1. What is NCQA and why is it important to health maintenance organizations?

The National Committee on Quality Assurance arose largely as the result of private purchasers' desire to instill a commitment to quality in the HMO industry and to do this through private sector initiatives rather than relying on public regulation. Working in collaboration with the HMO industry, NCQA has developed progressively more demanding standards for use in evaluating the performance of plans. A major impetus to its status and stature has come from a number of large employers requiring NCQA accreditation for HMOs as a condition of bidding for coverage for their employees. This, in turn, has made HMOs invest heavily in the systems necessary to meet accreditation standards and demonstrate efforts toward continuous improvement, a key philosophy of NCQA. The HMO industry has also recognized that NCQA accreditation may be preferable to publicly developed standards that might be promulgated at the state level, introducing enormous inter-state variability. Additionally, the current public relations problems of the HMO industry has caused many plans to use NCQA accreditation as a basis for arguing that they are being subjected to careful, systematic scrutiny by outside organizations that issue opinions as to the performance and trustworthiness of an HMO.