External Quality Review of Medicaid MCOs and Supporting Regulations in 42 CFR 438.360, 438.362, and 438.364

2010 EXTERNAL QUALITY REVIEW (EQR) PROTOCOLS
APPENDIX III: EQR GLOSSARY OF TERMS
Acceptable Error Rate: The maximum percentage of missing, surplus, or erroneous records that
the State accepts.
Algorithm: A specific set of instructions for carrying out a procedure or solving a problem.
Bias: A systematic distortion in data collection, analysis, or reporting of research findings.
Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA): Reauthorizes the
Children’s Health Insurance Program (CHIP) under title XXI of the Social Security Act. CHIPRA
ensures that States may continue their existing CHIP programs and provides funding to cover
additional low-income children, including children eligible for CHIP or Medicaid but not currently
enrolled. It also establishes authority for CMS to support States in improving quality of care for
children in Medicaid and CHIP by establishing an initial core set and then enhanced voluntary
quality measures.
Claims Data: See “Encounter Data”
Confidence Level: The likelihood, expressed as a percentage that a sample finding is true for
the population from which the sample was taken. A 95 percent confidence interval indicates a 5
percent chance that the sample result is due to chance and is not true for the population.
Consumer Assessment of Healthcare Providers and Systems (CAHPS): A public-private
initiative to develop standardized surveys of patients' experiences with ambulatory and facilitylevel care.
Compliance Review: A process to determine the extent to which Medicaid and CHIP MCOs are
complying with regulatory requirements at 42 C.F.R. Part 438, subparts D and E.
Correlation Coefficient: A statistical measure of the interdependence of two random variables,
the value of which indicates how much a change in one variable is related to a change in the
other variable. Correlation coefficients range in value from −1 to +1. A perfect positive
correlation is +1 and a perfect negative correlation is -1. Zero indicates the absence of a
relationship between the variables.
CPT codes: A coding system, defined in the American Medical Association publication Current
Procedural Terminology, for medical procedures that is used for billing and quality measures.

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Data: Factual information, especially information organized for analysis or used to reason or
make decisions.
Database Management System (DBMS): A set of computer programs that controls the creation,
maintenance, and use of a database.
Denominator: Provides the general specifications of any clinical component that is the basis for
inclusions and exclusions in the population to be considered in a measure; the number below
the numerator as in a fraction.
Early and Periodic Screening, Diagnosis, and Treatment Program (EPSDT): A comprehensive
and preventive child health program for Medicaid enrollees under age 21 that includes periodic
screening, vision, dental, and hearing services.
Edit Checks: A program instruction or subroutine that tests the validity of input in a data entry
program.
Encounter Data: The electronic record of services provided to MCO enrollees by both
institutional and practitioner providers (regardless of how the providers were paid) when the
services would traditionally be a billable service under fee-for-service (FFS) reimbursement
systems. Encounter data provide the same type of information that is found on claim forms
(e.g., UB-04 or CMS 1500), but not necessarily in the same format.
Erroneous Encounters: Encounters that occurred and are represented by an encounter record
that contains incorrect data elements.
External Quality Review (EQR): The analysis and evaluation of aggregated information on
quality, timeliness, and access to health services provided to Medicaid/CHIP enrollees by MCOs
or their contractors.
External Quality Review Organization (EQRO): An organization that meets the competence and
independence requirements set forth at 42 C.F.R. §438.354, for an organization to perform an
EQR and/or other EQR-related activities as set forth in 42 C.F.R. §438.358.
Fee for Service: Payment method where physicians and other health care providers receive a
fee for each service, such as an office visit, test, procedure, or other health care interaction.
Generalizability: The extension of findings and conclusions from a study sample to the
population from which the sample was drawn.

