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

OMB Approval No.
0938-0786

EQR PROTOCOL 3:
VALIDATING PERFORMANCE
IMPROVEMENT PROJECTS (PIPs)
A Mandatory Protocol for External Quality Reviews (EQR)
Protocol 1: Assessment of Compliance with Medicaid Managed Care Regulations
Protocol 2: Validation of Measures Reported by the MCO
Protocol 3: Validation of Performance Improvement Projects (PIPs)
Protocol 4: Validation of Encounter Data Reported by the MCO
Protocol 5: Validation and Implementation of Surveys
Protocol 6: Calculation of Performance Measures
Protocol 7: Implementation of Performance Improvement Projects (PIPs)
Protocol 8: Focused Studies
Appendix V: Information Systems Capabilities Assessment (ISCA)

Department of Health and Human Services (HHS)
Centers for Medicare & Medicaid Services (CMS)

Protocol 3
Version 2.0
December 1, 2011

Table of Contents
PURPOSE AND OVERVIEW OF THE PROTOCOL ....................................................................... 3
ACTIVITY 1: ASSESS THE STUDY METHODOLOGY ................................................................... 3
Step 1: Review the Selected Study Topic(s)................................................................................ 4
Step 2: Review the Study Question(s) ......................................................................................... 6
Step 3: Review the Identified Study Population ........................................................................... 6
Step 4: Review the Selected Study Indicators ............................................................................. 7
Step 5: Review Sampling Methods .............................................................................................. 9
Step 6: Review the Data Collection Procedures ........................................................................ 11
Step 7: Review Data Analysis and Interpretation of Study Results ............................................ 14
Step 8: Assess the MCO’s Improvement Strategies .................................................................. 15
Step 9: Assess the Likelihood that Reported Improvement is “Real” Improvement .................... 16
Step 10: Assess Sustainability of the Documented Improvement .............................................. 17
ACTIVITY 2: VERIFY STUDY FINDINGS (OPTIONAL) ................................................................ 18
ACTIVITY 3: EVALUATE AND REPORT OVERALL VALIDITY AND RELIABILITY OF PIP
RESULTS ..................................................................................................................................... 20
REFERENCES ............................................................................................................................. 21

Attachments
Attachment A: PIP Review Worksheet

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

2

PURPOSE AND OVERVIEW OF THE PROTOCOL
This mandatory protocol is used to determine whether a health care quality performance
improvement project (PIP) was designed, conducted, and reported in a methodologically sound
manner. The purpose of a PIP is to assess and improve the processes and outcomes of health
care provided by an MCO. Protocol 3 specifies procedures for EQROs to use in assessing the
validity and reliability of a PIP. 1 Protocol 3 specifies how to conduct the following three activities:
1. Assess the study methodology;
2. Verify PIP study findings; and
3. Evaluate overall validity and reliability of study results.
Results of the MCO’s PIPs may be reported in the annual Secretary’s Report on the Quality of
Care for Children in Medicaid and CHIP or the annual Secretary’s Report on the Quality of Care
for Adults in Medicaid. These reports are released every September and information that is not
available from a State’s EQR report may be so noted in the reports. Both reports will be
available on the CMS Medicaid website. States are strongly encouraged to have EQROs include
PIP outcome and trending information reported in the EQR technical report. This will enable the
Secretary to include results and lessons learned from State intervention strategies to improve
care as part of that annual reporting process.
Additionally, States may incorporate specific PIPs as part of their State quality strategy, required
by Section 1932(c)(1) of the Social Security Act, to align with the HHS National Quality Strategy
for Quality Improvement in Health Care. When doing so, soliciting input from participating
MCOs/PIHPs in the identification of PIP topics and methodologies may be helpful so that
relevant clinical, administrative and population-based improvement efforts are addressed as part
of the State’s overall strategy to improve health care delivery and outcomes of the people it
serves.

ACTIVITY 1: ASSESS THE STUDY METHODOLOGY
Activity 1 includes reviewing the following steps:
1.
2.
3.
4.
5.
6.
7.
8.

Review the selected study topic(s);
Review the study question(s);
Review the selected study indicators;
Review the identified study population;
Review sampling methods (if sampling used);
Review the data collection procedures;
Assess the MCO’s Improvement strategies;
Review the data analysis and interpretation of study results;

1

This protocol relies heavily on a guidebook produced by the National Committee for Quality Assurance (NCQA) that
identifies key concepts in quality improvement (QI) studies. Please see References at the end of this protocol for a list
of references that were used to develop this protocol.

