed to "sustain" such performance throughout calendar
year 1980. Performance during the last 7 days of 1980, representing
less than 2% of the total days in a calendar year, does not represent
sustained performance under any reasonable interpretation but instead
indicates isolated or beginning performance under the program. In
either case, the Board concludes that the criterion was correctly marked
as "not met."
In finding against PGFMC, the Board finds unpersuasive PGFMC's
argument that it began developing its presurgical review program in
June, 1980. The criterion requires that the PSRO "is reviewing"
presurgical procedures; which reasonably implies that actual review (as
opposed to preparing for such review) is taking place. Therefore, the
Board finds that it was reasonable for the Agency not to consider the
development stage of PGFMC's presurgical review program since the clear
language of the criterion states "is reviewing."
(10) CRITERIA SECTION B. Special Actions to Address Identified
Problems.
CRITERION II.B.1(d). PSRO is focusing its review system based on
identified problems in admission policies, such as weekend admissions,
Monday discharges, etc.
The Agency did not award PGFMC the 15 points available for this
criterion because the Agency determined that PGFMC was not focusing its
review by admission date. (Tr., p. 440.) The project officer testified
that his determination resulted from a telephone call to PGFMC's
Executive Director in which the Executive Director responded "no"
to the
project officer's question of whether PGFMC was focusing by admission
date. (Id.)
PGFMC contended that it performed the focusing activities since 1979.
This performance was mandated by a Memorandum of Understanding (MOU)
between PGFMC and the State of Maryland Medicaid Agency, effective July
1, 1979. (See, PGFMC Appeal Supplement II, Sec. II.B.1( d); Tr., p.
40.) PGFMC alleged that its performance under the MOU was attested to by
the Acting Director, Medical Assistance Compliance Administration, State
of Maryland, in a letter dated September 4, 1981. (Id.)
In response to PGFMC's argument, the project officer testified that
this national evaluation "is restricted, with the exception of a bonus
point, to acute review." (Tr., p. 442.) The Agency contended that the
additional information presented concerning weekend admissions related
to reviews conducted at a chronic disease hospital. (Id.) The Agency
argued that in this case the chronic disease hospital was not an acute
care facility and, therefore, was not a proper subject of this
evaluation. (Id.) As such, the criterion was properly marked as "not
met."
Finding: PGFMC should receive the 15 points available for this
criterion.
The Board concludes based on the evidence submitted that PGFMC "met"
this criterion. The MOU, page 2, Section A.3, states:
To provide, through PSRO review, the following services...:
a. Admission review and certification or denial,... of selected
admissions for medical necessity and appropriate utilization. PSRO will
monitor Friday and Saturday non-emergency admissions prior to
certification to assure medical necessity.
(PGFMC Appeal Supplement II, Sec. II.B.1(d)).
(11) As the project officer agreed, the MOU speaks specifically to
the monitoring of weekend admissions. (See, Tr., p. 475.) The effective
date of the MOU was July 1, 1979 and the Executive Director testified
that PGFMC continued to perform the review. (See, Tr., p. 40.) The
Agency did not dispute that the review described in the MOU meets the
criterion, nor did the Agency dispute PGFMC's continued performance
under the MOU. Therefore, the Board finds that PGFMC has performed the
type of review required in the criterion.
The Agency's argument that PGFMC performed this review solely in a
chronic disease hospital is not substantiated in the record. The
project officer testified that it was his understanding that the PGFMC's
review was restricted to the chronic disease hospital which was funded
as part of PGFMC's long-term care program. (See, Tr., pp. 440-441.)
However, page 2 of the MOU states that the PSRO review will take place
in "short-term general hospitals, /3/ chronic hospitals and private
psychiatric hospitals." (See, PGFMC Appeal Supplement II, Sec.
II.B.1(d).) As the project officer agreed, these are not all long-term
care facilities. (See, Tr., p. 475.) Since PGFMC performed the required
review and the Agency has failed to refute PGFMC's evidence that the
review took place in short-term care facilities, the Board finds that
PGFMC has met the criterion and is entitled to the 15 points.
CRITERION II.B.1(f). PSRO is addressing identified problems by
performing preadmission review.
The Agency did not award PGFMC the 10 points available for this
criterion because the Agency determined that PGFMC did not implement its
process of preadmission review within the period of the evaluation.
(Agency Response, p. 20.) As with criterion II.A.2., the documentation
submitted by PGFMC was the Maryland Hospital Services Regulations.
(See, e.g., Agency Exhibit A, Tab C, pp. 000081-000086.) The Agency
contended that these regulations did not become effective until January
1, 1981. (Agency Response, p. 20.) Therefore, the Agency argued,
although "(preauthorization) is required in certain instances" under
these regulations, the effective date for implementation of the
regulations was outside the time frame of the evaluation. Accordingly,
the criterion was properly marked as "not met." (Id.)
(12) PGFMC contended that it implemented preadmission review for a
chronic disease hospital on January 17, 1977. (PGFMC Post-hearing
Brief, p. 6; Tr., p. 40.) PGFMC submited as evidence of review in the
chronic disease hospital the September 4, 1981 letter from the Acting
Director, Medical Assistance Compliance Administration, State of
Maryland. (See, PGFMC Appeal Supplement II, Sec. II.B.1(f).) PGFMC
contended that it instituted preadmission review in all acute care
facilities on December 24, 1980 in accordance with regulations issued by
the State of Maryland Medicaid Agency. (PGFMC Appeal, Part II, p. 4.)
PGFMC argued that these activities satisfy the requirements of the
criterion.
The Agency argued that PGFMC's implementation of preadmission review
in December, 1980 did not meet the instructions requirement of
"sustained" performance and, therefore, the criterion was "not
met."
With regard to the chronic disease hospital, the Agency contended that
such a hospital was a long-term care facility, as indeed, PGFMC treated
it as part of its long-term care program. (See, Tr., p. 476.) As a
long-term care facility, it was not subject to this evaluation as only
acute care facilities were being reviewed. (Id. at p. 441.)
Finding: PGFMC should not receive the points for this criterion.
The Board concludes for the following reasons that PGFMC has not met
this criterion.
The instructions for completing the evaluation required that
performance be sustained throughout the rating period. As was
previously noted under criterion II.A.2. (see, pp. 7-9 of Decision),
the Board does not consider performance by PGFMC in the last seven days
of 1980 sufficient to meet the requirement in the instructions that such
performance be sustained through the rating period. Therefore,
implementation of preadmission review on December 24, 1980 was not
sufficient to meet the criterion.
With regard to the review in the chronic disease hospital, it was
undisputed that PGFMC treated the chronic disease hospital as part of
its long-term care program. (See, Tr., p. 112, 476.) PGFMC provided no
evidence to support its contention that the chronic disease hospital was
actually an acute care facility other than a claim that it was treated
as a long-term care facility because the government regulations so
required. (Id.) The Board finds PGFMC's evidence unpersuasive and
insufficient to overcome the inference arising from its undisputed
treatment of the facility as part of its long-term care program.
CRITERION II.B.1(g). PSRO is addressing identified problems by
performing preprocedure review.
(13) The Agency did not award PGFMC the 10 points available for this
criterion because the Agency determined that PGFMC did not implement its
process of preprocedure review within the period of the evaluation.
(See, Agency Response, p. 21; Tr., p. 443.) As in criteria II.A.2. and
II.B.1(f), the documentation submitted by PGFMC was the Maryland
Hospital Services Regulations. (See, e.g., Agency Exhibit A, Tab C, pp.
000081-000086.) The Agency contended that these regulations did not
become effective until January 1, 1981. (Agency Response, p. 21.) The
Agency argued that PGFMC's date of implementation was outside the period
of the evaluation and, therefore, the criterion was properly marked as
"not met."
PGFMC argued that it became involved in preprocedure review in June,
1980 in conjunction with a cost containment program instituted by the
State of Maryland. (See, PGFMC Appeal Supplement II, Sec. II.B.1(g).)
PGFMC argued that this program was implemented December 24, 1980 and,
therefore, met the criterion. (Id.) In addition, PGFMC's Executive
Director testified that PGFMC utilized the identical procedures for
preprocedure review as for preadmission review. (Tr., p. 41.) PGFMC
argued that it had performed these activities in a chronic care facility
since 1977. (Id.) PGFMC submitted as evidence of performance of this
review the September 4, 1981 letter from the Acting Director, Medical
Assistance Compliance Administration, State of Maryland. (See, PGFMC
Appeal Supplement II, Sec. II.B.1(g).) PGFMC argued that these
activities satisfy the criterion.
With regard to implementation of preprocedure review in December,
1980, the Agency asserted that such review did not meet the
instruction's requirement that performance be sustained and, therefore,
the criterion was "not met." The Agency did not address the similarity
in PGFMC's procedures regarding preadmission and preprocedure review.
Finding: PGFMC should not receive the points for this criterion.
As we previously noted (see, discussion of criteria II.A.2 and II.B.
1(f)) the Board finds that performance in the last days of 1980 does not
meet the requirement in the instructions that such performance be
sustained throughout the rating period. Therefore, implementation of
preprocedure review in December, 1980 is not sufficient performance to
meet the criterion.
In addition, the Board finds unpersuasive PGFMC's argument equating
preadmission and preprocedure review as evidence that the latter took
place the same time as the former. PGFMC's Executive Director testified
that both types of review used a form which the hospitals submitted to
PGFMC. (See, Tr., p. 41.) It was not alleged that it was the same form
or that the two procedures were performed simultaneously. On the
contrary, the Executive Director's testimony shows that the two reviews
were quite (14) different. The Executive Director stated that
"preadmission review is simply a review of the patient regardless of the
diagnosis or problem prior to admission," while preprocedure review is
"more specifically related to surgery...." (Tr., p. 41.)
