The Medicare Quality Improvement Organization (QIO) program was created in 1982 to improve the quality and efficiency of services provided to Medicare beneficiaries. See 42 U.S.C. §1320c, et seq. Originally known as Peer Review Organizations, the name was changed to Quality Improvement Organizations to reflect the predominant role of quality measurement and improvement, in addition to the traditional peer review function of the organizations. After three decades of providing services to both Medicare beneficiaries and health care providers, this generally well thought of program is facing stiff headwinds from skeptical legislators and various agencies.

As required by Sections 1152-1154 of the Social Security Act, the Centers for Medicare & Medicaid Services (CMS) contracts with one QIO in each state (and certain U.S. territories) to serve as that jurisdiction’s QIO.  With an annual budget of approximately a third of a billion dollars, the QIO program is the single largest investment in quality improvement (QI) infrastructure in the nation. See Independent Evaluation of the Ninth Scope of Work, QIO Program: Final Report, November 11, 2011.

QIOs provide a wide scope of services to health care providers including acute providers and post-acute providers. These services include group education such as seminars/webinars, learning collaboratives, individual consultation, providing data feedback reports, tools and links to other resources. Health care providers highly value QIO services and use QIO input and recommendations to make changes in patient care delivery. See QIO Program: Final Report, November 11, 2011.

Increasingly, the cost of the QIO program has drawn the attention of certain legislators, the Medicare Payment Advisory Commission and the Government Accountability Office (GAO). In a December 2010 report, the GAO urged CMS to tighten its oversight of the QIOs’ reporting of costs. Following the GAO report other influential stakeholders have sounded the call to change the way QIOs are presently structured and funded. These recommendations include shifting technical assistance funding from QIOs to low-performing providers, allowing providers to select their own QIO and replacing state-level QIOs with regional ones.

A large number of health care groups, including the American Health Care Association think the recommended changes are a bad idea.

“For more than a decade, our skilled nursing members from across the country built trusted, productive working relationships with their QIO. Attempting to recreate these relationships with an organization operating several states away dismantles the progress the profession has made and takes precious time and resources away from a currently beneficial system,”

said Mark Parkinson, AHCA president and CEO in an August 2013 press release. In addition to AHCA, nearly 50 medical societies, including the American Medical Association, went on record as opposing the restructuring of state-based QIOs.

According to an independent evaluation of the 9th Statement of Work QIO Program, the QIOs contributed directly to improvement in four of the twelve targeted measures of quality that were evaluated, including reducing physical restraints in nursing homes and reducing the number of hospital readmissions. The QIOs may have been partially responsible for improvement in four additional targeted measures of quality. More than three fourths of the hospitals and nursing homes surveyed said that QIO direct contacts or resources provided by the QIO staff led to changes that improved care for their patients.