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

3

9. Assess the likelihood that reported improvement is “real” improvement; and
10. Assess the sustainability of documented improvement.
The EQRO will review the PIP design and implementation using documents provided by the
MCO, which may be supplemented with MCO staff interviews. In addition, the MCO, on an ad
hoc basis, may supplement information obtained through hardcopy, electronic submission, or
interviews.
The EQRO should follow the 10 steps below and answer the questions posed in each. The
answers should be recorded on a standardized PIP Validation Worksheet (see Attachment A).

Step 1: Review the Selected Study Topic(s)
In this step, the reviewer determines the appropriateness of the selected study topic(s). The
topic(s) should address the overarching goal of a PIP, which is to improve processes and
outcomes of health care provided by the MCO.
Criteria
The PIP should target improvement in either clinical or non-clinical services delivered by the
MCO. Study topics must reflect MCO enrollee characteristics including demographics,
prevalence of disease, and the potential consequences of disease. The project may focus on
patterns of over or under utilization that present a clear threat to health or functional status. The
State may select the MCO’s study topic(s). Topics may also be selected based on enrollee input.
The topic should address a significant portion of the enrollees (or a specified sub-portion of
enrollees) and have the potential to significantly impact enrollee health, functional status, or
satisfaction. The topics should reflect high-volume or high-risk conditions of the population
served. High-risk conditions may occur for infrequent conditions or services. High risk also exists
for populations with special health care needs, such as children in foster care, adults with
disabilities, and the homeless. Although these individuals may be small in number, their special
health care needs place them at high risk.
The CMS suggests that States consider PIPs which address some of the national health
priorities CMS has identified, (e.g., in 2011, Partnership for Patients, Million Hearts Campaign,
pediatric oral health, and childhood obesity).
Recommended Sources of Supporting Information
• Data about enrollees:
• Health risks;
• Utilization of clinical or non-clinical services;
• Demographics (Age, sex, race, ethnicity, language); and
• Disability or functional status
• Geographic location of membership
• Utilization, diagnostic, and outcome information on:
EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

4

•
•

•
•
•
•

• Outpatient and inpatient encounters, services, and procedures;
• Medications and devices;
• Diagnoses; and
• Adverse incidents (such as deaths, avoidable admissions, or readmissions)
Standardized local, State, or national measures when appropriate and available
Data from other outside organizations, such as Medicaid or Medicare fee-for-service
data; data from other health plans; and local or national public health reports on
conditions or risks for specified populations; data from health information exchange
technology – including registries.
Data from surveys, grievance and appeals processes, disenrollment, and requests to
change providers
Data on appointments and provider networks (e.g., access, open and closed panels, and
provider language spoken)
Data from certified electronic health record (EHR) technology as described in Appendix
V: Information System Capabilities Assessment
Data from previous EQRO focused surveys

Assessment
To determine appropriateness of the study topic:
A. Review the documentation justifying the study topic using the potential data sources
listed above.
1. Did the State require the PIP topic, goal and/or study methodology?
2. Were specific MCO or State enrollee demographic characteristics and health risks
considered?
3. Is the topic consistent with demographic and epidemiologic information of the
current enrollees?
B. Did the MCO consider input from enrollees who are users of, or concerned with specific
areas such as mental health or substance abuse?
C. The PIP, over time, should address a broad spectrum of enrollee care and services. Does
the PIP address:
1. Children with special health care needs?
2. Preventive care?
3. Acute and chronic condition care?
4. High-volume and high-risk services (even if they are low frequency)?
5. Specialized care received from centers such as burn, transplant, and cardiac
surgery centers?
6. Continuity or coordination of care when received from multiple providers and
multiple episodes of care?
7. Appeals and grievances?
8. Access to and availability of care?
EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

5

Step 2: Review the Study Question(s)
In this step, the reviewer determines the appropriateness and adequacy of the study (questions).
The study question(s) identifies the focus of the PIP and establishes the framework for data
collection, analysis, and interpretation.
Criteria
The study question(s) should be clear, simple, and answerable. In addition, they should be
stated in a way that supports the ability to determine whether the intervention has a measurable
impact for a clearly defined population.
An example of a vague study question is:

×

“Does the MCO adequately address psychological problems in patients recovering
from myocardial infarction?”
In this example, it is not clear how “adequately address” will be assessed.
Furthermore, “psychological factors” is not specific.