In light of this testimony and the lack of other evidence, we fail to
see how the confirmation of performance of preadmission review
translates into confirmation of performance of preprocedure review.
Accordingly, the Board concludes that PGFMC failed to meet this
criterion.
CRITERION II.B.2(c). PSRO has documentation of resolution of
(problems). Worked with (institutions) and/or (practitioners) thereby
eliminating the need to proceed with sanction recommendation.
The Agency did not award PGFMC the 60 points available for this
criterion because the Agency determined that the "documentation fails to
demonstrate resolution of problems or behavior modification." (Agency
Exhibit A, Tab E, p. 000117.)
The Agency asserted that this criterion "requires documentation of
problem resolution where a sanction recommendation was at issue."
(Agency Response, p. 22.) The Agency asserted that specific guidelines
governing sanctions are set out in 42 CFR Sec. 474. The Agency argued
that under Sec. 474.4 the PSRO was required, upon identifying a
potential violation of a provider's obligation, to "first send the
provider a written notice containing specific information relevant to
the violation and the sanction process." (Id.) The Agency asserted that
in the example submitted by PGFMC a sanction recommendation was not in
issue and no sanction procedures had begun. (Id.; see also, Tr., pp.
443-447.)
PGFMC argued that the Agency's inferred interpretation of the
criterion (i.e., that it was necessary to actually make a sanction
recommendation) is inconsistent with the criterion itself. (See, PGFMC
Appeal Supplement II, Sec. II.B.2(c); Tr., p. 45.) PGFMC argued that it
operated under a sanction plan approved by the Agency. (Id.) The
Executive Director testified that PGFMC's sanction plan "was a contract
deliverable under its old contract with the Department (Agency)." (Tr.,
p. 50.) The Executive Director stated further that "(S)ince we have
never received any written notification from the Department... I have
reason to believe that the (sanction) plan has been approved." (Id.)
PGFMC asserted that its philosophy under the sanction plan was to
deal "in-house, in-county, in-state" before referring a problem to
the
Agency. ($UId.) PGFMC presented documentation and testimony detailing
(15) four examples of intervention with hospitals and practioners
handled under this sanction plan. PGFMC argued that these four examples
were evidence of eliminating the need to proceed with a sanction
recommendation. (Id.)
Concerning the first example, PGFMC's Executive Director testified
that PGFMC sent a letter to the Chairman of the State of Maryland
Commission on Medical Discipline informing the Commission that a
physician in Prince George's County was practicing medicine without a
license. (Tr., p. 47; see also, PGFMC's Appeal Supplement II, Sec.
II.B.2(c).) The Executive Director stated that as a result of PGFMC's
intervention, "it was confirmed that the physician was practicing
medicine without a license." (Id.) The physician died during the
inquiry, mooting the issue. (Id.)
The second example involved a specific concurrent quality assurance
(CQA) intervention on behalf of a patient to ameliorate poor care.
(See, Tr., p. 48.) CQA is a system of concurrent monitoring to assure
the provision of quality medical care. (See, PGFMC Appeal, Sec. III.C,
Attachment 2.) This particular case involved inappropriate physician
care. (Tr., p. 48.) The Executive Director testified that this case was
referred to PGFMC's profile analysis committee to conduct a profile of
the physician's practice. (Id. at p. 49.) No profile was performed
because the physician removed the records from the hospital. (Id.) At
that time the physician removed his practice to Montgomery County, and
PGFMC referred the physician's name to the Montgomery County Medical
Care Foundation. (Id.)
The third case involved a marginally capable physician. The
Executive Director stated that PGFMC's data showed that the physician
required more CQA intervention than any other doctor in Prince George's
County. Action was taken with regard to this physician under PGFMC's
sanction plan.A formal hearing was afforded the physician before PGFMC's
sanctions committee. (Id. at p. 51.) The sanctions committee
recommended that the physician's case be referred to the Maryland State
Commission on Medical Discipline. (Id. at p. 52.) This action was
taken. (Id.)
The fourth case involved a specific discharge plan in hospital 075.
(See, Tr., p. 53.) The Acute Care Coordinator at the hospital identified
12 instances where poor discharge planning occurred in placing patients
in nursing homes. (Id.) The Executive Director stated that this became
a sanction issue because PGFMC "could have denied all 12 cases." (Id.)
Instead, representatives from PGFMC and the hospital met to discuss the
problem. During the meeting both the problem and possible sanctions
PGFMC could impose if the problem was not corrected were (16) discussed.
(Id. at pp. 58-59.) As a result of the meeting, the problem was
corrected and since that time PGFMC has not had any CQA interventions
specific to discharge planning in that area. (Id.)
The project officer testified that, in terms of this criterion,
"sanction" has a specific meaning as defined in the Social Security
Act.
(Tr., p. 446; see, Social Security Act, Sec. 1160.) The project officer
stated that the examples submitted by PGFMC fail to meet the criterion
because "the vital part of the criterion, the issuance of the letter
warning of official Social Security Act standards, never occurred."
(Id.) In addition, the Agency contended that PGFMC's examples were not
legally sanctionable - as defined in Section 1862(d) and (3) of the Act
- and, therefore, PGFMC failed to meet the criterion. (Agency
Post-hearing Brief, pp. 7-8.)
Finding: PGFMC should receive the 60 points available for this
criterion.
The record indicates that PGFMC documented that it worked with
institutions/practitioners to resolve problems in at least two cases
(PGFMC's second and third examples). In fact the project officer
testified that he agreed that PGFMC demonstrated the resolution of
problems and behavior modification. (See, Tr., p. 484.) Based on this
evidence the Board finds that PGFMC "met" this criterion.
In finding for PGFMC, the Board rejects the Agency's argument that
this criterion requires the issuance of the letter warning of official
Social Security Act sanctions. The criterion on its face makes no
mention of such a requirement. In addition, another criterion - II.B.
2(b) - dealt specifically with the issuance of warning letters to
institutions and/or practitioners. /4/
We likewise are unpersuaded by the Agency's argument that PGFMC's
examples are not legally sanctionable as defined in the Social Security
Act. Under Section 1157 of the Act, a PSRO may identify a practitioner
or health care facility whose behavior is in violation of Section 1160
obligations. One such obligation is to assure that health care services
provided "will be of a quality which meets professionally recognized
standards of health care." (Sec. 1160(a)(1)(B) of the Act.) Of the four
examples submitted by PGFMC, at least the first three involve violations
of this obligation and are, therefore, legally sanctionable. Since the
criterion only requires one example, it is not necessary to determine
whether PGFMC's fourth example is legally sanctionable.
(17) CRITERION II.B.2(d). PSRO prepared (recommendations) on sanction
to Secretary and forwarded to appropriate party.
PGFMC argued that, under the sanction plan it operates, it is
required to deal with problems "in-house, in-county, in-state" before
forwarding a sanction recommendation to the Secretary. (Tr., p. 62;
Appellant's Exhibit I.) Pursuant to the sanction plan, PGFMC informed
the State of Maryland Commission on Medical Discipline on December 29,
1980 that a physician was practicing medicine without a license. (Id.)
PGFMC contended that its use of the state commission was superior to
using federal sanctions because the latter affects only Medicare and
Medicaid patients while the former has the legal authority to affect
physician behavior with regard to all patients, regardless of pay
source. (See, Tr., pp. 62-63, 121-122.) Therefore, PGFMC argued that,
although the criterion spoke of sending the sanction recommendation to
the Secretary, PGFMC's action was consistent with its approved sanction
plan and met the intent of this criterion. (Id.)
The Agency contended that the example submitted by PGFMC did not
satisfy the criterion because, as the project officer testified, "even
though it obviously was intended to be a punitive action, it is not a
sanction under the Act and, therefore, does not qualify." (Tr., p.
448.)
Finding: PGFMC should not receive the points for this criterion.
PGFMC did not contend, and the record does not indicate, that PGFMC
had forwarded a sanction recommendation to the Secretary. Though PGFMC
may have done a useful thing by informing the State authority in
accordance with its sanction plan, it did not do what the criterion
specifically required. We find that it was reasonable for the Agency to
award points to PSROs which performed activities authorized by the PSRO
statutes and regulations. In addition, another criterion - II.B. 2(c)
- provided points to PSROs which opted for other methods of resolving
problems.
CRITERIA SECTION C. Medical Care Evaluation Studies/Quality Review
Studies
CRITERIA II.C.4. PSRO meets at least 75% of the numerical requirement
of MCEs as outlined in Transmittal No. 43 or at least the minimum number
of studies as outlined in Transmittal No. 100 if the PERO has had an
approved alternative review plan or the number approved by the Project
Officer under other waiver provisions.
(18)
The Agency did not award PGFMC the 15 points available for this
criterion because it determined that PGFMC failed to complete the
required number of MCE studies. (See, Agency Response, p. 24.) The
Agency determined that under Transmittal 43 PGFMC was required to
complete 47 MCE studies. To meet the 75% requirement under this
criterion, PGFMC would have to actually have completed 35 MCEs. The
Agency determined that PGFMC completed only 16 studies and, therefore,
no points were awarded. (Agency Response, p. 24; Tr., p. 449.)
PGFMC argued that it had an approved alternative, effective on July
1, 1980, to MCE Transmittal 43. The Executive Director testified that
in February or March, 1980, PGFMC began development of a new care
evaluation plan which would require quality review studies in addition
to PGFMC performing CQA. (See, Tr., p. 73.) The plan was developed in
accordance with the draft of the Agency's new quality review study.
