The U.S. health care sector faces serious safety, quality, coverage, and cost challenges. The United States spends much more per capita ($4,637 in 2000) on health care than any other country (Reinhardt et al., 2002), yet Americans cannot count on receiving care that is safe and effective (Institute of Medicine, 1999; Leatherman and McCarthy, 2002). While health care represents 13 percent of the U.S. gross domestic product—about $1.3 trillion annually (Levit et al., 2002)—one in seven Americans do not even have health insurance, and there are disturbing disparities in care for certain racial and ethnic subgroups (Institute of Medicine, 2002b, 2002c).

A major redesign of the health care sector is needed (Institute of Medicine, 2001). This redesign can occur only in an environment that fosters and rewards improvement. The Institute of Medicine’s (IOM) 2001 report Crossing the Quality Chasm: A New Health System for the 21st Century calls for a “new environment for care” with payment incentives to encourage and reward innovation, precise streams of accountability and measurement reflecting quality achievements, and information and support to help engage consumers in understanding and interpreting information on quality and safety.

In this context, Congress asked the IOM to examine the federal government’s quality enhancement processes (the Healthcare Research and Quality Act of 1999, Public Law 106-129) in six government programs—Medicare, Medicaid, the State Children’s Health Insurance Program (SCHIP), the Department of Defense TRICARE and TRICARE for Life programs (DOD TRICARE), the Veterans Health Administration (VHA) program, and the Indian Health Service (IHS) program (see Table ES-1).

OVERVIEW OF CURRENT QUALITY ENHANCEMENT PROCESSES

Each of the six programs reviewed for this study has both minimum participatory standards for providers and ongoing performance assessment activities.

Minimum participatory standards for institutional providers and clinicians are intended to ensure that program participants possess minimal levels of competence and comply with health and safety requirements. For institutions, the standards include physical safety and sanitation requirements and organizational requirements that enable specific activities such as governance, credentialing of medical staff, and quality improvement processes. For clinicians, the standards generally require compliance with the licensing laws of at least one state. Minimum participation standards reflect a good deal of consistency among programs.

Across all six government programs, there has been a proliferation of



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