(State Gov't) External Quality Review of Medicaid MCOs and Supporting Regulations in 42 CFR 438.360, 438.362, and 438.364

EQR PROTOCOL 1 – ASSESSING MCO COMPLIANCE WITH MEDICAID
AND CHIP MANAGED CARE REGULATIONS
Attachment B: Compliance Definitions
Prior to the initiation of an EQR, the State must clearly define what constitutes compliance and identify
the amount of compliance detail it requires to satisfy Federal and State regulations. It must also
determine the rating or scoring system for each requirement or characteristic that the EQRO will review.
Clear definitions are necessary to avoid any confusion about the State’s expectations, the meaning of
EQRO findings, and value of compliance ratings.
A variety of rating or scoring systems are possible:
Two-point rating or scoring - Either the requirement is met or is not met.
1 - Met
2 - Not Met
Three-point rating or scoring - This scale allows for credit when a requirement is partially met and can
be used if this level of performance is defined acceptable by the State prior to the EQR.
1 - Fully Met
2 - Partially Met
3 - Not Met
Five point rating or scoring – This scale allows for five levels compliance to be assessed. Scoring in
this manner allows greater flexibility in the requirements for MCO performance, especially in complex
performance areas.
1 - Fully Met
2 - Substantially Met
3 - Partially Met
4 - Minimally Met
5 - Not Met
One of the above rating or scoring scales may serve as the primary system, or alternative scales may be
adapted to certain regulatory provisions. In an extensive EQR, a State may assert that the definition of
compliance for most regulatory provisions are appropriate for a 5 point rating scale, with two or three
particular provisions rated as “met” or “unmet.”
According to the Paperwork Reduction Act of 1995, no persons are required to respond to a collection of information unless it displays a valid
OMB control number. The valid OMB control number for this information collection is 0938-0786. The time required to complete this information
collection is estimated to average 1,591 hours per response for all activities, including the time to review instructions, search existing data
resources, gather the data needed, and complete and review the information collection. If you have comments concerning the accuracy of the
time estimate(s) or suggestions for improving this form, please write to: CMS, 7500 Security Boulevard, Attn: PRA Reports Clearance Officer,
Baltimore, Maryland 21244-1850

EQR Protocol 1 Attachment B
Compliance Definitions
September 2012

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Compliance Definitions Options
Full compliance:
• All documentation listed under a regulatory provision, or component thereof, is present; and
• MCO staff provide responses to reviewers that are consistent with each other and with the
documentation; or
• A State-defined percentage of all data sources – either documents or MCO staff – provide
evidence of compliance with regulatory provisions.
Substantial Compliance:
• After review of the documentation and discussion with MCO staff, it is determined that the
MCO has met most of the requirements as stated above.
Partial compliance:
• All documentation listed under a regulatory provision, or component thereof, is present, but
MCO staff are unable to consistently articulate evidence of compliance; or
• MCO staff can describe and verify the existence of compliant practices during the
interview(s), but required documentation is incomplete or inconsistent with practice; or
• Any combination of “Met,” “Partially Met” and “Not Met” determinations for smaller
components of a regulatory provision would result in a “Partially Met” designation for the
provision as a whole.
Minimal Compliance:
• After review of the documentation and discussion with MCO staff, it is determined that
although some requirements have been met, the MCO has not met most of the requirements.
Non-compliance:
• No documentation is present and MCO staff have little to no knowledge of processes or
issues that comply with regulatory provisions; or
• No documentation is present and MCO staff have little to no knowledge of processes or
issues that comply with key components (as identified by the State) of a multi-component
provision, regardless of compliance determinations for remaining, non-key components of the
provision.
A Note about Targeted Regulatory Components
If all applicable federal requirements are met, the State may focus on specific aspects or components of
its regulatory provisions to make performance improvement more manageable and targeted. If less than
full compliance with a full set of State regulations is defined by the State as acceptable, the State must
identify to the EQRO and the MCO specific regulatory provisions of the Compliance Review for which the
MCO is accountable. This must take place before the review begins. However, over the three year
Compliance Review cycle, the EQRO must review all compliance requirements.

EQR Protocol 1 Attachment B
Compliance Definitions
September 2012

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