(Id. at p. 74.) PGFMC was told by the person who was the project officer
at the time that the draft would be very similar to the final study and
PGFMC should, therefore, use the draft in developing the new care
evaluation plan. (Id.) The Executive Director testified that in April,
1980 he again checked with the new acting project officer about
developing the plan in accordance with the draft transmittal, and that
the acting project officer said it was "safe" since the final
transmittal would not contain any major changes. (Id. at p. 75.) PGFMC
argued that since it informed the Agency on several occasions "that we
would implement that care evaluation plan on July 1, 1980, that we had
not received any reason not to implement that plan," and that since "we
had been encouraged to be a pioneer in developing a plan which, in fact,
implemented Transmittal 100 at least six months before it had to be
implemented," it had Agency approval to operate under its plan as an
alternative to Transmittal 43. (Id. at pp. 75-76.)
PGFMC contended that it operated under Transmittal 43 from 1/1/80 -
6/30/80 and, with Regional Office approval, under Transmittal 100 as an
alternative to Transmittal 43 from 7/1/80 - 12/31/80. (PGFMC Appeal,
Part II, p. 7.) PGFMC presented two sets of figures which it alleged
represents the number of studies required in 1980 under these
transmittals:
#1 #2 Required by # 43: 25
31 Required by # 100: 18 18 Total requirement in 1980:
43 49
(See, PGFMC Appeal, Part II, p. 7; PGFMC Appeal Supplement II, Sec.
II.C.4.)
(19) Using the first set of figures, PGFMC argued that it "reported"
39 studies in 1980 which is 91% (39/43) of its 1980 requirement. (PGFMC
Appeal, Part II, p. 7.) Using the second set of figures, PGFMC argued
that it "performed" 45 studies which is 92% (45/49) of the required
studies. (PGFMC Appeal Supplement II, Sec. II.C.4.) PGFMC argued that,
in either case, the 75% requirement of the criterion was surpassed and,
therefore, the 15 points should have been awarded. (Id.)
The Agency admitted that regulations (42 CFR 446.18) codifying the
provisions for MCE studies established in Transmittal 43 also provided
for alternative MCE study procedures.(Agency Response, p. 23.) The
Agency asserted, however, that "such alternative plans must be submitted
to HSQB and approved before implementation can begin." (Id.) The Agency
argued that, although PGFMC may have had the project officer's approval
to develop an approved alternative, it did not have express written
authorization to implement an alternative to Transmittal 43. (Agency
Post-hearing Brief, p. 9.) The Agency contended that PGFMC "informed the
Regional Office on 1/14/81 that it implemented an alternative plan on
7/1/80." (Id.) Since PGFMC did not have approval to implement an
alternative plan, it was obligated to meet the numerical requirements of
Transmittal 43. The Agency contended that in any case, PGFMC completed
only 16 MCEs and would fail the 75% requirement under either
transmittal. (See, Tr., p. 449.)
PGFMC contended that "completion" is not the standard under
Transmittal 100. (Tr., p. 532.) PGFMC argues that the "completion"
standard under Transmittal 43 was changed to a "performance" standard
under Transmittal 100. (Id.) The project officer testified that
"(performed) certainly implies completed." (Id.)
Finding: PGFMC should not receive the points for this criterion.
The Board finds that PGFMC failed to meet this criterion. The
evidence presented by PGFMC does not show that PGFMC completed 75% of
the MCEs required under Transmittal 43 for the period 1/1/80 - 6/30/80.
Even if viewing the evidence most favorably for PGFMC, we find that
it operated under Transmittal 43 from 1/1/80 - 6/30/80 and under
Transmittal 100 from 7/1/80 - 12/31/80. We find, and PGFMC conceded,
that the performance standard under Transmittal 43 is "completion."
(See, e.g., Tr., p. 495.) Using the figures supplied by PGFMC, to meet
the 75% requirement under this criterion for the first half of 1980,
PGFMC should have completed 18 (75% of 25) studies under the first set
of figures or 23 (75% of 31) studies under the second set. The "MCE
Study Status Report" submitted by PGFMC shows that for the period 1/1/
80 - 6/30/80 PGFMC completed (20) at most 14 MCE studies. (See, PGFMC
Appeal, Sec. II.C.4, Attachment 1; see also, Agency Record, pp. 000128
- 000135.) Since PGFMC failed to complete the requisite number of
studies under Transmittal 43 for the first half of 1980, we find that
PGFMC did not meet the criterion.
In finding against PGFMC on this criterion, it is unnecessary to
decide the question of whether or not PGFMC had an approved alternative
to Transmittal 43 effective July 1, 1980. Likewise, the Board need not
decide whether the performance standards are different under
Transmittals 43 and 100. PGFMC's failure to meet the MCE study
requirements under Transmittal 43 for the first half of 1980 renders
these questions moot.
CRITERION II.C.6. PSRO systematically monitors delegated hospitals'
MCE/QRSs and evaluation is performed at least once per year.
PSRO evaluated its nondelegated Quality Review Program at least
annually.
The Agency did not award PGFMC the 20 points available for this
criterion because PGFMC presented "no evidence of systematic monitoring
of delegated hospital MCEs." (Agency Exhibit A, Tab G, p. 000136.)
The Agency argued that PGFMC's monitoring plan did not require yearly
evaluation of delegated review activities in accordance with Sec. E of
Transmittal 43 which states:
After delegation, the hospital is responsible for conducting MCE
studies in accordance with PSRO program requirement.... The PSRO must
monitor the hospital's performance through on-site visits and periodic
written reports (such as BOA Forms 131, 133 and 135), and where hospital
performance is unsatisfactory, provide technical assistance or, if this
fails to cause improvement, rescind delegation of the MCE study
function.
(Agency Response, p. 26.) The Agency contended that PGFMC presented
no documentation that it "monitored the hospitals' performance in this
manner." (Id.)
The project officer testified that systematic review "refers to a
periodic review of the entire system." (Tr., p. 452.) He stated that
"the periodicity in this case is at least annual," and that the term
"systematic" means looking "at how the system functions as opposed
to
looking at an individual component." (Id.) The project officer testified
that PGFMC's documentation indicated that individual MCE studies were
evaluated. (Tr., p. 451.) However, the project officer contended that
this is (21) different from a systematic monitoring of the overall
process. (Id.) The project officer elaborated on this difference as
follows: (A) PSRO could be in receipt of any number of reasonably
acceptable MCE studies, all of which would pass individual evaluation
criterion that they use for evaluating an MCE, but still not have a plan
that would be evaluated overall as an effective and comprehensive plan,
and what we were searching for in this particular plan was whether there
was indeed a systematic evaluation of the system, not just looking at
individual MCE studies to see if they had criteria and physician inputs,
and whatever else they might be looking at.
(Id. at pp. 451-452.)
PGFMC contended that its Delegated Hospital Monitoring Plan
"indicates that PGFMC systematically monitors delegated hospitals' MCE/
QRS." (See, PGFMC Appeal, Part II, p. 8.) In addition, PGFMC argued that
the delegated hospitals were evaluated at least once a year. In support
of its argument, PGFMC submitted copies of minutes of Board meetings and
of Care Evaluation Committee meetings. (Id. at Sec. II.C. 6.) PGFMC
contended that these minutes show: "(1) the formulation of a Care
Evaluation Plan; (2) the conversion to Transmittal 100 and (3) an
evaluation of its quality assurance policy." (Id. at Part II, p. 8.)
The Executive Director testified that the documentation it presented
clearly established monitoring activity other than the monitoring of
individual MCE studies, for example, that PGFMC evaluated all four
delegated hospitals prior to allowing them to implement the new Care
Evaluation Plan. (Tr., p. 80.) As a result, only three of the four
hospitals received delegation on the first attempt. (Id.) The fourth
hospital was given technical assistance and received delegation later in
1980. (Id. at p. 82.) In addition, the Executive Director testified
that he believed the submitted documentation shows site visits at
hospitals to monitor MCE studies and directors' meetings where these
issues were discussed. (Id.)
In response to PGFMC's argument that it assessed all four hospitals
that applied for delegation in 1980, the project officer stated that
"assessing the hospitals for delegation is different from monitoring."
(Tr., p. 496.)
(22) With regard to whether or not its monitoring was "systematized,"
the Executive Director stated that the delegated hospitals, in
accordance with PGFMC's monitoring plan which utilized Transmittal 100
as a guideline, were responsible for submitting quarterly care
evaluation reports to PGFMC's health study supervisor. (Tr., p. 81.)
Delegated hospitals selected topics off an "issue list" and submitted
quarterly report forms which included a study of the topic. (Id. at p.
82.) The Executive Director testified that the report form included a
"statement of the issues, a list of the criteria included in the study,
a statement of the study process, peer analysis -- that is, who reviewed
that, a statement of intervention to protect problem resolution, and
then a statement of follow-up mechanism to assure problem resolution or
reduction." (Id.) The reports were submitted to the Health Studies
Supervisor. The Executive Director stated that "we cannot complete our
Federal reporting requirements without the receipt of those forms." (Id.
at p. 83.) In addition, the supervisor went to the delegated hospitals
to evaluate the studies. (Id.) PGFMC argued that these activities
constituted a system for monitoring quality review studies. (Id.)
The Agency argued that the second part of the criterion was also "not
met" as PGFMC presented no evidence showing an evaluation of its
non-delegated quality review program. (Agency Response, p. 26; see
also, Tr., p. 452.)
PGFMC contended that minutes of PGFMC's Board of Directors meetings
indicated that PGFMC "decided not to pursue its request for a MCE waiver
and instead voted to implement a new quality assurance program based
upon the Department's draft policy." (PGFMC Appeal Supplement II, Sec.