A clearer study question is:

 “Does the intervention reduce the likelihood that patients with myocardial infarction
will develop severe emotional depression during hospitalization?”
Potential Sources of Supporting Information:
• QI study documentation
• Relevant clinical literature
• Enrollee focus groups/surveys
• Enrollee/provider representatives on Quality Committees

Step 3: Review the Identified Study Population
Measurement and improvement efforts must be system-wide.
Criteria
The PIP must clearly identify the ‘system’ or population, also referred to as the universe. Once
the population is identified, the MCO will determine whether to study data for the entire
population or a sample of that population. A representative sample of the identified population is
acceptable (see Step 5).
Potential Sources of Supporting Information
Data on the MCO’s enrolled population as well as enrollee counts relevant to the study topic and
measures. This includes:
•
Demographic information from the MCO’s enrollment files
•
The MCO’s utilization and outcome information such as:
EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

6

•

 Services
 Procedures
 Admitting and encounter diagnoses
 Adverse incidents (e.g., deaths, avoidable admissions, readmissions)
 Patterns of referrals
 Authorization requests
Other databases, as needed (e.g., pharmacy claims data to identify patients taking
a specific medication(s) during a specific enrollment period).

Assessment
Review the study description and methodology to determine if the study clearly identified the
study population. Consider the following questions:
A. How was the “at risk” population defined?
B. Are all individuals clearly defined in terms of the identified study question(s) and
relevant indicators?
C. Is the entire study population or a sample used? If the organization is able to collect
and analyze data through an automated data system, it is possible to study the whole
population? If the data must be collected manually, sampling may be more realistic.
D. Did the definition of the study population include requirements for the length of the
study populations’ members’ enrollment in the MCO? The required length of time will
vary depending on the study topic and study indicators.
E. If the entire population was studied, did the data collection approach capture all
enrollees to whom the study question applied?
F. If a sample was used, go to Step 5. If the entire population was studied, skip Step 5
and go to Step 6. If HEDIS® measures and sampling methodology is used, go to
Step 7.

Step 4: Review the Selected Study Indicators
A study indicator is a measurable characteristic, quality, trait, or attribute of a particular
individual, object, or situation being studied. Indicators may be quantitative or qualitative and
continuous or discrete. Discrete or categorical indicators have a limited number of possible
categories (e.g., an individual has/has not received a flu shot in the last 12 months). In contrast,
continuous indicators have unlimited possible values within the limits the indicator range, (e.g.,
age, blood pressure, temperature). Data collected on a continuous indicator such as blood
pressure can be used for a discrete indicator, (e.g., an enrollee’s blood pressure is/is not below a
specified level).
Criteria
Each PIP should have one or more measured indicator to track performance and improvement
over a specific period of time. All measured indicators should be:
• Objective; and
EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

7

•
•
•
•

Clearly defined; and
Based on current clinical knowledge or health services research; and
Enrollee outcomes (e.g., health or functional status, enrollee satisfaction); or
A valid indicator of these outcomes.

The number and complexity of measures may vary depending on:
• The study question(s);
• The complexity of existing practice guidelines for a clinical condition; and
• Availability of data and resources to gather data
Potential Sources of Supporting Information
• Clinical and non-clinical practice guidelines
• Administrative data
• Medical records
Assessment
The EQRO will review the project documentation to determine if appropriate measures are used.
Examples of measures currently existing within the public health community or the managed
care industry include NCQA’s Healthcare Effectiveness Data Information Set (HEDIS®) or
measures that are developed by CMS and AHRQ (such as the Pediatric or Adult Core
Measures). The MCO may also develop measures based on current clinical practice guidelines
or health services research. When an MCO develops its own measures, it must document the
basis for its adoption. Consider the following questions:
A. Did the study use objective, clearly defined, measurable, time-specific indicators?
B. Do the measures capture changes in health status, functional status, or enrollee
satisfaction?
C. Do the measures have any of the following key characteristics:
• related to identified health care guidelines relevant to the study question?
• an important aspect of care or operations that made a difference to the MCO’s/
beneficiaries?
• data available through administrative, medical records or another readily
accessible source?
• limitations on the ability to collect the data skew the results?
• require explicit or implicit criteria (Note that the specificity of the criteria used to
determine compliance with a measure must be considered)?
• if relevant, a strategy to ensure inter-rater reliability?
Notes to Reviewers
For the purpose of this protocol, “outcomes” are defined as changes in patient health, functional
status, or satisfaction resulting from the PIP. For a PIP with a clinical focus, measures should
EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

