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Madam Chairwoman, Ranking Member Michaud, and Members of the Subcommittee:
Thank you for inviting the
We appreciate the Subcommittee's leadership in overseeing the
The delegates to DAV's most recent
This resolution also urges VA to integrate and promote care coordination with all non-VA purchased care programs and services. Such coordination should include provider credentialing, case management, ensuring quality of care and patient safety, timely processing of claims, reimbursing at adequate rates, integrating records of care with VA's electronic health record, and scheduling appointments through a centralized process. With the exception of the ongoing Project on Healthcare Effectiveness through Resource Optimization (Project HERO) pilot program, today's VA contract and purchased care programs do not exhibit most of these attributes.
Under current law, VA practices three basic approaches in furnishing non-VA care: pre-authorized fee-for-service arrangements (called Non-VA Fee Care); contract care, including obtaining scarce medical specialists; and sharing agreements with the
Non-VA Fee Care
The statutory authority for fee basis health care is title 38, United States Code, section 1703. This section authorizes VA to contract for inpatient care and limited outpatient care by contract or individual authorizations for certain categories of veterans, when VA facilities are unable to provide needed care, or when VA facilities are geographically inaccessible to those veterans. This contracting authority is not limited to contracts that contain prices negotiated between VA and non-VA providers, but of individual authorizations that serve as price offers to non-VA providers chosen by eligible veterans. Contract hospitalization is generally reserved to emergency situations for which VA reimburses contract hospitals at
Notably, the purpose of fee-basis health care is addressed in the regulatory authority which implements the statutory authority granted by section 1703. Specifically, title 38, Code of Federal Regulations, section 17.52, allows for individual authorizations when demand is only for "infrequent use." Over the past several fiscal years, however, expenditures for fee basis services have been rising dramatically. In fiscal year (FY) 2005, VHA spent approximately
In addition to our organization's concern regarding the lack of care coordination and rising costs in fee care, specific concerns have been raised by others. The program is highly decentralized to the facility level, and lacks a standardized business process across the VA health care system. These concerns and others were raised by the
Generally, fee basis and contract hospitalization are unmanaged, are not governed by a program office locally, are not standardized or consistent across the system, do not exhibit "patient-centered care" attributes that characterize VA's internal care programs, and their costs to VA have surged over the past decade without sufficient action being taken to ensure program integrity, efficiency, and integration in the Department's health care system.
In general, VA agreed with the observations and recommendations of
Non-VA Care Coordination
The Non-VA Care Coordination (NVCC) project is part of a major initiative VA calls Health Claims Efficiency (HCE). The purpose of HCE is to coordinate and accelerate the ongoing cost savings initiatives with new initiatives to allow VA to enhance services to veterans. Specifically, this initiative includes reducing operational costs and streamline program deployment to enhance program efficiency, achieving cost savings through consolidated purchasing and reducing variability in non-VA care coordination clinical and business practice.
Currently VA lacks industry standard automated tool sets to identify and take action on improper payments, including fraud, waste and abuse. Further, while fee care's information technology systems and infrastructure have been improving, they have not been updated for cost effectiveness due to local variations in how they are established. DAV believes VA should continue to pursue private sector IT solutions to modernize the processing of non-VA health care claims.
With care coordination included in its name, a fully implemented NVCC as envisioned by the Chief Business Office will include improvements to patient-facing aspects of fee care. These include timely patient notification of
DAV applauds VA for taking steps in the right direction to meet the goals of DAV Resolution No. 212 to provide proper care coordination in fee care and to make care coordination a standard business practice. To ensure these new processes are being achieved in each VA facility, we have requested from VA results for key metrics for this and other focus areas. Until DAV has had the opportunity to review these results, we are unable to provide further comment on NVCC and whether this initiative will address concerns outlined in this testimony.
The 2011 NAPA report observes that the organizational, administrative, and technological systems used to operate and manage fee care have not kept pace with the unprecedented growth of fee care. Unlike
Madam Chairwoman, it should be noted that VA is authorized to attempt to recover any improper payments. VA also has the authority to bill third-party health insurers for non-VA care. DAV believes that internal controls should be improved to help prevent improper payments for non-VA fee care, and recovery auditing and third party billing should be included as a part of this Subcommittee's oversight and the Department's overall strategy to improve VA's purchased care programs.