II.C.6.) PGFMC argued that in making this decision PGFMC "clearly
evaluated its non-delegated quality review program." (Id.) PGFMC also
submitted a copy of its Care Evaluation Committee Plan for Non-Delegated
Hospitals as evidence of evaluating its non-delegated quality review
program at least annually. (See, PGFMC Appeal Supplement II, Sec.
II.C.6.)
The project officer testified that:
We did a review of all of the noties of the care evaluation committee
and found no evidence of an evaluation of the non-delegated quality
review program.
(Tr., p. 452.)
Finding: PGFMC should receive the 20 points available for this
criterion.
The Board finds based on the evidence submitted that PGFMC
systematically monitored delegated hospitals' MCE/QRSs at least
annually.
(23) PGFMC has documented, and the project officer has agreed, that
PGFMC's Care Evaluation Committee assessed all four hospitals which
applied for delegation in 1980 under Transmittal 100. (PGFMC Appeal,
Sec.II.C.6, Attachment 3.) The review included a comparison of the
hospitals' quality assurance plans against specific delegation criteria.
(Id.) in fact, one of the hospitals failed to receive delegation on the
first attempt. (Id.) This was not an evaluation of individual MCE/QRSs,
but was an overall evaluation of the hospitals' quality assurance plan.
We find that PGFMC's process of evaluating these hospitals satisfied the
systematic monitoring requirement of this criterion.
In finding for PGFMC, we find unpresuasive the project officer's
objection to PGFMC's evidence that "assessing hospitals for delegation
is different from monitoring." (Tr., p. 496.) Although the statement may
be true, it does not address the question of whether PGFMC's assessment
of the hospitals for delegation provides effectively the type of review
of the hospitals' system of performing MCE/QRSs that the Agency desired.
We find that PGFMC satisfactorily met this requirement.
The criterion also requires that the evaluation be performed at least
once per year. Since PGFMC's evaluation of these hospitals took place
in calendar year 1980 (see, PGFMC Appeal, Sec. II.C.6, Attachment 3),
which is the rating period for PGFMC for purposes of this national
evaluation, we find that the annual review requirement is met for this
criterion.
In addition, contrary to the Agency's assertion, PGFMC was monitoring
hospitals' performance through periodic reports as defined in Section E
of Transmittal 43. Section E lists as an example of a periodic report
BQA Form 135. PGFMC submitted as evidence for criterion II.C.4, as did
the Agency, its BQA Form 135s for 1980.(See, PGFMC Appeal, Sec. II.C.4,
Attachment 1; see also, Agency Exhibit A, pp. 000128-000135.)
We also find that PGFMC reviewed its non-delegated quality review
program annually. The minutes of PGFMC's March 17, 1980 Board of
Directors meeting included a discussion by PGFMC's Executive Director
concerning quality assurance and the formation of the Care Evaluation
Committee. (PGFMC Appeal, Sec. II.C.6.) PGFMC also submitted copies of
minutes of subsequent meetings of the Care Evaluation Committee in which
PGFMC's Care Evaluation Plan was developed. (Id.) This plan
specifically coordinates quality assurance programs among both delegated
and non-delegated hospitals. (Id. at Attachment 1.) Since PGFMC has
shown that it reviewed its non-delegated quality review program in 1980,
and the Agency has presented no contrary evidence, we find that PGFMC
met the criterion.
(24) CRTERIA SECTION D. Data System
CRITERION II.D.3. PSRO has systematic data monitoring system to
assure quality and accuracy of the data collected and mechanisms for
corrective action. This system should include reabstracting studies at
least once per year, training programs for coding personnel, 10% error
rate as threshold for action and at least yearly reabstracting
evaluations of each facility.
The Agency did not award PGFMC the 15 points available for this
criterion because the Agency determined "insufficient evidence (was)
submitted." (Agency Exhibit A, p. 000142.) The project officer defined
reabstracting as comparing an independent abstract against the original
abstract to assure that data is being transferred accurately. (Id. at
p. 502.) PGFMC has not disputed the project officer's definition of
reabstracting. The project officer testified that with regard to
systematic reabstracting, the documentation submitted by PGFMC concerned
a problem dealing with the status of newborns. The project officer
stated that:
The PSRO did indeed go out and look at coding for that particular
problem area..., but that is reacting to a particular incident. It is
not a systematic reabstracting.
(Tr., p. 455.)
PGFMC contended that the Agency originally asked for only one
reabstraction letter to meet this criterion. (Tr., p. 88.) In response
to the Agency's contention that one example is not sufficient, PGFMC has
submitted copies of additional letters. (See, e.g., PGFMC Appeal
Supplement II, Sec. II.D.3.) In addition, PGFMC submitted other forms
which it contended showed that PGFMC was reabstracting the medical
records every time it did a study. (Id.) PGFMC argued that this was
systematic. The Executive Director testified that an additional example
of how PGFMC monitored data was that the data manager "evaluates every
single abstract... and personally contacts the review coordinators if
there are problems in that abstract." (Tr., p. 89.)
The Agency contended that the process used by PGFMC of reviewing each
individual abstract is not reabstracting. (Tr., p. 500.) The project
officer testified that the failing of PGFMC's system is that "(there)
has been no validation of the accuracy of the transfer of data from the
medical record to the abstract." (Id.)
With regard to the training programs for coding personnel, the
project officer testified that "(there) was no documentation of training
for coders in calendar year 1980." (Tr., p. 456.)
(25) PGFMC did not dispute the Agency's contention that there were no
training sessions in 1980. PGFMC argued, however, that its review
coordinators were also coders. The Executive Director testified that
these employees "are trained in coding when they are new employees."
(Tr., p. 86.) The Executive Director stated that PGFMC had no new
employees in calendar year 1980 and, therefore, "there was no reason to
send somebody to a coding seminar." (Id.) In addition, PGFMC submitted
a
copy of its Acute Review Coordinator Orientation and Training Plan.
(PGFMC Appeal, Sec. II.D.3, Attachment 3.) PGFMC claimed that the plan
contained an agenda for two days of training with specific reference to
coding. (Tr., p. 87.) The Executive Director testified that to the best
of his knowledge this was done in 1980. (Id.)
With regard to the "10% error rate as a threshold of action," PGFMC
submitted its 1979 and 1980 PSRO Hospital Discharge Data Set (PHDDS)
tapes which indicate an error rate of less than 1%. (See, PGFMC Appeal,
Sec. II.D.3., Attachment 5.) PGFMC contended that this was evidence that
PGFMC "has a systematic monitoring system to assure quality and accuracy
of the data collected and mechanisms for corrective action." (Id. at
Part II, p. 9a.)
The Agency contended that the 10% error rate as a threshold for
action in the criterion is entirely different from the error rate on the
PHDDS tapes. (Tr., p. 456.) The project officer testified that the 10%
error rate "refers specifically to the error rate on studies of
reabstractions." (Id.) The project officer stated further that the error
rate cannot refer to the PHDDS submissions "because tapes with ten
percent error would never be accepted." (Id.) The project officer
explained that there were certain pieces of information "picked up"
in
the PHDDS system that are not collected in the data system. The project
officer stated that:
It is entirely possible... for all the abstracts to be coded wrong,
and still to be accepted by the PHDDS system with a very small
percentage of errors.
(Id.)
Finding: PGFMC should not receive the points for this criterion.
The criterion required a system of data monitoring which included the
reabstracting of studies at least once a year. PGFMC claimed that its
system of data monitoring validated the transfer of data in the same
manner as reabstracting. (See, e.g., Tr., p. 500.) We conclude that
PGFMC failed to substantiate its claim.
(26) The examples submitted by PGFMC used a sampling technique to
identify miscoded cases. Sampling would appear to provide the type of
validation of the accuracy of the transfer of data that the Agency
desired. PGFMC's evidence is a sample conducted in four hospitals in
response to Medicaid's concern with increased length of stay for
"uncomplicated deliveries." (See, PGFMC Appeal Supplement II, Sec.
II.
D.3.) The documentation shows that PGFMC performed one study in four
hospitals of this one particular situation. We find that, while PGFMC's
sampling validated the transfer of data with regard to "uncomplicated
deliveries," PGFMC presented no evidence indicating that sampling was
conducted in other hospitals with regard to other types of medical
abstracts. Without this evidence, we find that PGFMC's performance of
sampling review in this isolated case does not constitute a system as
required in this criterion.
We also find unpersuasive PGFMC's argument related to the data
manager's review of each individual abstract. The review of a finished
abstract is not an independent validation of the transfer of data to the
abstract. Since PGFMC presented no other evidence explaining the type
of review accomplished by the data manager, we conclude that the
evidence does not support a finding that the type of review conducted by
the data manager would accomplish the goals of reabstraction.
With regard to the "10% error rate," we find PGFMC's evidence
unpersuasive in the face of the project officer's testimony. The
project officer explained the difference between the error rate on the
PHDDS tapes and that on the data system. (See, Tr., p. 456.) The
project officer's testimony that different pieces of information were
collected on the two tapes precludes an accurate comparison of the error
rates of the tapes. Since PGFMC did not proffer any contradictory
testimony, the Board concludes that PGFMC's documentation by itself is
insufficient evidence to support PGFMC's claim and, therefore, PGFMC has
failed to document a 10% error rate.
The Board rejects PGFMC's argument that since it hired no new
employees in 1980 training sessions for coders were unnecessary. PGFMC
did not show that the Agency acted unreasonably in choosing to award
points to PSROs which performed the review activities outlined in the
criteria. Further, to award points for no effort under a criterion
would indirectly penalize PSROs which conducted training sessions for
coders.
