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J*_LD040309_Contract Services

Resources: Contract Services


Relevant Standards

  • CMS: §482.12(e)/A-0083-5,

    • See also Radiology: §482.26(a)/A-0529[Radiology Services]
    • See also Telemedicine: §482.12 §482.12(a)(8), 
  • TJC: LD.04.03.09, 
    • See also ideas for Contract Performance Expectations: HR.01.06.01, EC.01.01.01, EC.02.01.01, and PI.01.01.01 

References & Tools

Required Written Documents

  • LD.04.03.09:

    • EP 2 – Description of “nature and scope” of services provided via contract
    • EP 3 – Designation of leaders that approve contracts
    • EP 5 – Description of performance expectations
    • EP 10 – Evidence that reference/contract lab meets federal regulations (when relevant)
    • EP 23 – Telemedicine agreement (when relevant)

** Additional Clarifications & Compliance Strategies (Premier)**

[private Membership premier]



Contract Management Review.mp3  [5/7/14 – Audio recording of presentation with Q&A by Joseph Gigliotti, MSW for Illinois State Hospital System]  LD040309mp3

Tracer Methodology 101 Second Generation Contracted Services Tracer in a Hospital[®]

This is “one of five areas for which The Joint Commission now conducts second generation tracers”. Although not currently a Top Standards Compliance Issue for TJC, LD.04.03.09 (contracted services) is one of the most frequently cited for psychiatric hospitals in SPHCC. This article is part of the continuing Tracer Methodology 101 series. It primarily stresses the importance of clearly defining performance expectations for contracted services and developing reliable methods of monitoring (and documenting) performance related to them. Although the illustrative scenario is about an ICU, most of the sample questions are still useful and relevant. Develop and/or update a list of all contracts relevant to LD.04.03.09 and review for currency and performance criteria. Then periodically conduct a mock tracer addressing contracted services(or one particular contract each time). JCSC should adopt some of the sample questions in this article for that purpose.

• Addressing the Confusion about Contracted Services Subhead: How to Comply with Standard LD.04.03.09[®] [REF: HR, LDR] The Source, Volume 8, Number 5, May 2010 , pp. 3-11(9)
Reading Tips Review – May 2010, Vol 4, #5:

One particular point of confusion that is addressed is what/how much personnel data must be on file for contract employees. The author of this piece declares it is the intent of LD.04.03.09 to ensure that the level of care throughout the organization is consistent and equal, including that provided by contracted services. To that end the reader is provided a series of strategies for better monitoring, partnering with and communicating with contractors. Some of the suggestions such as shorter more focused orientations for contract employees and establishing mechanisms for rapid access to contractor personnel data (vs. keeping full sets of such data on site) are worth considering. For example, in this latter case, TJC indicates that a surveyor request for a contracted staff member’s personnel file can be satisfied if the file is requested and received from the contractor before the survey ends*. However, most important is the need for clear, up front contract/performance provisions. Note this provision only applies to contracted services that directly affect patient care.
[*Note: This option is further explained in the 4/8/10 TJC FAQ on Contracted Services and applies only to staff and independent contractors of accredited or certified organizations and not to licensed independent practitioners.]

• Also: Review Comments attached to this posting

One response to “J*_LD040309_Contract Services”

  1. Q: … our survey (is in process and) we have an issue with our written agreement with our local hospital to provide medical services, including x-ray to the patients. What we have had is not a formal contract but basically a letter of agreement signed by their CEO to the appointing authority that they are agreeing to provide medical services both inpatient and outpatient to our patients. Dr. Katz our surveyor says that is not specific enough and we need a more detailed contract as outlined in LD 04.03.09 and then we have the issue of the question of LIP for those who are performing said contracted services. Dr. Katz also stated that after checking with JC and possibly CMS they could be a Condition of Participation, which obviously I am hoping to avoid that! Right now in checking through DMHA no other hospital in our system has a formal contract with… I wanted to know …(if you have) any thoughts or suggestions you might have to address this significant issue.

    A: Contracts are a relatively hot issue that still has some gray (e.g., around Xray) and Katz can be a stickler for detail. Yes, I believe in a worst case scenario, this could develop into a CMS condition level finding. As such I would agree with your goal of at least mitigating against a condition level finding. To some extent, how you do that will depend on what you do/do not have in place. So let me try to lay out a few key points/background issues and then suggest some strategy.
    • Key Points
    The pivotal aspects of LD.04.03.09 are EPs 2 and 4. The sample citations in our Katz Profile also suggests that these are the ones he is most likely to site. It does not matter if it is a Letter of Agreement (LOA), MOU or formal contract, you just need to have a written description of the “nature and scope” of the services being provided. The other important point is that you have to be able to tell/ensure that the services are of acceptable quality/safety. TJC reasons that for this to happen you must first have set/defined “expectations” (think indicators or performance measures) so that you would have something to monitor/evaluate which is the key issue in EP4. You need to be able to show that there has been some reasonable effort to monitor service quality and ideally this was against some pre-established performance expectations/indicators.
    • Strategy
    1 – Request an Issue Resolution Session on this matter
    2 – Prepare for the Session
    • Defend EP2: Review your LOA for any detail that might serve to address nature and scope of services. Augment that with any description of nature/scope around outside medical services in general (and radiology in particular) that you might have elsewhere (e.g., hospital description of clinical services, medical staff bylaws/Rules & Regs, relevant policy, other correspondence with the hospital in question) in writing.
    • Defend EP4: Review your LOA for any detail that might serve to define expectations, indicators or measures of performance. E.g., does the LOA at least reference the need to meet applicable TJC standards? Augment this with any proof you can show that the services have been monitored/evaluated. Review the examples of information sources for monitoring given in the introduction of LD.04.03.09 to see if you can show the use of any of them. It would be especially useful if you could show medical staff minutes that documented any sort of annual review/evaluation of the services with that hospital (especially if was based on any of the info sources just referenced.)
    3 – During the session
    •Politely/carefully discuss the issue in terms of wanting to:
    Clarify the issue and his specific concern(s)
    Make sure he has seen all that you already have in place
    Learn from him how to improve.
    • Be careful (especially with Katz) not to admit or agree to anything other than the idea that your agreement and/or monitoring could be improved. He has been known to use casual/informal statements to indicate organization agreement with/support for citation.
    •You might show him a draft of an improved LOA and/or a draft procedure for how you intend to improve your monitoring/evaluation in the
    future to to get his consultative opinion and convey your sincere/constructive attitude about improving.
    4 – If you think you have some reasonable evidence of compliance (and he is just being too picky) the final option is to wait for the exit and if the issue is cited, to request that the survey team “Flag” this issue for central office review.
    5- If you think you are wrong with not much leg to stand on, the goal is to mitigate against condition level finding by demonstrating good effort/intent and willingness to learn/improve as quickly as possible.
    I hope something in the above will be useful. Know that I am available to you 24/7 by Survey

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