Medicare HMO/CMP Quality Improvement Act of 1986

Medicare HMO/CMP Quality Improvement Act of 1986 - Amends title XVIII (Medicare) of the Social Security Act to subject an individual who has an agreement with a health maintenance organization (HMO) or competitive medical plan (CMP) to furnish services to HMO or CMP enrollees to a civil monetary penalty and suspension from the Medicare program for knowingly charging such enrollees for amounts for which the HMO or CMP is liable.

Requires HMOs and CMPs to provide Medicare beneficiaries with an explanation of their rights as HMO or CMP enrollees when they enroll and at least annually thereafter.

Prohibits new waivers of the requirement that no more than 50 percent of HMO or CMP enrollees be eligible for Medicare or Medicaid (title XIX of the Act), unless more than 50 percent of the population in the area served by an organization consists of Medicare or Medicaid-eligible individuals. Provides that, where a waiver has already been granted for some other purpose, such waiver may only be extended if the Secretary of Health and Human Services determines that the organization is making reasonable efforts to meet scheduled enrollment goals. Authorizes the Secretary to suspend the enrollment of Medicare beneficiaries in organizations failing to comply with enrollment requirements.

Requires HMOs and CMPs to pay providers' clean claims within 22 days of their receipt, except where the HMO or CMP is under contract with the provider. Assesses interest on clean claims paid beyond 22 days of their receipt.

Authorizes the Secretary to impose a civil monetary penalty on HMOs and CMPs which substantially fail to provide medically necessary items and services, provided such failure adversely affects HMO or CMP enrollees.

Amends part B (Peer Review) of title XI of the Act to require peer review organizations (PROs) to review inpatient and outpatient services provided by HMOs and CMPs to determine whether the quality of such care meets professionally recognized standards of health care. Directs PROs to review and respond to all written complaints received from enrollees regarding the quality of HMO or CMP services. Requires HMOs and CMPs to enter executive agreements with PROs for the provision of such new review activities. Reimburses HMOs and CMPs for the cost of such agreements.

Directs the Secretary to cooperate with State officials in monitoring and enforcing compliance with HMO and CMP requirements.

Requires HMOs and CMPs to give the Secretary access to the financial records of certain subcontractors and notification as to their loans and special financial arrangements with subcontractors, affiliates, and related parties. Directs the Secretary to annually audit HMOs and CMPs.

Sets forth requirements related to the fiscal management of, and quality of health care provided by, certain network affiliates through which HMO or CMP services are furnished.

Requires studies of: (1) methods by which adjusted average per capita cost and adjusted community rate calculations, used in calculating payments to HMOs and CMPs, can be refined; and (2) the utilization and quality of HMO and CMP services provided to Medicare beneficiaries.