Part III of the Evaluation Criteria: Performance of Review - Impact/
Potential Impact
PGFMC received 110 of 1,200 possible points on this part; 515 points
were needed to pass. The Board has determined that PGFMC should receive
an additional 70 points for this part. PGFMC disputed the Agency's
scoring of the following criteria in this part:
(27) CRITERIA SECTION A. Management Objectives
Section A rated a PSRO's objectives based on whether they met one of
five stated levels for calendar years 1979 and 1980, or the last and
current grant period, not to exceed 24 months.
PGFMC received a score of level "3" for both years; PGFMC maintained
that it should have received a level "5" for those years. A PSRO
scoring at a level "3" was awarded 20 points for 1979 and 40 points
for
1980; a PSRO scoring at level "5" was awarded 70 points for 1979 and
130 points for 1980.
Level "3" read as follows:
PSRO set objectives which minimally met the criteria (in III.A.2.).
/5/ Experience shows that the PSRO has had to make extensive major
modifications (50 percent or greater of the objectives in either of the
2 grant cycles being evaluated) of the objectives during or at the end
of the grant cycle. Major modifications being changes in the
methodology or proposed outcome which might have been accounted for if
the objective had been adequately developed prior to submission.
Level "4" read as follows:
PSRO sets 4-8 objectives each grant period which meet the criteria
addressed in III.A.2., and reflect the activity and priorities of the
PSRO. The objective methodologies and measurements have been developed
so as to require only minimal modifications during the grant cycle
(Minimal modifications include refinement of data measurement, shifting
of timeframes by no more than 30 days, etc.).
Level "5" read as follows:
PSRO sets 4-8 objectives which meet the criteria in III.A.2., and
adequately reflect the activities and priorities of the PSRO. The
objectives have alternative methodologies to assure success. The
current objectives reflect extensive developmental work prior to their
proposal. Such developmental work might (28) include the conduct of
special MCEs, QRSs, or surveys, or the developmental analysis of special
profiles or data reports. The problems being addressed are of broad
scope and have especially ambitious outcomes/targets.
Mr. Paul Mendelsohn, Senior Public Health Analyst for the PSRO
program, testified that the "objective setting process has evolved over
three years," and for the past two years "the grants application package
has had a very specific format requirement." (Tr., pp. 261-262.) He
stated that the base level of acceptability of objectives was that the
objectives were "impact oriented rather than developmental or process."
(Id. at p. 262.) He stated that beyond this "the Bureau had five
criteria for approving acceptable objectives." (Id.) He stated that
those five criteria were that:
(The) objectives had to be measurable and related to data systems.
The second criteria was that they had to be verified documented PSRO
problems -- not perceived problems.
They had to be -- have specific time frames for performance which
were reflected in a grant chart or time frame milestone chart of
performance so that they could be monitored. And collectively they had
to represent the priorities -- they had to represent a priority that was
consistent with the budget.
And then, lastly, the PSRO must have methodologies that are
consistent and realistic with their budget and with that objective.
(Tr., pp. 262-264.)
Mr. Mendelsohn testified that in the process of measuring these
objectives, five levels of scores were established. (Id. at p. 265.)
Mr. Mendelsohn stated that:
(The) first level was nothing. The PSRO did not have acceptable
objectives. The second level, were those PSROs who after a great deal
of effort, had minimally acceptable objectives.
The third level required that... the PSROs came in basically with
objective sets that with some technical assistance and were good.
(29) The fourth and fifth levels had things that were extra. In
other words that they were particularly aggressive, that they had
assured themselves against failure by having alternative methodologies.
(Tr., p. 265.)
The project officer testified that, in scoring this criterion, the
Regional Office staff did an overall evaluation of PGFMC's 1979 and 1980
objectives. Based on this evaluation, PGFMC was awarded a level "3"
for
both 1979 and 1980. (Tr., p. 458.)
PGFMC argued that its documentation supported a score of level "5"
for both 1979 and 1980. PGFMC contended that it had 15 HCFA-approved
objectives in FY 79-80 and 8 in FY 80-81.(See, PGFMC Appeal, Part II, p.
10.) PGFMC submitted copies of these objectives as documentation. (Id.
at Sec. III.A., 1979, Attachment 1; Section III.A., 1980, Attachment
1.) PGFMC asserted that it received no negative comments from the Agency
on these objectives. PGFMC argued that, in fact, letters from Agency
officials "clearly indicate federal enthusiasm with PGFMC activities
related to objectives." (Id. at Part II, p. 10; see, e.g., Sec. III.A.,
1979, Attachment 1.)
PGFMC argued further that all of its objectives for the two years met
the Agency's criteria for objectives. (Id. at Part II, p. 10.) In
addition, PGFMC contended that of the 15 objectives in FY 79-80, only 2
required modification (13%), and 12 were met (80%). (Id.) Similarly,
PGFMC contended that 6 of the 8 in FY 80-81 objectives were already met
and the other 2 were still being measured. (Id.)
The Agency contended that PGFMC had received negative comments
concerning its objectives from the Agency. The Agency submitted a copy
of a December 5 /6/ memorandum from the then project officer to the file
as evidence of PGFMC's lack of progress on it objectives. (See, Agency
Exhibit H.) The project officer stated on page 3 of the memorandum tht
"(documentation) supporting the progress or lack of progress was not
presented at this time." (Id.) The project officer stated further that
he briefed PGFMC's Executive Director on what documentation the project
officer expected the next time the progress was reviewed. (Id.)
(30) With regard to PGFMC's argument that it met 12 of 15 of its FY
79-80 objectives and 6 of 8 of its FY 80-81 objectives, the Agency
argued that this was not a primary factor in this criterion. (Agency
Response, p. 31.) The Agency contended that 100% of the objectives could
have been met, but if they had "little breadth, depth, or significance
or were inappropriately developed," the PSRO would receive only a
minimally acceptable score. (Id.)
The Agency contended that no higher score than a level "3" schould
be
awarded. The project officer testified that, although PGFMC had
acceptable objectives that met the minimal criteria, he found that "a
number of objectives had to be revised in terms of time frames and
methodologies," and some had proved to be meaningless as the problems
they were aimed at proved to be no problem at all. (Tr., pp. 459-460.)
The project officer did not testify to any specific objectives the
exhibited the above mentioned deficiencies.
The Agency argued that PGFMC's objectives "fail to deal in depth with
utilization issues despite the fact that PGFMC has high utilization
problems." (Agency Response, p. 29.) The Agency argued that this problem
was discussed with PGFMC, but PGFMC "expressed a lack of interest in
utilization objectives." (Id.) The Agency submitted a January 22, 1980
memorandum from the then project officer in which the project officer
wrote that PGFMC's Executive Director had stated that:
The Board's (PGFMC) philosophy is to emphasize quality issues as
opposed to utilization issues and is unlikely to change.
(Agency Exhibit A, p. 00147B.)
PGFMC's Executive Director testified that the Agency had long felt
that PGFMC was unwilling to address utilization issues and, according to
the Executive Director, as the Agency's memorandum correctly stated, he
discussed this with the project officer. However, the Executive
Director stated that he informed the project officer that "contrary to
what he (the project officer) says, we (are) willing to look at
utilization objectives." (Tr., p. 91.) PGFMC submitted as evidence of
its concern with utilization objectives the agenda for the March 18,
1980 Profile Analysis Committee. (PGFMC Appeal Supplement II, Sec.
III.A.) PGFMC contended that the agenda "dealt exclusively with
utilization issues." (Id.; see also, Tr., p. 92.)
A second reason given by the Agency for not awarding PGFMC a higher
score was that a "majority of objectives deals with LTC (long-term care)
rather than acute care." (Agency Response, p. 29.) However, the project
officer testified that this part of the Agency's response was erroneous.
(Tr., p. 506.) The project officer further testified that this error
(31) did not require an adjustment to PGFMC's score on this criterion
because "it doesn't impact at all upon the evaluation of the quality of
those objectives." (Id. at p. 507.)
The Agency also contended that PGFMC's objectives "were not
measurable and did not reflect extensive developmental work prior to
their proposal." (Agency Response, p. 29.) Furthermore, the Agency
submitted a letter dated April 6, 1979 from the then project officer to
PGFMC's Executive Director which the Agency alleged showed that PGFMC
was notified that many of its objectives needed to be rewritten.
(Agency Exhibit A, p. 00147C.)
PGFMC argued that the Agency misconstrued the April 6, 1979 letter.
PGFMC contended that the letter stated that PGFMC's objectives were
received by the Agency on January 23, 1979. PGFMC asserted that the
letter clearly stated that the new format for objectives required by the
Agency in Regional PSRO letter 79-4 was dated February 9, 1979. PGFMC
argued that, since its objectives were written prior to the change in
format, "it is reasonable to assume that the Foundation (PGFMC) had no
way of knowing what specific format would be required." (PGFMC Appeal
Supplement II, Sec. III.A.)
PGFMC further argued that the April 6, 1979 letter clearly showed
that only one of twenty-one objectives (5%) needed to be rewritten.
(Tr., p. 95.) The Executive Director testified that PGFMC accepted the
Agency's comment on the one objective and that the objective "was
rewritten, and all of the objectives were approved by the Department."
(Id.)
The Agency's fourth reason for not awarding a higher score to PGFMC
was that "(the) objectives did not have alternative methodologies to
assure success." (Agency Response, p. 29.)
PGFMC conceded that it did not have alternative methodologies in its
grant package, but argued that the requirement was irrelevant in light
of the percentage of objectives met by PGFMC. (Tr., p. 96.) The
Executive Director testified that "for 1979, the Foundation (PGFMC) met
80 percent of its objectives, and in 1980... we have met, or will meet
75 percent of the objectives." (Id.) in Addition, the Executive Director
stated that this Agency argument was the result of information contained
in an Agency grant package used for 1980. (Tr., p. 96.) The Executive
Director asserted that the information was not available for the 1979
objectives.
