Private accreditation as a substitute for direct government regulation in public health insurance programs: when is it appropriate?

Private accreditation of health care institutions serves crucial quality assurance functions in the American health care system. Since the advent of widespread third-party payment for health care services in the mid-twentieth century, third-party payers have used private accreditation to thereby identify which health care institutions are qualified to provide services for payment to their beneficiaries. Private accreditation serves to alleviate the need for thirdparty payers to make independent assessments of the quality of their providers' facilities and services. As the federal government and states became third-party payers when the Medicare and Medicaid programs came on-line in 1965, they used private accreditation to identify qualified hospitals in a fashion similar to that of private insurers. For hospitals and, later, other health care institutions, the federal government and states used private accreditation as evidence of compliance with Medicare conditions of participation and state licensure laws, respectively. In so doing, the government effectively delegated regulatory responsibility for assuring that health care institutions meet the requisite quality standards for participation in their respective programs. When government relies on private accreditors to perform this important function, questions arise as to whether all the legitimate interests of the public served by public health insurance programs are adequately protected and/or promoted. First, are private accreditors capable of identifying the characteristics of health care institutions and the services they provide that assure quality of care and of developing uniform standards? Second, do private accreditors have sufficient staff and resources to ensure compliance with quality standards?