8

include change in health status or functional status or process of care proxies for these
outcomes. Standardized performance measures addressing outcomes may be limited because
health outcomes are influenced by factors outside of the organization’s control, such as poverty,
genetics, and environment. For these reasons, quality measures do not always need to be
outcome measures.
Process measures, while acceptable, must offer strong clinical evidence that the process being
measured is meaningfully associated with outcomes. This determination should be based on
published guidelines, including citations from randomized clinical trials, case control studies, or
cohort studies. At a minimum, the PIP should be able to demonstrate a consensus among
relevant practitioners with expertise in the defined area who attest to the importance of a given
process. It will be important that MCOs note within their PIP external validity threats which could
affect the results of the outcome measures.
While enrollee satisfaction is an important outcome of care in clinical areas, improvement in
satisfaction should not be the only measured outcome of a clinical project. Some improvement in
health or functional status should be addressed. For projects in non-clinical areas, the use of
health or functional status measures is preferred, but not required, when addressing access or
availability of services. Enrollee satisfaction alone may be sufficient for some non-clinical
projects.

Step 5: Review Sampling Methods
In this step, the reviewer determines the appropriateness and validity of the PIP’s sampling
methods. A sample is a statistical subset of a population that represents the entire population.
There are several types of sampling methods that are appropriate for different types of PIPs.
Criteria
Appropriate sampling is necessary to ensure valid and reliable information. Please refer to
Appendix II of the EQR Protocols for an overview of sampling methodologies applicable to PIPs.
MCOs that use HEDIS® measures should also use HEDIS® sampling methodology, which is
considered valid and reliable.
Potential Sources of Supporting Information
Data on enrollee characteristics relevant to health risks or utilization of clinical and non-clinical
services including:
• Age;
• Sex;
• Race/ethnicity;
• Language; and
• Functional status.
Utilization information includes:
EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

9

•

•

Diagnostic and outcome information such as:
• Procedures,
• Admitting and encounter diagnoses,
• Adverse incidents (such as deaths, avoidable admissions, readmissions),
• Patterns of referrals, and
• Authorization requests;
Other information as needed, such as pharmacy claims data to identify patients taking a
defined number of a specific medication(s) during a specific enrollment period.

Assessment
Review the study description and methodology. Consider following questions:
A. Did the methods
1. Calculate the required sample size?
2. Consider and specify the true or estimated frequency of the event?
3. Identify the confidence level to be used?
4. Identify an acceptable margin of error?
B. Are valid sampling techniques used?
Sampling
Statistical sampling methods apply two basic methodologies- probability sampling and nonprobability sampling. General information about using various types of sampling methods is
provided in Appendix II of the EQR Protocols.
Probability sampling is also known as random sampling, which means leaving the selection of
population units totally to chance and removing biased selection of study subjects. An example
would be a study of how many women received a cervical cancer screening during a specified
year by randomly selecting 100 of the 1,000 women members of the MCO. Types of probability
sampling include:
• Simple Random Sampling;
• Systematic Random Sampling;
• Stratified Random Sampling; and
• Cluster Sampling.
Non-Probability sampling uses specific characteristics of the study subject. An example would be
a study of the performance of a group practice by sampling all the patients that were seen in that
office on a specific day. Types of non-probability sampling include:
• Judgment Sampling;
• Convenience Sampling; and
• Quota Sampling.

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

10

Step 6: Review the Data Collection Procedures
In this step, the reviewer determines the validity of the procedures the MCO uses to collect the
data that inform the PIP measurements. Study results are dependent on accurate and valid data
that are collected appropriately.
Criteria
Data collection procedures must ensure that the data used to measure performance are valid
and reliable. Valid data measure what is intended to be measured, while reliable data produces
consistent results. To ensure both validity and reliability, the data collection plan should specify:
• The data to be collected;
• The data sources;
• How and when the data are to be collected;
• Who will collect the data; and
• Instruments used to collect the data.
To ensure the collection of valid and reliable data, the MCO should develop collection
specifications appropriate to the type of data needed. Procedures for collecting data from
automated data systems will be different from procedures for visual inspection of medical records
or other primary source documents. However, both types of data collection require the following
to ensure the data are consistently extracted and recorded:
•

Qualified Personnel:
Data collection personnel have the conceptual and organizational skills to abstract the
data. The specific skills will vary depending on the nature of the data and the degree of
professional judgment required. For example, experienced clinical staff, such as
registered nurses, should be used to extract the appropriate data from medical records to
support a judgment about whether clinical criteria are met. In contrast, trained medical
assistants or medical records clerks may collect data if the abstraction involves verifying
the presence of a diagnostic test report.