(32) The final reason given by the Agency for not awarding PGFMC a
higher score was that the "(objectives') outcomes or targets were not
especially ambitious." (Agency Response, p. 29.)
PGFMC referred to the April 6, 1979 letter from the then project
officer to PGFMC's Executive Director and noted the last paragraph:
I appreciate PGFMC's efforts in presenting these ambitious and
interesting objectives in advance of our request for them, and I look
forward to seeing the process develop.
(PGFMC Appeal, Sec. III.A., 1979, Attachment 3.) (emphasis added)
The project officer testified that he would not describe PGFMC's
objectives as ambitious. (Tr., p. 465.)
Finding: PGFMC should be awarded a level "4" for this criterion for
both 1979 and 1980. Therefore, PGFMC should be awarded 50 points for
1979 and 80 points for 1980, or an additional 70 points over the 60
points awarded PGFMC by the Agency.
The Board's conclusion is based on the fact that each of the reasons
given by the Agency for not awarding PGFMC a higher score on this
criterion is substantially refuted by testimony and evidence produced by
PGFMC; or is unsupported by any evidence in the record; or is related
solely to the requirements for attaining a level "5" score (and one
of
the reasons has now been abandoned by the Agency; see, p. 26 above).
PGFMC documented that it set 15 objectives in FY 79-80 and 8
objectives in FY 80-81. (See, PGFMC Appeal, Sec. III.A., 1979,
Attachment 1; Sec. III.A., 1980, Attachment 1.) The Agency did not
contest the validity of these figures. In addition, since level "3"
and
level "4" both contained the same requirement that objectives meet
the
criteria in III.A.2, and the Agency determined that PGFMC met level "3",
it follows that PGFMC met this requirement for level "4" also.
The difference between a level "3" and level "4" is the
extent and
type of modifications made of the PSRO's objectives. Level "3" required
a finding that the PSRO made "extensive major modifications" of its
objectives. Major modifications is defined as a change in the
methodology or proposed outcome of the objectives. The extent of the
modifications is quantified as greater than 50% in either of the two
grant cycles. Level "4" speaks of "minimal modifications."
Minimal
apparently refers to the quantity and quality of the modifications. In
terms of quantity, (33) since level "3" required 50% modifications,
it
can reasonably be inferred that "minimal" means something less than
50%.
With regard to quality, "minimal" is defined as including, but is
not
limited to, the refinement of data measurement and the shifting of
timeframes by no more than 30 days. Level "4" has an additional
requirement that the objectives "reflect the activity and priorities of
the PSRO."
Although the Agency produced evidence through the testimony of the
project officer that a number of objectives had to be revised, the
Agency made no attempt to document the number of revisions, the types of
revisions, to what extent the objectives had to be revised, or to how
many of PGFMC's objectives the revisions applied.
Level "4" requires only that the PSRO set 4-8 objectives that meet
the standards of that level. PGFMC documented, and the Agency did not
dispute, that PGFMC set 15 objectives in FY 79-80 and 8 objectives in FY
80-81. (See, PGFMC Appeal, Sec. III.A., 1979, Attachment 1; Sec.
III.A., 1980, Attachment 1.) The only evidence presented by the Agency
regarding this numerical requirement was the project officer's testimony
that a "number" of objectives had to be revised. (See, Tr., pp.
459-460.) Also, level "4" specifically allows for the shifting of
time
frames by no more than 30 days. Again, the Agency made no attempt to
document the number of days by which PGFMC shifted its time frames.
Since the Agency included quantifiable requirements in the scoring of
this criterion and yet failed to document the percentage of
modifications or to refute PGFMC's figures, we conclude that this basis
for not awarding PGFMC a level "4" score was unreasonable.
The Agency did submit a letter which the Agency alleged showed that a
number of PGFMC's objectives had to be rewritten. (See, Agency Exhibit
A, p. 00147C.) However, as PGFMC correctly pointed out, those revisions
were to be made in accordance with a new format that was issued after
PGFMC had submitted its objectives. Therefore, the Board finds that it
was unreasonable to include those revisions in the number of
modifications.On the other hand, this letter contains specific comments
by the project officer on PGFMC's objectives. In his comments, the
project officer recommended the rewriting of only two of 21 objectives.
(Id.) This is far less than the 50% modification figure necessary to
score a level "3".
Level "4" also required that the objectives "reflect the activity
and
priorities of the PSRO." In this regard, the Agency argued that PGFMC
failed to deal in depth with utilization issues. We find that the
Agency's argument is unsupported by the evidence in the record.
(34) The Agency's evidence on this point was a memorandum to the file
by the then project officer which simply states that PGFMC's Executive
Director "stated that (PGFMC's) philosophy is to emphasize quality
issues as opposed to utilization issues." (Agency Exhibit A, p.
00147B.) The Agency made no attempt to document the extent of PGFMC's
involvement in utilization issues in relation to other issues, or the
extent of the utilization problem. Indeed, it is entirely possible that
quality issues were simply a higher priority for PGFMC than utilization
issues.
There is nothing in the record to show that utilization issues were
neglected. Indeed, PGFMC's evidence showed that utilization issues were
discussed at committee meetings (See, PGFMC Appeal Supplement II, Sec.
III.A.), and in fact utilization objectives were set for the years in
question. (See, PGFMC Appeal, Sec. III.A., 1979, Attachment 1; Sec.
III.A., 1980, Attachment 1.) Since the Agency did not present any
evidence showing how the level of PGFMC's involvement in utilization
issues did not "reflect the activity and priorities of the PSRO,"
and
PGFMC showed that it addressed utilization issues, we conclude that
PGFMC met this requirement of level "4".
The last two reasons given by the Agency for not awarding PGFMC a
level greater than "3" were that:
(1) the objectives did not have alternative methodologies to assure
success; and
(2) the objectives outcomes or targets were not especially ambitious.
(See, Agency Response, p. 29.)
These two requirements were not relevant to level "4". They were
specific requirements of level "5" only and, therefore, PGFMC did
not
need to meet them to be awarded a level "4".
In determining that PGFMC should have been awarded a level "4",
the
Board rejected PGFMC's contention that it deserved a level "5" for
both
years. As is stated above, level "5" required that the PSRO's
objectives have alternative methodologies to assure the objectives
success. PGFMC conceded that its objectives did not have alternative
methodologies, but argued that the requirement was irrelevant in light
of the percentage of objectives PGFMC had met. (See, Tr., p. 96.) The
Board finds PGFMC's argument unpersuasive. The Agency established
alternative methodologies as a measure of level "5" objectives. As
we
stated previously, the Board will not substitute its judgment on program
(35) policy for reasonable policy choices of the Agency (see p. 6 of
this decision). PGFMC did not show that the Agency acted unreasonably
in choosing to award additional points to PSROs whose objectives had
alternative methodologies. Therefore, the Board finds that PGFMC should
not receive a level "5" for this criterion.
Section III.B.1: Impact - Utilization (Objectives)
This criterion measures the impact on reducing hospital utilization
as reflected in the PSRO's objectives.
Dr. Mendelsohn testified that the measurement of utilization impact
was computed as follows:
(Every) objective dealing with utilization was translated from an
impact standpoint into days saved.... The scores were then added. A
fraction based on the total days certified by the PSRO as the divisor.
The numerator was the total days saved by the PSRO by their
objectives.... We got a fractional score... of the days saved by the
PSRO through their objective process.... (We) took all of the scores of
all the PSROs, put them on a range... to establish the distributive
scoring.
It was distributed on a bell curve type of standard deviation.
(Tr., pp. 268-270.)
The Agency determined that PGFMC did not document any impact on
utilization "resulting from a listed objective for calendar years
1979-1980" and, therefore, awarded PGFMC "0" points for this
criterion.
(Agency Response, p. 32.) The project officer testified that "the
documentation submitted by (PGFMC) was that they were unable to complete
the chart." (Tr., p. 466.) The project officer stated that PGFMC
subsequently submitted documentation for arthroplasty (hip replacement).
(Id.). The Agency determined that this hip replacement data was not for
the relevant time period, and, therefore, it was not scored. (Id.)
PGFMC argued that it actively evaluated data regarding hip
replacement since 1978. (See, Tr. p. 158; see also, PGFMC Appeal
Supplement II, Sec. III.B.1.) Dr. Levy testified that as a result of a
review of survey data for 1978 and 1979, a problem was identified
regarding the length of stay for hip replacement. (Id.) Dr. Levy stated
that PGFMC "subsequently entered in the 1980 objectives the fact that
they (36) would attempt to reduce the length of stay." (Id.) Dr. Levy
asserted that the impact of the objective was that "the length of stay
was, in fact, reduced significantly." (Id. at p. 159.) In support of its
claim, PGFMC submitted a chart which purports to show that PGFMC's
actions under this objective accounted for a.44 percen treduction of all
hospital days relating to hip replacement, thereby entitling PGFMC to 60
points under this criterion. (PGFMC Appeal, Sec. III.B.1.)
In responding to PGFMC's chart, the Agency contended that PGFMC used
the wrong baseline period (1979) in completing the chart. The Agency
argued that:
"(given) the timing of this proposed objective (submitted June 24,
1980 for its grant period 10/1/80 - 9/30/81), the only choice for a
baseline period is the year preceding 10/1/80. Calendar (or fiscal)
year 1979 is not an acceptable baseline period."
(Agency Response, p. 32.)
PGFMC argued that it was "aggressively evaluating data related to hip
replacement since 1979." (PGFMC Appeal Supplement II, Sec. III.B. 1.)