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Healthcare Effectiveness Data and Information Set (HEDIS®): A collection of standardized
performance measures and their definitions designed to ensure that purchasers and consumers
can reliably compare the performance of managed health care plans. The performance
measures are related to public health issues such as cancer, heart disease, and asthma and
also include well-child visits. HEDIS® is sponsored, supported, and maintained by the National
Committee for Quality Assurance (NCQA).
Indicator: Easily identified features of a society which can be measured, which vary over time,
and are taken as revealing some underlying aspect of social reality.
Information System Capabilities Assessment (ISCA): Assessment of the desired capabilities of
the MCO’s information system which poses standard questions used to assess the strength of
the system; this provides information to the EQRO about the extent to which the information
system is capable of producing valid encounter data, performance measures, and other data
necessary to support quality assessment and improvement, as well as managing the care
delivered to its beneficiaries.
Managed Care Organization (MCO): Includes all managed care organizations, including PIHPs
under a Medicaid and/ or CHIP program. While multiple legal definitions of MCO appear in
various regulatory and legislative requirements, the term MCO in these EQR protocols refers
only to those managed care organizations that are subject to external quality review.
Margin of Error: A statistic expressing the amount of random sampling error in a survey's
results. The larger the margin of error, the less faith one should have that the sample result is
the true population value.
Measure: A standard used for valuing, ascertain the extent or quantity of something.
Missing Encounters: Encounters that occurred but are not represented by an encounter record.
Non-probability sampling: Selecting the sample based on the decisions of those administering
the study, and not on random chance
Numerator: In reference to the larger population of patients, the number of patients in a study
meeting the specifications of a clinical component in a measure.
Pay for Performance: An emerging movement in healthcare, in which providers and sometimes
MCOs are rewarded for quality of healthcare services.
Performance Improvement Projects (PIPs): A process/project to assess and improve processes,
thereby improving outcomes of healthcare.
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Performance Measure: The specific representation of a process or outcome that is relevant to
the assessment of performance; it is quantifiable and can be documented.
Probability sampling: A sampling method that allows for specifying for each case in the
population the probability of its inclusion in the sample; to select a sample that is representative
as possible of the population.
Quality: The degree to which the MCO increases the likelihood of desired health outcomes of its
enrollees through its structural and operational characteristics and through the provision of
health services that are consistent with current professional knowledge in at least one of the six
domains of quality, as specified by the Institute of Medicine (IOM) – efficiency, effectiveness,
equity, patient-centeredness, patient safety, and timeliness.
Quality Assurance Plan: Plan that includes processes to monitor, evaluate and review all
aspects of the survey administration procedure. The purpose of a quality assurance plan is to
document a strategy of reviews and audits to assure that the appropriate processes are being
followed correctly; a document to ensure the final products are of the upmost quality; the quality.
“Real’ Improvement: A measurable, statistically significant change in performance related to an
intervention.
Reliability: 1) The internal consistency of a study instrument, and 2) The reproducibility of study
results when the survey or intervention is administered under different conditions (e.g., by
different people, or at different times).
Sample: A subset selected from a population.
Sample Frame: The population from which the sample will be drawn; a list of all members of the
study population eligible for the study which is used to select the sample.
Sampling Plan: How an unbiased subset of the population (a sample) will be identified and how
data from that sample will be collected, striving to have the sample be as representative of the
overall population as possible.
State Regulation: A rule or order promulgated by a State prescribing what can and cannot be
done. They are the enactment of policy determinations.
State Requirement: That which is obligatory and must be performed; generally considered
important and necessary.

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Standard: A reference point, generally the ideal, against which other things can be evaluated;
the model of authority or excellence.
Study Population: A group of individuals taken from the general population to be included in the
study.
Surplus Encounters: Encounters for which an encounter did not occur or which duplicated other
records.
Study Question: Identifies the focus of the study and sets the framework for data collection,
analysis, and interpretation.
Sustained Improvement: Changes in the fundamental processes of health care delivery
demonstrated through repeated measurements over comparable time periods.
Unit of Analysis: The entity that is being studied during data analysis; it is the “what” or “whom”
that is being studied.
Validation: The review of information, data, and procedures to determine the extent to which
they are accurate, reliable, free from bias, and in accord with standards for data collection and
analysis.
Validity: The degree to which a tool measures what it is intended to measure.
Variable: A characteristic or condition that changes or has different values for different
individuals.

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