An Independent Review Organization (IRO) is an essential component of a Corporate Integrity Agreement executed with a healthcare organization. Every year, many healthcare organizations and providers enter into a Corporate Integrity Agreement (CIA) with the Office of the Inspector General (OIG). Sometimes the agreement is just called an Integrity Agreement (IA), but the requirements of both types are almost identical. The typical CIA lasts for five years, while IAs last for three years. Both types of agreements require the healthcare organization to hire an Independent Review Organization (IRO).
In this Article …
Why do you need an Independent Review Organization?
The range of organizations entering into CIAs/IAs is truly breathtaking. There are hospitals, medical groups, and independent physicians. There are home health and hospice agencies, laboratories, and pharmaceutical companies, just to name a few. The OIG uses CIAs/IAs as a requirement in lieu of excluding – with all its consequences – the provider from government healthcare plans. Sometimes the shortcomings of the organization are modest; other times the agreements follow fines and penalties in the millions of dollars.
Role of the IRO
The IRO is responsible for an audit or monitoring function that involves the area of non-compliance of the healthcare entity. Many times the behavior involves the claims submitted by the organization. Other times the issues surround relationships between designated health care services and physicians that are subject to the Stark Law or the Anti-kickback Statute. In some cases, the IRO must review the clinical care provided by the organization.
What should you look for in an Independent Review Organization?
The top two criteria are experience and expertise.
A prospective Independent Review Organization should have experience in the type of auditing required by your CIA. Many CIAs involve auditing a sample of claims to determine the medical necessity of the services billed. The IRO must also assess the accuracy of the individual claims by reviewing medical record documentation supporting the claim.
Other CIAs require a review of arrangements with physicians. Here the issue is compliance with the Stark Law and the Anti-kickback statute. It does not take an attorney to determine if an arrangement meets the requirements of the Stark Law, but the IRO should be very familiar with the regulations.
Still, other CIAs require a review of the care provided to patients by a healthcare provider. This would involve professional and licensed providers, experienced with the type of care being provided.
The second important criterion is expertise. Many CIAs now contain specific requirements for expertise. For instance, a claims audit will usually require expertise in medical record coding. But that may not be all that’s required. Such an audit may also require the expertise of a healthcare professional. These may include a physician or other practitioner. That individual’s role is to assess the medical necessity of the services documented in the medical record and on the claim.
Your IRO should also have expertise in statistical analysis. Most CIAs that involve claims reviews require the development of a mean point estimate. This is the number of over-payments, determined from the sample of claims reviewed, that could be contained in the entire universe of claims submitted during the Review Period. While this may be a simple calculation, it can have significant effects on the healthcare organization under review.
Therefore, it is important to get it right!
Download a Free Copy of our Guide “How to Select an IRO”
IRO Experience and Expertise come together!
Another area where experience and expertise come together is in the requirements for systems reviews.
Claims Systems Review
In a claims systems review, the IRO must be qualified to review the systems in place for all claims preparation and processing. This includes recording charges and coding, processing and issuing claims, and receiving and posting payments. The IRO must also identify by position, the staff members carrying out these functions.
In an arrangements review, the IRO must review the policies and processes in place to make arrangements. It must also audit a sample of those arrangements. This audit is looking at how the healthcare organization complies with the CIA and its own policies in making arrangements.
The CIA will require you to identify an Independent Review Organization within 90 days of the effective date of the CIA.
The Independent Review Organization should be easy to work with.
The healthcare organization can expect to spend three to five years working with the IRO. You should be comfortable with the approach by the IRO to the review project.
For instance: (1) are the key staff members of the IRO readily available for communications? (2) Does the IRO utilize secure electronic methods of receiving and sending documentation? (3) Does the IRO explain the review process in detail so you know what to expect? (4) Do references furnished by the IRO confirm good working relationships?
Avoid Conflicts of Interest with the IRO.
Finally, there is the issue of potential conflicts of interest. The IRO must attest to you (and you must attest to the OIG) that there are no conflicts of interest between the healthcare organization and the IRO. Once in a while, a physician wants to recommend another physician to perform the medical necessity review of the physician’s claims. Of course, this is not allowed. The IRO cannot have any known family members or personal acquaintances on its team who are Covered Persons of the healthcare organization. Covered persons include owners, employees, and contractors who provide patient care or billing/coding functions.
Questions or observations about IRO services? Please let us know!