PGFMC gave examples of a number of the activities conducted in
evaluating the validity of the data, and stated that "(as) a result,
activity related to reducing hip replacement length of stay took place
throughout 1980." (Id.) Based on these activities, PGFMC argued that
"1979 is the appropriate comparison year." (Id.)
The Agency also argued that PGFMC's impact period was too short.
(Agency Response, p. 32.) The Agency contended that the earliest PGFMC
could correct the problem of length of stay for hip replacement would be
10/1/80. (Id.) The project officer testified that "the impact period
for measurement of objectives must be a 12 - month period." (Tr., p.
513.) The Agency argued, therefore, that the three month impact period
was unacceptable. (Agency Response, p. 32.)
PGFMC contended that the criterion did not state that impact must be
measured over a period greater than three months. (Tr., p. 515.) PGFMC
argued that since it was performing the impact activity in 1980, it was
entitled to the points under this criterion. (Id. at p. 517.)
Finding: PGFMC should not receive the points for this criterion.
It was not disputed by the parties that this criterion concerned only
PGFMC's listed objectives. Nor was it disputed that PGFMC listed this
objective regarding hip replacement for the grant period 10/1/80 -
9/30/81.
(37) In scoring this criterion, PGFMC's grant cycles were evaluated.
(See, e.g., Tr., p. 517.) PGFMC's 1979 grant cycle ran from 10/1/78 -
9/30/79, and its 1980 grant cycle ran from 10/1/79 - 9/30/80. PGFMC did
not list its objective dealing with hip replacement until 10/1/80. We
find that PGFMC did not present any evidence that its activities
relating to its objectives for the 1980 grant year had any impact on
utilization.Therefore, PGFMC is not entitled to any points under this
criterion.
In so finding, we reject PGFMC's arguments concerning the use of the
three month period in 1980 as the impact period. The "General
Definitions" listed under criterion III.B.1. defined impact and baseline
period as follows:
Impact period - Usually the grant period, but never fewer than 12
months.
Baseline period - The immediate past corresponding period to the
impact period.... (The) number of months used should never be less than
12.
(See, e.g., PGFMC Appeal, Part I, Sec. III.B.1.)
The Agency specifically required that a 12 month period be used in
measuring impact under this criterion. PGFMC did not argue that the
requirement was unreasonable or of unnecessary length based on previous
experience in measuring impact, and, in any event the Board will not
substitute its judgment for the Agency's determination of what a
suitable period should be to measure impact.
Similarly, we reject PGFMC's argument that the baseline period is
1979. The definitional section provided that the baseline period is the
"immediate past corresponding period to the impact period" of at least
12 months. Since we have found that the impact period begins on
10/1/80, the baseline period is 9/30/79 - 10/1/80.
Section III.C: Impact - Quality
Under Part III.C., the PSRO was evaluated on its documented ability
to achieve an impact on the quality of health services provided. PSROs
were awarded from 0 to 350 points depending upon the Agency's
determination of which of four levels the PSRO had attained.
The Agency determined that PGFMC had attained a level "2" in this
area; accordingly, PGFMC was awarded 50 points. PGFMC argued that it
should have been scored a level "4", and awarded 350 points.
(38) Level "2" read as follows:
PSRO documented isolated quality impact, affecting only a few
physician or patient groups. Changes were small and insignificant.
PSRO may have had some influence in causing impact, but failed to make
any case that it was primarily responsible.
Level "4" read as follows:
PSRO produced documents claiming quality impact. Document showed
that impact encompassed an exceptionally high proportion (greater than
25%) of physicians or (greater than 25%) of patients (1) Change was
clearly significant in that it improved the patient care management or
outcome of care for a selected category of patients by a general percent
of physicians; (2) Interventions by the PSRO seemed largely responsible
for the impact, though other factors or trends may also have been
significant; (3) Modified behavior patterns were clearly documented;
or at least one pattern of life threatening incidence was eliminated.
PSRO fully demonstrated that its interventions were primarily
responsible for the impact.
The Agency awarded PGFMC a level "2" because the Agency determined
that PGFMC "documented isolated impact affecting only a few physician or
patient groups. The changes resulting were either small or
insignificant." (Agency, Response, p. 33.)
The project officer testified that because of the numerical element
contained in levels "3" and "4", a chart was completed for
each PSRO
indicating the percentage of patients or physicians "whose behavior was
clearly impacted upon via the operations of the PSRO program." (Tr., p.
469.)
The project officer stated that the percentage computed for PGFMC was
"significantly below 10 percent" and, therefore, only a level "1"
or
level "2" could be awarded. (Id.)
PGFMC contended that it should have been scored at a level "4".
PGFMC argued that its CQA program, complemented by outcome-oriented
validation studies produced sufficient impact to meet the percentage
requirements of level "4". (PGFMC Post-hearing Brief, p. 7.)
Alternatively, PGFMC argued that its interventions ameliorated both life
threatening and non-life threatening situations thus satisfying the
criterion. (Id.)
(39) I. Whether PGFMC documented quality impact.
A. Is PGFMC's CQA program a valid measure of impact?
PGFMC argued that its CQA program "automatically identifies and
corrects quality problems while the patient is hospitalized." (PGFMC
Appeal, Part II, p. 12.) PGFMC asserted that its CQA review has
"identified and resolved problems in the areas of allergy
identification, continuity of resident housestaff management, repeat
radiological examinations, ABG values not being dated, discharge
planning, and physical therapy." (Id.) PGFMC contended that during 1979
and 1980, 61% of the patients it was responsible for reviewing received
complete CQA review. (Id.) Of these patients, 1210 (3.15%) required
PGFMC intervention to improve "patient care management." (Id.) PGFMC
claimed it was solely responsible for those interventions. (Id.)
The basic components of PGFMC's CQA program are:
1) Concurrent monitoring by nurse review coordinators to assure the
provision of quality medical care as represented by specific and generic
criteria....
2) Identifying cases, through the above stated processes, of
non-compliance with the criteria.
3) Intervening in cases as appropriate to correct the ascertained
deficiency.
4) Documenting impact which is the result of a PGFMC intervention.
(See, PGFMC Appeal, Tab III.C, Attachment 2.)
Dr. James D. Levy, Past President of PGFMC and present Vice-President
for Professional Affairs at Greater Southeast Community Hospital,
Washington, D.C., testified that:
What (PGFMC) has tried to do is to look at the process of care, as
well as the outcome, and recognize that in general if your processes are
appropriate, then generally your outcome and your length of stay will
also be appropriate.
(Tr., p. 160.)
(40) Dr. Levy testified that in this regard PGFMC had placed a major
emphasis on admission policies, "making sure the admission is what it is
supposed to be, that the orders are what they are supposed to be, that
they are implemented in a timely manner." (Id. at pp. 161-162.) In
addition, PGFMC had focused on communication between doctors and nurses,
specifically in the area of allergy identification and patient drug
reaction. (Id.) Dr. Levy stated that this was because "approximately 20
percent of all patients admitted to hospitals have some type of drug
reaction." (Id.)
Dr. Levy stated that PGFMC had placed a great deal of emphasis on
these components with the result being that the quality of care issue
"problably impacts on about 61 percent of all the patients at...
PGFMC." (Id. at p. 162.)
Dr. Levy testified as to examples of how PGFMC's system had an impact
on the quality of care. One example dealt with a problem at a hospital
where Arterial Blood Gas (ABG) lab values were not dated. (See,
Appellant's Exhibit 2; Tr. p. 167.) This issue was detected through
PGFMC's CQA program. Dr. Levy stated that doing ABG tests - analyzing
blood for oxygen content or to determine the acid base - can be done as
quickly as 15 minutes apart or it is not unusual to have them done 2 to
3 times in a day. (Tr., p. 168.) Therefore, if the ABG value is
undated, in looking at the process of care without the information, it
becomes "deleterious to the patient's care." (Id.) Therefore, Dr.
Levy
asserted, this is an impact issue as the patient could have received
inappropriate care by having unlabeled ABGs. (Id. at p. 170.)
The second example Dr. Levy explained dealt with the issue of
discharge planning. (See, generally, Appellant's Exhibit 2; Tr., pp.
170-174.) Dr. Levy stated that discharge planning is an acute care issue
in that it is part of quality care in assessing "what this patient's
ultimate outcome is going to be in regards to what their needs are."
(Tr., p. 171.) Dr. Levy stated that "(you) are taking an acute situation
and you are trying to tie it to their entire life." (Id.) Dr. Levy
testified that PGFMC identified a discharge planning problem at hospital
075. (See, previous discussion p. 13 of this decision.) Dr. Levy stated
that PGFMC's actions resolved the problem "which significantly improved
patient management and patient outcome and patient care as far as what
happened to those patients." (Id.)
The Agency contended that CQA is a review technique and does not by
itself demonstrate impact. (See, Agency Response, p. 33.) Maureen
Rothermich, a PSRO program official working in the quality assurance
area, testified that PGFMC's CQA program by itself is not capable of
having a significant impact on the quality of care. (Tr., p. 385.)
(41) Ms. Rothermich testified that the three common elements of
quality assurance are structure, process, and outcome. (Tr., p. 368.)
She further stated that structural elements are not related to PSROs;
therefore, PSROs are involved with process and outcome. (Id.) Ms.
Rothermich stated that "it has been the general recommendation of the
people within the program that PSROs have quality assurance programs
that balance both process and outcome, that one not supercede the
other...." (Id.)
With regard to PGFMC's CQA program, Ms. Rothermich stated:
We viewed it as being primarily process oriented. They... isolated
sorts of incidents of day to day activities surrounding patient care,
and they did not utilize... things such as the PSRO management
information, morbidity and mortality data. They did not do any outcome
sort of oriented data collections of their own.
(Tr., pp. 369-370.)