•

Inter-Rater Reliability:
The number of data collection staff used for a given project affects the reliability of the
data. A smaller number of staff promotes inter-rater reliability; however, it may also
increase the amount of time it takes to complete this task. The PIP should also consider
and address intra-rater reliability (i.e., reproducibility of judgments by the same abstractor
at a different time).

•

Guidelines for Obtaining and Recording the Data to ensure consistent interpretation
among and between data collection staff. This is particularly important when there are
multiple reviewers collecting data. Appropriately qualified data collection staff (e.g.,
registered nurse, certified coder, etc.) should have access to a glossary of terms for each
project before data collection begins. The data collection staff should be provided with

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

11

clear and succinct written instructions, including an overview of the study, specific
instructions on how to complete each section of the form or instrument, and general
guidance on how to handle situations not covered by the instructions.
Potential Sources of Supporting Information
• List of sources of data used in the study.
• If medical record review or other manual data collection is used to produce study data:
 data recording forms; and
 instructions to data collectors.
• If automated data collection is used, an algorithm showing the steps in the production of
quality indicators and other relevant data collection.
• When assessing non-clinical services such as health care access or cultural competency
or care coordination, a study may utilize information on how the MCO is structured and
operates.
Assessment
Two processes may be used to assess data collection procedures:
1. Reviewing the study’s approach to data collection (discussed in this step); and
2. Conducting a verification sample of the study’s findings (discussed in Activity 2 of this
protocol).
Consider the following questions to determine the appropriateness of the PIP’s data collection
procedures:
A. Does the study design clearly specify how the data are to be collected?
Accurate measurement depends on clear and concise definitions of data elements.
When descriptive terms are used (e.g., high, low, or normal), numerical definitions
must be established for each term. The units of measure (e.g., pounds, kilograms,
etc.) must also be specified.
B. Does the study design clearly specify the sources of data?
Data sources vary and depend upon the selected topic and indicators. The topic and
indicators will reflect clinical and research considerations and the available MCO data
sources. Sources can include:
• Beneficiary medical records;
• Tracking logs;
• Encounter and claims systems;
• Provider interviews;
• Beneficiary interviews; and
• Surveys.

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

12

C. Does the study design specify a systematic method of collecting valid and reliable
data that represents the entire population relevant to the study (sampling adequacy)?
D. What is the type of data collected (automated vs. manual)?
Automated Data Collection: Evaluating an automated data collection methodology
emphasizes the system that stores the data and should focus on an estimation of the
degree of completeness of the automated data used for the PIP study indicators. 2
For example:
• Inpatient data: Did the data system capture all inpatient admissions?
• Primary care data: Did primary care providers submit encounter data for all
encounters?
• Specialty care data: Did specialty care providers submit encounter data for all
encounters?
• Ancillary services data: Did ancillary service providers submit encounter or
utilization data for all services provided?
• EHR data: Was patient clinical, service, or quality metrics data retrieved from
certified electronic health record technology?
Manual Data Collection: This may be the only feasible option for MCOs and selected
topics and emphasizes who and how the data are abstracted. The beneficiary medical
record is the most frequently used data source. Other manual systems include clinical
tracking logs, registries, complaint logs, and manual claims. When evaluating manual
data collection, consider the following:
• Is qualified staff collecting the data?
• Does the staff have the requisite clinical knowledge and skills, including good
conceptual skills, organization skills, thoroughness, and strong documentation
skills?
• Does the data collection tool provide reliable and accurate data collection over
the time periods studied?
• Is the data collection instrument(s) used for manual data collection clear and
promote inter-rater reliability?
E. Does the study design prospectively specify a data analysis plan that reflects the type
of data being collected (i.e., qualitative, quantitative data, or both)?
Qualitative data describes characteristics or attributes by which persons or things can
be classified (e.g., sex, race, poverty level, or the presence or absence of a specific
disease). Calculation of proportions and calculation of rates are the two most common
qualitative measures.

