A health carrier that issues a closed plan or a combination plan having a closed component shall, in addition to complying with the requirements of section 44-7206, develop and maintain the internal structures and activities necessary to improve quality as required by this section. A health carrier subject to the requirements of this section shall:

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(1) Establish an internal system capable of identifying opportunities to improve care. This system shall be structured to identify practices that result in improved health care outcomes, identify problematic utilization patterns, identify those providers that may be responsible for either exemplary or problematic patterns, and foster an environment of continuous quality improvement;

(2) Use the findings generated by the system to work, on a continuing basis, with participating providers and other staff within the closed plan or closed component to improve the health care services delivered to covered persons;

(3) Develop and maintain an organizational program for designing, measuring, assessing, and improving the processes and outcomes of health care as identified in the health carrier’s quality improvement program filed with the director and consistent with the provisions of the Quality Assessment and Improvement Act. This program shall be under the direction of the chief medical officer or clinical director of the health carrier. The organizational program shall include:

(a) A written statement of the objectives, lines of authority and accountability, evaluation tools, including data collection responsibilities, performance improvement activities, and an annual effectiveness review of the quality improvement program;

(b) A written quality improvement plan that describes how the health carrier intends to:

(i) Analyze both processes and outcomes of care, including focused review of individual cases as appropriate, to discern the causes of variation;

(ii) Identify the targeted diagnoses and treatments to be reviewed by the quality improvement program each year. In determining which diagnoses and treatments to target for review, the health carrier shall consider practices and diagnoses that affect a substantial number of the managed care plan’s covered persons or that could place covered persons at serious risk. This section shall not be construed to require a health carrier to review every disease, illness, and condition that may affect a covered person under a managed care plan offered by the health carrier;

(iii) Use a range of appropriate methods to analyze quality, including:

(A) Collection and analysis of information on over-utilization and under-utilization of health care services;

(B) Evaluation of courses of treatment and outcomes of health care services, including health status measures, consistent with reference databases such as current medical research, knowledge, standards, and practice guidelines; and

(C) Collection and analysis of information specific to a covered person or persons or provider or providers, gathered from multiple sources such as utilization management, claims processing, and documentation of both the satisfaction and grievances of covered persons;

(iv) Compare program findings with past performance, as appropriate, and with internal goals and external standards, when available, adopted by the health carrier;

(v) Measure the performance of participating providers and conduct peer review activities, such as:

(A) Identifying practices that do not meet the health carrier’s standards;

(B) Taking appropriate action to correct deficiencies;

(C) Monitoring participating providers to determine whether they have implemented corrective action; and

(D) Taking appropriate action when the participating provider has not implemented corrective action;

(vi) Utilize treatment protocols and practice parameters developed with appropriate clinical input and using the evaluations described in subdivisions (3)(b)(i) and (ii) of this section, or utilize acquired treatment protocols developed with appropriate clinical input; and provide participating providers with sufficient information about the protocols to enable participating providers to meet the standards established by these protocols;

(vii) Evaluate access to care for covered persons according to standards established by the insurance laws of this state. The quality improvement plan shall describe the health carrier’s strategy for integrating public health goals with health services offered to covered persons under the managed care plans of the health carrier, including a description of the health carrier’s good faith efforts to initiate or maintain communication with public health agencies;

(viii) Implement improvement strategies related to program findings; and

(ix) Evaluate periodically, but not less than annually, the effectiveness of the strategies implemented in subdivision (3)(b)(viii) of this section; and

(4) Assure that participating providers have the opportunity to participate in developing, implementing, and evaluating the quality improvement system.