Ms. Rothermich stated that "there has to be follow-up to show that
those kinds of incidents have been corrected and they are not occurring
again." (Id. at p. 413.)
PGFMC argued that it did follow-up studies of the interventions under
its CQA program. Dr. Levy testified that, after a problem was
identified and addressed, "the data (was) then subsequently collected
and profiled to look and see whether or not there is truly a systems
problem." (Tr., p. 169, see also, Tr., p. 184, 195.) In addition, PGFMC
asserted, and the project officer agreed, that it did a quarterly review
of all the hospitals within its jurisdiction and submitted it to the
Agency. (Tr., pp. 521-522.)
The Agency argued that these quarterly reports were not evidence of
monitoring but an indication of the "number of interventions taken by
the review staff at each facility." (Tr., p. 522.) The project officer
testified that the reports fail to measure the "changes in the outcome
of the medical process." (Id. at p. 524.) The project officer stated
that PGFMC "cannot generate a pattern from these isolated incidences."
(Tr., p. 524.)
B. How do you compute the percentage of impact?
PGFMC contended that modified behavior patterns are clearly
documented in the areas of ABG values, discharge planning, and house
staff management. (See, PGFMC's November 25, 1981 Supplemental
Memorandum, p. 2.) PGFMC (42) argued that the method of measuring the
amount of impact in these three areas is "projecting demonstrated
success against the true population benefiting from the altered conduct
imposed by PGFMC." (Id.) Utilizing this method of computation, PGFMC
contended that its measure of impact was as follows:
Type of intervention # of patients affected ABG Values
1,500 Discharge Planning 3,000 House Staff
Management 34,469 Total
38,969
Total number of patients reviewed in 1979-80: 63,064.
Percentage Impact: 62% (38,969/63,064).
(Id. at Attachment A.)
The Agency contended that PGFMC's method of computing impact was
incorrect. The Agency argued that impact is a "measure of change in
incidence from one record-keeping period to another." (Agency's November
25, 1981 Memorandum, p. 1.) The Agency stated that the percentage can be
expressed as a formula:
Change in Incidence
Discharges
(Id.)
Although PGFMC disagreed with the Agency's method of computing
impact, PGFMC contended that even by utilizing this method PGFMC
documented a 19 percent impact rate and was, therefore, entitled to a
level "3". (See, PGFMC November 25, 1981 Supplemental Memorandum,
p.
2.) PGFMC submitted a chart which purports to show a 19 percent impact
rate on the following intervention issues: allergy identification,
house staff management, ABG values, discharge planning, and continuity
of physician management. (Id. at Attachment B.)
The Agency contended that PGFMC's chart "assumed an extrapolated
improvement (or impact) that was contrary to the Agency's
interpretation." (Agency's December 1, 1981 Memorandum, p. 1.) The
Agency argued that since PGFMC's CQA program allowed for 100% sampling,
actual figures should have been available and used in computing impact.
(Id.)
The Agency argued that, by using the actual improvement or change (as
contrasted to PGFMC's extrapolations), the total impact for the six
identified areas was 1.4 percent. (Id. at p. 3.) The Agency maintained
that PGFMC was entitled to a level "2" for this criterion.
(43) II. Whether one pattern of life threatening incidence was reduced.
With regard to the correction of life threatening problems, Dr. Levy
testified that PGFMC's activities have been "very, very positive."
(Id.)
One example, (see, Appellant's Exhibit 2(b)), concerned a patient's
temperature. Dr. Levy stated:
(A) patient had a temperature of 101.4 that against - spiked the
temperature - and finally the temperature went to 102.3. What happened
was that the patient had a uninary tract infection, probably associated
septicemia. An antibiotic was ordered.
(Tr., p. 181.)
Dr. Levy stated that, although this problem could have discovered in
other ways, PGFMC's program "participated in detecting the problem and
taking action to see that the patient's health was protected." (Id.) Dr.
Levy stated that there was an impact on the patient and on the general
delivery of health care. (Id. at pp. 181-182.)
Dr. Levy testified to a second example of acute care intervention
(see, Appellant's Exhibit 2(c)) which was a situation where a new
coordinator was reviewing records of a patient who had a fracture and a
metastatic disease and discovered evidence that the patient's condition
was deteriorating. (Tr., p. 182.) Dr. Levy stated that the problem
PGFMC was addressing dealt with "how you minitor what is going on with
patient care on a day to day basis." (Id.) In this case, it was
discovered that the patient was receiving inadequate fluids. (Id. at p.
183.) Dr. Levy stated that "in fact, if reversal hadn't taken place, the
patient could have well died." (Id.)
With regard to the examples submitted by PGFMC and testified to by
Dr. Levy, Ms. Rothermich stated they were "isolated cases." (Tr.,
p.
385.) For example, Ms. Rothermich stated that in the case of the 102
degree fever, without a follow-up study no pattern can be established.
(Id.) Without such a pattern it cannot be determined whether the problem
was the night nurse's performance, the nursing unit, or the hospital in
general. (Id.) Ms. Rothermich asserted that "(it) is an isolated
incident, and the impact as a result of that is minimal." (Id. at p.
386.)
Finding: PGFMC is not entitled to a higher level for this criterion.
The Board finds that, even if we accept PGFMC's argument that its CQA
system complemented with follow-up studies can be a measure of (44)
impact, PGFMC has not shown that its measure of impact is greater than
10%. The Board also finds that PGFMC has not shown the reduction of at
least one pattern of life threatening incidence. Therefore, PGFMC is
not entitled to a score higher than a level "2".
The Board finds unpersuasive PGFMC's argument that impact should be
measured by looking at the entire population benefiting from PGFMC's
intervention. While PGFMC's method may represent a valid alternative of
measuring impact, PGFMC has not presented any evidence showing why the
Agency's method is incorrect, or why it does not produce an accurate
measure of impact under PGFMC's CQA system. Without such a showing, the
Board will not require the Agency to adjust its method of measuring
impact to accommodate PGFMC.
The Board also rejects PGFMC's claim that it documented a 19% impact
rate under the Agency's method of computation. PGFMC computed the
number of patients impacted upon by extrapolating from sample data.
(See, PGFMC November 25, 1981 Memorandum, Attachment B.) PGFMC has
presented no evidence to support the sample or to explain why
extrapolation is a valid method of determining the number of patients
impacted upon. Indeed, we agree with the Agency's assessment that,
since CQA provides for a 100% data base, actual figures should be
presented. Without documentation of the actual number of patients upon
whom PGFMC had an impact the Board finds against PGFMC.
We also find that PGFMC has failed to document the reduction of at
least one pattern of life threatening incidence. The two examples
submitted by PGFMC show PGFMC intervening on the behalf of an individual
patient in detecting and correcting a problem concerning proper medical
care. It is unnecessary for us to determine whether the two situations
represent life threatening incidence. The criterion required that the
PSRO reduce one "pattern" of life threatening incidence. We agree
with
the Agency's assessment that PGFMC's examples at best represent isolated
cases. PGFMC has presented no evidence in the form of follow-up studies
which would establish that a pattern of problem medical care existed.
Therefore, we find that PGFMC failed to meet this part of the criterion.
(45) IV. Conclusion
Based on the foregoing analysis, the Board has determined that the
Record does not support the Agency's determination to terminate PGFMC's
grant. PGFMC should have received a base score of 1125 points, 20
points greater than the 1105 points needed to pass the evaluation.
PGFMC also passed two of the three parts: Part I with 260 points and
Part II with 685 points. PGFMC should have received 180 points for Part
III. /1/ Below we refer to PGFMC's "Notice of Appeal," dated July
16,
1981, as Notice of Appeal; PGFMC's "Grant Termination Appeal" filed
dated July 16, 1981, as PGFMC Appeal; the "PGFMC Grant Termination
Appeal Supplement," dated July 30, 1981, as PGFMC Appeal Supplement;
the "Response of the Health Care Financing Administration," dated
August
24, 1981, as Agency Response; the Exhibits submitted in conjunction
with that response as Agency Exhibit; the "PGFMC Grant Termination
Appeal Supplement II," dated September 10, 1981, as PGFMC Appeal
Supplement II; the parties' post-hearing briefs dated October 9, 1981
as Agency Post-hearing Brief and PGFMC Post-hearing Brief. On October
22, 1981, the Agency submitted a copy of the decision in Region X Peer
Review Systems, Inc. v. Schweiker, Civil No. C-2-81-1067 (S.D. Ohio,
October 1, 1981). By letter dated October 27, 1981, PGFMC responded
that "we consider this opinion irrelevant to the case at bar." We
agree
that the opinion of the district court regarding the termination of that
PSRO's long term care review activities does not have any bearing on the
issues in this case. /2/ In those cases where a criterion was marked
"not met" because there was no evidence that PGFMC performed the
activity at issue, the Board considered the very lack of documentation
as a reasonable basis for the Agency's determination. (See, e.g.,
criterion II.B.2(d).) /3/ Although the Agency stated that this
national evaluation was restricted to acute care facilities, the Agency
has not provided a definition of what it considered to be an acute care
facility other than to contrast it with a long-term care facility.
(See, e.g., pp. 112, 441.) Since the Agency did not argue that
short-term general hospitals were not acute care facilities and the
project officer agreed that they are not long-term care facilities, we
find the short-term general hospitals were properly subject to this
evaluation. /4/ We note that the Agency determined that PGFMC
met criterion II.B.2(b). /5/ The criteria in III.A.2. were:
objectives do not reflect significant problems; do not have
measurability; have insufficient or unrealistic methodologies; lack
timeframes; and do not follow prescribed grant application format. /6/
The year was deleted from the face of this document. Therefore,
we cannot determine to which year's objectives the project officer's
comments referred.
SEPTEMBER 22, 1983