Why some hospitals are leaving the JCAHO, and where they're going

Accreditation Connection, June 11, 2004

Pressure to contain costs is one challenge that compels some hospitals to consider less expensive options than JCAHO accreditation.

Although the majority of the 5,810 hospitals in the United States are accredited by the JCAHO (4,640), increasing numbers are accredited by the Healthcare Facilities Accreditation Program (HFAP) (150) or not accredited by any private accreditation organization (about 1,000). A few hospitals are also choosing ISO 9002 registration, an international standards program common in manufacturing. During a recent HCPro audioconference* on the topic, 71% of participants polled said their hospitals were contemplating alternatives to JCAHO accreditation; 98% were JCAHO-accredited; 1%, JCAHO and HFAP accredited; and 1%, unaccredited.

According to speakers Hugh Greeley, founder of The Greeley Company, and Steve Bryant, practice director of accreditation and regulatory compliance services at The Greeley Company, hospitals opting out of formal accreditation programs continue to participate in federal reimbursement programs. They undergo state or Centers for Medicare & Medicaid Services (CMS) surveys, which allow them to demonstrate compliance with the Medicare Conditions of Participation (COP), as required for such reimbursement.

A change in attitude

As hospitals examine the value of accreditation v. simple licensure or a survey by CMS, they find that the expense and administrative difficulty of achieving compliance with a wide body of standards that are not always required by CMS may not in fact be justified, says Greeley.

"In a lot of areas, the JCAHO's expectations far exceed the COP," added Bryant. "And so organizations say, 'Do we have the human and financial resources to maintain JCAHO accreditation?' "

That was precisely the question before Frisbie Memorial Hospital in Rochester, NH, three years ago, according to Karen Dutcher, RN, vice president of patient-care services for the facility. "We had a very successful JCAHO survey and were pleased with that process," she said. "However, we became aware that many hospitals in the state of New Hampshire had made a decision to move to CMS survey, so we began talking to them and found that they were very satisfied with that survey for a variety of reasons-that it did not have any negative impact on their quality of care, perception of them in the community, or with their insurance payers."

Other states with hospitals that have opted for alternative programs include Idaho, Indiana, Wisconsin, Michigan, and Missouri.

Leaving the ranks

"What we found is that we could really focus in on the COPs that most directly affect our delivery of care to our patients and the quality of that care," Dutcher said. "We felt that some of the requirements for JCAHO accreditation were certainly what we wanted to use as benchmarks, but took us away from some of that real clear focus on patient care."

Cost savings have been an added benefit to the switch, Dutcher said. "We did decide to have a mock survey, which we've always done and will continue to do, so [it] was our decision to make that expenditure. But there is no cost to CMS for survey."

During the audio conference, Greeley presented 10 criteria for deciding licensure over accreditation, which were developed and used recently by one hospital chief executive officer and planning committee that faced this choice:

1. Consider whether post-graduate education programs would be affected

2. Study insurance contract requirements

3. Study bond covenant-requirements

4. Study managed-care contract requirements

5. Poll business and industry in the community about your options

6. Explore perception inside the organization

7. Explore perception outside the organization

8. Obtain positive recommendation from organized medical staff through the medical executive committee

9. Study possible impact on malpractice exposure

10. Evaluate the ability to recruit new graduates

Is nonaccreditation for everyone?

Quite simply, no, Greeley said. No one should underestimate the benefits of accreditation in today's environment. "I would not want to be the hospital in downtown Chicago that decided to forgo accreditation while all other hospitals in Chicago maintained accreditation status. I would worry that I would stand out like a sore thumb . . . and that the various third parties or powers-that-be would choose to seize on the fact that our hospital was somehow different from the norm, to exclude me from various payment programs."

Accreditation brings with it a very significant stamp of approval, he says, but points out more than 1,000 hospitals in the United States function very well without being accredited by an organization. "As long as licensure remains an acceptable route to participate in the Medicare/Medicaid program, and does not pose a barrier to participating in various insurance programs and managed care programs, it is likely that an increasing number of hospitals will consider moving in that direction."

* Click here for more information about " Alternatives to JCAHO Accreditation: Three routes to obtaining federal payment," sponsored by HCPro Inc., in Marblehead, MA.

Most Popular