1. (a) Each managed care organization (MCO) must develop and implement an ongoing quality assessment and performance improvement (QAPI) program for services it furnishes to its enrollees. The MCO must maintain and provide documentation of its compliance for the Health and Human Services Commission's (HHSC's) review, including performance measurement data. The MCO's quality assessment and performance improvement program must meet the requirements contained in 42 CFR §438.240 and, at a minimum, include:

   1. (1) a program of performance improvement projects that focus on clinical and non-clinical areas;
   2. (2) mechanisms to assess the quality and appropriateness of care furnished to enrollees with special health care needs;
   3. (3) mechanisms to detect both under and over-utilization of services;
   4. (4) practice guidelines that meet CMS requirements under 42 CFR §438.236.
2. (b) An MCO may subcontract QAPI functions. An MCO must not delegate responsibility for QAPI compliance.

3. (c) HHSC will develop monitoring and review systems and procedures to ensure MCO compliance with MCO contracts, this subchapter, and all related state and federal rules, regulations, and guidelines. HHSC monitoring and review includes the following.

   1. (1) HHSC monitors each MCO to ensure it is following its QAPI standards.
   2. (2) An MCO must submit QAPI information at regular and periodic intervals.
   3. (3) An MCO must submit to periodic inspection and review to determine compliance with all contract terms, and state and federal rules and policies.

4. (d) Periodic evaluation of each MCO's quality of services in each Medicaid managed care service area and the cost-effectiveness, member access, and quality of care under each federal waiver will be conducted by independent, external entities.

   1. (1) The quality evaluation must be conducted at the end of each year.
   2. (2) The assessment of cost-effectiveness, member access, and quality of care under each federal waiver must be conducted according to the terms of an approved federal waiver.
   3. (3) HHSC will determine the need for additional evaluations after completing the evaluations described in paragraphs (1) and (2) of this subsection.

Source Note:The provisions of this §353.417 adopted to be effective December 18, 1996, 21 TexReg 11822; transferred effective September 1, 2001, as published in the Texas Register May 24, 2002, 27 TexReg 4561; amended to be effective August 10, 2005, 30 TexReg 4466; amended to be effective September 1, 2006, 31 TexReg 6629; amended to be effective March 1, 2012, 37 TexReg 1283.