How to Select Your Independent Review Organization (IRO)

There are currently over 300 active Corporate Integrity Agreements (CIAs) that have been negotiated with the DHHS Office of Inspector General (OIG) within the last couple of years. Many of them require the selection and engagement of an Independent Review Organization (IROs) to monitor compliance with the terms of the CIA.

For those entities entering into a CIA, it is important to ensure that the scope and breadth of the Agreement is clear and the terms specifically defined. In most cases, compliance program and review requirements are fairly standard. Of course, it is important to establish the parameters of what constitutes “error” for purposes of “claims” reviews or “transactions” reviews.

In some instances, CIAs are developed in response to issues or alleged misconduct that require program evaluation and monitoring of operational systems or the quality of care, rather than claims or transactions reviews. Before entering into a CIA, it is advisable for a health care organization to have a subject matter expert assist in evaluating the proposed terms of a CIA to ensure that they are clear, and that the scope and objectives of the mandated IRO reviews are well defined.

Depending on the complexity of the CIA, it may be necessary to have more than one firm perform the required IRO reviews.  In such cases, it is advisable to select one firm to manage and be responsible for the entire project, rather than retaining multiple firms to perform different reviews.  Retention of multiple IROs, without proper overall management by one entity, will likely increase costs and complicate the conduct of the specified reviews.

Keep reading to find 10 tips to help you select the IRO that’s right for your organization.

Would you like to speak to somebody about choosing an Independent Review Organization? You can contact the Strategic Management team by calling (703) 683-9600 ext. 419 or by clicking here to contact us online.

10 Requirements When Selecting an Independent Review Organization

It is important to recognize that the OIG does not select the IRO. The OIG also does not provide specific guidance on how to select one, nor does it endorse any organizations or firms to serve as an IRO. It is entirely up to the health care entity or provider to determine the most appropriate organization to engage as an IRO. The OIG reserves the right to disapprove an entity’s choice of an IRO within the 30 days following the OIG’s receipt of written notice of the identity of a proposed IRO.

During the selection process, there are several areas that need to be considered when selecting the best firm to serve as your organization’s IRO.

  1. Expertise. A prospective IRO should have expertise in the specific areas that are encompassed by the CIA’s scope of work for the IRO. The absence of program expertise in a particular area to be reviewed can lead to difficulties in fulfilling an organization’s responsibilities under a CIA, and potentially jeopardize the credibility of the organization with the OIG after the mandated reports have been submitted and reviewed by the OIG.
  2. Industry Experience. Determine a firm’s experience in health care compliance, and in a health care organization’s particular business and programs. There is a big difference between a hospital, managed care organization, and pharmaceutical company. As CIAs with particular health care entities have different requirements for an IRO, it is advisable to assess a firm’s specific experience in your health care sector. A firm that has served as an IRO for physician practices may not have the necessary knowledge and experience to fulfill a CIA’s IRO requirements for a managed care organization.
  3. Tenure. Determine how long a firm has been in business and serving as an IRO. The longer the better, as lengthy experience will provide a health care organization with more expertise and understanding on how to manage IRO engagements, and work effectively with both the OIG and the subject entity.
  4. Ability to Perform the IRO Reviews. Ensure that a firm has the program expertise and professional competence to handle the requirements of the proposed IRO engagement. If the required IRO reviews are complex, it is important that an IRO be able to perform its duties comprehensively, and efficiently to satisfy the needs of both the health care organization and the OIG.
  5. Track Record. It is recommended that the firm to be selected have an established record of serving successfully as an IRO. The more experience as an IRO, the better. A firm with IRO experience will be able to manage the reviews and reporting effectively, and communicate with both the health care entity and OIG in a clear, consistent, and efficacious manner.
  6. References. Always ask for references from other health care organizations for which the firm has worked with in the past. Among the benefits of such checking is finding out whether a firm is able to provide IRO services meeting the requirements of a CIA in an efficient, economical, and timely manner.
  7. Qualifications of Staff.  Avoid a “bait and switch” situation where the people negotiating to become an IRO are switched for lesser qualified individuals to perform the IRO reviews. Insist that the prospective IRO identify the key personnel to be assigned to the engagement along with their professional qualifications.
  8. Conflicts of Interest Standards. Ensure that a prospective IRO does not have a conflict of interest. This is a key consideration for the OIG. The OIG believes that it is a conflict of interest if the IRO was previously engaged by the health care organization to perform management functions. The OIG has specified on its website various examples of potential conflicts of interest for an IRO. For example, an IRO cannot be involved in reviewing any systems that it previously had a role in developing.
  9. Review Standards. Engage a firm that has familiarity and will attest to its experience and adherence to the “Generally Accepted Government Audit Standards,” (“GAGAS”), issued by the U.S. Government Accountability Office. These standards govern both financial and program audits. The OIG expects that IRO reviews will comport with these standards.
  10. Fees and Expenses. A major consideration is the fees and expenses to be charged by an IRO. These can vary considerably depending on the size of a firm and other factors, including personnel and experience. It is important to consider projected costs in conjunction with an IRO’s experience, industry knowledge, and professionalism.

Selecting an IRO that meets a health care organization’s needs is a critical decision. Any problems that the OIG encounters with the selected IRO or the reviews it conducts will reflect poorly on the client health care organization. The fact that the OIG has entered into a CIA with a health care entity has already caused it to question the organization’s commitment to compliance and ability to participate in and meet the rules established by Federal health care programs. Therefore, it is important to select a firm that has a strong and credible record as an IRO, has specific industry expertise, has the required capability and capacity to perform the required reviews, and is free of any conflicts of interest.

The Importance of Choosing the Right IRO

Corporate Integrity Agreements are usually entered into in conjunction with the settlement of a health care fraud and abuse case with the U.S. Department of Justice. They are now a common part of the resolution of Government disputes with health care organizations.

Under a CIA, a health care entity consents to undertake certain obligations related to compliance as a part of the settlement of outstanding allegations and the OIG’s agreement to allow the organization to continue participating in Federal health care programs.

If a health care entity enters into a CIA with the OIG, certain specified obligations must be met. Often an organization must certify that it has complied with the responsibilities set forth in the CIA. A CIA also requires the engagement of an IRO to perform reviews related to the alleged misconduct.

Therefore, it is important that the subject organization select an IRO that is credible, and able to perform the mandated reviews in a professional and independent manner. The reviews conducted and reports prepared by the IRO will be the basis for the OIG’s assessment of an organization’s overall compliance with the CIA and fitness to participate in Federal health care programs in the future.

Contact Strategic Management Today

If you have more questions about the IRO selection process, how to interpret Corporate Integrity Agreements, or any other compliance issue, you can contact the Firm’s team of highly qualified consultants. You can reach Cornelia Dorfschmid, our lead IRO consultant, by calling (703) 683-9600 ext. 419 or by clicking here to fill out our online contact form.


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