Project HERO and Patient Centered Community Care
Under section 8153, the VA exercises discretionary authority to use contracts and sharing agreements with non-VA providers as a means to provide hospital care and medical services (defined in title 38, United States Code, section 1701) to all enrolled veterans. The stated purpose of VA's contracting authority under section 8153 is "[t]o strengthen the medical programs at Department facilities and improve the quality of health care provided veterans under this title by authorizing the Secretary to enter into agreements...while ensuring no diminution of services to veterans." Since the law does not address quality of care and care coordination, it only partially meets the goals of DAV Resolution No. 212.
VA has informed DAV of its plan to rely on the authority of section 8153 to create a new approach to centrally supported health care contracting, to be provided throughout the VA health care system. The program is to be entitled "Patient Centered Community Care" (PCCC). This effort is described by VA as a "soft approach" to contracting, but that it will apply lessons learned from Project HERO, now in its fifth and final year.
According to VA, the goal of PCCC is to create centrally supported health care contracts available throughout the VHA to provide veterans coordinated, timely access to high quality care from a comprehensive network of VA and non-VA providers. VA has completed a draft specification for PCCC, and we understand PCCC may include contracts covering five regional subdivisions with standards for access to care, quality of care, and medical documentation to facilitate the provision of care. Further, use of contract services under the PCCC umbrella will receive priority over other non-VA care options.
VA has repeatedly assured DAV that the care coordination that patients experienced under Project HERO will be made part of PCCC, but as of this date we are uncertain of these particulars. Information in more concrete terms will become available in VA's official Request for Proposals (RFP), which VA currently projects will be released in
DAV considers Project HERO to have been a moderate success story. The Chief Business Office in VA Central Office and the contractors,
We believe the current approach in Project HERO is a good model for VA to pursue as it moves to the next phase in reforming non-VA purchased care. We have concerns nevertheless that VA will struggle to establish in-house the kinds of services, supports and provider networks that are available within the large managed care systems such as
We applaud VA for announcing its intent to extend Project HERO for six months beyond the final option year that ends on
Need for Reorganization of All Fee and Contract Services
VA has a long and distinguished record of providing social support services (including health care services) to veterans, but VA continually struggles to provide adequate business-related services as a part of its responsibility. We see those problems reflected brightly here. We have witnessed this struggle year-in and year-out within the activities of the Chief Business Office, both in terms of its managing VA first- and third-party collections from veterans and health insurers, as well as its lack of management controls over these contract health care programs. With this backdrop we are doubtful that VA will be able to properly construct, staff, and manage a program overseeing VA contract health care that will perform as well as the Project HERO contractor is performing now. We urge the Subcommittee to closely examine VA's plans and make its own determination, but we hope the Subcommittee and VA will take our concerns into account. At minimum, we believe PCCC should be judiciously deployed and carefully expanded to ensure veterans are unencumbered when accessing contracted health care.
Madame Chairwoman, given the cost of this program and its importance to DAV and our service-disabled members, we believe bolder action is required than is currently envisioned by VA in NVCC and PCCC. In our view, the VA Chief Business Office is not the correct organization to build this new system. That office should concentrate on its original and basic mission to improve VA revenue performance for first- and third-party payments. VA instead should establish in Central Office a new contract care services management office, charged with the responsibility to use managed care industry best practices in establishing new approaches to VA purchased health care for veterans, taking fully into its jurisdiction all non-VA purchased care under current law. All of these programs have been criticized at one time or another by external reviewers and this may be VA's best opportunity in years to respond effectively to improve them. We believe a new office of this type--if staffed by professionals experienced in private health insurance and the managed care enterprise--could concentrate these similar programs (in which VA pays a non-VA party for the care of a veteran, dependent or survivor) under one management structure, integrated with the VA health care system; clarify accountability for policy and practice effectiveness across the system; and set standards for compliance and reporting.
This new office should coordinate with the
The end goal of this new office would be to allow veterans and other eligible family members to live a higher quality of life with respect and dignity, through receipt of better services, including care coordination, continuity and quality of care, at a defensible and lower cost to VA and taxpayers. Absent this kind of bold action and change, DAV fears that VA's poor record in the management of contract and purchased care will not be corrected or improved.
Madame Chairwoman, thank you for this opportunity for DAV to testify on an important topic to our members. I would be pleased to address your questions, or those of other Members of the Subcommittee.
Project on Healthcare Effectiveness through Resource Optimization (See H. Rept. 109-305 for the Military Quality of Life and Veterans Affairs Appropriations Act of 2006 (P.L. 109-114). Project HERO's dental contract with Delta Dental of
Read this original document at: http://veterans.house.gov/witness-testimony/mr-adrian-atizado-0
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