2

The accuracy of automated data is also a concern, but validation of this is beyond the scope of this protocol.

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

13

Quantitative data are concerned with numerical indicators such as height, weight and
blood levels. The methods by which the data are analyzed and presented will vary by
type of data. Quantitative data require, at a minimum, simple descriptive statistics
such as measures of central tendency (i.e., mean, median, or mode) and measure of
variability (i.e., range or standard deviation).
F. Are data collected on the entire population or a sample?
G. Is the PIP comparing these results to those of previous or similar studies? If so, the
data analysis plan should evaluate the comparability of the studies and identify the
appropriate statistical tests.
H. Is the PIP comparing the performance of an individual MCO, a number of MCOs, or
different provider sites? Comparing the performance of multiple entities involves
greater statistical design and analytical considerations than those required for a study
of a single entity, such as a MCO.

Step 7: Review Data Analysis and Interpretation of Study Results
In this step, the reviewer determines the accuracy of the MCO’s plan for analyzing and
interpreting the PIP’s results. Accurate PIP data analysis is critical because the MCO will
implement changes in treatment and operations based on the results of a PIP.
Criteria
The review examines the appropriateness of, and the adherence to, the statistical analysis
techniques defined in the data analysis plan. Interpretation and analysis of the study data should
be based on continuous improvement philosophies and reflect an understanding that most
problems result from failures of administrative or delivery system processes. Interpreting the data
should involve developing hypotheses about the causes of less-than-optimal performance and
collecting data to validate the hypotheses.
Potential Sources of Supporting Information
•
Baseline project indicator measurements
•
Repeat project indicator measurements
•
Industry benchmarks
•
Analytic reports of PIP results by the MCO
Assessment
Examine the calculated plan performance on the selected measures. To review the data analysis
and results of the study, consider the following:
A. Is the analysis of the findings conducted in accordance with the data analysis plan?

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

14

B. Are numerical results and findings presented in an accurate, clear, and easily
understood manner?
C. Does the analysis identify:
•
•
•
•
•

Initial and repeat measurements of project outcomes?
Realistic and unambiguous targets for the measures?
The statistical significance of any differences between the initial and repeat
measurements?
Factors that influence the comparability of initial and repeat measurements?
Factors that threaten the internal or external validity of the findings?

D. Does the analysis of the study data include an interpretation of the extent to which its
PIP is successful and what follow-up activities are planned as a result?

Step 8: Assess the MCO’s Improvement Strategies
In this step, the reviewer determines the appropriateness of the strategy for achieving true
improvements. Real, sustained improvements result from a continuous cycle of measuring and
analyzing performance, and developing and implementing system-wide improvements. Actual
improvements depend on thorough analysis and implementation of appropriate solutions.
An improvement strategy is defined as an intervention designed to change behavior at an
institutional, practitioner, or beneficiary level. The effectiveness of the intervention activity or
activities is determined by measuring the MCO’s change in performance, according to predefined
quality measures.
Criteria
Interventions are key to a PIP’s ability to bring about improved health care outcomes.
Appropriate interventions must be identified and/or developed for each PIP to assure the
likelihood of effecting measurable change.
If repeat measures indicate that quality improvement actions were not successful (i.e., did not
achieve significant improvement), the problem-solving process should begin again with data
analysis to identify possible causes and propose and implement solutions. If the quality
improvement actions were successful, the new processes should be standardized and
monitored.
Potential Sources of Supporting Information
• Current project baseline data
• Previous project data (if available)
• Results of clinical and literature research
• Project evaluation results completed by evaluators
EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

15

Assessment
To assess the MCO’s Improvement Strategies, consider the following questions:
A.

Are the interventions related to causes/barriers identified through data analysis and
quality improvement processes?
1. Interventions should be based on a root cause analysis of the problem the PIP
addresses. It is expected that interventions associated with improvement on
quality indicators will be system interventions (i.e., educational efforts,
changes in policies, targeting of additional resources, or other organizationwide initiatives to improve performance). Interventions that might have some
short-term effect, but that are unlikely to induce permanent change (such as a
one-time reminder letter to physicians or beneficiaries) are insufficient.
2. An MCO is not required to demonstrate conclusively (e.g., through controlled
studies) that a change in an indicator is the effect of its intervention; it is
sufficient to show that an intervention occurred that might reasonably be
expected to affect the results. Nor is the MCO required to undertake data
analysis to correct for secular trends (e.g., changes that reflect continuing
growth or decline in a measure because of external forces over an extended
period). The MCO should be able to demonstrate that its data have been
corrected for any major confounding variables with an obvious impact on the
outcomes. The MCO’s interventions should reasonably be determined to have
resulted in measured improvement.

B.

Are the interventions sufficient to be expected to improve processes or outcomes?

C.

Are the interventions culturally and linguistically appropriate? For example, a
mailing in English at 12th grade level to members of a predominately Chinese
language population would not be appropriate. More information on culturally and

linguistically appropriate services may be found at the following website:
http://minorityhealth.hhs.gov/templates/browse.aspx?lvl=2&lvlID=15.

Step 9: Assess the Likelihood that Reported Improvement is “Real” Improvement
In this step, the reviewer determines the likelihood that the results of the PIP are accurate. It is
important to determine if a reported change represents “real” change or is a result of a short-term
event unrelated to the intervention, or simply random chance. Therefore, the EQRO must assess
the probability that a reported improvement is a true improvement.
Criteria

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

16

“Real improvement” can be assessed in several ways, but is most confidently assessed by
calculating the degree to which an intervention is statistically “significant”. This protocol requires
the EQRO to assess the extent to which any change in performance reported is statistically
significant; however, it does not specify a specific level of statistical significance that must be
met. States may establish a required level of statistical significance for findings to be accepted as
valid. The EQRO should state in its final report which findings do not meet the required level of
statistical significance.
Potential Sources of Supporting Information
• Baseline and repeat measures on quality indicators
• Tests of statistical significance calculated on baseline and repeat indicator measurements
• Benchmarks for quality specified by the State Medicaid agency or found in industry
standards
Assessment
Review documents to determine the extent to which improvement occurred. Through repeated
measurement of the quality indicators selected for the project, meaningful change in
performance relative to the performance observed during baseline measurement must be
demonstrated. The repeat measurement should use the same methodology as the baseline
measurement, unless the baseline data was collected for the entire population at risk; the repeat
measurement may then use a reliable sample. Performance using the identified indicators can
be measured by collecting information on all individuals, encounters or episodes of care to which
the indicator is applicable (a census) or by collecting information on a representative subset of
individuals, encounters, providers of care, etc. Consider the following questions:
A. Are there any documented improvements in processes or outcomes of care?

B. Does the improvement in performance appear to be the result of the planned quality
improvement intervention?
C. Is there any statistical evidence that any observed performance improvement is true
improvement?

Step 10: Assess Sustainability of the Documented Improvement
Real change is the result of changes in the fundamental processes of health care delivery and is
most valuable when it offers demonstrable sustained improvements. In contrast, a spurious “onetime” improvement can result from unplanned accidental occurrences or random chance. This
step in the protocol is to determine if the real change is sustainable.
Criteria
Improvement must demonstrate repeated improvements or the likelihood of repeated
improvements.
EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

17

Potential Sources of Supporting Information
•
Baseline and first repeated measurements on quality indicators
•
Additional measurements on quality indicators made after the first repeat
measurement
Assessment
Review of the re-measurement documentation is required to assure the improvement on a
project is sustained. Consider the following question:
A. Is sustained improvement demonstrated through repeated measurements over
comparable time periods?
Measurements of the outcomes are repeated after the first measurement following
implementation of the intervention. Because of random year-to-year variation, population
changes, and sampling error, performance on any given measure may decline in the second
measurement. However, when all measurements for a given review are taken together, this
decline should not be statistically significant.

ACTIVITY 2: VERIFY STUDY FINDINGS (OPTIONAL)
This activity is optional because verifying actual PIP study findings is a resource intensive activity
that may not be feasible. If the PIP uses HEDIS® measures that have been certified by a third
party, this step may not be needed. However, guidelines for conducting this optional activity are
provided here.
Criteria
In addition to reviewing the methodology and findings of a PIP, States may request the EQRO
verify the actual data produced to determine if the initial and repeated measurements of the
quality indicators are accurate. This activity may not be feasible to perform for every (or even
some) PIPs. Verification activities can provide added confidence in reported PIP results as they
provide greater evidence that the findings are accurate and reliable. Therefore, this activity is
included in this protocol as an optional activity that a State may elect to have the EQRO conduct
on an ad hoc basis when the State has special concerns about data integrity.
Potential Data Sources Needed for Verification Activities:
• Current project data and findings
• Depending upon the source of the PIP data:
• MCO administrative data
• Beneficiary interviews and surveys
• An assessment of the MCO’s Information System (see Appendix V)

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

18

Assessment
The key focus in this activity is validating the processes through which data needed to produce
quality measures were obtained, converted to information, and analyzed. Assessing the
algorithm together with the integrity of the MCO’s information system and encounter data will
provide a strong indication of the accuracy of the MCO’s reported quality measures. The
algorithm for converting the information and analyzing it is verified in Activity 2, Step 6 of this
protocol. The methods used to verify how the data were collected depends on whether the data
are obtained through review and abstraction of medical records or produced through an
automated information system.
Verification of quality measures produced through medical record review can be achieved by
conducting a re-abstraction of a small subset (validation sample) of the reviewed records. Data
retrieval and analysis should be conducted on a small scale, with the validation sample following
the same abstracting rules as the original study. Statistical correlations will be made between the
validation sample and the original study data. A wide variety of statistical methods can be applied
to assess the degree of correlation between the study and validation measures. Two
recommended methods are the Pearson correlation coefficient for continuous data (e.g., age,
income, etc) and the Kappa statistic for categorical data (e.g., gender, race, etc.).
Verification of data obtained though MCO-automated information system is a reflection of three
phenomena:
1. Soundness of the algorithm used to produce quality measures from its information
system;
2. Integrity (completeness and accuracy) of the MCO’s information system at capturing
enrollee information; and
3. Accuracy of the information translated from source documents (e.g., an enrollee’s
medical record) into automated data in the MCO’s information system.
These three activities can be performed by one or more of the following methods:
• Review the assessment of the MCO’s information system and any validations of MCO
encounter data that the State has produced as described in Appendix V.
• Review the results of another Protocol or EQR activity (e.g., validating encounter data,
validating performance measures, or assessing an MCO’s compliance with standards for
MCO information system specified by the State Medicaid agency or other organization
such as a private accrediting organization.
• Review the MCO’s own recently completed assessment of the MCO’s information system
and validation of its encounter data from the MCO, the State Medicaid agency, or other
organization identified by the MCO.
• In the event that no current evaluation of an MCO’s information system or encounter data
exists, the State may choose to contract this important function to fulfill this requirement
to validate its MCO PIPs.

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

19

ACTIVITY 3: EVALUATE AND REPORT OVERALL VALIDITY AND
RELIABILITY OF PIP RESULTS
Following the completion of Activity 1 and Activity 2, the EQRO will assess the validity and
reliability of all findings to determine whether or not the State has confidence in the MCO’s
reported PIP findings. As studies always have weaknesses, the EQRO will need to accept
threats to the accuracy of the PIP, and determine PIP generalizability as a routine fact of QI
activities.
The EQRO will report findings to the State. The PIP validity report should include the description
of the PIPs that were validated and the findings of the EQRO’s validation review. Because
determining threats to validity, reliability, and PIP design is sometimes a judgment call, the
EQRO can report a level of confidence in its findings. Examples of levels that can be reported to
the State include:
•
•
•
•

High confidence in reported MCO/ PIP results;
Confidence in reported MCO/ PIP results;
Low confidence in reported MCO PIP results; or
Reported MCO PIP results not credible.

The EQRO and the State must include the actual results of the PIPs in the final EQRO technical
report for submission to CMS.

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

20

REFERENCES
Quality Improvement System for Managed Care (QISMC)
Health Care Quality Improvement Studies in Managed Care Settings: A Guide for State Medicaid
Agencies (National Committee for Quality Assurance (NCQA))
A Health Care Quality Improvement System for the Medicaid Managed Care, A Guide for States
(Health Care Financing Administration (HCFA))
Framework for Improving Performance, From Principles to Practice (Joint Commission on
Accreditation of Healthcare Organizations (JCAHO)
1990-2000 Standards for Health Care Networks (SHCN) (JCAHO)
NCQA 1997, 1998, and 1999 Standards for Accreditation of Managed Care Organizations and
NCQA 1999 Standards for Accreditation of Managed Behavioral Healthcare Organizations
(MBHO)
Peer Review Organizations (PRO) 4th and 5th Scope of Work (SOW) (CMS)
*Please see EQR Protocols Appendix I for information about how these references were used to develop
PIP protocols.

END OF PROTOCOL

EQR Protocol 3
Validation of Performance Improvement Projects (PIPs)
December 2011

21